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PETITIONER: K. KANDASWAMY

       Vs.

RESPONDENT: UNION OF INDIA & ANR.

DATE OF JUDGMENT01/09/1995

BENCH: RAMASWAMY, K. BENCH: RAMASWAMY, K. HANSARIA B.L. (J)

CITATION:  1996 AIR  277            1995 SCC  (6) 162  JT 1995 (7)    80        1995 SCALE  (5)439

ACT:

HEADNOTE:

JUDGMENT:                          O R D E R      Leave granted.      This appeal  by special  leave arises  from  the  order dated November  19, 1990  made in  O.A. No.  641/88  by  the Central Administrative  Tribunal, Madras  Bench.  Undisputed facts are  that the  appellant is  an I.P.S.  direct recruit cadre officer  (1966) in  the Tamil  Nadu Police Service. At the relevant  time he was Addl. Inspector General of Police. On the  basis of  recommendation by  the Review Committee on June 12,  1986 for  considering his  case for promotion, the Government of  India had called for a special report and the State Government  had submitted its report on June 12, 1987. Therein it  was stated  that since  his  posting  as  Deputy Inspector  General   of  Police,   Coimbatore,  there   were persistent reports  of his acquiring large assets and of his getting money  from  his  subordinates.  While  no  specific evidence  of  receiving  money  from  his  subordinates  was forthcoming, he  himself had  come up  with  a  request  for permission to  acquire a  coffee estate  in the  name of his wife for  Rs.25 lakhs  on the  basis that  he would pay Rs.5 lakhs by mortgaging his house and rest of the amount by bank loans. Formal  enquiries indicated  that the estate would be worth  about  at  least  Rs.60  lakhs.  As  the  transaction appeared to  be highly  suspicious, confidential preliminary enquiries were  made by  the Directorate  of  Vigilance  and Anti-Corruption into  the source  for this  large amount. It was stated  that in  the C.Rs.  of the  period from April 1, 1985 to  September 30,  1985, it  has been recorded that his work  as   Managing  Director,  Tamil  Nadu  Police  Housing Corporation, Madras,  was not satisfactory. It has also been recorded that  his integrity during this period could not be certified, as  he came out with a proposal about purchase of an estate  by his  wife and  son valued  at a  few lakhs. An officer with  not much  of patrimony  to  boast  about,  the transaction is  full  of  suspicion.  Government  have  been

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requested  to   have  this   further  verified  through  the Vigilance Agency. It was also noted that pending further the reports, the  entries on  verification of  the integrity was awaited.      On consideration of the above report, the Government of India in  its proceedings  dated August  20,  1987  recorded thus:      "The undersigned  is directed to enclose      copies of briefs regarding a proposal to      retire  Shri   K.   Kandaswamy,   I.P.S.      (TN:1966)  from  Indian  Police  Service      under rule  16(3) of  AIS (DCRB)  Rules,      1958,  with  the  request  that  it  may      kindly  be  placed  before  the  Central      Establishment    Board/     Appointments      Committee of the Cabinet Secretariat for      consideration and orders."      Pursuant thereto,  decision was  taken to  compulsorily retire the  appellant from  service and  order was passed to compulsorily retire  to appellant  from  service  under  the impugned order dated February 9, 1988.      Shri S. Sivasubramaniam, the learned Senior counsel for the appellant,  contended that the appellant had all through unblemished record of service. The assets with regard to the poultry business conducted by his wife and son were enquired and found  accounted for,  there was  no further evidence to conclude that  the appellant  is having any disproportionate assets. When  a crime  was  registered  against  him,  after recommendation for  his retention  in the service, the order of compulsory  retirement is  not a  bona fide  exercise  of power. There  is no report submitted by the Vigilance or the Anti-Corruption    Department    regarding    the    alleged disproportionate assets.  His admission  was only  of having Rs.5 lakhs  worth house.  Therefore, the  view taken  by the Government to compulsorily retire the appellant from service is clearly  arbitrary and untenable. We find no force in the contention.      It is  seen that  the Government of India had requested the State Government to send special report on the integrity of the appellant. As stated earlier, the Government had sent the report.  The report  thus contained  specific  averment, namely, that  the appellant himself had come forword seeking permission to  purchase Coffee  Estate  worth  Rs.25  lakhs, which on  enquiry was  found to  be worth  Rs.60 lakhs.  The authorities also had information of the alleged unauthorised collections made by the appellant through subordinates. That may  be  an  assumption.  But  the  fact  remains  that  the appellant himself  had come  forward to  purchase  a  coffee estate worth Rs.25 lakhs, he admitted that a poultry farm is run by his wife and son and he claims that he had home worth Rs. 5  lakhs and he would obtain loans from the Bank for the purchase of the huge Estate worth Rs.25 lakhs.      The question,  therefore, is  whether the Government of India was  not  justified  in  doubting  the  integrity  and whether it is based on no evidence.      As seen  in the  light of documents and in the light of the specific  permission sought  by the appellant himself on the basis  of the  special report  submitted  by  the  State Government, the  Government of India through its appropriate Committee  reached  the  conclusion  that  in  view  of  the doubtful integrity  it would  not be desirable in the public interest to  retain the  appellant in  service. Accordingly, they have  compulsorily retired  the appellant from service. Compulsory  retirement  does  not  amount  to  dismissal  or removal from  service within  the meaning  of Article 311 of

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the Constitution.  It is  neither punishment nor visits with loss of  retiral benefits;  nor does  it  cast  stigma.  The officer would  be  entitled  to  the  pension  that  he  has actually earned  and there  is no  diminution of the accrued benefits.  The   object  of  compulsory  retirement  of  the Government employee  is public  interest. If the appropriate authority bona  fide forms  that  opinion,  the  correctness thereof on merits cannot be challenged before courts, though it may  be open  to the aggrieved employee to impugn it. But the same  may be  challenged on  the ground  that  requisite opinion is  based on  no evidence  or has not been formed or the decision  is based  for collateral grounds or that it is an arbitrary decision.      While exercising  the power  under Rule  56 (j)  of the Fundamental Rules,  the appropriate  authority has  to weigh several circumstances in arriving at the conclusion that the employee requires  to  be  compulsorily  retired  in  public interest. The  Government is  given power  to  energise  its machinery by weeding out dead wood, inefficient, corrupt and people of  doubtful integrity  by compulsorily retiring them from service, when the appropriate authority forms bona fide opinion  that   compulsory  retirement   of  the  Government employee  is   in  the  public  interest,  court  would  not interfere with  the order.  In S. Ramachandra Raju vs. State of Orissa [(1994) 3 SCC 424], a Bench of this Court to which one of  us (K.  Ramaswamy, J.)  was a member, considered the entire case  law and held that "the Government must exercise its power  only in  the public  interest to  effectuate  the efficiency of the service. The dead wood needs to be removed to augment  efficiency. Integrity in public service needs to be  maintained.   The  exercise   of  power   of  compulsory retirement must  not be  a haunt  on public servant but must act as  a check  and reasonable measure to ensure efficiency of service  and free  from corruption  and incompetence. The officer would  live by  reputation built  around him.  In an appropriate case,  there may  not be  sufficient evidence to take punitive  disciplinary action  of removal from service. But his  conduct and reputation is such that his continuance in service would be a menace to public service and injurious to public  interest. The  entire service record or character rolls or  confidential reports  maintained would furnish the backdrop material for consideration by the Government or the Review  Committee   or   the   appropriate   authority.   On consideration of the totality of the facts and circumstances alone; the  Government should  form  the  opinion  that  the Government officer  needs to  be compulsorily  retired  from service. Therefore, the entire record more particularly, the latest, would  form  the  foundation  for  the  opinion  and furnish the  base to  exercise the  power under the relevant rule to compulsorily retire a Government officer."      Higher the ladder the officer scales in the echolons of service, greater  should be  the transperancy  of integrity, honesty, character  and dedication to duty. Work culture and self-discipline augment  his experience. Security of service gives fillip  to accelerate  assiduity to  stay in  line and measure up  to the  expected standards  of efficiency by the Government employee. Thereby, they ultimately aid to achieve excellence  in  public  service.  The  security  of  service provided  by   Article  311  of  the  Constitution  and  the statutory rules made under proviso to Article 309 would thus ensure to  remove deficiency  and incompetence  and  augment efficiency  of   public   administration.   The   rights   - constitutional or statutory - carry with them corollary duty to maintain  efficiency, integrity  and dedication to public service. Unfortunately,  the latter  is being overlooked and

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neglected  and   the  former  unduly  gets  emphasised.  The appropriate Government  or the  authority would,  therefore, need to consider the totality of the facts and circumstances appropriate in  each case and would form the opinion whether compulsory retirement  of a  Government employee would be in the public  interest. The  opinion  must  be  based  on  the material on  record; otherwise  it would amount to arbitrary or colourable exercise of power.      Considered from  this perspective  and the  material on record, we  are of  the considered  view that  the  decision taken by  the Government  of India  cannot  be  held  to  be arbitrary, unjustified  or based  on no evidence. It is made clear that  our observations  may not  be construed  as  any finding  on  the  alleged  disproportionate  assets  of  the appellant. We  are informed  that a criminal case is pending trial and  the criminal  Court would decide the case without in any  way getting  influenced by  any of  the observations made by us.      The  appeal   is  accordingly  dismissed.  But  in  the circumstances without costs.