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PETITIONER: THE STATE OF BOMBAY

       Vs.

RESPONDENT: SAUBHAGCHAND M. DOSHI

DATE OF JUDGMENT: 25/09/1957

BENCH: AIYYAR, T.L. VENKATARAMA BENCH: AIYYAR, T.L. VENKATARAMA DAS, SUDHI RANJAN (CJ) SINHA, BHUVNESHWAR P. KAPUR, J.L. SARKAR, A.K.

CITATION:  1957 AIR  892            1958 SCR  571

ACT:        Government  sertvant-Compulsory retirenment-Whether  amounts        to  dismissal or removal-Whether ’applicable to Art.  311(2)        of the Constitution-Bombay Civil Services Rules, as  amended        by the Saurashtra Government, R. i65-A-Whether ultra  vires-        Constitution of India, Art. 311(2).

HEADNOTE:        Rule 165-A of the Bombay Civil Services Rules, applicable to        the State of Saurashtra, as amended, provided: "  Government        retains  an absolute right to retire any Government  servant        after  he  has completed 25 years qualifying service  or  50        years of age, whatever the service without giving any reason        and no claim to special compensation on this account will be        entertained.   This right will not be exercised except  when        it  is in the public interest to dispense with  the  further        services  of  a  Government servant such as  on  account  of        inefficiency or dishonesty...........        On October 30, 1952, the Government of Saurashtra passed  an        order compulsorily terminating the services of the  respond-        ent,  acting under the above rule.  The respondent  filed  a        writ application in the High Court challenging the  validity        of  the  order on the ground that it was  made  without  any        notice  to him of any charge of misconduct  or  inefficiency        and without any enquiry and was, in consequence, in  contra-        vention of Art. 311(2) of the Constitution of India.  Though        the  respondent had completed the age Of 50 on the  date  of        the order, his contention was that in view of the fact  that        R.  165-A  provided  that the right to retire  wilt  not  be        exercised  except on grounds of inefficiency or  dishonesty,        an  order retiring an officer before the age of  superannua-        tion  was in substance one of dismissal or removal and  must        satisfy the requirements of Art. 3Ii(2), and that R.  165-A,        in  so far as it authorised the Government to terminate  the        services  without  any reason and without any  enquiry,  was        repugnant to Art. 311(2) and therefore ,ultra vires.        Held,  that R. 165-A is not violative of Art. 311(2) and  is        intra vires, and that the impugned order, dated October  30,        1952, is valid.

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      An  order under R. 165-A is not one of dismissal or  removal        and Art. 311(2) is not applicable to such an order.        Shyam Lal v. The State of Uttar Pradesh, (1955) i S.C.R. 26,        explained and followed.        73        572

JUDGMENT:        CIVIL APPELLATE JURISDICTION : Civil Appeal No. 182 of 1955.        Appeal from the judgment and order dated February 26,  1954,        of  the former Saurashtra High Court in Civil  Miscellaneous        Application No. 52 of 1953.        R.   Ganapathy  Iyer, K. L. Hathi and B. H. Dhebar, for  the        appellant.        N.   C. Chatterjee, J. B. Dadachanji and Rameshwar Nath, for        the respondent.        1957.   September 25.  The Judgment of the Court was  deliv-        ered by        VENKATARAMA AIYAR J.-This is an appeal against the  judgment        and order of the High Court of Saurashtra in a writ petition        filed  by the respondent, setting aside an order  passed  by        the  State  of Saurashtra on October 30, 1952  retiring  him        from service.        The  respondent  was appointed in 1948 Memandari,  that  is,        Superintendent of State Guest Houses, in what was the  State        of  Junagadh when it was administered by the  Government  of        India, and was, later on, confirmed in that appointment.  In        1949, Junagadh became integrated into the State of  Saurash-        tra,  and, thereafter, the services of the  respondent  were        continued  by that State, and he was appointed from time  to        time  to various posts.  On June 15, 1950, he was  appointed        Sales  Tax Officer, Madhya Saurashtra, Rajkot, and was  con-        firmed in that post on April 16, 1952.  On October 30, 1952,        the  Government of Saurashtra, purporting to act under  Gov-        ernment  Resolution No. 60 of 1948 as it then stood,  passed        an   order   compulsorily   terminating   his   services.The        respondent  thereupon filed a writ application in  the  High        court of Saurashtra, challenging the validity of this  order        on the ground that it was made without any notice to him  of        any charge of misconduct or inefficiency and without any en-        quiry,  and  was, in consequence in  contravention  of  Art.        311(2).  The learned Judges upheld this contention, and  set        aside  the order in question on the ground that it  was,  in        effect,  one  of dismissal, and that, as there had  been  no        enquiry, it was illegal and void.  This appeal        573        has  been  preferred against their judgment and order  on  a        certificate under Art. 133(1)(c).        It will be convenient at this stage to refer to the relevant        rules bearing on the question.  Rule 161 of the Bombay Civil        Services Rules, which Rules had been adopted by the State of        Saurashtra with some modifications, runs as follows:        Except  as otherwise provided in the other clauses  of  this        rule,  the  date of compulsory retirement  of  a  Government        servant,,  other  than an inferior servant, is the  date  on        which he attains the age of 55 years.  He may be retained in        service  after the date of compulsory retirement  only  with        the previous sanction of Government, on public grounds which        must be recorded in writing."        It  may  be stated that the respondent Was not  an  inferior        servant, and this rule was therefore applicable to him.        Then, there was R. 165-A, which was in these terms :        "  A competent authority may remove any  Government  servant

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      subject  to these rules from Government service or  may  re-        quire  him  to retire from it on the ground  of  misconduct,        insolvency or inefficiency:        Provided  that, before any such order is issued, the  proce-        dure  referred to in Note I to rule 33 of the  Bombay  Civil        Services,  Conduct,  Discipline and Appeal  Rules  shall  be        followed."        Note I referred to above is as follows:        "  For the procedure to be followed before an order of  dis-        missal, removal or reduction in rank can be passed, see Rule        55 of the Civil Services (Classification, Control and Appeal        Rules,  1930,  which has been reproduced in  Appendix  I  to        these Rules.  The instructions issued by the Government  for        the  guidance of officers in taking proceedings  under  that        Rule are contained in Appendix II to these Rules."        Rule 55, referred to above, in so far as it is material,  is        as follows:        " Without prejudice to the provisions of the Public Servants        Inquiries  Act,  1850, no order of  dismissal,  .removal  or        reduction shall be passed on a member,        574        of  a Service (other than an order based on facts which  led        to  his conviction in a criminal court) unless he  has  been        informed  in writing of the grounds on which it is  proposed        to take action, and has been afforded an adequate opportuni-        ty  of defending himself.  The grounds on which it  is  pro-        posed  to  take  action shall be reduced to the  form  of  a        definite  charge or charges, which shall be communicated  to        the person charged together with a, statement of the allega-        tions on which each charge is based and of any other circum-        stances  which it is proposed to take into consideration  in        passing orders on the case.  He shall be required, within  a        reasonable  time, to put in a written statement of  his  de-        fence and to state whether he desires to be heard in person.        If  he so desires or if the authority concerned so  directs,        an  oral enquiry shall be held.  At that inquiry  oral  evi-        dence’  shall be heard as to such of the allegations as  are        not  admitted, and the person charged shall be  entitled  to        cross-examine the witnesses, to give evidence in person  and        to have such witnesses called, as he may wish, provided that        the  officer  conducting the inquiry may,  for  special  and        sufficient reason to be recorded in writing refuse to call a        witness.  The proceedings shall contain a sufficient  record        of  the  evidence and a statement of the  findings  and  the        grounds  thereof"  The sum and substance of these  rules  is        that  when  it is sought to remove or  retire  a  Government        servant on account of misconduct, insolvency or inefficiency        before  the age of superannuation which was 55 years,  there        must  be an enquiry as provided in R. 55. The  complaint  of        the  respondent is that he was only 50 on October 30,  1952,        and  that as there was no enquiry as required by R. 55,  the        order of retirement is illegal.        Rule  No.  165-A,  however, was amended  by  the  Saurashtra        Government  on September 28, 1950, and again on January  15,        1952,  and  on the relevant date, the rule, as  amended  and        omitting what is not material, stood as follows:        "  Government is pleased to direct that the proviso and  the        Note to Bombay Civil Services Rule 165-A        575        shall not apply to the servants of this Government.  Govern-        ment is further pleased to issue the following orders  which        shall be made applicable to such servants:        Government  retains an absolute right to retire any  Govern-        ment  servant  after he has completed  25  years  qualifying        service  or  50 years of age, whatever the  service  without

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      giving  any reason, and no claim to special compensation  on        this  account  will be entertained. This right will  not  be        exercised  except when it is in the public interest to  dis-        pense with the further services of a Government servant such        as on account of inefficiency or dishonesty.  Thus the  rule        is intended for use:        (i)Against a Government servant whose efficiency is impaired        but, against whom it is not desirable to make formal charges        of  inefficiency or against one who has ceased to  be  fully        efficient (i.e., when a Government servant’s value is clear-        ly  incommensurate with the pay which he draws) but  not  to        such a degree as to warrant his retirement on a  compassion-        ate allowance ; and        (ii)in  case where corruption is clearly  established  even        though no specific instance is likely to be proved under the        Bombay Civil Services Conduct, Discipline and Appeal Rules."        Under  this rule, the Government had the power to  terminate        the services of an officer without assigning any reason,  if        he had completed 25 years of service or attained the age  of        50.  It was under this rule that the order was statedly made        on October 30, 1952, and as the respondent had completed the        age of 50 on that date, the order would be within the  scope        of  the authority conferred on the State by that  rule,  and        must  be upheld, unless the rule itself is held to be  ultra        Vires.        Now,  the stand taken by the respondent in the  Court  below        was  that  an order retiring an officer before  the  age  of        superannuation was in substance one of dismissal or  removal        and must, in order to be valid, satisfy the requirements  of        Art.  311(2), and that R. 165-A, in so far as it  authorised        the  Government to terminate the service without any  reason        and without        576        any enquiry was repugnant to Art. 311(2), and was  therefore        ultra vires.  This contention found favour with the  learned        Judges in the Court below.        Since the above decision was given, the question whether  an        order  of  compulsory  retirement was one  of  dismissal  or        removal within Art. 311(2) came up for consideration in this        Court in Shyam Lal v. The State of Uttar Pradesh(1), and  it        was  held that such an order did not amount to one  of  dis-        missal  or removal within the meaning of that  Article,  and        was  not  protected by it. If this decision applies  to  the        present case-and it is the contention of the appellant  that        it  does-then  there can be no question but that  the  order        dated October 30, 1952, is valid, and that this appeal  must        succeed.   Mr. N. C. Chatterjee for the respondent  contends        that  that decision does not govern the present appeal,  and        his  argument  in  support of this contention  may  thus  be        stated:  The  rule as to compulsory retirement  embodied  in        Note  I to art. 465-A, which was considered in  Shyam  Lal’s        case (1), was in these terms :        " Government retains an absolute right to retire any officer        after he has completed twenty-five years’ qualifying service        without giving any reasons, and no claim to special  compen-        sation on this account will be entertained."        Rule 165-A differs from the above rule in a material partic-        ular,  in that after incorporating the above rule,  it  pro-        ceeds  on  to  state that the right Will  not  be  exercised        except  on grounds of inefficiency or dishonesty.  An  order        of retirement under Note I to art. 465-A carries with it  no        stigma and no imputation against the character or the abili-        ty of the officer, whose services are terminated.  But where        the  termination is, under R. 165-A, it must reflect on  the        efficiency  or  the  capacity of the officer,  and  where  a

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      person’s services are terminated before the age of  superan-        nuation on grounds of inefficiency or dishonesty, that could        be regarded only as dismissal or removal.        (1)  [1953] i S.C.R.26.        577        Support for this argument was sought in the following obser-        vations in Shyam Lal’s case (1), at p. 41 :        "There  can  be  no doubt that removal-I  amusing  the  term        synonymously  with  dismissal-generally  implies  that   the        officer  is regarded as in some manner blameworthy or  defi-        cient,  that  is  to say, that he has been  guilty  of  some        misconduct or is lacking in ability or capacity or the  will        to  discharge  his duties as he should do.   The  action  of        removal  taken  against him in such  circumstances  is  thus        founded  and justified on some ground personal to the  offi-        cer.  Such grounds, therefore, involve the levelling of some        imputation or charge against the officer which may conceiva-        bly  be controverted or explained by the officer.  There  is        no  such  element of charge or imputation in  the.  case  of        compulsory  retirement...... It is true that  this  power-of        compulsory  retirement may be used when the authority  exer-        cising  this power cannot substantiate the misconduct  which        may  be  the real cause for taking the action  but  what  is        important  to note is that the directions in the  last  sen-        tence  in Note I to article 465-A make it  abundantly  clear        that  an imputation or charge is not in terms made a  condi-        tion  for  the  exercise of the power.  In  other  words,  a        compulsory retirement has no stigma or implication of misbe-        haviour or incapacity."        It  was argued that the principle to be deduced  from  these        observations was that where the retirement involved a stigma        or  imputation of misconduct or incapacity, then it must  be        treated as dismissal, and that, on that principle, an  order        of  retirement  under  R. 165-A must be held to  be  one  of        dismissal or removal.        This  argument proceeds -on a misconception as to  what  was        decided  in  Shyam  Lal’s case (1).  There,  the  point  for        determination was simply whether an order of retirement  was        one  of dismissal or removal falling within the  purview  of        Art.  311(2),  and it was held that it was not.   The  ratio        decidendi  of  that decision is this: Under  the  rules,  an        order  of  dismissal is a punishment laid  on  a  Government        servant, when it is found that he        (1)  [1955] i S.C.R. 26.        578        has  been guilty of misconduct or inefficiency or the  like,        and  it is penal in character, because it involves  loss  of        pension which under the rules would have accrued in  respect        of  the  service already put in.  An order of  removal  also        stands  on  the same footing as an order of  dismissal,  and        involves the same consequences, the only difference  between        them  being  that while a servant who is  dismissed  is  not        eligible  for  re-appointment, one who is  removed  is.   An        order of retirement differs both from an order of  dismissal        and an order of removal, in that it is not a form of punish-        ment  prescribed by the rules, and involves no penal  conse-        quences,  inasmuch  as  the person retired  is  entitled  to        pension  proportionate to the period of service standing  to        his credit.        Now,  the policy underlying Art. 311(2) is that when  it  is        proposed to take action against a servant by way of  punish-        ment  and  that will entail forfeiture of  benefits  already        earned  by him, he should be heard and given an  opportunity        to show cause against the order.  But that consideration can        have no application where the order is not one of punishment

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      and  results in no loss of benefits already accrued, and  in        such a case, there is no reason why the terms of  employment        and  the  rules of service should not be  given  effect  to.        Thus,  the  real  criterion for deciding  whether  an  order        terminating the services of a servant is one of dismissal or        removal  is  to ascertain whether it involves  any  loss  of        benefits  previously earned.  Applying this test,  an  order        under  R.  165-A cannot be held to be one  of  dismissal  or        removal, as it does not entail forfeiture of the proportion-        ate pension due for past services.        Does it make any difference in the position, as is contended        by the respondent, that R. 165-A provides, unlike Note I  to        art.  465-A in Shyam Lal’s case(1) that the power is not  to        be exercised except in cases of misconduct or inefficiency ?        When  the Government decides to retire a servant before  the        age of superannuation, it does so for some good reason,  and        that,  in  general  would  be  misconduct  or  inefficiency.        Indeed, in Shyam Lal’s case (1), the Government did give  to        the        (1)  [1955] i S.C.R. 26.        579        officer  concerned,  notice  of charges  of  misconduct  and        inefficiency and called for his explanation, though a formal        enquiry was not held.  In providing that no action would  be        taken except in case of misconduct or inefficiency, R. 165-A        only made explicit what was implicit in Note I to art.  465-        A.  The fact to be noted is that while misconduct and  inef-        ficiency  are factors that enter into the account where  the        order is one of dismissal or removal or of retirement, there        is this difference that while in the case of retirement they        merely  furnish the background and the enquiry, if  held-and        there  is no duty to hold an enquiry-is only for the  satis-        faction  of the authorities who have to take action, in  the        case  of dismissal or removal, they form the very  basis  on        which  the  order is made and the enquiry  thereon  must  be        formal,  and must satisfy the rules of natural  justice  and        the  requirements of Art. 311(2).  It should be  added  that        questions  of the above character could arise only when  the        rules  fix  both  an age of superannuation and  an  age  for        compulsory  retirement and the services of a  civil  servant        are terminated between these two points of time.  But  where        there is no rule fixing the age of compulsory retirement, or        if  there is one and the servant is retired before  the  age        prescribed  therein, then that can be regarded only as  dis-        missal or removal within Art. 311(2).        Now,  the  provision  in R. 165-A on  which  the  respondent        relies does not, on its true construction, impose any fetter        on  the  power previously conferred on the  State  in  terms        absolute,  to terminate the services of its servant  without        assigning any reason.  It is really in the nature of depart-        mental  instructions to be followed when action is  proposed        to  be taken under, that rule, and makes it clear  that  the        enquiry into the charges is only for the satisfaction of the        authorities.  We are accordingly of opinion that R. 165-A is        Dot  violative of Art. 311(2) and is intra vires,  and  that        the impugned order’ dated October 30, 1952, passed in  exer-        cise of the power conferred thereby is valid.        A  contention was also raised for the respondent that  under        the rules of service in force in the State of        74        580        Junagadh,  the age of superannuation was 60, that art.   XVI        of  the Instrument of Accession provided that the  permanent        members of the public services in the several States  should        be continued on conditions not less advantageous than  those

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      on which they were holding office at the date of  accession,        and that under this Covenant, the respondent was entitled to        continue  until he attained the age of 60.  The decision  in        Bholanath J. Thaker v. State of Saurashtra(1) was relied  on        in  support  of this position.  But no such, claim  was  put        forward  in  the writ petition, and it is now  too  late  to        raise it.        In the result, the appeal is allowed, the order of the lower        Court  is set aside, and the petition of the  respondent  is        dismissed.   The parties will bear their own costs  through-        out.        Appeal allowed.