P. Srinivasa Rao, Upper Division Clerk vs The Divisional Engineer (Operation), APSEB and Another

Iyyapu Panduranga Rao, J.—This writ petition is directed for the issue of a writ of certiorari to call for the records pertaining to the proceedings dated 28-5-1986 in Memo No.SE/OR/ HYD/Peshi/D. No. 939 (in brief the ''impugned Proceedings'') and quash the same as illegal, improper, unjust and contrary to the Regulations of the A.P. State Electricity Board (in brief ''the Board''). The Petitioner joined the service of the Board as a Lower Division Clerk on January 29,1960. He was promoted as Upper Division Clerk in June, 1969. While working as U.D. Clerk the petitioner was kept under suspension as per orders dated August 23,1983 in Memo No. DEE/OP/VKB/ADM/C2/B. No. 22/83. Sri K.Hanumantha Rao, Divisional Engineer (Electrical), N.R.T. Rural, Hyderabad was appointed as Enquiry Officer, as per orders dated 25-9-1983. The said enquiry officer framed as many as 16 charges and initiated enquiry in accordance with the Regulations of the A.P.S.E.B. The petitioner having submitted his explanation informed that an oral enquiry may also be made. The Enquiry Officer held that all the charges except the charges 14 and 15 were held proved. The Enquiry Officer recommended major punishment of dismissal from service. The Superintending Engineer, Operation, Hyderabad as per his memo No.SE/OR/HYD/Peshi/ D. No. 2240,dt. August 20,1984 while enclosing the copy of the Enquiry report called upon the petitioner to submit his written statement within fifteen days from the date of receipt of notice to show cause as to why he should not be dismissed from service. As, such the petitioner approached this court having filed W.P. No. 13128 of 1984 alleging that the procedure adopted by the enquiry officer as well as the officer who passed the proceedings dated August 20,1984 calling upon the petitioner to show cause as to why he should not be dismissed from service, offends all canons of principles of natural justice, the said notice was not in confirmity with the regulations of the Board, the conclusions arrived at by the Enquiry Officer without conducting the enquiry in accordance with rules is illegal; in the enquiry report the enquiry officer did not consider the defence case as set up by the petitioner and that the said enquiry was in contravention of Regulation 10 of A.P.S.E.B. Employees Discipline and Appeal Regulations, (in short ''Regulations'').

The said writ petition was heard and as per order dated September 18, 1984 stayed all further proceedings in the matter. Subsequently, as per orders dated July 18,1985 since the counsel appearing for the Board submitted that the dismissal order which was the subject matter of W.P. No. 13128/84 was withdrawn, W.P. No. 13128/84 was dismissed as having become infructuous. Subsequently the enquiry was further proceeded with and the Enquiry Officer recommended the punishment of removal of the petitioner from service. In view of that, the Superintending Engineer, Operation (Rural), Hyderabad as per his Memo No,SE/OR/HYD/Peshi/D. No. 482 dt. August 26,1985 issued a final show cause notice calling upon the petitioner to show cause as to why the punishment of removal from service should not be awarded and called upon the petitioner to show cause as to why the said punishment should not be awarded within 15 days from the date of receipt of the said memo. Having received the said final show cause notice the petitioner submitted a detailed explanation reiterating his innocence. Later the Superintending Engineer (Operation), Rural, Hyderabad under the impugned proceedings removed the petitioner from the service of the Board besides directing recovery of Rs. 50,166-75 towards loss caused to the Board on account of the defalcation of the said amount. Having received the impugned proceedings, the petitioner in accordance with the Regulations preferred an appeal to the Chief Engineer of the Board, Hyderabad and the Chief Engineer as per his proceedings in Memo No.CEE/WZ/P/F. No. 137/D/No. 63/87 dt. 5-5-1987 rejected the appeal preferred by the petitioner. Thereupon the writ petitioner has come up with the present writ petition for the issue of a writ of certiorari to quash the impugned proceedings.

It is the contention of the petitioner that on August 17,1983 the petitioner and the Accountant by name Md. Basheet found that one K. Venkateswara Rao misapporpriated certain amounts belonging to the Board and brought the said information to the notice of the Assistant Accounts Officer (E.R.O.) Rural, West, Hyderabad oh the same day who asked the petitioner and the said Md. Basheer to give the said complaint in writing, accordingly the petitioner and Md. Basheer on August 23,1983 reduced the said complaint into writing and handed over the same to the Assistant Accounts Officer, E.R.O. Rural, West, Hyderabad, in the said complaint it was categorically mentioned that Sri Venkateswara Rao had misappropriated the funds belonging to the Board, and requested, the authorities to arrange audit of all the accounts, pertaining to the period of the said Venkateswara Rao, but surprisingly even though there was no allegation against the petitioner, the petitioner was suspended as per orders dt. 23-8-1983. It is to be further seen that as per Memo No.SE/OR/HYD/Peshi/CF. 58 dt. September 22, 1983 not only the petitioner but K. Venkateswara Rao, Md. Basheer and Smt. Waheedunnisa Begum were also kept under suspension. It is the contention of the petitioner that having noticed the fraud committed by Sri K. Venkateswara Rao he gave a complaint along with Md. Basheer but strangely he was kept under suspension and disciplinary proceedings were initiated against him. Of course, it is also not in dispute that Memo No. SE /OR/ HYD/Peshi/CF. 58 dt. 28-9-1983 shows that one K. Venkateswara Rao, Md. Basheet and Smt. Waheedunnisa Begum were also kept under suspension. But in the event of there being any material against the petitioner, the action of the authorities cannot be questioned.

It is to be further seen that the petitioner was kept under suspension by the Divisional Engineer (Electrical) and it is the contention of the petitioner that the Divisional Engineer has no power to keep him under suspension and sudh a power vests only with the Superintending Engineer.'' But since the matter proceeded further, the petitioner was removed from service, the correctness or otherwise of the same is being canvassed in these proceedings, the validity or otherwise of the authority of the Divisional Engineer to keep the petitioner under suspension need not be gone into.

Shri Gangiah Naidu, the learned counsel appearing for the petitioner submits that the impugned proceedings be quashed on three grounds:

(1) That the impugned proceedings and the proceedings of the Appellate Authority, namely, the Chief Engineer are not speaking orders;

(2) That the petitioner was not provided with reasonable opportunity to peruse the relevant records and consequently the petitioner was prejudiced in the conduct of the enquiry; and

(3) In any event the punishment awarded is disproportionate to the act attributed to the petitioner.

It is to be seen whether there are any merits in any of the contentions raised by the petitioner. The procedure regarding imposition of penalities in respect of the employees of the Board are governed by Regulation No. 10 and Regulation 10 so far as it is relevant is as follows:

Procedure for imposing penalities: No order imposing on a member of a service a penalty specified in items (i), (ii) and (iii), (v) or (ix) of regulation 5 shall be passed except after

(a)...

(b)...

(2) (a) In every case where it is proposed to impose on an employee any of the penalties in items (iv), (vi) to (viii) in regulation 5, he shall be given a charge sheet clearly setting forth the grounds on which it is proposed to take action and any other circumstances which it is proposed to take into consideration in passing orders in the case. He shall be required to answer the charge or charges in a written statement within a reasonable time not exceeding one month and also to state whether he desires an oral inquiry or only to be heard in person. An oral inquiry shall be held if the employee desires such inquiry, or if so directed by the authority concerned. At that inquiry directed by the authority concerned oral evidence shall be heard as to such of those allegations are not admitted. The employee shall be permitted to produce witnesses in his defence and cross-examine any witness on the evidence the charge rests. The officer conducting the inquiry may, for special and sufficient reasons to be recorded in writing, refuse to call a witness. After the inquiry has been completed the person charged shall be entitled to put in, if he so desires a further written statement of his defence. If no enquiry is held and if he had desired to be heard in person, a personal hearing shall be given to him. In all cases where enquiry is conducted sufficient record of the evidence and a statement of the findings and the grounds thereof, should be kept. The authority competent to impose the penalty shall take into consideration the employee''s answer to the charge or charges, the evidence laid on either side and the employee''s plea during the oral inquiry before the order imposing the penalty is passed.

(b)......

(3) (a) The authority imposing any penalty under these regulations shall maintain a record showing -

(i) the allegations upon which action was taken against the person punished;

(ii) the charges framed, if any;

(iii) the person''s representation, if any, and the evidence taken if any; and

(iv) the findings and the grounds thereof, if any.

(b) Every order imposing the penalty shall state the grounds on which it is passed and shall be communicated in writing to the person concerned.

(5) (a) The provisions of sub-regulations (1) and (2) shall not apply where it is proposed to impose on a member of a service any of the penalties mentioned in regulation 5 on the ground of conduct which has led to his conviction on a criminal charge or where the authority competent to impose the penalty is satisfied that for reasons to be recorded by that authority in writing, it is not reasonably practicable to hold such inquiry or give such opportunity".

Relying upon Regulation 10 Mr. Gangaiah Naidu, the learned counsel for the petitioner submits that the authority competent to impose penalty shall take into consideration the employee''s answer to the charge or charges, the evidence laid on either side and the employee''s plea during the oral inquiry before the order imposing the penalty shall be passed and every order imposing the penalty shall state the grounds on which it is passed, but the order of the Superintending Engineer, the authority competent to impose the penalty, is not in accordance with the above provisions of Regulation 10.

It is now to be seen as to what is the order of the Superintending Engineer who has imposed penalty on the petitioner. The relevant portion of the proceedings of Superintending Engineer, the authority competent to impose the penalty, reads thus:

"The explanation of the delinquent has been examined in detail and the Superintending Engineer Operation, Rural, Hyderabad is of opinion that the same seems to be in general and no fresh points are brought out in his explanation. Sri P. Srinivasa Rao, U.D.C. has also misused his position and misappropriated Board''s funds to huge extent and that he does not deserve to be continued in service. The Superintending Engineer/Operation, Rural, Hyderabad has therefore come to final conclusion to confirm the proposed punishment i.e., removal from service.

Accordingly it is ordered that Sri P. Srinivasa Rao, U.D.C. (under suspension) is "Removed from service" from the date of receipt of the Memo besides recovery of Rs. 50,166-75 p. (Rupees fifty thousand one hundred sixty six and paise seventy five only) towards loss caused to the Board on account of defalcation of said amount by him."

Now it is to be seen whether the above order is in accordance with Regulation 10 extracted above. Number of decisions are cited at the Bar to show that order similar to the one in question extracted above cannot be treated as one wherein the employee''s answer to the charge or charges, the evidence laid on either side, the employee''s plea during the oral enquiry before the order imposing penalty is passed are considered.

The State of Punjab and Others Vs. Bakhtawar Singh and Others, ., is a case where one of the respondents, namely, Abrol was removed from the service of the Punjab State Electricity Board, Patiyala and the said order was contested on the ground that the authorities have not applied their mind to the material on record. The order against Abrol reads as follows:

"I have gone through the charges and the explanation furnished by Shri R.P. Abrol. From the material on the file, I am definitely of the opinion that he is not a fit person to be retained as part-time member of the Electricity Board. I therefore, order that Shri Abrol may be removed from membership under Sub-clause(iv) of Clouse (e) of Sub-section (1) of Section 10 of the Electricity Supply Act, 1948. CM. may kindly see. After CM. has seen, immediate orders be issued."

Commenting upon the above order the Svipreme Court observed as follows:

"The order cannot be said to be a speaking order. It is arbitrary to the core. Such an order cannot be upheld."

In S.N. Mukherjee v. Union of India 1990 S.L.R. 8., it was observed that the object of observing rules of natural justice is to prevent miscarriage of justice and secure fair play in action; the administrative authority exercising judicial or quasi- judicial functions is required to record the reasons for its decision except in cases where such requirement has been dispensed with expressly or by necessary implication. In the said Judgment it is observed as follows:

"The object underlying the rules of natural justice is to prevent miscarriage of justice" and secure fair play in action". As pointed out earlier the requirement about recording of reasons for its decision by an administrative authority exercising quasi-judicial functions achieves this object by excluding chances of arbitrariness and ensuring a degree of fairness in the process of decision making. Keeping in view the expanding horizon of the principles of natural justice, we are of the opinion that the requirement to record reasons can be regarded as one of the principles of natural justice which govern exercise of power by administrative authorities.

For the reasons aforesaid, it must be concluded that except in cases where the requirement has been dispensed with expressly or by necessary implication, and administrative authority exercising judicial or quasi- judicial functions is required to record the reasons for its decision."

From an order of the Superintending Engineer appeal lies to the Chief Engineer. The factors to be taken into consideration while disposing of an appeal are mentioned in Regulation 15. Regulation 15 so far as it is relevant is as follows:

"15(1) In the case of an appeal from an order imposing any penalty specified in regulations the appellate authority, shall consider-

(a) whether the facts on which the order was passed have been established;

(b) whether the facts established afford sufficient ground for taking action; and

(c) whether the penalty is excessive, adequate or inadequate; and after such consideration, shall pass such order as it thinks proper."

It is the contention of the petitioner that the appellate authority, namely, the Chief Engineer has not considered the aspects mentioned in Regulation 15(1) of the Regulations namely, whether the facts on which the order was passed was established or otherwise, whether the facts established afford sufficient ground for taking action and whether the penalty is excessive, adequate or inadequate. Before proceeding further to show that the appellate authority, namely, the Chief Engineer has not followed the guidelines mentioned in regulation 15, the relevant portion of the order of Chief Engineer be noted which reads as follows:

"The appeal dated nil preferred by Sri P. Srinivasa Rao, Ex-UDC, Elecy. Rev. Office, Rural West, Hyderabad against the orders imposing the punishment of removal from service, besides recovery of the defalcated amount issued by the Supreintending Engineer, Operation Rural, Hyderabad in the Memo dt. 28-5-1986 has been carefully considered by the undersigned and it is found that there is no justification to interfere with the final orders issued by the Superintending Engineer, Operations Rural, Hyderabad in the reference (1) cited imposing the punishment of "Removal from Service" besides recovery of the defalcated amount as there was no recovery of the defalcated amount as there are no fresh points put forth by the appellant in the appeal.

Accordingly Sri P. Srinivasa Rao, Ex-UDC is informed that his appeal is hereby "Rejected".

This is the order of the Chief Engineer, the appellate authority. It is now to be seen whether this order is in accordance with Regulation 15.

R.P. Bhatt Vs. Union of India and Ors (UOI) ., ., is a case where the appellant therein was appointed as Supervisor for a period of two years. After the expiry of the probation period his services were terminated, but the said order could not be served on the appellant as he absented himself without leave. Consequently the appellant was transferred with a direction to serve the orders of termination. But the said order was not served on a representation made by the appellant that by then, the probation period has expired. But however, an enquiry was initiated against the appellant for absconding himself from service to evade service of order of termination. After regular departmental enquiry the appellant was served with a show cause notice and was removed from service. The appeal preferred by the appellant was also dismissed. One of the contentions raised by the appellant was that the Authority has not applied its mind while removing him from service. The rule position therein regarding enquiry is as follows:

27 (2): In the case of an appeal against an order imposing any of the penalities specified in Rule 11 or enhancing any penalty imposed under the said Rules, the appellate authority shall consider:

(a) whether the procedure laid down in these Rules has been complied with and if not, whether such non-compliance has resulted in the violation of any provisions of the Constitution of India or in the failure of Justice;-"

The Supreme Court held that the word "consider" according to Rule 27(2) implies ''due application of mind'', and that the appellate authority is required to consider whether the procedure laid down in the Rules has been complied with and having examined the question, the Supreme Court was pleased to observe as follows:

"There is no indication in the impugned order that the Director-General was satisfied as to whether the procedure laid down in the Rules had been complied with; and if not, whether such non-compliance had resulted in violation of any of the provisions of the Constitution or in failure of justice. We regret to find that the Director-General has also not given any finding on the crucial question as to whether the findings of the disciplinary authority were warranted by the evidence on record. It seems that he only applied his mind to the requirement of Cl.(c) of R. 27(2), viz., whether the penalty imposed was adequate or justified in the facts and circumstances of tine present case. There being non- compliance with the reuqirements of R. 27(2) of the Rules, the impugned order passed by the Director-General is liable to be set aside."

In Ram Chander Vs. Union of India (UOI) and Others, ., the Supreme Court examined the meaning of the word ''consider'' and was pleased to observe that the said word meant the objective consideration after due application of mind which implies giving of reasons for its decision.

Hiralal Shah v. State of Assam 1985 (2) S.LR. 370., is a case where the petitioner therein who was a confirmed peon in the Calcutta Office of tine Government of Assam was appointed by the Trade Advisor and Director of Movements, Government of Assam, Calcutta. The said petitioner was placed under suspension. Thereafter a charge-sheet was issued against him. The petitioner submitted his reply to the charge-sheet. There was an enquiry resulting a show cause notice calling upon the petitioner to show causes as to why he should not be dismissed from service. It was contended before the Calcutta High Court that tine appellate authority has not given any reason as to why the decision of tine disciplinary authority should be upheld and why the contentions raised by tine petitioner in his Memorandum of Appeal should not be accepted. Adverting to the said aspect, it was observed as follows:

"The appellate order is very cryptic and it has been only stated that all connected papers and documents were read and there was no ground for interfering with the order passed by the disciplinary authority. There is no manner of doubt that in the Memorandum of Appeal the petitioner had challenged the findings of the disciplinary authority and the Appellate Authority was required to advert to the said contentions and to consider the same. It cannot be said that simply because the Appellate Authority concurred with the view of the disciplinary authority he was not required to disclose any reason whatsoever. If the Appellate Authority concurs with the view of the disciplinary authority it may not be necessary to give any elaborate independent reasonings of its own but from the appellate order it must appear that the contentions raised in the Memorandum of Appeal have been adverted to and either for independent reason given by the Appellate Authority or on reasonings given by the disciplinary authority, such contentions have not been accepted by the Appellate Authority. The necessity of giving reasons by the authority vested with quasi-judicial duties and functions cannot be under-estimated or minimised. It is a settled law that the adjudicating officer must indicate reasons in support of his findings so as to inspire confidence in the adjudicating process and justice should not only be done but must also appear to have been done."

M.S. Chauhan v. State Bank of India 1985 (I) S.L.R. 684, is a case where the petitioner therein was accused of misusing his official position in getting the agricultural advances sanctioned in favour of his father and relations while he was posted as officer, Junior Management Grade,ScaleI. After conducting an enquiry, the disciplinary authority passed an order of dismissal of the petitioner from the service of the Bank. The appellate authority has passed an order dismissing the appeal. It is the contention of the pettioner there in that the appellate authority has not duly considered his appeal in accordance with Rules. The relevant portion of the Rule prescribing the guidelines for examining the appeals, reads thus:

"The Appellate Authority shall consider whether the findings are justified and whether the penalty is excessive or inadequate and pass appropriate orders. The Appellate Authority may pass an order confirming, enhancing reducing or setting aside the penalty or remitting the case to the authority with such directions as it deemed fit in the circumstances of the case."

In the said case the order passed by the Appellate Authority reads as follows:

"The Board after having fully considered the facts of the case came to the conclusion that mere is nothing in the appeal/petition which can be sustained and there are no grounds for admitting the same. Accordingly, the order of the disciplinary Authority is upheld and the appeal made by the official is dismissed."

Having examined the order passed by the Board, while rejecting the appeal the Punjab and Haryana High Court was pleased to observe as follows:

"A bare perusal of the aforesaid order clearly goes to show the non- applicability of mind by the appellate authority and complete disregard to the procedure laid down in sub-rule (2) of Rule 51 of the Rules. The Appellate Authority has not indicated any reasons for holding that the findings arrived at by the punishing authority are justified....... we are constrained to hold that the order passed by the Authority on the appeal of the petitioner suffers from patent illegality inasmuch as it does not conform to the procedure laid down in sub-rule (2) of Rule 51, with the result that on this ground alone tine impugned order of the Appellate Authority is liable to be set aside."

Having examined the above decisions carefully, I am of the clear opinion that the Authority competent to impose the penalty, viz., the Superintending Engineer and the Appellate Authority who is the Chief Engineer respectively have not complied with the provisions of the Regulations 10 and 15 of the Regulations. In view of the said circumstances, I am of the clear opinion that this is a fit case where the proceedings dated 28-5-1986 in Memo No.SE/OR/HYD/ Peshi /D. No. 939 and the order of the Chief Engineer, West Zone, Hyderabad in Memo No.CEE/WZ/P/F. No. 137/D/No. 63/87 dated 5-5-1987 are liable to be set aside and they are hereby set aside. Since it is the allegation of the department that the petitioner was responsible for defalcation of a huge sum of Rs. 50,166-75 p., it is open to the authorities to consider the matter afresh in accordance with the Regulations, etc. and any other law for the time being in force.

Sri Gangaiah Naidu, the learned counsel for the petitioner has also submitted that the petitioner was not supplied with certain documents which are relevant for the enquiry and non-supply of the said documents vitiates the enquiry. In support of his contention he relied upon the decisions reported in Pratliama Bank v. Vijay Kumar Goel 1989 (5) S.L.R. 381, Kashinath Dikshita Vs. Union of India (UOI)and Others, , Sujit Kumar Haider v. Union of India 1989 (2) S.L.R. 2, H.K. Dogra v. Chief G.M.S.B.I. 1989 (2) S.L.R. 122, and Sachidanand Singh v. Union of India 1989 (2) S.L.R. 318. It is an admitted fact that the documents asked for by the petitioner need not be supplied unless and until the petitioner satisfies the Enquiry Officer about the relevance of the said document/documents. The learned counsel for the petitioner has drawn my attention to certain documents to show that all along his client was complaining about non-supply of documents. As such when the matter is re-entrusted to the Enquiry Officer, the petitioner shall file a statement afresh mentioning the particulars of documents required by him showing more particularly the relevancy of the said documents and in the event of the Enquiry Officer rejects the said request, in respect of all or any of the said documents, the said Officer shall pass an order specifically mentioning as to why the request of the petitioner was rejected in respect of each of the documents.

Hence orders of the Superintending Engineer as well as the Chief Engineer referred to above are set aside. In view of tine question relating to the non-supply of the documents and in view of my above observation, the report of the enquiry officer is also set aside; the enquiry officer shall record further evidence if any in the light of any documents sought to be produced by the petitioner and arrive at the conclusions whereupon further proceedings shall be taken in accordance with the Regulations, etc.

In view of the above observations the writ petition is allowed. No costs.