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PETITIONER: HINDUSTAN PAPER CORPN.

       Vs.

RESPONDENT: PURNENDU CHAKROBARTY & ORS.

DATE OF JUDGMENT:       30/10/1996

BENCH: B.P. JEEVAN REDDY, K. VENKATASWAMI

ACT:

HEADNOTE:

JUDGMENT:                       J U D G M E N T      VENKATASWAMI. J.      Leave granted.      Heard learned counsel for the parties at length.      The appellant-Corporation  on January 5, 1989 passed an order  invoking   Rule  23(vi)  E  of  the  Hindustan  Paper Corporation Conduct Discipline and Appeal Rules (hereinafter called "the  Rules"). That  order was to the effect that the first respondent herein must be deemed to have lost his Lien on his appointment with the Corporation/Mill.      The first  respondent has  successfully challenged  the said order  of  the  appellant  before  the  High  Court  of Guwahati and thus. the appellant is before us.      The  first  respondent  entered  the  services  of  the appellant as  a Fire  Fighting Officer  and  was  eventually promoted on 28.8.1985 as Assistant Manager (Security & Fire- fighting). On  may 26.  1988 the  body of  one  shanti  Rani Chakrabarty, sister-in-law  of  the  first  respondent.  was found in  the house  of the  first respondent. On 27.5.1988. the first  respondent applied casual leave. On the next day. an FIR  was lodged  aginst the  first respondent  and others under Section 302/201 read with Section 34 IPC by Karim Ganj Police. On  3.6.1988. the  first respondent after the expiry of casual  leave sent an application for Earned Leave for 11 days giving  the reason ’personal affair’ and mentioning his leave address  as U/S  PWD Dispur,  Gauhati. On 6.6.1988 the Senior Manager  of the appellant received a message from the Police to  direct the  first respondent  to  report  to  the police station.  On 7.6.1988 the Senior Manager informed the police that the first respondent has sent an application for Earned Leave.  Again the  police requested  to intimate  the whereabouts  of  the  first  respondent.  On  l4,6.1988  the appellant informed  the police  that the  whereabouts of the first respondent  not known.  However. the permanent address of the first respondent as available in the official record. was supplied  to the  police. Thereafter. the appellant sent series  of   leave  applications   dated  21.6.88.  14.7.88. l3.9.88. 28.8.88.  13.9.88. 29.9.88.  16.10.88  and  5.11.88 without minding  to find  out whether  previous applications for  leave   have  been   sanctioned  or  not.  These  leave

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applications initially  did  not  disclose  any  reason  and subsequently  it  mentioned  ‘on  medical  grounds’  without enclosing any medical certificate and without disclosing his leave address.  The appellant-Corportion  again received  on 28.11.1988 a  communication from  the police  that the first respondent was  wanted as  an accused  in a  murder case. ln view of  that the  Appellant-Corporation by  a communication dated 30.1l.1988  informed the  first  respondent  that  his leave  on   medical  grounds   was  not  sanctioned  as  his applications were  not supported by medical certificates and that  he  was  liable  to  be  treated  as  an  unauthorised absentee. He  was. therefore.  called  upon  to  submit  his explanation, if any within 15 days of receipt of the letter. He was  also incidentally  informed that  he was required by the Superintendent  of Police, Karim Ganj in connection with the murder.  In response to the above communication from the appellant-Corporation. the  first respondent  submitted  his reply baldly  stating that  he was suffering from chest pain for quite  some time  and that  he had  consulted specialist outside HPC for personal reasons and due medical cercificate Will be  produced at  the time  of joining. He also informed the Corporation  that he knew that he was required to appear before the  Police and that he would report to the police as per  rules.   It  is  under  these  circumstances  that  the appellant-Corporation  passed   the  order   dated  5.1.l989 invoking Rule 23 (vi) E the Rules.      The appellant  aggrieved by  the said  order moved  the Guwahati High  Court by  filing Civil  Rule No.  288 of 1992 under Article  226 of the Constitution of India. The learned Single Judge as well as the Division Bench. on appeal by the appellant-Corporation, agreeing  with the arguments advanced on behalf of the first respondent set aside the order of the appellant-Corporation  dated   5.1.1989  and   directed  re- instatement of first respondent with 50% back wages.      When the  Special Leave  Petition came up for admission this Court  while issuing  notice passed  an  order  in  the following terms:      "In the light of the sub-clause (E)      of  Clasue   VI  of  Rule  23.  the      validity of  which is stated not to      have so far been pronounced upon by      this Court  in  the  context  of  a      Public Sector Corporation. a notice      shall    be     issued    to    the      respondents."      Before actually  going into  the validity  of the  said Rule it  would he  beneficial to appreciate the facts little more critically,  which will  be  helpful  to  come  to  the correct conclusion.      The first  respondent is  not a  workman  to  avail  or invoke the  provisions of  the Industrial Disputes Act 1947. He is  governed by  the Rules  framed by  the Corporation in this regard.  We have  already noted  that in  view  of  the pendency of  criminal case registered against him, the first respondent without  disclosing that  fact has  been  sending applications for leave commencing from 21.6.1988 ending with 5.11.1988. Copies  of the application for leave are tiled in the paper  book along  With copies  of medical  certificates produced by  the first respondent. not before the appellant- corporation on  time. but  long subsequently.  Initially, as noticed earlier. the applications for leave did not disclose any reason.  Later on,  in the  application for  leave dated 13.8.1988,  the   reason  given  was  suffering  from  heart disease’. Again  in the  application  dated  13.9.1988.  the reason given  was heart  disease since long. The same reason

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was given  in the  applications dated  29.9.1988  16.10.1988 and 5.11.1988  It is very relevant to note that according to the medical  certificates, copies  of which are now produced which are dated 4.5.1988 onwards ending with 21.01.89. nowhere it  was stated  that he  was  suffering  from  heart disease. Further.  nature of  the sickness  was mentioned in the certificate  and in  spite of  that  the  same  was  not disclosed correctly  in the  leave applications.  It is also clear that  those certificates were available and inspite of that not  enclosed alongwith  the leave  applications.  From this one  has to  draw the inference that either the medical certificates are not genuine in the sense that they were not obtained then and there or the first respondent deliberately did not enclose them along with the leave applications. Even today no  proper explanation  is forthcoming  from the first respondent on this aspect. With this background we shall now set out the relevant rule:-      Rule 23, PENALTIES      The following  penalties may be imposed on an employee.      as hereinafter  provided. for  misconduct committed  by      him or for any other good and sufficient reasons.      Minor Penalties      a) censure:      b) withholding  of increment(s)  of pay with or without      cumulative effect:      c) withholding of promotion;      d) recovery from pay or such other amount as may be due      to him  of the  whole or  part of  any  pecuniary  loss      caused to  the Corporation  by negligence  or breach of      orders.      Major Penalties      e) reduction  to a  lower grade  or post. or to a lower      stage in a time scale:      f)  removal   from  service   which  shall   not  be  a      disqualification for future employment ;      g) dismissal;      Explanation:  The  following  shall  not  amount  to  a      penalty within the meaning of this rule.      i) withholding  of increment  of an employee on account      of his  work being found unsatisfactory or not being of      the  required  standard.  or  for  failure  to  pass  a      prescribed test of examination:      ii) stoppage  of an employee at the efficiency bar in a      time scale, on the ground of his unfitness to cross the      bar:      iii) non-promotion, whether in an officiating capacity      or otherwise , of an employee to a higher post for      which he may be eligible for higher post for which he      may be eligible for consideration but for which he is      found unsuitable after consideration of his case;      iv) reversion  to lower  grade or  post, of an employee      officiating in  a higher  grade or  post, on the ground      that he  is considered,  after trial,  to be unsuitable      for such  higher grade  or post,  or on  administrative      grounds unconnected with his conduct;      v) reversion  to his  previous grade  or  post,  of  an      employee appointed  on probation  to another  grade, or      post during  of at  the end of the period of probation,      in accordance with the terms of his appointment;      vi) TERMINATION OF SERVICE      A)    of  an employee appointed on probation. during or      at the  end of  the period  of probation. in accordance      with the terms of his appointment:      B)    of  an employee appointed in a temporary capacity      otherwise than  under a  contract or  agreement. on the

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    expiration of the period for which he was appointed. Or      earlier  in   accordance  with   the   terms   of   his      appointment:      C)  of  an  employee  appointed  under  a  contract  or      agreement.  in   accordance  with  the  terms  of  such      contract or agreement:      D) of any employee on reduction of establishment; and      E) Loss of lien on his appointment by an employee:      1. Proceeding  on  leave  without  prior  sanction  and      remaining  unauthorisedly   absent  for   more  than  8      consecutive days.                            and/or      2. Over-staying  his sanctioned leave beyond the period      originally granted  or  subsequently  extended  formore      than 8 consecutive days."      In the  light of the above Rule, in  particular Rule 23 (vi) E, the appellant-Corporation factually by communication dated 30.11.1988  informed the  first  respondent  that  the leave  applications  have  not  been  supported  by  medical certificates; that  period must  be treated  as unauthorised absent’ and  if he  has got aything to say on that aspect he has to  send the  reply within  15 days  from  the  date  of receipt of that letter. His reply  was that he was suffering from  chest  pain  for  quite  some  time  and  the  medical certificates will be produced at the time of joining. To say the least,  that should  not be the attitude of an employee. First of  all. he  was expected to take the leave ordinarily with prior  sanction and  extend the  same after the earlier one was  sanctioned by the appropriate authority. Right from the beginning  his applications  were not only not in proper form but  were not  supported by any medical certificates to justify the  claim of  the first  respondent. At  least  the first respondent  should have  replied properly by enclosing the medical  certificates or should have come forward with a true case.  He   did neither. lt is in that context that the appellant-corporation invoked  the said  Rule. namely.  Rule 23(vi) E.      Mr.  P   P  Rao.   senior  counsel  appearing  for  the appellant-Corporation fairly  in our  view rightly  conceded that the  Rule. namely. Rule 23(vi) E has to be construed by reading into it the Principles of natural justice. Otherwise by reading  it literally,  it would  amount to arbitrary and unreasonable vesting  of authority  and liable  to be struck down. According  to the  learned counsel.  if only the first respondent had  properly responded  to the show cause notice the Corporation  might not  have taken  the extreme  step of cutting off the appointment of the first respondent with the Corporation.      We consider that in view of this concession made by the learned counsel  on behalf of the appellant Corporation that the said  Rule must  be read and given effect to. subject to the compliance  of the  principles of  natural  Justice.  It cannot be  said that   the rule is arbitrary or unreasonable or ultra  vires Article  14 of  the Constitution.  In  other words,  before  taking  action  under  the  said  clause  an opportunity should  be given  to the  employee to show cause against the  action proposed  and if  the cause shown by the employee is  good and  acceptable, it follows that no action in terms  of the  said clause  will be  taken. Understood in this sense.  it can  not be  said that  the said  clause  is either  unreasonable  or  voidable  of  Article  16  of  the constitution.      Mr. Sanjay  Parikh. Learned  counsel appearing  for the first respondent  however. vehemently contended that in view of the  recent judgment  of this Court in D.K. Yadav vs. JMA

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ndustries  Ltd (1993) 3  SCC 259 which has considered number of earlier judgments of this Court including Hindustan Steel Ltd. vs.  Presiding Officer,  Labour Court (1976) 4 SCC 222: L. Robert  D‘ Souza vs. Executive Engineer. Southern Railway (1982) 1  SCC 645:  Delhi Transport Corpn. V. D.T.C. Mazdoor Congress 1991  supp (1)  SCC 600,  the judgment and order of the High Court cannot be assailed.. According to the Learned counsel. before passing the impugned order against the first respondent, the  appellant-Corporation should have conducted a full  fledged order. He  also invited our attention to the reasonings given by the Division Bench of the High Court.      The Devision  Bench of the High Court by confirming the order of  the learned single Judge appears to have fell into an error  in correct   appreciating  the scope  of Rule  23. According to  the learned  Judges of the Division Bench. the loss of lien is a major penalty and therefore. attracts Rule 25 which  provides that  no major  penalty  can  be  imposed without holding an inquiry under the Rules. This view of the Division Bench led them to pass the following observation.      "Admittedly. no  inquiry  has  been      held and the alternative submission      of substantial  compliance  of  the      Rules   as already discussed above,      has been  held to  be illusory.  It      cannot therefore be said in absence      of any inquiry  whatsoever that the      deliquent      writ      petitioner      deliberately abstained from duty on      a feigned  or pretended  ground  of      illness.  It   was  a   matter   of      inquiry..      We have  extracted Rule  23 in full. The explanation to the Rule  specifically states  that certain items enumerated thereunder shall  not be  treated as a penalty at all within the meaning  of Rule  23. For  our case  the relevant    sub clause is (vi) E which says that proceeding on leave without Prior sanction  and remaining unauthorisedly absent for more than 8  consecutive days; and/or over-staying his sanctioned leave beyond  the period  originally granted or subsequently extended for  more than  8 consecutive  days would result in loss of  lien of  the appointment  of the  employee. In this case we have seen that the first respondent had proceeded on leave without prior sanction and remained unauthorisedly absent for  more than  6 months  consecutively which obliged the appellant-Corporation  to  issue  communication  to  the first respondent calling upon him to explain. Unfortunately. the first respondent. for reasons best known to him. has not availed himself  of the  opportunity  as  seen  earlier  but replied in a half-hearted way which resulted in the impugned order. Therefore.  under the circumstances it cannot be said that  the  principles  of  natural  justice  have  not  been complied with  or the  circumstances require  any enquiry as contemplated under Rule 25. In the case cited by the learned counsel for  the first respondent. this Court has held "that the law  must. therefore,  be now  taken to  be well-settled that  procedure   prescribed  tor   depriving  a  person  of livelihood must  meet the  challenge of  Article 14 and such law would  be liable to be tested on the anvil of Article 14 and the  procedure prescribed by a statute on statutory rule or rules  or orders  affecting the civil rights or result in civil consequences  would have  to answer the requirement of Article 14.  So it  must be  right, just  and fair  and  not arbitrary,  fianciful   or  oppressive.   There  can  be  no distinction  between   a  quasi-judicial   function  and  an administrative function  for the  purpose of  principles  of

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nature justice.  The aim  of both  administrative inquiry as well as  the quasi-judicial  inquiry is  to arrive at a just decision and  if a  rule of natural justice is calculated to secure justice  to put it negatively, to prevent miscarriage of justice.  it  is  difficult  to  see  why  it  should  be applicable  only   to  quasi-judicial  inquiry  and  not  to administrative inquiry. It must logically apply to both."      On a  consideration of  the entire facts, we are of the view that  the test  laid down  by this  Court, as extracted above has  been satisfied  by the  appellant-Corporation and therefore when viewed from the point of Rule 23(vi) E, there was no  good reason for the High Court to interfere with the impugned order of the appellant-Corporation dated 5.1.1989.      While ordering  notice, this  court  has  directed  the appellant to  pay  1/5th  of  the    arrears  to  the  first respondent within  3 months.  lt is  stated that   order has been complied  with. It  is also  brought to our notice that the first  respondent is  due to  rctire shortly  within few months. Taking  the totality  of the facts and circumstances of the  case and  having due regard to the services rendered by the first respondent. the ends of justice would be met if the appellant-Corporation is directed to give all pensionary and terminal, benefits to the first  respondent treating the case to the first respondent as compulsory retirement on and from 5.1.1989.  We direct  accordingly .  the amount already paid pursuant  to the interim direction of this Court is not liable to  be refunded by the first respondent and not to be adjusted against the terminal benefits payments. if any.      The appeal  is accordingly  disposed of. However. there will be no order as to costs.