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Electronics Corporation Of India v. G. Muralidhar .
Factual and Procedural Background
The respondent’s employment was terminated by an order issued directly by the Chairman-cum-Managing Director (CMD) of the appellant-Corporation. Because the CMD was the designated Appellate Authority—not the Disciplinary Authority—this procedure deprived the respondent of a statutory right of appeal. The respondent challenged the termination in a writ petition before the Andhra Pradesh High Court. A learned Single Judge quashed the dismissal, ordering reinstatement with back wages. The Division Bench affirmed that decision. On further appeal, the Supreme Court initially issued notice limited to the quantum of relief, directed provisional payment of ₹50,000, and later granted leave to decide the matter on merits.
Legal Issues Presented
- Whether an order of termination passed by an authority that is, under the applicable service rules, the Appellate Authority (and not the Disciplinary Authority) is vitiated on the ground that it denies the employee a statutory right of appeal.
- If the termination is invalid, what relief—particularly regarding reinstatement and back wages—should be granted to the employee?
Arguments of the Parties
Appellant’s Arguments
- The precedent of Surjit Ghosh v. Chairman & Managing Director, United Commercial Bank (1995) 2 SCC 474 should be confined to its own facts.
- Because the Board of the Corporation is a higher forum than the CMD, the employee could be directed to file an appeal before the Board, thereby curing any defect.
- Grant of automatic reinstatement with full back wages was unnecessary; an alternative remedial framework should be considered.
Respondent’s Arguments
The opinion does not contain a detailed account of the respondent’s legal arguments.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Surjit Ghosh v. Chairman & Managing Director, United Commercial Bank (1995) 2 SCC 474 | An order passed by an Appellate Authority acting as the Disciplinary Authority deprives the employee of the right of appeal and is therefore vitiated; reinstatement is the usual consequence, but back wages may be moderated. | The Court relied on this precedent to hold that the respondent’s termination was invalid, directed reinstatement, and limited back-wage relief to ₹50,000 already paid. |
Court's Reasoning and Analysis
1. The Court confirmed that, under the Corporation’s service rules, the CMD is the Appellate Authority in respect of the respondent; therefore, the CMD lacked disciplinary jurisdiction.
2. Because no separate rule conferred review or revisional powers on the Board, allowing an “appeal” to that body would amount to judicial legislation, which the Court declined to undertake.
3. Following Surjit Ghosh, the Court held that denial of the statutory right of appeal vitiates the termination order.
4. On relief, the Court found no basis to disturb the High Court’s order of reinstatement but considered the interim payment of ₹50,000 to be adequate compensation for the interregnum; hence, no further back wages were awarded.
Holding and Implications
HELD: The appeal is disposed of. The respondent shall be reinstated with continuity of service and seniority, but will receive no back wages beyond the ₹50,000 already paid. Regular salary is payable prospectively from the date of this judgment, and the employer is directed to issue a posting order promptly.
Implications: The decision affirms the principle that an employee cannot be deprived of a statutory right of appeal by disciplinary action taken directly by an appellate authority. The ruling primarily affects the parties to the case and does not lay down a new legal standard beyond reiterating the rule in Surjit Ghosh.
Order
1. The order of termination from service of the respondent-delinquent was assailed before the Andhra Pradesh High Court by filing a writ petition. The said order of termination had been passed not by the disciplinary authority, but by the Appellate Authority. The learned Single Judge of the High Court came to the conclusion that by taking recourse to such procedure, a right of appeal was denied to the delinquent and, therefore, the order of termination is vitiated by application of the decision of this Court in Surjit Ghosh v. Chairman & Managing Director, United Commercial Bank (1995) 2 SCC 474, (1995) 29 ATC 373. That order of the learned Single Judge was assailed before the Division Bench by filing an appeal. The Division Bench, however, upheld the order of the learned Single Judge and did not interfere with the same. Necessarily, therefore, the direction of the learned Single Judge for reinstatement and back wages remained to be implemented. When the matter came up to this Court, initially a notice had been issued to show cause as to why the relief of reinstatement and back wages granted by the High Court should not be modified in the light of the direction given in Surjit Ghosh case (1995) 2 SCC 474, (1995) 29 ATC 373. A further direction was given that a sum of Rs 50,000 be paid to the delinquent in accordance with the aforesaid decision of this Court. Later on, however, leave had been granted by order dated 29-3-1996.
2. Mr Rohatgi, the learned Additional Solicitor-General appearing for the appellant contended that the judgment in Surjit Ghosh case (1995) 2 SCC 474, (1995) 29 ATC 373 must be limited to the facts of that case and in the case in hand when a higher forum is available to scrutinise the legality and correctness of the decision of the Chairman-cum-Managing Director (CMD), namely, the Board, it would be meet and proper to direct that an appeal should be presented to the said Board, leaving the matter to the Board to take an ultimate decision. It is however conceded before us by the learned Additional Solicitor-General that under the rules governing the conditions of service of the Corporation, the CMD is not the disciplinary authority in respect of the respondent and, in fact, he is the Appellate Authority and, therefore, undoubtedly a right of appeal which was otherwise available to the respondent, has been denied. It is also stated to us that there is no general provision which confers a power of review or revision on the Board against any order passed by the CMD. In that view of the matter, even if the Board may be a superior authority to the CMD, to hold that an appeal would lie against an order of termination passed by the CMD, would tantamount to a fresh legislation which we are not inclined to adopt. Necessarily, therefore, a valuable right of appeal having been denied to the respondent-delinquent, in view of the judgment of this Court in Surjit Ghosh case (1995) 2 SCC 474, (1995) 29 ATC 373 the order of punishment gets vitiated and the respondent employee is entitled to a direction for reinstatement and back wages, though the back wages could be limited depending upon the facts and circumstances of the case. In the case in hand, a sum of Rs 50,000 has already been paid to the respondent by virtue of the interim order of this Court dated 23-2-1996 following the direction in the case of Surjit Ghosh (1995) 2 SCC 474, (1995) 29 ATC 373.
3. We, therefore, while do not find any justification for interfering with the direction for reinstatement, observe that the respondent employee will not be entitled to any back wages from the date of termination till today excepting the sum of Rs 50,000 which has already been paid to him. He is entitled to his regular salary from today and appointment/posting be given to him at an early date. The civil appeal stands disposed of accordingly. Needless to mention that on reinstatement the employee would get his due seniority and continuity of service.
4. The learned Additional Solicitor-General also informed us that the employee himself has sought for voluntary retirement. That is a matter for the employer to take into consideration and pass appropriate orders.
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