Prayag Singh Rauthore vs The Managing Director Ajmer

Instant appeals have been filed by the intra parties by not being satisfied by the order of the Ld. Single Judge impugned dt. 1.4.2013.

The appellant Prayag Singh Rathore who joined the respondent bank as Cashier cum Clerk on 3.6.1974 and while working as Branch Manager in officiating capacity retired on attaining the age of superannuation on 31.3.2006 but his retiral benefits were withheld by the respondent without any reasonable cause and that compelled him to approach this Court by filing of writ petition and it is prayed that his retiral dues towards gratuity, leave encashment and arrears of salary due and payable have been withheld without any authority of law may be paid along with interest.

After notice of the present petition came to be served, the respondent came out with the defence that while he was in service and working as Manager of the Bank, he put certain alleged financial loss while creating security interest over the property mortgaged against disbursement of loan and for which notice was served upon him and since no reply came forward keeping that alleged financial loss to the bank to be recovered and settled from his terminal benefits, the same was withheld by the respondent.

Indisputably, after the appellant retired from service on 31.3.2006 neither any disciplinary enquiry was pending on the date of his retirement or at any point of time it was served at later stage. It is also informed to this Court that Rajasthan Civil Service Pension Rules, 1996 (Rules 1996) are applicable and R.7 of Rules 1996 prohibits respondent from initiating disciplinary proceedings at such belated stage and the alleged loss which was contended by the bank at that point of time was to be quantified by due process and that can be decided after holding enquiry and calling upon appellant providing reasonable notice and opportunity of hearing but that was never initiated against him as such he has a legitimate right to get his retiral dues on retirement in March 2006 and at least delay could not be attributed to him and the fact is that all the three claims of the appellant regarding gratuity, leave encashment and arrears of salary which is provided under the rules still so far has not been released.

On the last date, when this matter came up for hearing, this Court called upon the respondent bank to seek instruction and inform as to whether terminal benefits have been released to the appellant to which he was entitled under law and why the appeal has been preferred by the bank against the order of the Ld. Single Judge. Counsel for bank on instruction submits that as regard terminal benefits are concerned, so far have not been released keeping in view pendency of appeal and alleged loss which the bank has suffered against inaction of the appellant.

Counsel for employee submits that no department or judicial enquiry was initiated or pending against him and the respondent bank is not justified in withholding terminal benefits and delay if any cannot be attributed to him and at least he is entitled for interest at the rate of 9% witch the govt. also acknowledge in terms of Rule 89 of Rules 1996 and to that extent at least order of Ld. Single needs further modification and may be paid in addition to his terminal benefits along with 9% interest over due retiral benefits to him.

R.7 of the Rules 1996 which re relevant for the present purpose reads as infra-

Right of Governor to withhold or withdraw pension

(1) The Governor reserves to himself the right of withholding or withdrawing a pension or part thereof, whether permanently or for a specified period, and of ordering recovery from a pension of the whole or part of any pecuniary loss caused to the Government, if in any departmental or judicial proceedings, the pensioner is found guilty of grave misconduct or negligence during the period of his service including service rendered upon re-employment after retirement:

Provided that the Rajasthan Public Service Commission shall be consulted before any final orders are passed:

Provided further that where a part of pension is withheld or withdrawn, the amount of such pension shall not be reduced below the amount of 1 "rupees one thousand two hundred seventy five per mensem."

(2) (a) The departmental proceedings referred to in sub rule (1), if instituted while the Government servant was in service whether before his retirement or during his reemployment, shall, after the final retirement of the Government servant, be deemed to be proceedings under this rule and shall be continued and concluded by the authority by which they were commenced in the same manner as if the Government servant had continued in service:

Provided that where the departmental proceedings are instituted by an authority subordinate to the Governor, that authority shall submit a report recording its findings to the Governor.

(b) The departmental proceedings, if not instituted while the Government servant was in service, whether before his retirement, or during his re-employment-

(i) shall not be instituted save with the sanction of the Governor,

(ii) shall not be in respect of any event which took place more than four years before such institution, and

(iii) shall be conducted by such authority and in such place as the Governor may direct and in accordance with the procedure applicable to departmental proceedings in which an order of dismissal from service could be made in relation to the Government servant during his service.

(3) No judicial proceedings, if not instituted while the Government servant was in service, whether before his retirement or during his re-employment, shall be instituted in respect of a cause of action which arose, or in respect of an event which took place, more than four years before such institution.

(4) In the case of a Government servant who has retired on attaining the age of superannuation or otherwise and against whom any departmental or judicial proceedings are instituted or where departmental proceedings are continued under sub rule (2), a provisional pension as provided in Rule 90 shall be sanctioned.

(5) Where the Governor decides not to withhold or withdraw pension but orders recovery of pecuniary loss from pension, the recovery shall not ordinarily be made at a rate exceeding one third of the pension admissible on the date of retirement of a Government servant.

The existing words "rupees three hundred per mensem" substituted vide FD Notification No. F.15(3)FD(Rules)/97 dated 21.3.1998 w.e.f. 1.10.1996. (6) For the purpose of this rule,-

(a) departmental proceedings shall be deemed to be instituted on the date on which the charges together with a statement of allegations on which they are based, or the proposal of Government to take disciplinary action together with the allegations on which it is proposed to be taken, are issued to the Government servant or pensioner, or if the Government servant has been placed under suspension from an earlier date, on such date; and

(b) judicial proceedings shall be deemed to be instituted-

(i) in the case of criminal proceeding, on the date on which the complaint or report of a police officer, of which the Magistrate takes cognizance, is made, and

(ii) in the case of civil proceedings, on the date the plaint is presented in the court.

The departmental proceedings referred to in sub rule (1) of R.7, if instituted while the Government servant was in service whether before his retirement or during his reemployment, shall, after the final retirement of the Government servant, be deemed to be proceedings under this rule and shall be continued and concluded by the authority by which they were commenced in the same manner as if the Government servant had continued in service. But as regard, person who stood retired from service no enquiry or proceeding shall be instituted in respect of a cause of action which arose, or in respect of an event which took place, more than four years before such institution.

In the instant case, the appellant stood retired way back in March 2006 and no enquiry has so far been initiated and that is now prohibited under R.7 of Rules 1996. As regard alleged loss is concerned, as prayed for by the respondent bank, in our considered view, mere serving of notice to the employee was not in itself sufficient to arrive to a conclusion that there was alleged financial loss to the bank intended to recovered from him and that is not permissible to be recovered or initiation of any proceedings in view of R.7 of Rules 1996.

At the same time, we find substance in the submission made by counsel for employee that if delay is not attributable to him and terminal benefits has not been paid that makes him entitled to 9% interest which has been acknowledged by the state govt. in terms of R.89 of rules 1996 and we are of the view that present appellant employee is entitled for 9% interest over the terminal benefits which are due and payable on retirement on 31.3.2006 and to this extent order passed by the Ld. Single Judge needs modification.

Consequently, the appeal preferred by the bank is without substance and accordingly dismissed.

As regard, appeal filed by the appellant employee is concerned that stands allowed and we direct the bank to pay terminal benefits which are due and payable to the employee on 31.3.2006 along with interest at the rate of 9% to be paid till actual payment. Since the employee stood retired way back in March, 2006 and terminal benefit has not been released so far, we direct the Bank to make the payment in terms of order of the Court within a period of three months failing which the employee will further be entitled to interest at the rate of 18% until actual payment. No cost.