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PETITIONER: OM PRAKASH GOEL

       Vs.

RESPONDENT: HIMACHAL PRADESH TOURISM DEVELOPMENT CORPORATION LTD. SHIMLA

DATE OF JUDGMENT06/05/1991

BENCH: REDDY, K. JAYACHANDRA (J) BENCH: REDDY, K. JAYACHANDRA (J) PANDIAN, S.R. (J)

CITATION:  1991 AIR 1490            1991 SCR  (2) 701  1991 SCC  (3) 291        JT 1991 (3)     6  1991 SCALE  (1)892  CITATOR INFO :  D          1992 SC 496  (26)

ACT:      Civil Service:      Constitution  of India, 1950: Articles 311(2),  14  and 16-Termination of service by simple notice after  conducting enquiry-Whether  in the nature of camouflage and by  way  of punishment-Juniors retained in service but senior’s  service terminated-Whether arbitrary and discriminatory.      Himachal Pradesh Tourism Development Corporation  Staff Regulations:  Regulation  19(3)(b)  and  39-Termination   of service-Allegations  of  misconduct-Enquiry  conducted-Order terminating  service by simple notice passed-Whether  valid- Whether   in  the  nature  of  camouflage  and  by  way   of punishment-Senior’s   service  terminated  while   retaining juniors  in  service-Whether arbitrary  and  discriminatory- Employee  practising  as  lawyer  since  termination-Whether entitled to backwages on reinstatement.

HEADNOTE:      A charge sheet was issued to the petitioner, a directly recruited Accountant in the respondent Corporation  alleging that while working in the Transport Wing of the Corporation, he facilitated and abetted the embezzlement of Rs.100 by not ensuring  that the amount found was in excess, and  thus  he failed  to  serve the Corporation honestly  and  faithfully, that  he made some fictitious entries in the Cash  Book  and that   he  made  certain  information  public  without   the permission of the Managing Director.  The petitioner replied that  all  the  charges  were fake  and  false.   the  leave sanctioned  to the petitioner earlier for prosecuting  legal study was canceled and the petitioner challenged the same in the  High Court but the case was adjourned.  Meanwhile,  the petitioner’s services were terminated on the ground that  he was  no longer required and that one month’s pay in lieu  of notice  would  be  paid  in  terms  and  conditions  of  his appointment  letter and provisions of Staff  Regulations  of the Corporation.  The petitioner challenged the same  before the  High  Court,  but the Writ Petition  was  dismissed  in limine.                                                        702

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    In  the appeal before this Court it was contended  that the  termination was only a camouflage and that  though  the petitioner   was   still  a  temporary  servant,   yet   the termination amounted to punishment, because of the manner in which  it was passed and the background behind it.   It  was also contended that though the termination order stated that the  petitioner’s  services  were no  longer  required,  his juniors  were  retained and were continuing in  service,  in violation of Articles 14 and 16 of the Constitution.      Disposing of the Special Leave Petition, this Court      HELD:  1.1 In a case of an order of  termination,  even that  of a temporary employee, the Court has to see  whether the  order  was made on the ground of misconduct if  such  a complaint  was  made  and in that process  the  Court  would examine  the  real circumstances, as well as the  basis  and foundation  of the order complained of and if the  Court  is satisfied  that  the  termination  of  services  is  not  so innocuous as claimed to be and if the circumstances  further disclose  that it is only a camouflage with a view to  avoid an   enquiry   as  warranted  by  Article  311(2)   of   the Constitution,  then  such  a termination  is  liable  to  be quashed. [706E-F]      Annop  Jaiswal v. Government of India & Anr., [1984]  2 SCR 453; Nepal Singh v. State of U.P. & Ors., [1985] 2 SCR 1 and  Jarnail  Singh & Ors. etc. v. State of Punjab  &  Ors., [1986] 2 SCR 1022, relied on.      1.2 In the instant case, the termination order,  though appears  to  be innocuous was only intended  to  punish  the petitioner for the misconduct, in respect of the allegations which are mentioned in the charges that were served on  him. As  a matter of fact, the enquiry was conducted, but  before the  conclusion  of the enquiry, the termination  order  was passed.  Therefore, it is not difficult to see that the form of  the  termination order is only a clock for an  order  of punishment. [707C-D]      1.3  Besides,  the  termination is also  liable  to  be quashed  on the ground that it is violative of  Articles  14 and 16 of the Constitution, as it is clear from the  records that while the petitioner’s juniors are retained in service, the  petitioner’s  services  are  terminated  as  no  longer required. [708F, 709A-B]      Jarnail  Singh & Ors. etc. v. State of Punjab  &  Ors., [1986]2 SCR 1022 and K.C. Joshi v. Union of India and  Ors., [1985]3 SCR 869, relied on.                                                        703      1.4  In  the circumstances, the  termination  order  is quashed  and the petitioner is directed to be reinstated  in service.   However,  it  shall be open  to  the  respondent- Corporation to proceed with the  disciplinary enquiry  if it so chooses. [709H]      1.5 As regards the backwages, admittedly the petitioner has been practising as a lawyer since his termination.   But this  Court  has not refused to grant  background  that  the employee  has  been practicing as lawyer during  the  relevant period, but has taken into consideration the probable income that  would have been earned him, while granting  backwages. However,  a roving enquiry cannot be made by this Court  nor would  it  be  possible for  the  respondent-Corporation  to unearth  the income which the petitioner would have  derived as  practising advocate.  Undoubtedly, the petitioner  would have  been  entitled  to  subsistence  allowance  till   his reinstatement, even if the relevant period is treated as one of  suspension pending enquiry.  Therefore,  the  petitioner shall  be entitled to the full back wages upto the  date  of his enrollment as a lawyer and from that date upto the  date

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of  reinstatement  at the rate of half  of  the  subsistence allowance  per month.  Out of the total income,  the  income admittedly  earned  by him as a practising lawyer  shall  be deducted and the balance paid to the petitioner.  The amount so paid shall, for the purpose of income tax, be spread over as if derived during those financial years from the date  of his  dismissal  till date of reinstatement.  [708B,  709D-G, 710A-B]      S.M. Saiyad v. Baroda Municipal Corporation, relied on.

JUDGMENT:      CIVIL  APPELLATE JURISDICTION: Special  Leave  Petition No. 13560 of 1983.      From  the  Judgment and Order dated  27.6.1983  of  the Himachal Pradesh High Court in C. W. P. No. 86 of 1983.      P.P. Rao and H. J. Zaviri for the Petitioner.      V.K. Kanth and C.P. Pandey for the Respondents.      The following Order of the Court was delivered by      K.  JAYACHANDRA REDDY, J. The petitioner  was  directly appointed  as an Accountant in the Himachal Pradesh  Tourism Development  Corporation Ltd. (’Corporation’ for  short)  on 28.8.78  He  was on probation in the Transport Wing  of  the Corporation. After                                                        704 training  he  was  transferred to the  Office  of  the  Area Manager,  Simla  and  was  posted  as  an  Accountant.   His conditions of service were governed by the Regulations  made by   the  Board  of  Directors  of  the  Corporation.    The petitioner detected certain irregularities in the  Transport Wing  and  wrote a letter dated 19.6.1980 to  the  Transport Officer  pointing  out  the  financial  irregularities   and embezzlements committed by the then Cashier.  The employees’ Union took up the matter and demanded the Management to take necessary action and also made some demands on behalf of the Union.   The  petitioner was the General  Secretary  of  the Union.   In April 1980, the respondent No. 2 was  posted  as the  new Managing Director.  According to the petitioner  he was  annoyed  with  the  petitioner  because  of  his  union activities.   It  is  stated that  the  petitioner  actively participated  in highlighting the demands.  On 13.5.1981  an order  transferring the petitioner to Dalhousie was  passed, even   though  the  petitioner  had  been  earlier   granted permission  on  23.7.79 to do his 3 years Law course  as  an evening  student.  the petitioner made a representation  for cancellation  of  the  transfer on the ground  that  he  was already  half  way  through his legal  study  and  that  the transfer was mala fide.  Respondent No. 2 got more  annoyed. The  petitioner submitted a study leave application for  one year.   But he was granted only 90 days leave in  the  first instance with full pay and allowances and later on half  pay and  subsequently without pay he was granted extra  ordinary leave.  Meanwhile, a chargesheet was issued on 21st  August, 1981  framing certain charges.  The gravamen of the  charges is  that  while  working  in  the  Transport  Wing  of   the Corporation  the  petitioner  facilitated  and  abetted  the embezziment of Rs. 100 by notensuring that the amount  found was  in excess and that he failed to serve  the  Corporation honestly  and faithfully.  The other charge is that he  made some  fictitious  entries in the Cash Book  and  the  fourth charge  is that he made certain information  public  without the  permission  of  the Managing  Director.   To  this  the petitioner  submitted a reply stating that all  the  charges are  fake  and false.  It is stated  that  the  petitioner’s

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leave  was cancelled and the petitioner challenged the  same in  the  High  Court of Himachal Pradesh but  the  case  was adjourned.    Meanwhile  the  petitioner’s   services   were terminated  with effect from 8th January, 1982 stating  that they  are no longer required and one month’s pay in lieu  of notice  would  be  paid  in  terms  and  conditions  of  his appointment  letter and provisions of Staff  Regulations  of the Corporation.  The petitioner challenged the same  before the  High  Court,  but the Writ Petition  was  dismissed  in limine.   In this Court it is urged that the termination  is only a camouflage and that though the petitioner was still a temporary servant yet the termination amounted to punishment because of the manner in which it was                                                        705 passed and the background behind it.      It is not in dispute that the Corporation has power  to terminate  the services by giving one month’s notice or  pay in  lieu  thereof, in the case of a temporary  employee  who have completed one month’s service.  Regulation 19(3)  reads thus:      Termination of service by notice          "19(3)  The Corporation may terminate the  services          of any employee by giving him:          (a) xx               xx                  xx          (b) one month’s notice, or pay in lieu thereof,  in          the case of temporary employees who have  completed          one  months service and one day’s notice or pay  in          lieu thereof in the case of temporary employees  in          the first month of their service." Regulation  39  prescribes  various penalties  that  can  be awarded and termination of service is one of them.  Now  the only question that arises for consideration in this case  is whether  the  termination of the  petitioner’s  services  is simply one as per the Regulation 19(3) or in the nature of a camouflage   and,  therefore,  amounts  to   punishment   as contended by the petitioner.      In Anoop Jaiswal v. Government of India & Anr., p[1984] 2 SCR 453, it is held as under:          "Where the form of the order is merely a camouflage          for  an  order of dismissal for  misconduct  it  is          always open to the Court before  which the order is          challenged to go behind the form and ascertain  the          true  character of the order.  If the  Court  holds          that  the  order  though in the form  is  merely  a          determination  of employment is in reality a  clock          for an order of punishment, the Court would not  be          debarred, merely because of the form of the  order,          in  giving  effect to the rights conferred  by  law          upon the employee." In  Nepal Singh v. State of U.P. & Ors., [1985] 2 SCR it  is held as under:                                                        706          "Where  allegations  of  misconduct  are   levelled          against  a  Government Servant, and it  is  a  case          where  the  provisions  of  Article  31(2)  of  the          Constitution  should be applied, it is not open  to          the  competent  authority  to take  the  view  that          holding  the  enquiry contemplated  by  the  clause          would be  a bother or a nuisance and that therefore          it  is  entitled  to  avoid  the  mandate  of  that          provision  and resort to the guise of  an  ex-facie          innocuous  termination order.  The Court will  view          with great disfavour any attempt to circumvent  the          constitutional  provision  of article 311(2)  in  a          case where that provision comes into play."

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In  Jarnail  Singh & Ors., etc. v. State of Punjab  &  Ors., [1986] 2 SCR 1022 it is, held thus:          "When  an  allegation  is  made  by  the   employee          assailing the order of termination as one based  on          misconduct though conched in innocuous terms, it is          incumbent on the court to lift the veil and to  see          the  real  circumstances as well as the  basis  and          foundation  of the order complained of.   In  other          words,  the  Court, in such a case, will  lift  the          veil and will see whether the order was made on the          ground of misconduct, inefficiency or not."      From  the  above  decisions it can be seen that  it  is well-settled that in a case of an order of termination  even that  of a temporary employee the Court has to  see  whether the  order  was made on the ground of misconduct if  such  a complaint  was  made  and in that process  the  Court  would examine  the  real circumstances as well as  the  basis  and foundation  of  the order complained of and if  the Court is satisfied  that  the  termination  of  services  is  not  so innocuous as claimed to be and if the circumstances  further disclose that it is only a camouflage with a view to avoided an   enquiry   as  warranted  by  Article  311(2)   of   the Constitution,  then  such  a termination  is  liable  to  be quashed.   In  the above mentioned decisions,  the  impugned termination order was accordingly quashed.      It  is  not in dispute that a regular  chargesheet  was served  on  the  petitioner, as  mentioned  above,  on  21st August, 1981 and to the said chargesheet a list of documents also  was  appended on the basis of which  the  articles  of charge were framed.  The petitioner replied to these charges on  7th  September, 1981.  Without reference to any  of  the charges or the reply the order of termination was passed  on 8th                                                        707 January,  1982  as  already  mentioned.   In  the   counter- affidavit  at more than one place it is admitted  about  the framing  of the charges etc. regarding the news  item  which refers  to the information given out by the petitioner.   It is  stated  in the counter-affidavit that  services  of  the petitioner  were terminated as a probationer and not on  the basis of the enquiry report which came after the services of the  petitioner  had been terminated.  It can  therefore  be seen that an enquiry, in fact, was contemplated and was held but  the  report came into light after  termination  of  the services of the petitioner.  It is also submitted on  behalf of  the  petitioner that the audit report  would  show  many irregularities as pointed out by the petitioner and that the petitioner    acted   honestly   in   pointing    out    the irregularities.  It is not necessary for us to go into  this question.  Having gone through the various records and  also the   admissions  made  in  he  counter-affidavit,  we   are satisfied  that the termination order, though appears to  be innocuous,  was only intended to punish the  petitioner  for the  misconduct,  in respect of the  allegations  which  are mentioned  in  the charges that were served on  him.   After serving  the chargesheet, as a matter of fact,  the  enquiry was conducted.  But before the conclusion of the enquiry the termination order was passed.  Therefore it is not difficult to  see  that the form of the termination order  is  only  a cloak for an order of punishment.      In  this context, the learned counsel  also  questioned the termination order from another angle.  In that order  it is  mentioned  that the services of the  petitioner  are  no longer  required, therefore they are terminated.   But  from the  record it is clear that juniors to the  petitioner  are

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retained  and  they  are  continuing  in  service.   In  the affidavit  it is clearly mentioned that juniors whose  names are  given  there are retained in service  in  violation  of Article  14  and 16 of the Constitution.   In  the  counter- affidavit  only a vague reply is given simply  stating  that the  averments made by the petitioner are not  correct.   In K.C. Joshi v. Union of India and Ors., [1985] 3 SCC 869.  It is  observed that ’If it is discharge simpliciter, it  would be  violative  of  Article 16, because a  number  of  store- keepers  junior  to  the appellant are shown  to  have  been retained in the service’.  Likewise in Jarnail Singh’s  case it was observed as under:          "In  the  instant  case, ad  hoc  services  of  the          appellants  have been arbitrarily terminated as  no          longer required while the respondents have retained          other surveyors who are juniors to the  appellants.          Therefore, on this ground also, the impugned  order          of  termination of the services of  the  appellants          are illegal and bad being in contravention of the                                                        708          fundamental  rights guarantee under Article 14  and          16 of the Constitution of India." After a careful perusal of the record we are satisfied  that the  juniors to the petitioners are retained.  Therefore  on this  ground  also  the termination order is  liable  to  be quashed.      Admittedly  the  petitioner has been  practising  as  a lawyer  ever  since his services  were terminated.   In  the rejoinder  filed  by him he merely stated that  he  was  not earning  much  in that profession and that he  has  incurred debts.   The learned counsel for the  Corporation,  however, submitted   that   since  the  petitioner   was   admittedly practising  as  a lawyer the question of granting  him  back wages  is any event does not arise and that  even  otherwise there cannot be a roving enquiry to the earning he has  made as  a  lawyer  at this distance of  time.   The  petitioner, however, at this juncture filed a further affidavit that his total  income from 1985 onwards uptilnow was only  Rs.15,550 and  that  he has not received any other income  during  all these  years.   It is also submitted on his behalf  that  in similar circumstances this Court awarded back wages even  in a  case  of an employee who practised as a lawyer  from  the date of dismissal till his reinstatement. In S. M. Saiyad v. Baroda  Municipal Corporation, the employee was directed  to be   reinstated  in  service  by  the  labour  court.   Then ultimately on the question of back wages it was urged before this  Court  that though the appellant was practising  as  a lawyer  after  enrolment  during that period  still  he  was entitled for back wages.  This Court accepted this plea  and observed as under:          "The  appellant  seeks back wages  for  the  period          December 12, 1969 to October 26, 1976.  This period          according  to the respondent has to be  divided  in          two  parts; (1) from December 12, 1969 to Jan.  20,          1972   when  the  appellant  was  enrolled  as   an          advocate, and (2) for the period Jan. 21, 1976   to          October  26,  1976 from which date he  has  already          been awarded back wages, it was submitted on behalf          of  the respondent that the appellant  himself  has          admitted  that  since  his  being  enrolled  as  an          advocate  he  was earning Rs. 150 per  month  which          aspect must be borne in mind while considering  the          submission  of the appellant for the award of  back          wages." Partly  accepting this plea this Court  ultimately  observed

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that the appellant therein must have atleast stated  earning after a lapse of one                                                        709 year from the date on which he was enrolled as an  advocate. Ultimately this court directed that:          "We,  accordingly, allow this appeal and set  aside          the  decision of the High Court refusing  the  back          wages  for the period December 12, 1969 to  October          26,  1976 and directed that the appellant shall  be          entitled   to  back  wages  including  salary   and          allowances and other benefits to which he would  be          entitled  as  if  the has  continued  the  service.          While making the payment of back wages as per  this          order  the  respondent is entitled  to  deduct  the          amount  of Rs. 150 p.m.  from January 20,  1973  to          October  26,  1976 from the  amount  which  becomes          payable  to  the appellant.   The  respondent  must          compute  the amount payable as herein directed  and          pay what becomes payable to the appellant within  a          period of two months from today." It  can therefore be seen that this Court did not refuse  to grant back wages on the simple ground that the employee  was a  practicing lawyer during the relevant period.But  on  the other  hand  it took into account the  probable  income  and after  deducting  the  same the balance of  back  wages  was directed to be computed.      In  the  instant  case in the affidavit  filed  by  the petitioner it is stated that he was practising as an income- tax  advocate  ever since his enrolment  in  October,  1982. But, however, he asserted that he got his first brief in the year  1985.  These averments are contradicted by  the  other side.   Under  these circumstance we cannot  make  a  roving enquiry  nor  would it be possible for  the  corporation  to unearth  the income which the petitioner would have  derived as a practising advocate.  There are many imponderables  and conjectures  too.  Under these circumstances we  asked  both the counsels to suggest a solution.  We have heard both  the sides  on this aspect elaborately.  Shri P. P. Rao,  learned counsel  for the petitioner submitted that if  the  relevant period is to be treated as one of suspension pending enquiry the  petitioner would have been entitled to the  subsistence allowance  till his reinstatement.  That atleast  should  be the criteria in granting the back wages in a situation  like this.  We think this is a reasonable and fair suggestion.      In  the  result the termination order  is  quashed  and consequently the petitioner shall be reinstated in  service. However,  he shall be entitled to the full back  wages  upto the date of his enrolment as a                                                        710 lawyer  which was in the month of October, 1982.   From  the date  of  his enrolment upto the date  of  reinstatement  he shall  be entitled to the back wages at the rate of half  of the  subsistence allowance per month  and the  total  amount shall be computed on that basis.  Out of that the income  of Rs.15,550  admittedly earned by him as a  practising  lawyer shall  be deducted and the balance amount shall be  paid  to the  petitioner.  The amount so paid  to him shall  for  the purpose  of income tax, be spread over as if derived  during those  financial years from the date of his  dismissal  till the  date of reinstatement.  However, we would like to  make it clear that it is open to the Corporation to proceed  with the disciplinary enquiry if it so chooses.      The special leave petition is accordingly disposed  of. In  the circumstances of the case there will be no order  as to costs.

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N.P.V                              SLP disposed of.                                                        711