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PETITIONER: TAKHATRY SHIVADATTRAY MANKAD

       Vs.

RESPONDENT: STATE OF GUJARAT

DATE OF JUDGMENT05/05/1989

BENCH: PANDIAN, S.R. (J) BENCH: PANDIAN, S.R. (J) OZA, G.L. (J)

CITATION:  1989 AIR 1843            1989 SCR  (3) 214  1989 SCC  Supl.  (2) 110 JT 1989 (3)    33  1989 SCALE  (1)1244

ACT:     Bombay  Civil  Services Conduct, Discipline  and  Appeal Rules,  1958--Rules 188 & 189--Pension and  gratuity--Reduc- tion  of--Proceedings--Whether can be taken after a  Govern- ment servant’s retirement.     Junagadh State Pension & Parwashi Rules 1932--Rule  241- A,  Clauses 3, 13 and 15--Government  servant--Reduction  in pension and gratuity--Whether permissible.

HEADNOTE:     This appeal is directed against the order of the Gujarat High Court upholding the order dated the 15th November, 1977 passed by the State of Gujarat whereby the amounts of gratu- ity  and pension payable to the appellant on  superannuation were reduced by 50 per cent.     The  appellant  was born on January 15, 1909  and  after obtaining a Degree in Bachelor of Engineering (Civil) joined the service in the former State of Junagarh and as such  was governed  by the Junagadh State Pension and Parwashi  Allow- ances  Rules of 1932 which were duly codified and  published in  the Junagadh State Account Code, State of  Junagadh  was integrated into the State of Saurashtra on 20.1.1949 and the services  of  the appellant were absorbed in  the  State  of Saurashtra. The conditions of service of the absorbed  serv- ants  were  duly protected and a  proclamation  providing  a guarantee  that the service conditions of absorbed  servants could  not  be varied to their disadvantage  was  issued  on 20.1.49--that being the date of merger of the State.     The State of Saurashtra made the Saurashtra  Covenanting State  Servants (Superannuation Age) Rules, 1955. Rule  3(i) thereof provided that a Government servant shall, unless for special reasons otherwise directed by Government retire from service on his completing 55 years of age. After the  merger of  the  State of Saurashtra with State of  Bombay  the  old Bombay  Civil  Service Rules, 1959 were made  applicable  to Saurashtra  area  and  on 1.7.59 the  Bombay  Civil  Service Rules, 1959 were promulgated. As per clause (c)(2)(ii)(1) of Rule  161,  Government  servants in the  Bombay  Service  of Engineers  Class I were to retire on reaching the age of  55 years. 215

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   The  appellant was compulsorily retired by the State  on 12.10.1961 with effect from 12.1.1962 when he had  completed the age of 53 years. The appellant challenged that order  by means  of  writ before the High Court  and  having  remained unsuccessful  he  took up the matter before this  Court  and this  Court by its judgment dated 9.4.69 allowed the  appeal and  declared that the appellant was entitled to  remain  in service  until he attained the age of 55 years and that  the impugned  order compulsorily retiring him at the age  of  53 years was invalid and ineffective.     In order to give effect to this Court’s order  mentioned above,  the  Government of Gujarat on 4.8.69  intimated  the appellant that he will be deemed to have remained in service uptil  14.1.64, when he attained the age of 55 years. as  he had attained that age prior to the decision of this Court.     In the meantime the age of superannuation of the employ- ees of the State of Gujarat had been raised from 55 years to 58  years.  The appellant in order to take  benefit  of  the change moved a writ petition before the High Court of  Guja- rat but remained unsuccessful. Thereupon he filed a  special leave  petition before this Court. This Court by  its  order dated  21.7.1975 declined to interfere. Thus  the  appellant was  not entitled to continue in service beyond 55 years  of age.     It may be mentioned that prior to his compulsory retire- ment there were three departmental inquiries pending against the  appellant,  on  grounds of  slackness  in  supervision. overpayment  to contractors and loss to the  Government  and payment  in advance of the receipt of goods. The  first  in- quiry  was initiated on 6.2.61. second on 11.4.1963 and  the third  on 17.8.63. These inquiries remained pending  against the appellant till 1971.     The  appellant filed yet another Special Civil  Applica- tion No. 504 of 1971 before the High Court praying for issue of  a  writ of mandamus directing the State to  pay  to  the appellant all his outstanding salary. allowances.  including due  increments after the efficiency bar from 12.1. 1902  to 14.1.  1964  together with 6% interest. An  application  for interim relief was also filed but was withdrawn later on the representation perhaps made by the State that the  enquiries had become infructuous consequent to appellant’s retirement.     In  the  meanwhile the State of Gujarat  issued  a  show cause notice dated 17.7.1971 to the appellant intimating him that the Government 216 considered  his  service record and did not  find  the  same thoroughly  satisfactory  for the reasons mentioned  in  the said notice and accordingly the Government proposed to  make 50%  reduction both in the payment of Gratuity  and  Pension admissible  to  him. The appellant submitted his  reply  and these proceedings due to laches on the part of the appellant went  on for a considerable time and the  Government  passed the  final  order  on 15.11.1977 reducing  the  Pension  and Gratuity by 50 per cent.     To  challenge this Order the appellant again filed  Spe- cial  Civil Application before the High Court  for  quashing the order reducing his Pension and gratuity. The High  Court dismissed  the application in limine on  8.3.1978  observing that in the present case the Government recorded reasons why it came to the conclusion that the petitioner’s Service  was unsatisfactory and therefore, put a proportionate cut in the Pension.  as  no case of discrimination was  made  out.  The appellant,  preferred  Letters Patent  Appeal.  against  the order passed by the Single Judge. His contention before  the Division  Bench was that he continued to be governed by  the

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Junagadh  Rules in spite of the fact that the  Bombay  Rules were  sought to be made applicable to him.  His  alternative contention was that even if the Bombay Rules were to be made applicable, so far as the question of payment was concerned, inasmuch  as they were not less advantageous  on  compulsory retirement. proportionate pension was payable to the  appel- lant under the Bombay Rules of 1959. The Division Bench held that  under  either set of Rules, it was open to  the  State Government  to reduce the amount of pension payable  to  the petitioner as his service had not been found satisfactory by the  State under Junagadh Rules as also under  Bombay  Civil Service  Rules.  The High Court  accordingly  dismissed  the Letter Patent Appeal. Hence this appeal.     It  was  contended on behalf of the appellant  that  the High Court went wrong in upholding the impugned order reduc- ing  the  amounts of pension & gratuity in exercise  of  its power under Rules 188 and 189 of the Bombay Rules, as it had already  been ruled by this Court in its judgment  in  Civil Appeal No. 409 of 1966, that Bombay Rules could not be  made applicable to the appellant. It was urged that the appellant was  not  governed by Saurashtra Rules either,  and  it  was asserted  that  either in the show cause notice  or  in  the impugned  order.  it Is nowhere specifically  stated  as  to under  what set of Rules, the impugned order Imposing a  cut in the Pension or Gratuity has been passed. A contention was also  raised based on clauses 3, 13 & 15 of Rule 241  -A  of Junagadh  Rules  stating  that  they  operate  in  different fields.  It was added that no inquiry as contemplated  under Rule  189 had been made and admittedly the State had  stated before the High Court that 217 the departmental inquiries had become infructuous consequent upon the retirement of the appellant.     According  to  the counsel for the State  the  appellant having been retired in pursuance of a judicial order  passed by this Court, he cannot now be heard that his retirement at the  age of 55 years should be construed as  compulsory  re- tirement--the superannuation age having been increased to 60 years  under  Junagadh  Rules, that the  retirement  of  the appellant  is normal one; he was entitled to  pension  under Rule 241 of the Junagadh Rules and the State has passed  the impugned order after complying with the provisions of  Rules JUDGMENT: or gratuity be not reduced. Dismissing the appeal. this Court,     HELD:  Rules  188 and 189 have expressly  preserved  the State  Government’s power to reduce or withhold  pension  by taking  proceedings against a Government Servant even  after his retirement. [229H; 230A]     In  the instant case, in accordance with  the  procedure specified in Note I to Rule 33 of the Bombay Civil  Services Conduct, Discipline and Appeal Rules a show cause notice had been issued to the appellant on 17.7.71 calling upon him  to show  cause within 30 days from the date of the  receipt  of the  notice as to why the proposed reduction should  not  be made  in the Pension and death-cum-retirement gratuity.  The appellant  failed to avail that opportunity to disprove  the allegations  and  satisfy his appointing authority  that  he rendered  satisfactory service throughout. It was  in  those circumstances the appointing authority thought fit to impose reduction  on  the Pension and gratuity in  accordance  with Rules 188 and 189 of the Bombay Rules on the ground that the appellant had not rendered satisfactory service. The  appel- lant is not entitled to take advantage of clause (b)(ii)  of the  proviso  to Rule 189-A since the proceedings  had  been

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instituted long before his retirement. Further as per clause (a) of the said proviso the proceedings were already  insti- tuted long before his retirement. Further as per clause  (a) of  the  said proviso, the  proceedings  already  instituted while the Government servant was in service could be contin- ued  and concluded even after his retirement. Therefore  the order  dated  15.11.1977 reducing the pension  and  gratuity cannot be said to contravene the Bombay Rules. [231A-E] A combined reading of clauses 3, 13 and 15 of Rule 241-A of 218 Junagadh  Rules shows that clause 3 is an exception  to  the general scheme laid down in clauses 13 and 15. [228C]     Bholanath J. Thakar v. State of Saurashtra, AIR 1954  SC 680;  Dalip Singh v. State of Punjab, [1961] 1 SCR 88;  Moti Ram  Deka  etc. v. General Manager NEF  Railways,  Maligaon, Pandu  etc., [1964] 5 SCR 683; State of Maharashtra v.  M.H. Mazumdar,  [1988] 2 SCC 52 and M. Narasimhachar v. State  of Mysore, [1960] 1 SCR 981, referred to. State  of U.P.v. Brahm Datt Sharma, [1987] 2 SCC  179,  fol- lowed.

&     CIVIL  APPELLATE JURISDICTION: Civil Appeal No. 3726  of 1984.     From the Judgment and Order dated 8.8.1981 of the  Guja- rat High Court in L.P.A. No. 145 of 1978. B.K. Mehta and M.V. Goswami for the Appellant. G.A. Shah and M.N. Shroff for the Respondent. The Judgment of the Court was delivered by     RATNAVEL PANDIAN, J. This is an appeal by special  leave from  the judgment of the Gujarat High Court dismissing  the appeal made in Letters Patent Appeal No. 145 of 1978 arising from  the order passed in Special Civil Application No.  268 of 1978 of the said High Court.     As  this  case has a chequerred history  spreading  over decades, we feel that the relevant facts that are  necessary for  the disposal of this appeal are to be stated in  brief. The appellant was born on 15th January, 1909 and he obtained the Degree of Bachelor of Engineering (Civil). He joined the service  of  the erstwhile State of Junagadh  in  Saurashtra region  on 1st August, 1934. While the appellant was in  the service  of Junagadh State, he was governed by the  Junagadh State Pension & Parwashi Allowances Rules of 1932 (hereinaf- ter  called as "Junagadh Rules) which had been published  in the  official  Gazette of that State and which  were  subse- quently codified and published in the Jugagadh State Account Code.  Rule 241-A of the aforesaid Junagadh  Rules  provided for  pension and Parwashi Allowances. The State of  Junagadh was integrated into the State of Saurashtra on 20th January, 1949.  Thereafter the appellant was absorbed in the  service of the State 219 of  Saurashtra.  The supplementary  Covenant  which  brought about the integration read with Art. 16 of the main Covenant expressly  protected  the conditions of the service  of  the absorbed  servants and the protection was  also  statutorily recognised  by the Saurashtra Ordinance 3 of the  1949  read with Ordinance 1 of 1948. A proclamation providing a guaran- tee  that the conditions of service could not be  varied  to the disadvantage of the Covenanting State servants was  also issued  in  that behalf on 20th January 1949 which  was  the date  of the merger of the State into the State of  Saurash- tra.

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   Based  on  the decision of this Court  in  Bholanath  J. Thakar v. State of Saurashtra, A.I.R. 1954 S.C. 680  wherein it was held that the rules as regards the age of superannua- tion which prevailed in the covenanting State which in  that case  was  the State of Wadhwan, continued  to  cover  those Government  servants  who had come from that State  and  had been  absorbed in the services of the State  of  Saurashtra. The  State  of Saurashtra made  the  Saurashtra  Covenanting State Servants (Superannuation Age) Rules 1955  (hereinafter called  as  "Saurashtra Rules") in exercise  of  the  powers conferred  by  Art. 309 of the Constitution of  India.  Rule 3(i) provided:               "A  Govt.  servant shall, unless  for  special               reasons   otherwise  directed  by   Government               retire from service on his completing 55 years               of age."     After  the integration of the Saurashtra State into  the State of Bombay a resolution was passed by the Government on 7th January 1957 applying the old Bombay Civil Service Rules to Saurashtra area. On 1st July 1959 the Bombay Civil  Serv- ices  Rules  1959, (hereinafter called the  "Bombay  Rules") were promulgated under Art. 309 of the Constitution.  Clause (c)(2)(ii)(1) of Rule 161 is as follows:               "Except  as  otherwise provided in  this  Sub-               clause,  Government  servants  in  the  Bombay               Service of Engineers, Class 1, must retire  on               reaching  the  age  of 55 years,  and  may  be               required by the Government to retire on reach-               ing the age of 50 years, if they have attained               to the rank of Superintending Engineer." The  appellant was compulsorily retired from  service  under the above rule by an order passed by the State of Gujarat on 12.10.1961 with effect from 12.1.1962 when he had  completed the age of 53 years. This order of retirement was unsuccess- fully challenged by the appellant 220 before the Gujarat High Court by a writ petition under  Art. 226 of the Constitution. Not being satisfied, the  appellant took  up the matter before this Court which by its  judgment dated  9.4.1969  allowed the appeal and declared  "that  the appellant  was  entitled to remain in service until  he  at- tained  the  age  of 55 years and that  the  impugned  order directing his retirement was invalid and ineffective."  This judgment  is reported in 1970 1 SCR 244--AIR 1970 S.C.  143, Takhatray  Shivdatray  Mankad v. State of Gujarat,.  As  per this  decision, the appellant had the right to  continue  in service  till  he attained the age of 55 years.  It  may  be noted that the appellant had already completed the age of 55 years by the time the judgment was pronounced by the Supreme Court.  In  due  compliance of the above  judgment  of  this court, the Government of Gujarat by its order dated 4.8.1969 intimated  the  appellant that he should be deemed  to  have remained  in service upto the date on which he attained  the age of 55 years, that its upto 14.1.1964. In other words, by this  order the appellant was retired on his  attaining  the age of 55 years on 14.1.1964. Prior to this decision of  the Supreme  Court,  the age of  superannuation  for  Government servants of the Government of Gujarat was raised to 58 years with reservation of power to the State Government to compul- sorily retire a Government servant at 55 years by serving  a notice.  The appellant in order to avail of this benefit  of the changed circumstances filed a Special Civil  Application No. 70 of 1970 before the High Court of Gujarat, but  became unsuccessful.  Being dissatisfied with that judgment of  the High  Court,  he filed a Special Leave Petition No.  977  of

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1975  before this court which by its order  dated  21.7.1975 declined  to interfere with the decision of the  High  Court under  Art. 136 of the Constitution of India. The  resultant effect  is that the matter came to a finality to the  effect that  the appellant was not entitled to continue in  service beyond the age of 55 years.     Even  before he was compulsorily retired by the  Govern- ment’s Order dated 12.10.1961, a departmental enquiry on the ground  of  slackness of supervision had been  initiated  on 6.2.1961.  Thereafter,  a second  departmental  enquiry  was ordered against the appellant on charges of over-payment  to contractors  and  consequent  loss  to  the  Government   on 11.4.1963.  A  third  enquiry was  ordered  against  him  on 17.8.1963  on charges Of payment in advance before  the  re- ceipt of goods. Thus there were three departmental enquiries before his retirement on attaining the age of 55 years, that is  on 14.1.1964. These enquiries were pending  against  the appellant till 1971. Be  that  as  it may, the appellant filed  a  Special  Civil Application 221 No.  504 of 197 1 before the High Court of  Gujarat  seeking issue of a writ of mandamus against the State of Gujarat  to direct  the State to pay the appellant all  the  outstanding salary,  allowances as well as the revised. pay  and  allow- ances  including increment subsequent to the stage of  effi- ciency bar falling due from 12.1.1962 to 14.1.1964  together with interest @ 6% per annum from the date of payment  with- held  till  the date of actual payment thereof to  him.  The State defended this action of withholding the pension on the ground that the departmental enquiries initiated against him were pending. The appellant, therefore, filed a Civil Appli- cation  No.  2304 of 1972 in the above  said  Special  Civil Application No. 504 of 1971 for interim relief, which appli- cation he withdrew subsequently. According to the appellant, he  withdrew the application on the representation  made  on behalf  of  the  respondent therein  that  the  departmental enquiries had become infructuous consequent upon the retire- ment of the appellant.     In  the  meanwhile, the State of Gujarat issued  a  show cause notice dated 17.7.1971 to the appellant informing  him that the Government had considered that his service had  not been found thoroughly satisfactory on account of the reasons mentioned in the said show cause notice, and therefore,  the Government  had  proposed to make reduction of 50  per  cent both  in  the  amount of  pension  and  death-cum-retirement gratuity  admissible  to  him. We shall  now  reproduce  the relevant portion of the show cause notice (Annexure ’C’):               "Government therefore proposes, in exercise of               the  powers  vested  in  it  under:  (i)  Para               241(E)(3) and (3) of the Junagadh Account Code               or  (ii) Rule 76 of the Ex-Saurashtra  Pension               Rules,  as contained in Saurashtra  Government               Resolution,  Finance  Department  No.   121/40               dated  19.10.1949 or (iii) Rule 188 of  Bombay               Civil Services Rules, as may be applicable  to               you,  to  make a reduction of 50%  (fifty  per               cent)  both  in  the  amount  of  pension  and               Death-cum-Retirement  Gratuity  admissible  to               you."     The  appellant submitted his reply and  the  proceedings went  on before the Government for a considerable length  of time.  Ultimately, the final order was passed on  15.11.1977 reducing  the  pension and gratuity by 50  per  cent.  Being aggrieved  by  the said order, the appellant  filed  Special

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Civil  Application No. 268 of 1978 before the High Court  of Gujarat  for  quashing the order reducing  his  pension  and gratuity.  The  learned single Judge of Gujarat  High  Court rejected  the said civil application in limine by his  order dated 8.3.1978 concluding 222 "In the present case the Government recorded reasons why  it came  to the conclusion that the petitioner’s  service  were unsatisfactory  and, therefore, put a proportionate  cut  on the petitioner’s right to pension. No case of discrimination is made out."     As  against this order, the appellant filed the  Letters Patent Appeal No. 145 of 1978 before a Division Bench of the High  Court contending that he was governed by the  Junagadh Rules  and  he continued to be governed by  those  rules  in spite  of the fact that the Bombay Rules were sought  to  be made applicable to him. In the alternative it was  submitted that even if the Bombay Rules were to be made applicable, so far  as the question of payment was concerned,  inasmuch  as they  were not less advantageous on  compulsory  retirement, proportionate pension was payable to the appellant under the Bombay  Rules of 1959. The Division Bench examined both  the alternative  contentions  with reference  to  the  concerned rules and ultimately concluded thus:               "Under either set of rules, therefore, it  was               open  to  the State Government to  reduce  the               amount  of pension payable to  the  petitioner               since his service had not been found satisfac-               tory  by the State Government under the  Juna-               gadh State Rules or, in the alternative, under               the  Bombay Civil Services Rules, his  service               has not been found thoroughly satisfactory. In               view  of these conclusions, we agree with  the               conclusion reached by A.D. Desai, 3. though he               did not examine the alternative case from  the               point  of  view of the Bombay  Civil  Services               Rules."      On  the  basis of the above findings,  the  appeal  was dismissed. Hence the present appeal.      Shri B.K. Mehta, learned counsel appearing on behalf of the,  appellant assailed the impugned judgment of the  Divi- sion Bench of the High Court inter-alia contending (1)  that the  High  Court  had clearly gone wrong  in  upholding  the impugned order of reduction in pension made in the purported exercise  of  power under Rules 188 and 189  of  the  Bombay Rules  in view of the finding of this Court in C.A. No.  409 of 1966, Takhatray Shivdatray Mankad’s, case (supra), where- in  it  was  held that the Bombay Rules could  not  be  made applicable  to the appellant; (2) that the appellant is  not governed  by the Saurashtra Rules because the said rules  do not provide for compulsory retirement as pointed out by  the Supreme Court in C.A. No. 409 of 1966 and (3) 223 that the State Government has not specifically stated in the show cause notice dated 17.7.1971 (Annexure C) as well as in the impugned order for reducing the pension (Annexure A)  as to under what set of rules, namely, whether under the  Juna- gadh Rules or the Saurashtra Rules or the Bombay Rules  they were  exercising  the  power for reducing  the  pension  and gratuity.     It  has been further urged that clauses 3, 13 and 15  of Rule 241-A of Junagadh Rules operate in different fields  in that while Rule 3 applies to cases of normal superannuation, Rule  13  applies  to cases of  compulsory  retirement  and, therefore, the observation of the Division Bench of the High

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Court in the Letters Patent Appeal approving the view  taken by  the learned single judge that Rule 3 controls  Rule  13, would practically render Rule 13 as ultra vires Art. 311  of the  Constitution  of  India,  since  compulsory  retirement together  with reduction of pension would amount to  penalty in the absence of procedural safeguards. Further it is urged that  during  the pendency of the appeal (C.A.  No.  409/66) before  this  court, the Bombay Rules were extended  to  the Saurashtra State Covenanting servants and the superannuation age  was raised to 58 years and therefore the  appellant  in any case was entitled to continue upto 60 years of age under the Junagadh Rules or upto 58 years of age under the  Bombay Rules.  When it was so, the retirement of the  appellant  on attaining the age of 55 years should be construed as a  case of compulsory retirement before the normal age of superannu- ation  which coupled with the order of reduction in  pension would  amount to penalty which could not have  been  imposed without  following the prescribed procedure under  the  Con- duct.  Discipline and Appeal Rules. In support of this  last submission,  reliance  was placed on the  decision  of  this Court in Dalip Singh v. State of Punjab, [1961] I SCR 88 and Moti  Ram  Deka Etc. v. General  Manager,  N.E.F.  Railways, Maligaon, Pandu, Etc., [1964] 5 SCR 683.     In  the  alternative,  he submitted  assuming  that  the Bombay Rules apply to the case of the appellant, the enquiry as  prescribed  under Rule 189 of the Bombay Rules  was  not followed.  further  if the case of the appellant  is  to  be governed by the Saurashtra Rules, there was no provision for compulsory retirement as pointed out by the Supreme Court in C.A, No. 409 of 1966. Finally he submitted that the impugned order  for reduction of pension is bad in law and  void  be- cause  (1) no enquiry for the reasons as contemplated  under Rule  189  of the Bombay Rules had been  conducted  and  (2) admittedly the State had stated before the High Court in the course  of  hearing of the Civil Application  on  24.10.1972 that the departmental enquiry had become 224 infructuous  and  was dropped as the appellant  had  already retired. In any case, no enquiry could be held in  pursuance to the show cause notice dated 17.7.1971 after a lapse of  4 years  in view of the prohibition under proviso  (b)(ii)  of Rule 189-A of the Bombay Rules. Therefore, the reduction  of pension  and gratuity by 50% is wholly unreasonable,  unwar- ranted and arbitrary.     Mr.  C.A. Shah, learned counsel appearing on  behalf  of the  respondent,  stoutly opposed the  submissions  made  on behalf  of  the  appellant stating that  the  appellant  was directed  to retire on attaining the age of 55 years as  per the judicial pronouncement of this court in C.A. No.  409/66 fixing  his  age  of retirement at 55 years  and  hence  the appellant  cannot be permitted to be heard that his  retire- ment  at  the age of 55 should be  construed  as  compulsory retirement,  in view of the fact that the age of  retirement was  increased to 60 years under the Junagadh Rules  and  58 years  under the Bombay Rules. According to Mr.  Shah  after the  dismissal  of the Special Civil Application No.  70  of 1970 by the Gujarat High Court holding that the right of the appellant  to continue in service was judicially  determined by  this court and so it cannot be said that the State  Gov- ernment  had discriminated the appellant, which decision  of the  High  Court was upheld by this court by  the  order  of dismissal of the Special Leave Petition on 21.1.1979. It  is urged  by  the learned counsel for the respondent  that  the appellant’s  retirement  having been a normal  one,  he  was entitled  to pension under Rule 241-A of the Junagadh  Rules

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and  as such the State Government in exercise of the  powers under  the said rules had passed the order dated  15.11.1977 reducing the pension and gratuity to 50% after affording  an opportunity  to him by issuing a show cause notice  alleging several acts of misconduct to which notice the appellant did not  give any explanation in spite of several  opportunities afforded for over 6 years. Hence the order of the Government reducing the pension and gratuity to 50% on the finding that the  allegations  of  misconduct are  proved  is  justified. According  to him Rules 188 and 189 of the Bombay Rules  are inapplicable  to the case of the appellant. Moreover,  these rules  are  in pari materia to Rule 241-A  of  the  Junagadh Rules  and  therefore as held by the Division Bench  of  the High  Court  under either of the Rules,  the  Government  is competent  to reduce the pension for misconduct.  Coming  to Rule  189-A  which was introduced on  29.10.1971  after  the issue  of  show cause notice in this case, it is  said  that this  Rule provides that the proceedings  already  initiated shall  be  deemed  to be a proceeding under  this  rule  and continued  and  concluded by the authority. In  the  present case,  the proceedings were initiated even while the  appel- lant was in service and they were 225 dropped  after his retirement. Therefore, the  appellant  is not justified in contending that those proceedings relate to misconduct which had occurred 4 years prior to the  institu- tion  and therefore they are not sustainable as per  proviso (b)(ii) of Sec. 189-A of the Bombay Rules.     We  shall scrutinize the respective contentions  of  the learned counsel with reference to the facts of this case and the position of law with reference to the relevant rules and the  various  judicial  pronouncements of this  court  in  a series  of decisions dealing with powers vested in  the  ap- pointing  authority  to reduce the pension and  gratuity  on proof  of allegations of misconduct or negligence  committed by the employee or on the proof of inefficiency and unsatis- factory service. The appellant who was retired compulsory on 12.1.1962  in  pursuance of the order of  the  Public  Works Department,  State  of Gujarat dated  12.10.1961  under  the Bombay  Rules  when he had completed the age  of  53  years, successfully contested that matter and obtained the order in his  favour from this court in C.A. No. 409 of 1966  by  the judgment  dated  9.4.69  quashing the  order  of  compulsory retirement and declaring "that the appellant was entitled to remain in service until he attained the age of 55 years"     In  pursuance of the above judgment of this  court,  the Government  passed  the  following order  on  4.8.1969,  the relevant portion of which reads as under:               "Shri  T.S.  Mankad should be deemed  to  have               remained in service as Executive Engineer upto               the  date on which he had attained the age               of 55 years i.e. upto 14.1.64 (A.N.)               The orders issued in Government Order,  Public               Works Department No. DPA 1861-E dated 12.10.61               should be treated to have been cancelled." The  aforesaid  order  was challenged by  the  appellant  in Special Civil Application No. 70 of 1970 before the  Gujarat High  Court  with  a  prayer to  declare  this  order  dated 4.8.1969  as  illegal,  void, ultra vires, bad  in  law  and inoperative  and the same was not binding on the  appellant, besides  challenging  the  constitutional  validity  of  the latter  part of the amended Rules 161(ii)(1) of  the  Bombay Rules. But this Special Civil Application No. 70 of 1970 was rejected holding that the right of the appellant to continue in service was judicially determined by this court and  that

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judicial  determination  was given effect to  by  the  State Government  by  its order dated 4.8.1969.  As  against  this judg- 226 ment, the appellant preferred Special Leave Petition  before this  court which was dismissed on 21.1.1979. Thus the  con- troversy  was  put  to an end and the result  was  that  the appellant was not entitled to continue in service beyond  55 years  of age. Hence the contention of the  learned  counsel for  the appellant that the appellant is entitled  to  avail the benefit of the increase of age of superannuation  fixing it at 60 years under the Junagadh Rules or at 58 years under the Bombay Rules cannot be accepted. The further  submission made  on behalf of the appellant that his retirement  should be construed only as compulsory retirement coupled with  the order  of  reduction in pension and  gratuity  amounting  to penalty  without following the procedures  prescribed  under the Conduct, Discipline and Appeal Rules, is also equally to be dismissed as devoid of any merit since the appellant  was retired  only in accordance with the pronouncement  of  this court.     We  have now to examine whether the propositions of  law expatiated  in the decisions cited by Mr. B.K. Mehta can  be made applicable to the facts of this instant case. In  Dalip Singh  v.  State of Punjab, [1961] 1 SCR  88  the  appellant therein  namely,  Dalip Singh was retired from  service  for ’administrative reasons’. He brought a suit  on a plea  that the order of his retirement amounted to removal from service within  the meaning of Art. 311(2) of the Constitution.  The Trial Court decreed the suit in his favour. On appeal by the State,  the High Court dismissed the suit holding  that  the order  of compulsory retirement in that case did not  amount to  removal from service within the meaning of Art. 3 11  of the  Constitution. As against this, Dalip  Singh  approached this  court.  This Court held that there were no  basis  for saying that the order of retirement contained any imputation or  charge against the officer and that he had been  allowed full  pension as provided in Rule 278 of the  Patiala  State Regulations,  on the strength of which Dalip Singh  was  re- tired and that the order of retirement was hardly by way  of punishment.  In that view, this court agreed with  the  view taken by the High Court and dismissed the appeal.     In Moti Ram Deka Etc. Iv. General Manager, N.E.F.  Rail- ways,  Maligaon,  Pandu,  Etc., [1964] 5 SCR  683  the  only question  for consideration was whether the  termination  of services  of a permanent Railway servant (Civil) under  Rule 148(3)  and 149(3) of the Indian Railway Establishment  Code amounted to removal under Art. 311(2) of the Constitution of India.  Majority of the seven judges Bench having regard  to the facts therein held that the termination of services of a permanent servant otherwise than on ground of superannuation or compulsory retirement, must per se amount to his  removed and if by 227 Rule  148(3) or Rule 149(3), such a termination  is  brought about,  the Rule clearly contravenes Art. 311(2) and  so  it must be held to be invalid. On carefully going through  both the decisions, we are of the firm view that these two  deci- sions cannot be of any assistance to the case of the  appel- lant  since in the present case, the appellant’s  retirement on  attaining the age of 55 years, pursuant to the  declara- tion  of this Court was a normal retirement on reaching  the age of superannuation and not a compulsory retirement by way of punishment for misconduct as contended by the appellant.     Next  we shall deal with the respective  contentions  of

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both  the parties with reference to the Junagadh  Rules  and the  Bombay Rules. It may be mentioned here that the  appel- lant  himself  under  the ground (h) of  his  Special  Leave Petition had stated that his services were to be governed by the  Junagadh  Rules.  It was also urged on  behalf  of  the respondent  that the appellant’s retirement being  a  normal one, he is entitled to pension under Junagadh Rules and  the State  Government in exercise of the power vested in it  had passed the order dated 15.11. 1977 reducing the pension  and gratuity to 50%. As pointed out by the Division Bench of the High  Court, under the scheme of the Junagadh Rules  as  per clause  10  of Rule 241˜A, the pensions are  admissible  for superior  service  of not less than 10 years  and  they  are divided  into 4 classes, namely, (1)  compensation  pension; (2)  invalid  pension; (3) superannuation pension;  and  (4) retiring pension. As we are concerned only with the superan- nuation pension in the present’ case, we would refer to  the relevant clause which reads as follows:                     "(13) Superannuation pension is admissi-               ble  only  on attaining the age of  60  years,               except  in  cases  in  which  the  authorities               consider  it desirable in the interest of  the               State  an officer should retire  on  attaining               the age of 55 years or at any time  thereafter               on such superannuation pension as he may  have               earned at the time of retirement."     A bare perusal of the above clause shows that superannu- ation pension is admissible to the State Government  servant on his attaining the age of 60 years, save in cases in which the  authorities  consider in the interest of the  State  to retire an officer on attaining the age of 55 years or at any time  thereafter  on such superannuation pension as  he  may have earned at the time of his retirement.      Clause  15 of Rule 24’1-A deals with the  proportionate pension.  As  clause  3 of Rule 241-A is  material  for  our purpose, that clause is reproduced hereunder: 228 "The full amount of pension or gratuity admissible under the rules will not be granted unless the service is proved  from State  records on receipt of an application for  pension  or gratuity from the retired officer in Form No. 53 and will be liable  to reduction in the absence of such proof or if  the service  is  not reported by the Head of the  Department  to have been satisfactory." As per this clause, the Government servant will be  entitled to full amount of pension or gratuity only if his service is proved  from the records satisfactory lest the pension  will be liable to reduction. A combined reading of clauses 3,  13 and  15 shows that clause 3 is an exception to  the  general scheme laid down in clauses 13 and 15. On careful considera- tion  of this rule, we see no merit in the submissions  made by the learned counsel that these clauses operate in differ- ent fields and therefore observations of the High Court that Rule 3 controls Rule 13 would render Rule 13 as ultra  vires Art.  311  of the Constitution of  India,  since  compulsory retirement  together with reduction of pension would  amount to penalty in the absence of the procedural safeguards.  The Government  in its detailed order dated 15.11.1977  has  set out  the  reasons  for reducing the amount  of  pension  and gratuity. The relevant portion of the order reads thus:               "Government is satisfied that the services  of               Shri T.S. Mankad, Executive Engineer have  not               been  found  to  be  thoroughly  satisfactory.               Accordingly Government hereby orders that  the               pension  and  Death-cum-Retirement   Gratuity,

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             which may be accepted by the Accountant Gener-               al,  Ahmedabad as admissible under  the  rules               shall  be reduced by the specified extents  aS               under:               (i) Amount of reduction in pension = 50%                                                           (Fifty               percent)               (ii)  Amount  of reduction in gratuity  =  50%               (Fifty percent)." According to the respondent, the appellant instead of giving a  proper  explanation  to  the  show  cause  notice   dated 17.7.1971  entered into long correspondence with  respondent raising all sorts of irrelevant questions and seeking sever- al adjournments thereby adopting delayed tactics and further the appellant though informed the authorities that he  would inspect certain documents in the Department for making his 229 reply,  he  would not do so and therefore according  to  the learned  counsel it was in those circumstances, the  Govern- ment  was  constrained to pass this order  dated  15.11.1977 after a lapse of more than 6 years taking into consideration that his service had not been found thoroughly  satisfactory for the reasons mentioned in the show cause notice to  which he  had not given any reply. We see much force in the  above submission,  made by Mr. Shah the learned counsel  appearing for the respondent.     In  view of the above position, we are of the view  that the  impugned  order  dated 15.11.1977 cannot’  be  said  to contravene the Junagadh Rules.     Now  we shall pass on to the alternative  contention  on the assumption that Bombay Rules would apply to the case  of the  appellant.  The relevant Rules are Rules  188  and  189 which are reproduced below:               "188. Government may make such reduction as it               may think fit in the amount of the pension  of               a  Government  servant whose service  has  not               been thoroughly satisfactory."               "189. Good  conduct is an implied condition of               every  grant of pension. Government may  with-               hold  or withdraw a pension or any part of  it               if the pensioner be convicted of serious crime               or  be  found  to have been  guilty  of  grave               misconduct either during or after the  comple-               tion of his service, provided that before  any               order to this effect is issued, the  procedure               referred to in Note 1 to Rule 33 of the Bombay               Civil Services Conduct, Discipline and  Appeal               Rules shall be followed."     An examination of Rule 188 shows that the Government may reduce  the amount of pension of a Government servant as  it may  think fit if the service of the Government servant  has not  been thoroughly satisfactory. As per Rule 189 the  Gov- ernment may withhold or withdraw a pension or part of it  if the petitioner is convicted of severe crime or found to have been guilty of misconduct during or after the completion  of service  provided  that before any order to this  effect  is issued, the procedure referred to the Bombay Civil  Services Conduct,  Discipline  and Appeal Rules are  followed.  These Rules thus, have expressly preserved the State  Government’s power to reduce or withhold pen- 230 sion by taking proceedings against a Government servant even after  his retirement. The validity of these rules have  not been  challenged.  These two rules came  for  interpretation before this court in State of Maharashtra v. M.H.  Mazumdar,

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[1988]  2  SCC  52 and this Court expressed  its  view  with reference to these rules as follows:               "The aforesaid two rules empower Government to               reduce or withdraw a pension. Rule 189 contem-               plates withholding or withdrawing of a pension               or  any part of it if the pensioner  is  found               guilty  of  grave misconduct while he  was  in               service  or after the completion of his  serv-               ice. Grant of pension and its continuance to a               Government  servant depend upon the good  con-               duct  of  the  Government  servant.  Rendering               satisfactory service maintaining good  conduct               is  a  necessary condition for the  grant  and               continuance  of  pension. Rule  189  expressly               confers power on the Government to withhold or               withdraw any part of the pension payable to  a               Government servant for misconduct which he may               have  committed  while in service.  This  rule               further provides that before any order  reduc-               ing or withdrawing any part of the pension  is               made by the competent authority the  pensioner               must  be given opportunity of defence  in  ac-               cordance with the procedure specified in  Note               I  to  Rule 33 of the  Bombay  Civil  Services               Conduct,  Discipline  and  Appeal  Rules.  The               State Government’s power to reduce or withhold               pension  by taking proceedings against a  Gov-               ernment  servant even after his retirement  is               expressly  preserved by the  aforesaid  rules.               The  validity of the rules was not  challenged               either  before the High Court or  before  this               Court. In this view, the Government has  power               to reduce the amount of pension payable to the               respondent.  In M. Narasimhachar v.  State  of               Mysore, [1960] 1 SCR 981: AIR 1960 SC 247  and               State  of Uttar Pradesh v. Brahm Datt  Sharma,               [1987] 2 SCC 179 similar rules authorising the               Government  to withhold or reduce the  pension               granted to Government servant were interpreted               and this Court held that merely because a Gov-               ernment  servant retired from service  on  at-               taining the age of superannuation he could not               escape the liability for misconduct and negli-               gence or financial irregularities which he may               have committed during the period of his  serv-               ice  and the Government was entitled to  with-               hold  or reduce the pension granted to a  Gov-               ernment servant." 231 In compliance with the principle of natural justice  requir- ing an opportunity of hearing to be afforded to a Government servant before an order affecting his fight is passed and in accordance with the procedure specified in Note-I to Rule 33 of the Bombay Civil Services Conduct, Discipline and  Appeal Rules  a show cause notice as pointed out earlier  had  been issued  to the appellant on 17.7.197 1 calling upon  him  to show  cause within 30 days from the date of the  receipt  of the  notice as to why the proposed reduction should  not  be made  in the pension and death-cum-retirement gratuity.  But the appellant failed avail that opportunity to disprove  the allegations  and satisfy appointing authority that  he  ren- dered  satisfactory  service  throughout. It  was  in  those circumstances the appointing authority taking into consider- ation of the serious allegations levelled against him in the disciplinary proceedings had thought it fit to impose reduc-

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tion  in the pension and gratuity in accordance  with  Rules 188  and  189  of the Bombay Rules on the  ground  that  the appellant had not rendered satisfactory service. The  appel- lant is not entitled to take advantage of clause (b)(ii)  of the  proviso to Section 189-A of the Bombay Rules since  the proceedings had been instituted long before his  retirement. Further as per clause (a) of the said proviso, the  proceed- ings already instituted while the Government servant was  in service  could  be continued and concluded  even  after  his retirement. Hence for the reasons stated above the  impugned order  dated  15.11.1977 reducing the pension  and  gratuity cannot be said to contravene the Bombay Rules.     At  the risk of repetition, we may point out that  three departmental  proceedings containing serious allegations  of misconduct  were instituted against the appellant  of  which one  was instituted even before he was compulsorily  retired on  12.1.1961 and other two proceedings were  instituted  in the  year 1963 that is much earlier the appellant  attaining the  age of superannuation on 14.1.1964. These  departmental proceedings are stated to have become infructuous consequent upon the retirement of the appellant on attaining the age of superannuation.  To  the show cause notice  dated  17.7.1971 proposing  to inflict reduction in pension and gratuity  the appellant, instead of giving a proper reply, disproving  the charges  and  satisfying the appointing  authority  that  he rendered  satisfactory  service throughout had  delayed  the matter for over a period of six years. It was in that situa- tion that the impugned order dated 15.11.1977 happened to be passed.      The  learned  counsel  for  the  appellant  strenuously contended  that  after the disciplinary inquiries  had  been dropped on the ground that they had become infructuous,  the Government was not right and 232 justified  in reducing the pension and gratuity on the  same charges which were the subject matter of the enquiries. This argument  of the learned counsel, in our opinion,  does  not merit  consideration because the charges against the  appel- lant were not made use of for awarding any punishment  after his  retirement  from service but only for  determining  the quantum  of the appellant’s pension in accordance  with  the rules  relating to the payment of pension and  gratuity.  In this  connection it would be apposite to refer the  observa- tion of the Supreme Court in State of Uttar Pradesh v. Brahm Datt Sharma & Anr., [1987] 2 SCC 179 which we quote below:               "If  disciplinary proceedings against  an  em-               ployee  of  the Government  are  initiated  in               respect of misconduct committed by him and  if               he  retires from service on attaining the  age               of  superannuation, before the  completion  of               the  proceedings,  it  is open  to  the  State               Government to direct deduction in his  pension               on  the proof of the allegations made  against               him. If the charges are not established during               the disciplinary proceedings or if the  disci-               plinary  proceedings  are quashed  it  is  not               permissible to the State Government to  direct               reduction  in the pension on the same  allega-               tions  but  if  the  disciplinary  proceedings               could  not be completed and if the charges  of               serious allegations are established, which may               have  bearing  on the  question  of  rendering               efficient  and satisfactory service, it  would               be open to the Government to take  proceedings               against  the Government servant in  accordance

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             with  rules for the deduction of  pension  and               gratuity." The above principle laid down in that case squarely  applies to the facts of the present case.     For all the reasons hereinbefore stated we hold that the order  of  State Government dated  15-11-1977  reducing  the amount  of pension and the gratuity on the ground  that  the service  of  the  appellant had not  been  found  thoroughly satisfactory by the appointing authority cannot be assailed. In  that  view of the matter we see no reason  to  interfere with the impugned judgment of the High Court. In the result, the appeal is dismissed but without any order as to costs. Y.L.                                           Appeal   dis- missed. 233