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K.V Seshavataram v. State Of Hyderabad (Now Andhra Pradesh) .
Summary of the Opinion (M.A. Ansari, J.)
Factual and Procedural Background
The appellant was a long-serving government employee of the former State of Hyderabad who began as an Overseer on probation in 1923, was promoted over the years and by 1954 had been allowed to cross the efficiency bar with retrospective effect from 1 October 1952. In 1952 contractors accused him of taking bribes and partiality; a departmental enquiry found those charges unestablished. Newspaper reports questioned the appellant's property relative to his income, and he was directed to appear before the Public Works Department (P.W.D.) Minister and to submit statements, which he did and which apparently established that his acquisitions were within legal income.
Despite the outcome of the enquiry, the P.W.D. Secretary suggested that, given the appellant’s bad reputation, retirement under Rule 293 of the Hyderabad Civil Service Rules might be considered. The appellant had completed 30 years and 10 months of service; a departmental proposal to retire him was approved by the Finance Department and, on 31 May 1955, the Government issued an order compulsorily retiring him under Rule 293. The appellant made representations to the Chief Minister and appealed to the Rajpramukh, all unsuccessfully.
The appellant petitioned to vacate the retirement order. A learned Judge of the High Court dismissed that petition, and this appeal followed.
Legal Issues Presented
- Whether the requirement of three months' notice (in the Pension Rules) is a condition precedent to the exercise of the power to compulsorily retire under Rule 293, and if non‑compliance renders the retirement order ultra vires.
- Whether compulsory retirement under Rule 293, as applied in this case, is a punitive measure attracting the protections of Article 311(2) of the Constitution (i.e., whether the appellant was entitled to be afforded an opportunity to show cause).
- Whether the retirement order was mala fide or discriminatory and thereby violative of Article 14 of the Constitution.
Arguments of the Parties
Appellant's Arguments
- The three months' notice provision in the Pension Rules is a condition precedent; failing to give that notice makes the retirement order void/ultra vires.
- The order was punitive; therefore Article 311 required that the appellant be given a reasonable opportunity to show cause against the proposed action (procedural safeguards under Article 311 were not complied with).
- The retirement order was mala fide and discriminatory, violating Article 14 of the Constitution.
State's Arguments
- The retirement was effected under Rule 293 of the Hyderabad Civil Service Rules; the P.W.D. Secretary had suggested retirement in view of the appellant's reputation and the Finance Department approved the proposal (the learned Judge found official records showed Finance Department approval).
- The Note to Rule 293 vests an absolute right in Government to retire a servant after the qualifying period (25 or 30 years as applicable) without giving reasons, and thus the three months' notice is not a condition precedent but a collateral safeguard.
- Because the Government had an absolute right to retire under the Rule, Article 311 does not apply; even if motives existed, they are irrelevant where the rule grants the power.
- Rule 293 is not arbitrary; reasonable classification under the Rule does not violate Article 14.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Parshotam Lal Dhingra v. Union of India, AIR 1958 S.C. 36 | Established the test: when a servant has a right to a post or rank under contract or service rules, termination or reduction is prima facie a punishment and attracts Article 311(2); if the servant has no such right because the rules permit termination at any time, Article 311(2) is not attracted. Also held motive irrelevant where the power to terminate flows from rule or contract. | The court applied this test to conclude that because the Note to Rule 293 vested an absolute right in Government to retire the servant, Article 311(2) did not apply; motive was therefore irrelevant to validity. |
| Balakotaiah v. Union of India, AIR 1958 S.C. 232 | Held that if a person has a right to continue in office under service rules or agreement, premature termination is punishment; also that loss of accrued benefits may render an order punitive. | The court relied on this authority to reiterate that compulsory retirement may amount to punishment where a right to continue exists; the court distinguished the present case because Rule 293 removed any such right. |
| Shyam Lal v. State of U.P., AIR 1954 S.C. 369 | Earlier authority relating to when Article 311(2) is attracted; forms part of the line of cases the court said were not dissented from. | The court noted this case (and similar authorities) as consistent with the principle that Article 311(2) applies where the public servant has a right to continue in the post except for misconduct, and used it to support its understanding of the test. |
| State of Bombay v. Saubhagchand, (S) AIR 1957 SC 892 | Another earlier authority on the scope of Article 311(2) and related tests; treated as consistent precedent. | The court relied on it as part of the established line of authorities confirming that loss of accrued benefits is not the sole test and that Article 311(2) is attracted where a right to continue in the post exists except for misconduct, etc. |
Court's Reasoning and Analysis
The court proceeded through a sequential analysis tied closely to the text of the relevant rules and the established precedents:
- Preliminary factual finding: The High Court's factual conclusion that the Finance Department had approved the proposal to retire the appellant was accepted and must stand on appeal (the learned Judge found official records showing approval).
- Interpretation of Rule 293 and its Note: The court examined Rule 293 of the Hyderabad Civil Service Rules and its Note. The Note explicitly retained an absolute right in Government to retire a Government servant after the qualifying service without giving reasons and without claims to special compensation. Because the Note vests an "absolute right" in Government to retire, any qualification in other rules that would limit that right (for example a three months' notice requirement in the Pension Rules) cannot operate as a condition precedent to the exercise of the absolute right.
- Nature of the three months' notice requirement: The Pension Rules provision requiring three months' notice was characterized as a collateral or procedural safeguard benefitting both parties (a "collateral advantage" that provides foreknowledge), not as a condition precedent whose violation would nullify the substantive power to retire. Consequently, failure to give notice does not render the retirement order void; it gives the affected servant a right to the benefits he would have obtained had notice been given (not to vitiate the substantive order).
- Application of Article 311 principles: The court applied the test from Parshotam Lal Dhingra and related authorities: Article 311(2) is attracted when the servant has a right to the post except for misconduct, negligence or other good cause; if the rules or contract give the Government the right to terminate without cause, Article 311(2) does not apply. Because the Note to Rule 293 removed any right of the appellant to be continued in service (i.e., the Government had an absolute right to retire him), Article 311(2) was not attracted in this case. The court therefore rejected the contention that Article 311 required a show‑cause opportunity.
- On mala fides and Article 14: Having found that the Government possessed the right to retire under Rule 293, the court held that the motive for exercise of that right is irrelevant (consistent with Dhingra). As to the Article 14 challenge (that Rule 293 was unconstitutional or that the action was discriminatory), the court found no establishment of arbitrariness; Rule 293 involved reasonable classification and was not shown to be arbitrary or whimsical. Consequently the Article 14 challenge failed.
- Remedy for non‑compliance with notice: The court concluded that, while the failure to give three months' notice did not invalidate the retirement, the appellant was entitled to the benefits he would have received had proper notice been given. Accordingly the court declared the appellant entitled to arrears of pay for the three months' notice period and to such incidental rights he might have enjoyed during that period.
- Disposition: Beyond awarding the three months' arrears and incidental rights, the court found no merit in the appeal and dismissed it; parties were directed to bear their own costs.
Holding and Implications
APPEAL DISMISSED.
Direct effects on the parties:
- The retirement order under Rule 293 was upheld; the appellant remains compulsorily retired.
- The appellant was declared entitled to arrears of pay for three months (the period corresponding to the notice that should have been given) and to incidental rights he would have had during that notice period.
- Parties were ordered to bear their own costs.
Broader implications: The opinion applies existing Supreme Court principles (notably Parshotam Lal Dhingra and related authorities) to hold that where a service rule vests an absolute right in Government to retire a servant, Article 311(2) procedural safeguards are not attracted and the motive for exercise of the power is irrelevant. The opinion does not purport to announce a new principle beyond applying those precedents.
M.A Ansari, J.:— The appeal is against the judgment by a learned Judge of this Court, dismissing a petition to vacate the order by the Government of the former State of Hyderabad, whereby the appellant had been compulsorily retired from the State service.
2. In 1923 the appellant was appointed an Overseer on probation in the Public Works Department and in 1944 was promoted as a Superviser. In 1949 he was a Sub-Engineer and in 1954 was allowed to cross the efficiency bar with retrospective effect from October, 1, 1952. It is alleged that in May, 1952 two contractors had sent a petition to the P.W.D authorities accusing the appellant of taking bribe and of partiality. A departmental enquiry was then conducted, but the Chief Engineer had found the aforesaid charges not to have been established. While the above matter was pending, reports had appeared in the newspaper that the property acquired by the petitioner was not commensurate with the appellant's income, whereupon he was directed to see the P.W.D Minister.
3. During the interview he was asked to submit statements which he did. Apparently the appellant has succeeded in showing the acquisitions to be within his legal income; for his retirement has not proceeded on the ground of his having improperly acquired properties. He complains that on May 26, 1955 the P.W.D Secretary informed him that he was being compulsorily retired from the service and the orders would be issued in a short while.
4. He appealed to the Chief Minister against the proposed action, but on May, 27, 1955 received a communication that his representation was disallowed. On May, 31, 1955 the order retiring the petitioner from service under Rule 293 of the Hyderabad Civil Service Rules was given with permission to avail himself of the leave and on June 7, 1955 he was asked to hand over the charge.
5. It is stated that after handing over the charge a representation against the order was again made to the Chief Minister, but with no success. Also the appeal against it to the Rajpramukh was dismissed. This order of retirement has been challenged on the ground of having been passed mala fide in violation of the provisions of Article 311 and the Rules, under which it was made, to be violative of Article 14 of the Constitution.
6. The State's case is that although during the enquiry as to how the immovable properties of such value had been acquired by the appellant, it was found that no action could be taken against him, ??? the P.W.D Secretary had put up a note suggesting that in view of the bad reputation the appellant retirement under Rule 293, Hyderabad Civil Service Rules might be considered.
7. It was found that the appellant had then completed 30 years and 10 months of service and eventually a proposal was put up by the Department the he should be retired from Government service. The proposal was accepted by the Finance Department and finally on May, 31, 1955 the Government passage the order compulsorily retiring him.
8. The charges of the order being mala fide ??? having infringed the provisions of Article 311 we denied. It was further contended that the rule under which the retirement has been directed is not contrary to the guarantee of equal protection.
9. The learned Judge has found that the order of retirement was not contrary to the Hyderabad Civil Service Rules. He has further found the complaints of the Finance Department not having but consulted to be without substance.
10. He has also held the direction about given three months' notice in the relevant rule not to be mandatory. The complaint concerning Article 14 have been violated has been rejected and the learnt Judge has finally found that there was no mala fide in the action taken by the Government. According he dismissed the petition.
11. The learned Counsel for the appellant urged three grounds before us for vacating the order retiring his client. The first is that the provision the rules about giving three months' notice is a condition precedent to the exercise of the power of compulsory retirement and the aforesaid condition having been fulfilled, particular order against appellant was not in accordance with the rule at therefore ultra vires.
12. The next argument is that because the order was punitive the State was bound by Article 311 afford the appellant a reasonable opportunity showing cause against the proposed action, which has not been done and the order was therefore contravention of the constitutional safeguards under Article 311. The last ground is that the order was mala fide, discriminatory and therefore violative of A. 14. Before dealing with these arguments it will of advantage to have extracts from the relevant rule on which the arguments proceeded. Rule 292 of the Hyderabad Civil Service Rules reads as follows:
“Government servants in superior service had the option of retiring after completing 25 year qualifying service.
Note: This rule applies to Government servants in superior service, who having been service on 31st May, 1951, have opted for the pension rules. The Government servants in super service who entered service on or after 1st June, 19 or who having been in service on 31st May, 19 elected to come under the Revised Pension Rule, 1951, and all Government Servants in inferior service will have the option to retire only after completed 80 years qualifying service in accordance with the Rule 2 of Rule 1 of the Revised Pension Rule, 1951.”
13. Then Rule 293 is in these terms:
“A Government Servant cannot be; given ??? pension against his will unless the Government Finance Department so approve. In ordering retire-lent on completion of 25 years of qualifying service under these Rules or of 30 years qualifying service the case of pensioners coming under the Revised Pension Rules, 1951, Government will not be bound ??? give reasons for retirement.
Note: Government retain an absolute right to ??? a Government servant after he has completed 25 years ‘or 30 years’ qualifying service, as the case may be, according to the Pension Rules applicable him, without giving reasons and no claims to special compensation on this account will be entertained.”
14. It is common ground that the appellant's retirement was in exercise of powers contained in Rule 293 and it is not disputed that he having been in service on May, 31, 1951 had elected to, come under the Revised Pension Rules, 1951. The Counsel for the appellant has also argued that under the relevant rule the consent of the Finance Department to the retirement was necessary and that has not been taken in the particular case.
15. The learned Judge hearing the writ petition has found that the official record shows the Finance Department had approved it and the finding must stand in this appeal. The Counsel then urged that three months' notice is a condition precedent to the exercise of the power and that has not been done. The rule on which he relies reads thus:
“Section I—Pension:—
(1)(i) The amount of superannuation, invalid and compensation gratuity and pension will be the appropriate amount set out in the Annexure.
(ii) An officer may retire from service any time after completing 30 years' qualifying service, provided that he shall give in this behalf a notice in writing to the appropriate authority at least three months before the date on which he wishes to retire. Government may also require an officer to retire any time after he has completed 30 years ‘qualifying service’, provided that the appropriate authority shall give in this behalf a notice in writing to the Officer it least three months before the date on which he is required to retire.”
16. It was argued that the words “provided that” in the above Rule show the notice to be a condition precedent to the exercise of the powers and any order without complying with the condition would be void is being without jurisdiction. In this connection reliance was placed on the meaning of the word “provided” contained in the Oxford Concise Dictionary, which says the word to mean “on condition that”. We find the argument to be without force.
17. It is not disputed that the Note to Rule 293 contains no such qualification on the Government's right to retire. Indeed the note emphasises the right to be an absolute one which can be exercised without giving reasons. It follows that a public servant after completing the required number of years ceases to have the right of being continued in service.
18. The right to retire having thus become absolute, my further curtailment by some other rule would be meaningless. Any further requirement would then be merely procedural or in the nature of a collateral safeguard. It follows that the requirement of giving three months' notice in the Pension Rules is a collateral provision in the interest of both the parties, whose observation does not control the exercise of the right.
19. It further follows that the infringement of this safeguard like that of warranty would entitle the party complaining against it to such advantages as he would have otherwise enjoyed, but would not vitiate the main order. It is idle to deny that all guarantees in employment do not go to the very root and cover only incidental matters. The distinction is substantial and too much cannot be built on the form in which the incidental safeguards are incorpoed in the relevant Rule.
20. We therefore hold that the Note to Rule 293 having vested the Government with an absolute right, any requirement of notice does not operate as a condition on its exercise for that would clash with the absolute investiture. Therefore the requirement of notice of three months is in the nature of a collateral advantage of knowing beforehand when the retirement is to become effective and make appropriate arrangements.
21. Its infringement would only entitle the party complaining to such benefits, as he would otherwise have got had the provisions been complied with. That being the proper interpretation of the several rules the failure to give the required notice in the case would not be fatal to the order of retirement.
22. The learned Counsel of the appellant has then argued that the deprivation of this benefit would be punitive and his client would be entitled to a notice of the proposed punishment under Article 311(2) of the Constitution, which has not been done. In this connection he has relied on the observations of the Supreme Court in the case of Parshotam Lal Dhingra v. Union Of India, AIR 1958 S.C 36.
23. In that case the appellant has been reverted from the post of Signal and Tele communication Engineer (Telegraphs) in Class III service, where he was officiating, to his substantive post in Class III service. A learned Judge of the High Court had allowed a Writ Petition against the aforesaid order, but in Letters Patent appeal the Judgment was reversed. In the appeal to the Supreme Court Das, C.J, who delivered the majority judgment of the Court has observed as follows at page 48:
“Shortly put, the principle is that when a servant has right to a post or to a rank either under the terms of the contract of employment, express or implied, or under the rules governing the conditions of his service, the termination of the service of such a servant or his reduction to a lower post is by itself and prima facie a punishment, for it operates as a forfeiture of his right to hold that post or that rank and to get the emoluments and other benefits attached thereto. But if the servant has no right to the post, as where he is appointed to a post, permanent or temporary either on probation or on an officiating basis and whose temporary service has not ripened into quasi-permanent service as defined in the Temporary Service Rules, the termination of his employment does not deprive him of any right and cannot, therefore, by itself be a punishment. One test for determining whether the termination of the service of a Government servant is by way of punishment is to ascertain whether the servant, but for such termination, had the right to hold the post. If he had a right to the post as in the three cases hereinbefore mentioned, the termination of his service will by itself be a punishment and he will be entitled to the protection of Article 311. In other words and broadly speaking, Article 311(2) will apply to those cases where the Government Servant, had he been employed by a private employer, will be entitled to maintain an action for wrongful dismissal, removal or reduction in rank. To put it in another way, if the Government has, by contract, express or implied, or, under the rules, the right to terminate the employment at any time, then such termination in the manner provided by the contract or the rules is, prima facie and per se, not a punishment and does not attract the provisions of Article 311.”
24. His Lordship has further observed at page 49:
“In short, if the termination of service if founded on the right flowing from contract or the service rules, then prima facie, the termination is not a punishment and carries with it no evil consequences and so Article 311 is not attracted. But even if the Government has, by contract or under the rules, the right to terminate the employment without going through the procedure prescribed for inflicting the punishment of dismissal or removal or reduction in rank, the Government may nevertheless, choose to punish the servant and if the termination of service is sought to be founded on misconduct, negligence, inefficiency or other disqualification, then it is a punishment and the requirements of Article 311 must be complied with. As already stated if the servant has got a right to continue in the post, then, unless the contract of employment or the rules provide to the contrary, his services cannot be terminated otherwise than for misconduct, negligence, inefficiency or other good and sufficient cause. A termination of the service of such a servant on such grounds must be a punishment and therefore, a dismissal or removal within Article 311, for it operates as a forfeiture of his right and he is visited with the evil consequences of loss of pay and allowances.”
25. The third passage on which the Counsel relies in the judgment is also to be found at the same page:
“The real test for determining whether the reduction in such cases is or is not by way of punishment is to find out if the order for the reduction also visits the servant with any penal consequences.”
26. It was argued before us that had the appellant been a private employee the termination order would entitle him to damages for breach of his contractual right and therefore according to the test laid in the authority cited above the appellant's order of retirement is bad because of the failure to comply with the provisions of Article 311.
27. Reliance has further been placed on Balakotaiah v. Union of India AIR 1958 S.C 232, where Venkatarma Aiyar, J., has held that if a person had a right to continue in office either under the service Rules, or under special agreements, a premature termination of his service would be punishment and likewise if the order would result in loss of benefits already earned and accrued, that would also be punishment.
28. It is well to remember that the aforesaid pronouncements of the Supreme Court do negative the argument often urged that a compulsory retirement in any case does not amount to dismissal or removal under Article 311(2), because it entails no forfeiture of the rights and benefits that have already accrued.
29. The authorities further clarify the position that a compulsory retirement, where a person had a right to continue in office, except on ground of misconduct, negligence, inefficiency or other disqualification, is a punishment. They however, do not hold that a compulsory retirement where a public servant has no right to continue in office is also a punishment.
30. The earlier authorities concerning this aspect like Shyam Lal v. 1. State Of U.P AIR 1954 S.C 369, and State of Bombay v. Saubhagchand, (S) AIR 1957 SC 892, have not been dissented from. In other words, the test of the order not resulting in loss of benefits already earned and accrued is not conclusive in all cases and Article 311(2) is attracted where the public servant who has been retired has a right to continue in the post except on grounds of misconduct.
31. The test therefore is whether a right to continue in the post except for misconduct, negligence, inefficiency or other good and sufficient cause is claimed. It follows that when such a right is not claimed, because the State has an absolute right to retire, the constitutional guarantee contained in Article 311(2) is not attracted.
32. The question therefore in this case is whether the appellant has a claim to such a right and no whether his retirement would be actionable, has he been a private employee. Obviously he has no such right to continue, because the Note to Rule 29 makes the absence of such right clear. His right the continue in the post is terminable without proof to the grounds enumerated above and therefore Article 311(2) is not attracted. Therefore this plea for allowing the appeal fails.
33. We now come to the last ground i.e, whether the retirement was mala fide. In our opinion an decision of the question is not necessary, for if the right be in the Government, the motive for its exercise is not relevant. As has been held in Dhingra’ case, AIR 1958 SC 36, if a right exists under the contract or the rule to terminate the service, the motive operating on the mind of the Government is wholly irrelevant.
34. It may be that the particular exercise of the right complained against has been discriminatory and so violative of Article 14 of the Constitution; but the appellant has not succeeded in establishing that in this case. Article 14 had been invoked to challenge the constitutionality of Rule 293, but then it is firmly established that reasonable classification is no infringement of the guarantee of equal protection Rule 293 has not been shown to be arbitrary and whimsical and in these circumstances the complain fails.
35. Consistently with the view we have taken it is clear that this public servant is entitled to his pay for three months which he would have got, had the retirement been preceded with notice for such a period.
36. This liability is not seriously controverted. The infringement of the provision as to notice would also not deprive the appellant of his right to other incidental matters, which he would have got had he continued in his service during the aforesaid period
37. We think adequate justice would be done is the case if we declare him entitled to the arrears of pay for the three months during which the notice to him to retire would have run and also to such incidental rights as he might be entitled to. Beyond this direction there is no force in the appeal which is dismissed. Having regard to the circumstances of the case the parties should bear their own costs.
V.R.B
38. Appeal dismissed.
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