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AMICUS AI
Citation Codes
Neutral Citations
1995 INSC 642
Equivalent Citations
citation codes
Case Number
Disposition
Attorney(S)
Judges
Acts
  • Section 5, Subsection 2 of the 1983 Income Tax Act
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Cites
Cited by
Citation Codes
Neutral Citations
1995 INSC 642
Equivalent Citations
citation codes
Case Number
Disposition
Attorney(S)
Judges
Acts
  • Section 5, Subsection 2 of the 1983 Income Tax Act
Smart Summary

Factual and Procedural Background

The respondent-workmen gained employment with the Indian Railways circa 1983 as casual labourers by producing forged “casual labourer service cards.” When the fraud was detected, departmental enquiries were initiated in 1987 and culminated in orders of removal from service. The Central Administrative Tribunal, Madras Bench, initially set aside those orders and remanded the matter. After fresh removal orders were passed, the Ernakulam Bench of the Tribunal again set them aside, holding that the alleged misconduct did not fall within Rule 3(1)(i) and (iii) of the Railway Services (Conduct) Rules, 1966, and directed reinstatement with consequential benefits. The Union of India and concerned railway authorities appealed to the Supreme Court, resulting in the present judgment disposing of three consolidated appeals.

Legal Issues Presented

  1. Whether railway employees who procured employment by submitting forged casual labour service cards can be retained in service once the fraud is detected.
  2. Whether such misconduct is governed by Rule 3(1)(i) and (iii) of the Railway Services (Conduct) Rules, 1966, or can otherwise justify removal from service.
  3. Whether the passage of time and grant of temporary status confer any equitable right preventing the employer from recalling appointments tainted by fraud.

Arguments of the Parties

Appellants (Union of India & Railway Authorities)

  • The respondents’ conduct in obtaining employment through forged documents is “unbecoming of a railway servant” and violates Rule 3(1)(i) and (iii).
  • Employment orders obtained by fraud are voidable at the employer’s option and can be recalled after following due process.
  • Allowing the respondents to continue would amount to putting a premium on dishonesty.

Respondents (Workmen)

  • For employment as casual labourers, production of service cards was not strictly necessary; hence the forged cards were immaterial.
  • The respondents are illiterate, have been in service since 1983, and have already been granted temporary status; removing them now would be unduly harsh.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Distt. Collector & Chairman, Vizianagaram Social Welfare Residential School Society v. M. Tripura Sundari Devi, (1990) 3 SCC 655 Appointments obtained in disregard of stipulated qualifications amount to fraud on the public; courts should not perpetuate such fraud. The Court relied on this authority to reaffirm that employment secured through fraudulent means cannot be protected, regardless of subsequent service or qualifications acquired.

Court's Reasoning and Analysis

The Supreme Court found it established through departmental enquiries that the respondents procured railway employment by producing forged service cards, amounting to clear misrepresentation and fraud. The Court held that:

  • Even without determining the exact applicability of Rule 3(1)(i) and (iii), an appointment tainted by fraud is voidable at the employer’s instance and may be recalled after observing natural justice.
  • The Tribunal erred in confining its analysis to whether the misconduct fit within Rule 3(1) because fraudulent procurement of employment fundamentally vitiates the appointment itself.
  • Equitable considerations—such as long years of service or illiteracy—cannot sanitize a fraudulent act; allowing continuance would “put a premium on dishonesty.”
  • The precedent in Vizianagaram underscores that courts should not endorse or perpetuate appointments obtained through fraudulent or irregular means.

Holding and Implications

Appeals Allowed – Orders of the Central Administrative Tribunal set aside; Original Applications of the respondents dismissed; no order as to costs.

Immediate Effect: The respondents’ removal from railway service stands confirmed, and they are not entitled to reinstatement or consequential benefits.

Broader Implication: The judgment reiterates that employment obtained by fraud is voidable and may be terminated notwithstanding the duration of service, reinforcing judicial intolerance toward fraudulent procurement of public employment. No new legal doctrine was created, but the decision strengthens existing principles against fraud in public service appointments.

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    Union Of India And Others v. M. Bhaskaran .

    S.B Majmudar, J.— Leave granted in these petitions.

    2. By consent of learned advocates appearing for the respective parties the appeals were taken up for final hearing.

    3. The short question involved in these three appeals is as to whether the respondent-workmen who had obtained employment in railway service run by appellant-Union of India, on the basis of bogus and forged casual labourer service cards could be continued in railway service once such fraud was detected by the railway authorities. The Central Administrative Tribunal, Ernakulam Bench has taken the view that as the aforesaid misconduct of the respondent-railway employees does not fall within the four corners of Rule 3(1)(i) and (iii) of Railway Services (Conduct) Rules, 1966 (hereinafter referred to as ‘the Rules’), the orders of removal from service passed against the respondents could not be sustained and they were entitled to be reinstated in railway service with all consequential benefits. The aforesaid view of the Tribunal is brought on the anvil of scrutiny in the present proceedings moved by the appellant-Union of India and the railway authorities concerned under whom the respondent-workmen worked at the relevant time.

    4. The Tribunal in the impugned judgments has placed reliance on its earlier decision in OA No. 892 of 1993 decided on 22-6-1994 for taking the view that such misconduct would not attract Rule 3(1)(i) and (iii) of the Rules. It is not in dispute between the parties that the respondent-workmen concerned had got employment in railway by producing bogus and forged casual labourer service cards purported to have been issued by their earlier employers. However, according to the Tribunal such a misconduct would not attract Rule 3(1)(i) and (iii) of the Rules as the employee concerned even though engaged as a casual employee could not be said to be governed by the Rules at the time when he obtained such employment and that he was not guilty of any misconduct committed during the railway service.

    5. The aforesaid view of the Tribunal can be better appreciated in the light of the relevant provisions of the Rule itself. Rule 3(1) reads as under:

    “3. General.—(1) Every railway servant shall at all times—

    (i) maintain absolute integrity;

    (ii) maintain devotion to duty; and

    (iii) do nothing which is subversion of law and order and is unbecoming of a railway or government servant.”

    Now it is no doubt true that on the express language of the Rule the railway servant concerned has to maintain absolute integrity and has not to do anything which is subversion of law and order and which is unbecoming of a railway or a government servant. That would certainly apply to a railway servant who is alleged to have misconducted himself while in railway service. However, learned Senior counsel for the appellants vehemently submitted that the misconduct alleged in the present case, of snatching railway employment on the basis of bogus certificates or casual labourer service cards, would indeed show that the employee concerned had exhibited a conduct which was unbecoming of a railway servant.

    6. It is not necessary for us to express any opinion on the applicability of Rule 3(1)(i) and (iii) on the facts of the present cases for the simple reason that in our view the railway employees concerned, respondents herein, have admittedly snatched employment in railway service, maybe of a casual nature, by relying upon forged or bogus casual labourer service cards. The unauthenticity of the service cards on the basis of which they got employment is clearly established on record of the departmental enquiry held against the employees concerned. Consequently, it has to be held that the respondents were guilty of misrepresentation and fraud perpetrated on the appellant-employer while getting employed in railway service and had snatched such employment which would not have been made available to them if they were not armed with such bogus and forged labourer service cards. Learned counsel for the respondents submitted that for getting service in railway as casual labourers, it was strictly not necessary for the respondents to rely upon such casual service cards. If that was so there was no occasion for them to produce such bogus certificates/service cards for getting employed in railway service. Therefore, it is too late in the day for the respondents to submit that production of such bogus or forged service cards had not played its role in getting employed in railway service. It was clearly a case of fraud on the appellant-employer. If once such fraud is detected, the appointment orders themselves which were found to be tainted and vitiated by fraud and acts of cheating on the part of employees, were liable to be recalled and were at least voidable at the option of the employer concerned. This is precisely what has happened in the present case. Once the fraud of the respondents in getting such employment was detected, the respondents were proceeded against in departmental enquiries and were called upon to have their say and thereafter have been removed from service. Such orders of removal would amount to recalling of fraudulently obtained erroneous appointment orders which were avoided by the employer-appellant after following the due procedure of law and complying with the principles of natural justice. Therefore, even independently of Rule 3(1)(i) and (iii) of the Rules, such fraudulently obtained appointment orders could be legitimately treated as voidable at the option of the employer and could be recalled by the employer and in such cases merely because the respondent-employees have continued in service for a number of years on the basis of such fraudulently obtained employment orders cannot create any equity in their favour or any estoppel against the employer. In this connection we may usefully refer to a decision of this Court in Distt. Collector & Chairman, Vizianagaram Social Welfare Residential School Society v. M. Tripura Sundari Devi (1990) 3 SCC 655, (1990) 14 ATC 766. In that case Sawant, J. speaking for this Court held that when an advertisement mentions a particular qualification and an appointment is made in disregard of the same, it is not a matter only between the appointing authority and the concerned appointee. The aggrieved are all those who had similar or even better qualifications than the appointee or appointees but who had not applied for the post because they did not possess the qualifications mentioned in the advertisement. It amounts to a fraud on public to appoint persons with inferior qualifications in such circumstances unless it is clearly stated that the qualifications are relaxable. No court should be a party to the perpetuation of the fraudulent practice. It is of course true as noted by the Tribunal that the facts of the case in the aforesaid decision were different from the facts of the present case. And it is also true that in that case pending the service which was continued pursuant to the order of the Tribunal the candidate concerned acquired the requisite qualification and hence his appointment was not disturbed by this Court. But that is neither here nor there. As laid down in the aforesaid decision, if by committing fraud any employment is obtained, such a fraudulent practice cannot be permitted to be countenanced by a court of law. Consequently, it must be held that the Tribunal had committed a patent error of law in directing reinstatement of the respondent-workmen with all consequential benefits. The removal orders could not have been faulted by the Tribunal as they were the result of a sharp and fraudulent practice on the part of the respondents. Learned counsel for the respondents, however, submitted that these illiterate respondents were employed as casual labourers years back in 1983 and subsequently they have been given temporary status and, therefore, after passage of such a long time they should not be thrown out of employment. It is difficult to agree with this contention. By mere passage of time a fraudulent practice would not get any sanctity. The appellant authorities having come to know about the fraud of the respondents in obtaining employment as casual labourers, started departmental proceedings years back in 1987 and these proceedings have dragged on for a number of years. Earlier, removal orders of the respondents were set aside by the Central Administrative Tribunal, Madras Bench and proceedings were remanded and after remand, fresh removal orders were passed by the appellant which have been set aside by the Central Administrative Tribunal, Ernakulam Bench and which are the subject-matter of the present proceedings. Therefore, it cannot be said that the appellants are estopped from recalling such fraudulently obtained employment orders of the respondents subject of course to following due procedure of law and in due compliance with the principles of natural justice, on which aspect there is no dispute between the parties. If any lenient view is taken on the facts of the present case in favour of the respondents, then it would amount to putting premium on dishonesty and sharp practice which on the facts of the present cases cannot be permitted.

    7. For all these reasons, therefore, these appeals are allowed. The impugned orders of the Tribunal are set aside and the original applications filed by the respondents before the Central Administrative Tribunal, Ernakulam Bench are dismissed. However, in the facts and circumstances of the cases, there will be no order as to costs all throughout.

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    Comments

    Union Of India And Others v. M. Bhaskaran .
    (Oct 30, 1995)