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CASE NO.: Appeal (civil)  346 of 2005

PETITIONER: Ranjit Singh

RESPONDENT: Union of India & Ors

DATE OF JUDGMENT: 05/04/2006

BENCH: S.B. Sinha & P.P. Naolekar

JUDGMENT: J U D G M E N T

S.B. Sinha, J :

       The Appellant herein was an Inspector, Central Excise and Customs,  New Delhi.  As his father died in harness, he was appointed on  compassionate grounds

       A raid by the Central Bureau of Investigation (CBI) was conducted in  his house on 29th November, 1990.  He was allegedly possessing assets  disproportionate to his known source of income.  A criminal case was  initiated against him by the CBI.  On or about 31.12.1991, a disciplinary  proceeding was initiated against him.  The charges framed against him were:

"Article \026 1 \026 That Shri Ranjit Singh during the  year 1981-90 while working as a Government  Servant in the capacity of Inspector Customs and  Central Excise failed to maintain absolute integrity  and devotion to duty and acted in a manner  unbecoming of a Government servant inasmuch as  he by exploiting his official position as a  Government servant acquired assets to the tune of  Rs. 6,43,737.15 in his own name and in the name  of his family members which are disproportionate  to the known sources to his income.  During the  above said period his total income from all known  sources comes to Rs. 5,54,924.10 p and the  expenditure comes to Rs. 1,92,676.83 and the  assets disproportionate to the known sources of  income come to the tune of Rs. 2,81,488.88 p.   Thus, said Shri Ranjit Singh by his above acts of  omission and commission contravened provisions  of Rule 3 (1)(i)(ii) and (iii) of CCS (Conduct)  Rules, 1964.

Article \026 II \026 That Shri Ranjit Singh during the  said period while functioning in the above said  capacity failed to maintain devotion to duty and  acted in a manner unbecoming of a Government  servant as much as he invested Rs. 60,000/- in the  purchase of FDRs in his own name as well as in  the name of his mother Smt. Leelawanti in Punjab  and Sind Bank, Vijayawada in 1981 without any  intimation to his department/ Government as  required under Rule 18 (3) of the CCS (Conduct)  Rules, 1964."

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       A closure report was submitted by the CBI on 20th July, 2001.  In the  departmental proceeding, the Appellant adduced evidences on his behalf as  also cross-examined witnesses examined on behalf of the Department.  The  Enquiry Officer submitted a report dated 26.9.1996 exonerating him from  the said charges.  The Disciplinary Authority, however, differed with the  findings of the Enquiry Officer and issued a memorandum on or about  17.2.1997 stating the reasons for his difference with the Enquiry Officer and  called upon the Appellant to make his representation in his defence to the  grounds of disagreement before a final decision is taken stating:

"Any representation which he may wish to make  against the tentative opinion will be considered by  the undersigned independent of her tentative  opinion.  Such a representation, if any, should be  made in writing and submitted so as to reach the  undersigned not later than 10 days from the date of  receipt of this memorandum."

       By a letter dated 13.3.1997, the Appellant prayed for grant of 10 days  time.  The same was allowed.  Yet again on 25.3.1997, he prayed for further  10 days’ time to submit his representation which was also allowed.  It is,  however, not in dispute that on or about 7.4.1997, i.e., after the expiry of 10  days time from 25.3.1997, he filed another application for granting 3-4 days  time.  According to the Disciplinary Authority, the order of punishment was  already prepared on 8.4.1997 whereas the said application dated 7.4.1997  reached its hand later.   

       The contention of the Disciplinary Authority in this behalf  furthermore is that he was informed by an order dated 21.3.1997 that no  further opportunity would be granted to him.  The Disciplinary Authority  contends that the said order was served on the Appellant but according to  him he did not receive the same.   

The Appellant, however, submitted a memorandum on 10.4.1997  before the Disciplinary Authority stating in details as to why the conclusion  of the Enquiry Officer in his report should be upheld.  The said  memorandum admittedly was not considered by the Disciplinary Authority.

       The Disciplinary Authority by an order dated 8.4.1997 directed  dismissal of the Appellant from services stating:

"The charges proved against the charged officer  are quite grave in nature.  The charged officer had  acquired assets disproportionate to his known  sources of income.  This highly unbecoming of a  Govt. servant and necessitate imposition of a  severe penalty.  I, therefore impose penalty of  removal from service on Sh. Ranjit Singh with  immediate effect."

       In support of the said order, however, no fresh reason was assigned.   The Disciplinary Authority proceeded on the basis that as the Appellant had  been given an opportunity of hearing to submit his defence and as he had  failed to do so, a presumption was drawn that he did not wish to comment on  the grounds of disagreement.  It was stated:

"\005The evidence proving disproportionate assets  has already been discussed at length in the memo  dt. 17.02.97.  The same are unchallenged by the  charged officer and nothing has come to the notice  of the undersigned to refute the evidentiary value

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of the material discussed in the said memo.  The  reasons for not treating AC, RCR, Music System,  CTV & VCR as items having been fifteen/ leaned  to Smt. Leelawanti by her relatives have already  been given in memo dt. 17.02.97.  As per my  findings in this regard contained in the above said  memo these items infact belonged to the charged  officer and shall be treated as his assets.

       The money spent on the construction of  house no. EA-68 Inderpuri has also been logically  discussed in above referred memo.  In the absence  of any objection from charged offer this is also  held to correct calculation.

       Thus, as per discussion in the memo dt.  17.02.97 an assets amounting to Rs. 1,15,873.62  owned by Sh. Ranjit Singh are held to be  disproportionate to his known sources of income  and therefore charge I is held to be proved against  the charged officer."

         The Appellant thereafter preferred an appeal before the Appellate  Authority being the Commissioner of Central Excise, Delhi against the said  order. The following points were framed by the said authority for  consideration:

"(i)    Whether by not giving Sh. Ranjit Singh  extension of time, which had twice over expired,  prejudice has been caused to him, in other words,  whether it amounts to denial of principles of  natural justice in the circumstances of the case." (ii)    Whether or not the conclusion arrived at by  the Disciplinary Authority in her disagreement  with the inquiry officer, who had property  evaluated the evidence and come to the conclusion  are in accordance with the test laid for  departmental inquiries namely preponderance of  probability or not."

       On the first point, the Appellate Authority opined in favour of the  department.  On the second point, it was held:

"Shri Ranjit Singh has agitated that his mother’s  property has been attributed to him, therefore, he  has been wronged.  According to him, this point  has been overlooked by the inquiry officer and also  by the Disciplinary Authority.  There is elaborate  findings and discussion in IO report on the subject,  in the nature of circumstances of this case that  appears to be the most appropriate method.  I agree  with the same and reject the contention of Shri  Ranjit Singh in the appeal memorandum in this  regard."

       The Appellate Authority on the said premise agreed with the  observations of the Disciplinary Authority that both the charges have been  established.   

       A revision filed thereagainst by the Appellant was also dismissed.   The Revisional Authority used the same language as that of the Appellate  Authority while passing the order dated 22.4.1999.  

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An Original Application was filed by the Appellant before the Central  Administrative Tribunal which was marked as OA No. 1106 of 2000.  The  said original application was dismissed only stating:

"In UOI Vs. Upendra Singh (1994) 27 ATC 200  the Hon’ble Supreme Court has held the Tribunal  cannot take over the functions of the disciplinary  authority.  The truth or otherwise of the charges is  a matter for the disciplinary authority to go into.   Indeed even after the conclusion of the disciplinary  proceedings, if the matter comes to the Court or  Tribunal, they have no jurisdiction to look into the  truth of the charges or into the correctness of the  findings rendered by the disciplinary authority, or  the Appellate Authority as the case may be.  The  function of the Court/ tribunal is none of judicial  review, the purpose of which is to ensure that the  individual receives fair treatment."

       A writ petition filed by the Appellant herein was summarily rejected  by the Division Bench of the High Court.  The Appellant is, thus, before us.

       Mr. Parag Tripathi, learned senior counsel appearing on behalf of the  Appellant has raised two contentions in support of the appeal.  The learned  counsel would firstly submit that keeping in view of the fact that the  Municipal Corporation of Delhi valued the residential house of the  Appellant at Rs.2,41,576/- whereas the Executive Engineer appointed by the  CBI valued the same at Rs. 3,26,000/- and, thus, the difference between the  two valuations being only Rs.84,426/-, it cannot be said that the assets  possessed by the Appellant were disproportionate to his known source of  income.

       It was further submitted that the Appellate Authority could have  granted some time to the Appellant to file his show cause having regard to  the fact that although he is said to have prepared his order on 8.4.1997, it  was not dispatched from his office till then and in that view of the matter, it  must be held that the principles of natural justice have been violated.   

       Mr. T.S. Doabia, learned senior counsel appearing on behalf of the  Respondent, on the other hand, contended that the Executive Engineer of the  CBI was examined before the Deputy Commissioner for the purpose of  proving his report on valuation of the residential building of the Appellant  and in that view of the matter, his report was admissible in evidence.  It was  contended that from the order of the Appellate Authority, it would appear  that a portion of the building was not valued by the MCD.

       It is not disputed that the Disciplinary Authority had issued a show  cause notice.  It is also true that pursuant to or in furtherance of the said  notice, the Appellant did not file any show cause.  However, it stands  admitted that a show cause was filed by the Appellant herein prior to  communication of the order.  The Disciplinary Authority states that the  Appellant was communicated the order dated 21.3.1997 that no further time  would be granted, but the Appellant, on the other hand, contends that that he  did not receive the same.  The Tribunal, before whom the said contention  was raised by the respondent for the first time, did not go into the same nor  was it established by or on behalf of the Disciplinary Authority that the said  communication dated 21.3.1997 reached the hands of the Appellant before  he made a request for grant of 3-4 days’ further time by letter dated 25.3.97.

       The Disciplinary Authority did not arrive at any independent finding  for passing the order of dismissal dated 8.4.1997.  He, as indicated  hereinbefore, proceeded on the basis that as the Appellant had not filed a  show case, he must be held to have accepted the points on the basis whereof

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the Disciplinary Authority recorded his disagreement with the findings of  the Inquiry Officer.  The Disciplinary Authority, however, failed to consider  that the grounds on which he had disagreed with the Inquiry Officer forming  the basis for issuing the show cause notice dated 17.2.1997, was a tentative  one.  Only because the Appellant did not file a show cause, the same would  not mean that he was not required to consider the materials brought on  records by the parties before the Disciplinary Authority, afresh.  He was  obliged to do so.

In Punjab National Bank and Others v. Kunj Behari Misra [(1998) 7  SCC 84], this Court has clearly held that the principles of natural justice are  required to be complied with by the Disciplinary Authority in the event he  intends to differ with the findings of the Enquiry Officer observing:

"The result of the aforesaid discussion would be  that the principles of natural justice have to be  read into Regulation 7(2). As a result thereof,  whenever the disciplinary authority disagrees  with the enquiry authority on any article of  charge, then before it records its own findings on  such charge, it must record its tentative reasons  for such disagreement and give to the delinquent  officer an opportunity to represent before it  records its findings. The report of the enquiry  officer containing its findings will have to be  conveyed and the delinquent officer will have an  opportunity to persuade the disciplinary authority  to accept the favourable conclusion of the  enquiry officer. The principles of natural justice,  as we have already observed, require the  authority which has to take a final decision and  can impose a penalty, to give an opportunity to  the officer charged of misconduct to file a  representation before the disciplinary authority  records its findings on the charges framed against  the officer."

The said decision has been followed by this Court in State Bank of  India and Others v. K.P. Narayanan Kutty [(2003) 2 SCC 447], wherein it  was clearly held that in such an event the prejudice doctrine would not be  applicable stating:

"6.\005 In para 19 of the judgment in Punjab  National Bank case extracted above, when it is  clearly stated that the principles of natural justice  have to be read into Regulation 7(2) [Rule 50(3)(ii)  of the State Bank of India (Supervising Staff)  Service Rules, is identical in terms applicable to  the present case] and the delinquent officer will  have to be given an opportunity to persuade the  disciplinary authority to accept the favourable  conclusion of the enquiry officer, we find it  difficult to accept the contention advanced on  behalf of the appellants that unless it is shown that  some prejudice was caused to the respondent, the  order of dismissal could not be set aside by the  High Court."

        In view of the aforementioned decisions of this Court, it is now well  settled that the principles of natural justice were required to be complied  with by the Disciplinary Authority.  He was also required to apply his mind  to the materials on record.  The Enquiry Officer arrived at findings which

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were in favour of the Appellant.  Such findings were required to be over  turned by the Disciplinary Authority.  It is in that view of the matter, the  power sought to be exercised by the Disciplinary Authority, although not as  that of an appellate authority, but akin thereto.  The inquiry report was in  favour of the Appellant but the Disciplinary Authority proposed to differ  with such conclusions and, thus, apart from complying with the principles of  natural justice it was obligatory on his part, in absence of any show cause  filed by the Appellant, to analyse the materials on records afresh.  It was all  the more necessary because even the CBI, after a thorough investigation in  the matter, did not find any case against the Appellant and thus, filed a  closure report.  It is, therefore, not a case where the Appellant was  exonerated by a criminal court after a full fledged trial by giving benefit of  doubt.  It was also not a case where the Appellant could be held guilty in the  disciplinary proceedings applying the standard of proof as preponderance of  the probability as contrasted with the standard of proof in a criminal trial,  i.e., proof  beyond all reasonable doubt.  When a final form was filed in  favour of the Appellant, the CBI even did not find a prima facie case against  him.  The Disciplinary Authority in the aforementioned peculiar situation  was obligated to apply his mind on the materials brought on record by the  parties in the light of the findings arrived at by the Inquiry Officer.  He  should not have relied only on the reasons disclosed by him in his show  cause notice which, it will bear repetition to state, was only tentative in  nature.  As the Appellate Authority in arriving at his finding, laid emphasis  on the fact that the Appellant has not filed any objection to the show cause  notice; ordinarily, this Court would not have exercised its power of judicial  review in such a matter, but the case in hands appears to be an exceptional  one as the Appellant was exonerated by the Inquiry Officer.  He filed a show  cause but, albeit after some time the said cause was available with the  Disciplinary Authority before he issued the order of dismissal.  Even if he  had prepared the order of dismissal, he could have considered the show  cause as it did not leave his office by then.  The expression  "communication" in respect of an order of dismissal or removal from service  would mean that the same is served upon the delinquent officer.  [See State  of Punjab vs. Amar Singh Harika, AIR 1966 SC 1313]

Even otherwise also the jurisdiction of a Disciplinary Authority to  consider the matter would remain with him till it goes out of his hands which  would mean the order is dispatched, as in the case of order of suspension.  [See Sultan Sadik v. Sanjay Raj Subba and Others, (2004) 2 SCC 377]

We are, therefore, of the opinion that interest of justice will be sub- served if the Disciplinary Authority is directed to consider the matter afresh  in the light of the show cause filed by the Appellant herein before him.  It  will be desirable that an opportunity of personal hearing is also given to the  appellant herein.  We make it clear that although we are setting aside the  order of Disciplinary Authority and consequently all other orders, we direct  that the Appellant shall be deemed to be under suspension till an appropriate  order is passed by the Disciplinary Authority.  The question of payment of  backwages, it is directed, would depend upon the ultimate order that may be  passed by the Disciplinary Authority.  For the views we have taken, it is not  necessary for us to consider the other contentions raised by Mr. Tripathi.   

This appeal is allowed to the afore-mentioned extent and the matter is  remitted to the Disciplinary Authority for consideration of the matter afresh  in the light of the observations made hereinbefore.  However, in the facts  and circumstances of the case, there shall be no order as to costs.