K.C. Arya vs Union of India (UOI) and Others

Jawahar Lal Gupta, J.—The petitioner is aggrieved by orders dated December 31, 1990 and May 31, 1991. By each of these orders, the petitioner''s one increment was stopped with cumulative effect. The first order has been challenged through C.W.P. No. 14748 of 1991 while the second order is the subject matter of CWP No. 2577 of 1992. Both these orders have been challenged on a common ground viz. the order stopping an increment with cumulative effect amounts to the imposition of a major penalty which could not have been imposed except after holding a regular enquiry. The short question involved in the case does not require a detailed examination of the factual position.

The conditions of service governing the petitioner are laid down in the Syndicate Bank Officer Employees'' (Discipline and Appeal) Regulations, 1976. The punishment which can be imposed on an employee are enumerated in Regulation 4. The relevant provision in the said Regulation provides as under:-

"4. Penalties:-The following are the penalties which may be imposed on an officer/employee, for acts of misconduct or for any other good and sufficient reasons.

(b) Withholding of increments of pay with or without cumulative effect;

Major penalties:

(e) reduction to a lower grade or post, or to a lower stage in a time scale;"

Mr. P.S. Patwalia, learned counsel for the petitioner contends that the withholding of increments of pay with cumulative effect results in reduction to a lower stage in a time-scale of pay and consequently falls within the mischief of Regulation 4 which is a major penalty. As against this, Mr. A.K. Jaiswal, learned counsel for the respondent-Bank submits that the withholding of increments "with or without cumulative effect" has been specifically mentioned as a minor penalty and, therefore, the claim made on behalf of the petitioner cannot be sustained.

After hearing the learned counsel for the parties, I find that the matter is covered by the judgment of the Apex Court in Kulwant Singh Gill v. State of Punjab 1990(6) S.L.R. 73. Specific reference may be made to the relevant observations in paragraph-4 of the judgment It reads as under:-

"....Withholding of increments of pay simpliciter without any hedge over it certainly comes within the meaning of Rule 5(iv) of the Rules. But when penalty was imposed withholding two increments i.e. for two years with cumulative effect, it would indisputably means that the two increments earned by the employee was cut off as a measure of penalty for ever in his upward march of earning higher scale of pay. In other words the clock is put back to a lower stage in the time-scale of pay and on expiry of two years the clock starts working from that stage afresh. The insidious effect of the impugned order by necessary implication, is that the appellant employee is reduced in his time-scale by two places and it is in perpetuity during the rest of the tenure of his service with a direction that two years'' increments would not be counted in his time scale of pay as a measure of penalty. The words are the skin to the language which if peeled off its true colour on its resultant effects would become apparent When we broach the problem from this perspective the effect is as envisaged under Rule 5(v) of the Rules. It is undoubted that the Division Bench in Sarwan Singh v. State of Punjab and Ors. ILR 1985 P & H 193 speaking for the Division Bench, while considering similar question, in paragraph 8 held that the stoppage of increments with cumulative effect, by no stretch of imagination falls within Clause (v) of Rule 5 or in Rule 4.12 of Punjab Civil Services Rules. It was further held that under Clause (v) of Rule 5 there has to be a reduction to a lower stage in the time scale of pay by the competent authority as a measure of penalty and the period for which such a reduction is to be effective has to be stated and on restoration it has further to be specified whether the reduction shall operate to postpone the future increment of his pay. In such cases, withholding of the increments without cumulative effect does not at all arise. In case where the increments are withheld with or without cumulative effect the Government employees are never reduced to a lower stage of time scale of pay. Accordingly it was held that Clause (iv) of Rule 5 is applicable to the facts of that case. With respect we are unable to agree with the High Court. If the literal interpretation is adopted the learned Judges may be right to arrive at that conclusion. But if the effect is kept at the back of the mind, it would always be so the result will be the conclusion as we have arrived at. If the reasoning of the High Court is given acceptance, it would empower the disciplinary authority to impose, under the grab of stoppage of increments, or earning future increments in the time scale of pay even permanently with expressly stating so. This preposterous consequences cannot be permitted. Rule 5(IV) does not empower the disciplinary authority to impose penalty or withholding increments of pay with cumulative effect except after holding inquiry and following the prescribed procedure. Then the order would be without jurisdiction or authority of law, and it would be per-se-void. Considering from this angle we have no hesitation to hold the impugned order would come within the meaning of Rule 5(V) of the Rules; it is a major penalty and imposition of the impugned penalty without enquiry is per se illegal."

In view of the above observations, the irresistible conclusion is that by the stoppage of increments, the petitioner was reduced to a lower stage in the time scale of the post held by him. Mr. Jaiswal, however, contends that in the present case, the question involved is materially different from that which was considered by the Apex Court in Kulwant Singh Gill''s case (supra). The provision of Regulation 5 which fell for consideration before the Supreme Court, provided for withholding of increments of pay, while in the present case the rule provides for withholding of increments of pay with or without cumulative effect.

This in my opinion is of no consequence. Even where the rule provides merely for stoppage of increments competent authority can order that the increments be stopped with or without cumulative effect. What has to be seen is the actual effect of the order. If as a result of the stoppage of increments, an employee''s pay is reduced to a lower stage in the time scale of the post held by him, the penalty prescribed under Regulation 4(e) shall be said to have been imposed. It would amount to a major penalty. If the contention raised by the learned counsel for the petitioner is accepted, the result would be that the employee shall be visited with a major penalty under the garb of the authority having passed an order for the imposition of a major penalty. This is clearly not permissible in view of the law laid down by the Apex Court.

Accordingly, these writ petitions are allowed. The orders dated December 31, 1990 (annexure P.7 in C.W.P. No. 14748 of 1991) as also the order passed by the appellate authority and the reviewing authority and the order dated May 31, 1991 (annexure P-8 in CWP No. 2577 of 1992) and the orders on appeal etc are quashed. The increments, if already withheld, shall be released and the arrears shall be paid to the petitioners within three months from today. No costs. However, this order will not preclude the competent authority from proceeding afresh in the matter on the basis of the charge sheet already issued and holding a regular enquiry before imposing any of the penalties contemplated under Regulation 4.