Allahabad HC: Once A Person Retires From Service, Corporation Vests With No Power To Continue Departmental Proceedings7 min read
Published on: 15 March 2023 at 22:01 IST
While ruling on a very significant legal point pertaining to power of corporation to continue with departmental proceedings against a person even after retirement from service, the Lucknow Bench of the Allahabad High Court in a most learned, laudable, landmark and latest judgment titled Virendra K Singh Chauhan v. State of U.P. Thr. Prin Secy Co operative and 2 Ors. In Case – Writ – A No. – 2000639 of 2008 that was reserved on 23.8.2022 and then finally pronounced on 22.02.2023 has minced just no words to hold that once a person has retired from service, the corporation vests with no power to continue with the departmental proceedings.
It must be noted that the Single Judge Bench of Hon’ble Mr Justice Irshad Ali was unequivocal in asserting that, “Once the petitioner has retired from service on 31.12.2001, there was no authority vested in the corporation for continuing the departmental proceeding even for the purpose of imposing any reduction in the retiral benefits payable to the petitioner. In absence of such an authority, it is held that enquiry/disciplinary proceeding had lapsed and the petitioner was entitled to full retiral benefits on retirement.”
The Bench also said in no uncertain terms that as the enquiry has lapsed, it is obvious that the petitioner would have to get the balance of the emoluments payable to him.
At the very outset, this brief, brilliant, bold and balanced judgment authored by the Single Judge Bench comprising of Hon’ble Mr Justice Irshad Ali of Lucknow Bench of the Allahabad High Court sets the ball in motion by first and foremost putting forth in para 2 that, “The present writ petition has been filed before this Court seeking a writ, order or direction in the nature of certiorari quashing the impugned order dated 20.02.2007 (Annexure No.1) passed by respondent No.3 and order dated 30.09.2003 (annexure-5) with a further prayer to issue a writ, order or direction in the nature of mandamus commanding the respondent No.3 to release the amount of Rs.42,403/- along with interest of 14% that has been illegally deducted in respect of loan case of Sri Ishaq Ali.”
As we see, the Bench mentions in para 3 that, “Brief facts of the case are that the petitioner was working as Branch Manager in U.P. Sahkari Gram Vikas Bank Ltd., who after completion of service on attaining the age of superannuation retired from service on 31.12.2001.”
To put things in perspective, the Bench envisages in para 4 that, “The petitioner filed Writ Petition No.1840 (S/B) of 2001 before this Court against his date of superannuation fixed by the bank at the age of 58 years and claimed parity of 60 years in parity with government employees.
The writ petition was admitted and an interim order was passed therein on 21.12.2001, whereby following direction was issued:
List in the week commencing 14.1.2002. In the meantime it would be open for the U.P. Cooperative Development Bank to consider the Government G.O. with regard to enhancement of age of superannuation of the petitioners to be 60 years. The retirement of the petitioners shall be subject to the decision of the writ petition.””
In hindsight, the Bench then discloses in para 5 that, “The Managing Director of the Bank passed an order on 30.09.2003 on the basis of which an order was passed on 20.02.2007, whereby the disciplinary initiation against the petitioner in the year 1997 was concluded after about two years of his retirement and a recovery of Rs.1,15,000/- along with upto date interest was directed against the petitioner from the dues payable to the petitioner.”
Further, the Bench then reveals in para 6 that, “Against the order dated 30.09.2003, the petitioner preferred appeal before the Board of Directors on 27.10.2003, which was rejected by the appellate authority and information in this regard was furnished to the petitioner by the General Manager (Administration) vide letter No.151609/karmik/2004-05 dated 13.12.2004.”
To recapitulate, the Bench then recalls in para 7 that, “For payment of retiral benefits, the petitioner preferred representation dated 18.07.2005 before the Managing Director, however, no heed was paid to the same,”.
“When, the request made by the petitioner vide representation dated 18.07.2005 was not replied with, he again filed another representation on 29.08.2006. Thereafter, he filed another representation before respondent No.3 on 19.07.2007 and when no response was received from the department, he contacted the concerned officials of the Bank, where he came to know that his all retiral benefits viz. gratuity, insurance, security and leave encashment etc. were adjusted against the liabilities fixed upon the petitioner and no amount was paid to the petitioner.”
Furthermore, the Bench then discloses in para 8 that, “The petitioner filed an application under Right to Information Act asking the action taken in respect of deductions made against his retirement dues and asked to provide copy of the decisions taken in respect thereof. Thereafter, the Jan Suchna Adhikari of the bank supplied the information sought by the petitioner vide letter dated 03.12.2007. By the information so provided, the petitioner came to know that the deductions were made against certain loan amounts disbursed by him in favour of certain persons.”
Briefly stated, while specifying the relevant case laws relied upon by the learned counsel for the petitioner, the Bench states that, “a) Judgments relied upon by learned counsel for the petitioner:
i) Dev Prakash Tewari (Supra):
“5. We have carefully considered the rival submissions. The facts are not in dispute. The High Court while quashing the earlier disciplinary proceedings on the ground of violation of principles of natural justice in its order dated 10-1-2006 granted liberty to initiate the fresh inquiry in accordance with the Regulations.
The appellant who was reinstated in service on 26-4-2006 and fresh disciplinary proceeding was initiated on 7-7-2006 and while that was pending, the appellant attained the age of superannuation and retired on 31-3-2009.
There is no provision in the Uttar Pradesh Cooperative Societies Employees Service Regulations, 1975 for initiation or continuation of disciplinary proceeding after retirement of the appellant nor is there any provision stating that in case misconduct is established a deduction could be made from his retiral benefits.”
ii) Bhagirathi Jena (Supra):
“In view of the absence of such a provision in the above said regulations, it must be held that the Corporation had no legal authority to make any reduction in the retiral benefits of the appellant.
There is also no provision for conducting a disciplinary enquiry after retirement of the appellant and nor any provision stating that in case misconduct is established, a deduction could be made from retiral benefits. Once the appellant had retired from service on 30-6-1995, there was no authority vested in the Corporation for continuing the departmental enquiry even for the purpose of imposing any reduction in the retiral benefits payable to the appellant. In the absence of such an authority, it must be held that the enquiry had lapsed and the appellant was entitled to full retiral benefits on retirement.”
iii) Brij Mohan (Supra):
“A perusal of the aforesaid judgment it is manifestly clear that the facts of this case are squarely covered by the judgment in Dev Prakash Tewari (Supra).
Learned counsel for the petitioner has failed to point out any provision under the Regulations, 1975 or any other guidelines under the Act, 202 to continue the disciplinary proceedings after the employee has retired. Accordingly, the order dated 22.06.2016 is set aside and it is held that the disciplinary proceedings initiated vide order dated 22.06.2016 stand lapsed. Accordingly, the writ petition is allowed.””
Quite significantly, the Bench then quite unequivocally states in para 19 that, “On perusal of the case laws cited by learned counsel for the parties, it is evident that there is no provision in the Uttar Pradesh Cooperative Societies Employees Service Regulations, 1975 for initiation or continuation of disciplinary proceeding after retirement nor is there any provision stating that in case misconduct is established, a deduction could be made from the retiral benefits.”
Most significantly and so also definitely most forthrightly, the Bench minces just no words to hold in para 20 that, “Once the petitioner has retired from service on 31.12.2001, there was no authority vested in the corporation for continuing the departmental proceeding even for the purpose of imposing any reduction in the retiral benefits payable to the petitioner,”.
“In absence of such an authority, it is held that enquiry/disciplinary proceeding had lapsed and the petitioner was entitled to full retiral benefits on retirement. As the enquiry has lapsed, it is obvious that the petitioner would have to get the balance of the emoluments payable to him.”
As a corollary, the Bench directs in para 21 that, “In view of reasons recorded above, the impugned orders dated 20.02.2007 (Annexure No.1) and 30.09.2003 (annexure-5) are hereby quashed.”
In addition, the Bench mentions in para 22 that, “The writ petition succeeds and is allowed.”
Finally, the Bench concludes by directing in para 23 that, “The respondents are directed to pay the allowances/post retiral benefits to the petitioner as claimed in the writ petition in accordance with the rules and regulations within a period of eight weeks from the date of production of a certified copy of this order.”
In conclusion, we thus see that the Lucknow Bench of the Allahabad High Court in this noteworthy case was unmistakably firm in ruling that once a person retires from service, the corporation vests with no power to continue the departmental proceedings.
So the respondents were directed to pay the allowances/post retiral benefits to the petitioner. We have dealt with this quite in detail along with reasons as elaborated hereinabove.