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Case Number

C.W.P No. 6372 of 2003

Judges

S.S Nijjar
Nirmal Yadav, JJ.

Acts

Rule 7 of the Haryana State Electricity Board Employees (Punishment and Appeal) Regulations, 1990.

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Smart Summary

Judgment Summary — S.S. Nijjar, J.

Factual and Procedural Background

The petitioner joined the Haryana State Electricity Board (now Haryana Vidyut Parsaran Nigam Limited) on 01.04.1966 as an Apprentice Assistant Engineer and was subsequently appointed as Assistant Engineer on 01.10.1996. He obtained promotions thereafter, including a promotion to Assistant Executive Engineer in May 1978. The petitioner’s service record is described in the opinion as excellent.

On 12.01.1996 the petitioner was served a charge-sheet (Annexure P-1) alleging negligence and lack of supervisory check, resulting in financial loss to the Board and payment of excess amounts. The petitioner replied to the charge-sheet on 17.04.1996. The charge-sheets arose from a Committee constituted by office order dated 26.12.1993; charge-sheets were issued to 27 persons and a regular departmental inquiry under Rule 7 of the Haryana State Electricity Board Employees (Punishment and Appeal) Regulations, 1990 was conducted against 13 officers, including the petitioner.

The petitioner’s request for change of the Inquiry Officer was rejected. On 14.03.1999 a Show Cause Notice proposed removal from service and recovery of Rs. 8,56,880.10. The Show Cause Notice referred to two inquiry reports dated 24.06.1998 and 24.01.1999, but the petitioner states that only the 24.01.1999 report was supplied along with the Show Cause Notice. The petitioner submitted a detailed reply on 09.04.1999. By order dated 28.05.1999 (Annexure P-5/P-6) an amount of Rs. 8,56,880/- was ordered to be recovered and the petitioner was removed from service; the opinion records that removal was ordered without considering the petitioner’s reply.

The petitioner appealed on 22.06.1999. The Board of Directors rejected the appeal by order dated 6/7.01.2003 (Annexure P-12), referring to a Board decision dated 27.04.2001. A subsequent appeal to the Chairperson was also dismissed. The present writ petition challenged these orders. The court heard learned counsel for the parties and examined the record.

Legal Issues Presented

Whether the denial of the Inquiry Officer’s report (or the failure to furnish it to the petitioner before the disciplinary authority recorded its findings) constitutes a denial of reasonable opportunity and a breach of principles of natural justice.
Whether the non-supply of the inquiry report caused prejudice to the petitioner such that the disciplinary orders (removal and recovery) should be set aside.
What relief is appropriate if the court finds the non-supply of the inquiry report prejudicial — i.e., whether the order of punishment must be set aside and what the consequences (reinstatement, continuation of inquiry, back wages) should be.

Arguments of the Parties

Appellant's Arguments (Mr. Malik, counsel for petitioner)

The Inquiry Officer’s report was accepted by the Disciplinary Authority without granting the petitioner an opportunity of hearing; the report was supplied only along with the Show Cause Notice and not earlier.
Acceptance of the inquiry report without prior supply to the petitioner violated principles of natural justice and contravened the law as laid down in Managing Director, ECIL, Hyderabad v. B. Karunakar (the ECIL case).
If afforded an opportunity, the petitioner would have demonstrated that the inquiry report was based on no evidence — specifically, that not a single prosecution witness was examined — and that he suffered grave prejudice.

Respondent's Arguments (Mr. Girish Agnihotri, counsel for respondents)

No prejudice was caused to the petitioner; the petitioner had been duly heard.
Remanding the case to the Disciplinary Authority would be a mere formality and would not affect the punishment imposed on the petitioner.
The petitioner did not plead before issuance of the Show Cause Notice that he had suffered prejudice by non-supply of the inquiry report.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Managing Director, ECIL, Hyderabad v. B. Karunakar, 1994 (1) Recent Services Judgments, 443 : [1993 (5) SLR 532 (SC)] (referred to in the opinion as the ECIL case)	The ECIL judgment holds that denial of the Inquiry Officer’s report to a delinquent employee is a denial of reasonable opportunity and a breach of natural justice; the delinquent employee is entitled to a copy of the report even if rules are silent or prohibit furnishing; the court must consider whether non-supply prejudiced the employee and should not mechanically set aside punishment unless prejudice is shown; where prejudice is found, appropriate relief is to remit or allow fresh inquiry with reinstatement limited to continuation for inquiry, leaving back-wages/benefits to the authority to decide after final outcome.	The High Court applied the principles from paras 30 and 31 of the ECIL judgment. It held that non-furnishing of the inquiry report amounted to denial of reasonable opportunity and, after examining the record, concluded that it could not be said that grave prejudice had not been caused. The court therefore quashed the disciplinary orders and directed reinstatement for continuation of inquiry in accordance with the ECIL framework.
Mohd. Ramzan Khan's case (referred to in ECIL and applied in principle)	The opinion records that the law laid down in Mohd. Ramzan Khan's case — specifically the right to make representation to the disciplinary authority against inquiry findings as an integral part of opportunity of defence — should apply to employees in all establishments.	The court noted that the ECIL decision applied the Mohd. Ramzan Khan principle universally and treated it as part of the legal framework governing supply of inquiry reports and opportunity to make representations. The High Court followed that approach in ordering relief.

Court's Reasoning and Analysis

The court first recorded that it had heard learned counsel and reviewed the record. It examined the parties’ submissions and found the respondents' position (that no prejudice was caused and that remand would be a ritual) unacceptable in light of the Supreme Court’s decision in the ECIL case.

The opinion reproduces and relies on key passages from paras 30 and 31 of the ECIL judgment which (a) treat denial of the inquiry report as a denial of reasonable opportunity and a breach of natural justice, (b) establish that an employee is entitled to the inquiry report even if rules are silent or forbid furnishing it, and (c) instruct courts to assess whether non-supply caused prejudice before deciding whether to set aside punishment (i.e., courts should not mechanically order reinstatement if no prejudice would have changed the result).

Applying these principles to the facts on record, the High Court examined whether the petitioner suffered prejudice due to non-delivery of the Inquiry Report. After reviewing the materials, the court stated that it was of the considered opinion that it would not be possible to conclude that grave prejudice had not been caused to the petitioner by non-delivery of the Inquiry Report. In other words, the court found that the non-supply did cause prejudice sufficient to warrant relief under the ECIL framework.

Consequently, the court allowed the writ petition and quashed the disciplinary orders dated 28.05.1999 and 6/7.01.2003. The court ordered that the petitioner be reinstated for the limited purpose of continuation of the disciplinary inquiry in accordance with the law laid down by the Supreme Court (i.e., furnishing the report and giving the petitioner an opportunity to show prejudice), and left the respondents free to pass fresh orders in accordance with law. The court ordered no costs.

Holding and Implications

The writ petition is allowed; orders dated 28.05.1999 (Annexure P-5/P-6) and 6/7.01.2003 (Annexure P-12) are quashed and the petitioner is to be reinstated for the limited purpose of continuation of the inquiry in accordance with the Supreme Court’s decision in the ECIL case.

Direct effects and immediate consequences:

The disciplinary orders removing the petitioner and ordering recovery are quashed.
The petitioner shall be reinstated in service specifically for the purpose of allowing the respondents to continue the inquiry after furnishing the inquiry report and giving the petitioner an opportunity in accordance with the Supreme Court’s guidance.
The respondents are at liberty to pass fresh orders in accordance with law after conducting the remainder of the proceedings; the court left issues such as entitlement to back-wages and other consequential benefits to the authority concerned to decide after the conclusion of proceedings, consistent with the ECIL framework.
No costs were awarded.

The opinion applies and follows settled Supreme Court authority rather than purporting to lay down new precedent; it enforces the ECIL principle that non-supply of an inquiry report ordinarily entails furnishing of the report by the court and a determination of whether prejudice resulted, with relief tailored accordingly.

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M.S Sandhu v. Haryana Vidyut Parsaran Nigam And Another

S.S Nijjar, J.:— We have heard the learned counsel for the parties at length and have gone through the record of the case.

2. The petitioner joined the Haryana State Electricity Board (now known as Haryana Vidyut Parsaran Nigam Limited), on 01.04.1966 as Apprentice Assistant Engineer. He was, thereafter, appointed as Assistant Engineer on 01.10.1996 Thereafter, the petitioner has earned promotions on different posts. In May, 1978 he was promoted as Assistant Executive Engineer.

3. The service record of the petitioner is stated to be excellent. On 12.01.1996, the petitioner was served a charge-sheet, Annexure P-1. It was alleged that due to the negligence and lack of supervisory check of the petitioner, works executed through the contractor, the Board had to suffer huge loss and that he being the over all head of the division has permitted the payment of huge excess amounts.

4. The petitioner submitted a reply to the charge-sheet on 17.04.1996 We may also notice that on the basis of the report of the Committee constituted vide office order dated 26.12.1993 by the Board, the charge-sheets were issued to 27 persons, including the petitioner. In his reply, the petitioner had submitted detailed objections to the preliminary enquiry report. After considering the reply of the petitioner, the enquiry officer was appointed. Regular departmental enquiry was conducted under Rule 7 of the Haryana State Electricity Board Employees (Punishment and Appeal) Regulations, 1990. Enquiry was conducted against 13 officers including the petitioner. Of these officers, three were Executive Engineers, nine were Sub Divisional Officers and one was Assistant Executive Engineer. Request of the petitioner for change of the Enquiry Officer was rejected. On 14.03.1999, a Show Cause Notice was issued to the petitioner wherein it was proposed to remove the petitioner from service. A sum of Rs. 8,56,880.10 P. was also proposed to be recovered from the petitioner. The reply of the petitioner was sought within 21 days. In the Show Cause Notice reference had been made to two enquiry reports, i.e 24.06.1998 and 24.01.1999 It is also stated by the petitioner that only enquiry report dated 24.01.1999 was supplied to him alongwith the Show Cause Notice. The petitioner submitted a detailed reply to the Show Cause Notice bn 09.04.1999 An amount of Rs. 8,56,880/- was also ordered to be recovered from him by order dated 28.05.1999, Annexure 6. Without considering the reply submitted by the petitioner, he was ordered to be removed from service. The petitioner submitted an appeal against the aforesaid order on 22.06.1999 The Board of Directors rejected the appeal of the petitioner on 6/7.01.2003, Annexure P-12, in the light of the decision of the Board dated 27.04.2001 Thereafter, the petitioner submitted an appeal to the Chairperson which was also dismissed.

5. Mr. Malik, learned counsel for the petitioner submits that the enquiry report had been accepted by the Disciplinary Authority without granting any opportunity of hearing to the petitioner. In the Show Cause Notice dated 14.03.1999, it is clearly stated that the Punishing Authority agreeing with the findings of the Inquiry Officer is of the firm view that the petitioner has thrown all norms to winds and has caused a financial loss to the Board (now Nigam) to the tune of Rs. 8,56,880.1 OP. According to the learned counsel, the entire proceedings from the stage of the enquiry proceedings are liable to be quashed as the Enquiry Report had been accepted without supplying a copy of the Enquiry Report to the petitioner. The enquiry report was sent to the petitioner only alongwith the Show Cause Notice. Therefore, the action of the respondents is clearly contrary to the law laid down in the case of Managing Director, ECIL, Hyderabad v. B. Karunakar, 1994 (1) Recent Services Judgments, 443 : [1993 (5) SLR 532 (SC)]. Learned counsel for the petitioner further submits that if an opportunity of hearing had been granted to the petitioner, he would have pointed out that the enquiry report is based on no evidence as not even a single prosecution witness was examined. Therefore, grave prejudice has been caused to the petitioner.

6. On the other hand, it is submitted by Mr. Girish Agnihotri, learned counsel for the respondents that no prejudice has been caused to the petitioner at all. The petitioner has been duly heard. Remanding back the case to the Disciplinary Authority would be just a ritual. There would be no effect on the punishment imposed on the petitioner. Learned counsel also submitted that the petitioner has not even pleaded the prejudice which has been caused to him by non-supply of the enquiry report before the issuance of Show Cause Notice.

7. We have considered the submissions made by the learned counsel for the parties. We are unable to accept the submissions made by Mr. Agnihotri. The law has been settled by the Supreme Court in the ECIL's case (supra). In para 30 of the aforesaid judgment, it is observed as under:—

“30. Hence, the incidental questions raised above may be answered as follows:—

(i) Since the denial of the report of the Inquiry Officer is a denial of reasonable opportunity and a breach of the principles of natural justice, it follows that the statutory rules, if any, which deny the report to the employee are against the principles of natural justice and, therefore, invalid. The delinquent employee will, therefore, be entitled to a copy of the report even if the statutory rules do not permit the furnishing of the report or are silent on the subject.

(ii) XXXXXXXXX

(iii) XXXXXXXXX

(iv) In the view that we have taken, viz., that the right to make representation te the disciplinary authority against the findings recorded in the inquiry report is an integral part of the opportunity of defence against the charges and is a breach of principles of natural justice to deny the said right, it is only appropriate that the law laid down in Mohd. Ramzan Khan's case (supra) should apply to employees in all establishments whether Government or non-Government, public or private. This will be the case whether there are rules governing the disciplinary proceedings or not and whether they expressly prohibit the furnishing of the copy of the report or are silent on the subject. Whatever the nature of punishment, further whenever the rules require an inquiry to be held, for inflicting the punishment in question, the delinquent employee should have the benefit of the report of the Inquiry Officer before the disciplinary authority records its findings on the charges levelled against him. Hence, question (iv) is answered accordingly.

(v) The next question to be answered is what is the effect on the order of punishment when the report of the Inquiry Officer is not furnished to the employee and what relief should be granted to him in such cases. The answer to this question has to be relative to the punishment awarded. When the employee is dismissed or removed from service and the inquiry is set aside because the report is not furnished to him, in some cases the non-furnishing of the report may have prejudiced him gravely while in other cases, it may have made no difference to the ultimate punishment awarded to him. Hence, to direct reinstatement of the employee with back-wages in all cases is to reduce the rules of justice to a mechanical ritual. The theory of reasonable opportunity and the principles of natural justice have been evolved to uphold the rule of law and to assist the individual to vindicate his just rights. They are not incantations to be invoked nor rites to be performed on all and sundry occasions. Whether, in fact, prejudice has been caused to the employee or not on account of the denial to him of the report, has to be considered on the facts and circumstances of each case. Where, therefore, even after the furnishing of the report, no different consequence would have followed, it would be a perversion of justice to permit the employee to resume duty and to get all the consequential benefits. It amounts to rewarding the dishonest and the guilty and thus, to stretching the concept of justice to illogical and exasperating limits. It amounts to an “unnatural expansion of natural justice” which in itself is antithetical to justice.”

8. Mr. Agnihotri had, also emphasized the observations made in paragraph 31 of the judgment aforesaid, which are as follows:—

“31. Hence, in all cases where the Inquiry Officer's report is not furnished to the delinquent employee in the disciplinary proceedings, the Courts and Tribunals should cause the copy of the report to be furnished to the aggrieved employee if he has not already secured it before coming to the Court/Tribunal, and give the employee an opportunity to show how his or her case was prejudiced because of the non-supply of the report. If after hearing the parties, the Court/Tribunal comes to the conclusion that the non-supply of the report would have made no difference to the ultimate findings and the punishment given, the Court/Tribunal should not interfere with the order of punishment. The Court/Tribunal should not mechanically set aside the order of punishment on the ground that the report was not furnished as is regrettably being done at present. The Courts should avoid resorting to short-cuts. Since it is the Court/Tribunal which will apply their judicial mind to the question and give their reasons for setting aside or not setting aside the order of punishment, (and not any internal appellate or revisional authority), there would be neither a breach of the principles of natural justice nor a denial of the reasonable opportunity. It is only if the Court/Tribunai finds that the furnishing of the report would have made a difference to the result in the case that it should set aside the order of punishment. Where after following the above procedure, the Court/Tribunal sets aside the order of punishment, the proper relief that should be granted is to direct reinstatement of the employee with liberty to the authority/management to proceed with the inquiry, by placing the employee under suspension and continuing the inquiry from the stage of furnishing him with the report. The question whether the employee would be entitled to the back-wages and other benefits from the date of his dismissal to the date of his reinstatement if ultimately ordered, should invariably be left to be decided by the authority concerned according to law, after the culmination of the proceedings and depending on the final outcome. If the employee succeeds in the fresh inquiry and is directed to be reinstated, the authority should be at liberty to decide according to law how it will treat the period from the date of dismissal till the re-instatement and-to what, benefits, if any, and the extent of the benefits, he will be entitled. The reinstatement made as a result of the setting aside of the inquiry for failure to furnish the report, should be treated as a re-instatement for the purpose of holding the fresh inquiry from the stage of furnishing the report and no more, where such fresh inquiry is held.

That will also be the correct position in law”.

9. Mindful of the aforesaid observations of the Supreme Court, we have examined the entire record. We are of the considered opinion that it would not be possible to come to a conclusion that grave prejudice has not been caused to the petitioner by non-delivery of the Enquiry Report.

10. In view of the above, we allow the present writ petition. Orders dated 28.05.1999, Annexure P-5 and 6/7.01.2003, Annexure P-12, are hereby quashed. The petitioner shall be re-instated in service for the purpose of continuation of enquiry proceedings in accordance with law laid down by the Supreme Court, as noticed above. The respondents shall be at liberty to pass fresh orders in accordance with law. No costs.

11. Petition allowed.

M.S Sandhu v. Haryana Vidyut Parsaran Nigam And Another

Judgment Summary — S.S. Nijjar, J.

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Appellant's Arguments (Mr. Malik, counsel for petitioner)

Respondent's Arguments (Mr. Girish Agnihotri, counsel for respondents)

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

M.S Sandhu v. Haryana Vidyut Parsaran Nigam And Another

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