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PETITIONER:

BAIKUNTHA NATH DAS AND ANR.

Vs.

RESPONDENT:

CHIEF DISTT. MEDICAL OFFICER, BARIPADA AND ANR.

DATE OF JUDGMENT19/02/1992

BENCH:

JEEVAN REDDY, B.P. (J)

BENCH:

JEEVAN REDDY, B.P. (J)

SHARMA, L.M. (J)

RAMASWAMI, V. (J) II

CITATION:

1992 AIR 1020 1992 SCR (1) 836

1992 SCC (2) 299 JT 1992 (2) 1

1992 SCALE (1)428

CITATOR INFO :

R 1992 SC1368 (3)

ACT:

Civil Services-C.C.R.-Adverse remarks-Communication and

noncommunication-Effect of-Action under Rule 56 (J) of the

Fundamental Rules (Rule 71 of Orissa Service Code) whether

to be delayed till the disposal of representation on adverse

remarks.

Civil Services-Orissa Service Code, Rule

71(Corresponding to rule 56. (J) of the Fundamental Rules)-

Compulsory retirement-Whether to be delayed till the

disposal of representation on adverse remarks.

Civil Services-Orissa Service Code-Rule 71-Compulsory

retirement-Principles of natural justice whether applicable-

Whether permissible on uncommunicated adverse remarks-

Courts' interference-Scope of.

Constitution of India, 1950-Article 226-Court's

jurisdiction to interfere with order of compulsory

retirement-Scope of-Principles of natural justice-

Applicability of-Compulsory retirement whether permissible

on uncommunicated adverse remarks.

HEADNOTE:

C.A.No.869 of 1987

On 15.3.1951, the appellant was appointed as a

Pharmacist, which was then designated as compounder. On

13.2.1976 he was retired compulsorily by the Government

under the first proviso to Sub-rule of Rule 71 of the Orissa

Service Code.

The appellant challenged the order by way of a writ

petition in the High Court contending that the order was the

result of ill-will and malice the Chief District Medical

Officer bore towards him; that his entire service was spot-

less and that at no time were any adverse entries in his

confidential character rolls communicated to him.

The respondent- Government submitted that the decision

to retire

837

the petitioner compulsorily was taken by the Review

Committee and not by the Chief Medical Officer; that besides

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the remarks made in the confidential character rolls, other

material was also taken into consideration by the Review

Committee that it arrived at its decision bonafide and in

public interest which decision was accepted and approved by

the Government. The allegation of malafides was denied.

The High Court looked into the proceedings of the Review

Committee and the confidential character rolls of the

appellant and dismissed the writ petition on the reasoning,

that an order of compulsory retirement after putting in the

prescribed qualifying period of service did not amount to

punishment; that the order was passed by the state

Government and not by the Chief Medical Officer and that the

petitioner has failed to establish that remarks in the

confidential character rolls were not duly and properly

recorded. It held that the adverse remarks though not

communicated, can yet be relied upon. Accordingly it held

that the decision to retire was taken by the Review

Committee on proper material and there were no grounds to

interfere with its decision.

The present appeal by special leave was filed by the

government servant against the decision of the High Court on

the question, whether acting upon undisclosed material was a

ground for quashing the order of compulsory retirement C.A.

No. 870 of 1987 was also filed on similar facts.

It was contended by the appellant that since an order of

compulsory retirement had adverse effects upon the career

and prospects of the government servant, the order should be

passed in accordance with principles of natural justice;

that before passing the order, a notice to show cause

against the order proposed should be given to the government

servant; that the order of compulsory retirement was based

upon uncommunicated adverse remarks and that the appellant

was also not afforded an opportunity to make a

representation against the same; and that as per the new

concept of Article 14 adumbrated Maneka Gandhi case, AIR

1978 SC 579, any and every arbitrary action was open to

judicial scrutiny.

Dismissing the appeals, this Court,

HELD: 1.01. What is normally required to be

communicated is adverse remarks - not every remark, comment

or observation made in the confidential rolls. There may be

any number of remarks, observations and

838

comments, which do not constitute adverse remarks, but are

yet relevant for the purpose of F.R. 56(j) or a Rule

corresponding to it. [855B-C]

1.02. The adverse remarks ought to be communicated in

the normal course, as required by the Rules/ orders in that

behalf. Any representations made against them would and

should also be dealt with in the normal course, with

reasonable promptitude. [854D-E]

1.03. The action under F.R.56(j) (or the Rule

corresponding to it) need not await the disposal or final

disposal of such representation or representations, as the

case may be. In some cases, it may happen that some adverse

remarks of the recent years are not communicated or if

communicated, the representation received in that behalf are

pending consideration. On this account alone, the action

under F.R.56(j) need not be held back. [854E-F]

1.04. There is no reason to presume that the Review

Committee or the government, if it chooses to take into

consideration such uncommunicated remarks, would not be

conscious or cognizant of the fact that they are not

communicated to the government servant and that he was not

given an opportunity to explain or rebut the same.

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Similarly, if any representation made by the government

servant is there, it shall also be taken into consideration.

[854F-G]

1.05. Not only the Review Committee is generally

composed of high and responsible officers, the power is

vested in government alone and not in a minor official. It

is unlikely that adverse remarks over a number of years

remain uncommunicated and yet they are made the primary

basis of action. Such an unlikely situation, if indeed

present, may be indicative of malice in law. [854G-H]

2.01. An order of compulsory retirement is not a

punishment. It implies no stigma nor any suggestion of

misbehaviour. [855D]

2.02. The order has to be passed by the government on

forming the opinion that it is in the public interest to

retire a government servant compulsorily. The order is

passed on the subjective satisfaction of the government.

[855D-E]

2.03. Principles of natural justice have no place in the

context of an order of compulsory retirement. This does not

mean that judicial scrutiny

839

is excluded altogether. While the High Court or this Court

would not examine the matter as an appellate court, they may

interfere if they are satisfied that the order is passed

(a) mala fide or (b) that it is based on no evidence or (c)

that it is arbitrary in the sense that no reasonable person

would form the requisite opinion on the given material;

in short, if it is found to be a perverse order. [855E-F]

2.04. The remedy provided by Article 226 of the

Constitution is no less an important safeguard. Even with

its well-known constraints, the remedy is an effective check

against mala fide, perverse or arbitrary action. [855A]

2.05. An order of compulsory retirement is not liable to

be quashed by a court merely on the showing that while

passing it, uncommunicated adverse remarks were also taken

into consideration. That circumstance by itself cannot be a

basis for interference. [856B]

2.06. The government (or the Review Committee, as the

case may be) shall have to consider the entire record of

service before taking a decision in the matter, of course,

attaching more importance to the record of and performance

during the later years. The record to be so considered would

naturally include the entries in the confidential

records/character rolls, both favourable and adverse. If a

government servant is promoted to a higher post

notwithstanding the adverse remarks, such remarks lose their

sting, more so, if the promotion is based upon merit

(selection) and not upon seniority. [855G-856A]

2.07. The nature of the function is not quasi-judicial

in nature and because the action has to be taken on the

subjective satisfaction of the Government, there is no room

for importing any facet of natural justice particularly

because an order of compulsory retirement is not a

punishment nor does it involve any stigma. [856E]

Union Of India v. M.E.Reddy, [1980] 1 SCR 736; Union of

India v. J.N.Sinha, [1971] 1 SCR 791, Applied.

Shyam Lal v. State of Uttar Pradesh, [1955] 1 SCR 26;

Shivacharana v. State of Mysore, AIR (1965) SC 280; State

of Orissa v. Dr. Binapani Devi, [1967] 2 SCR 625; A.K.

kraipak v. Union of India, AIR 1970 SC 150; R.L. Butail v.

Union of India, [1971] 2 SCR 791; Dr. N.V. Puttabhatta v.

State of Mysore, AIR 1972 SC 2185; Gian Singh Mann v. Punjab

and Haryana

840

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High Court, AIR 1980 SC 1894; O.N.G.C. v. Iskandar Ali, Brij

Bihari Lal Agarwal v. High Court Of Madhya Pradesh, [1981] 2

SCR 29; Baldev Raj Chaddha v. Union Of India, [1981] 1 SCR

430; J.D. Srivastava v. State of Madhya Pradesh, [1984] 2

SCR 466; Brij Mohan Singh Chopra v. State of Punjab, [1987]

2 SCC 1988; Gurdyal Singh Fiji v. State of Punjab, [1979] 3

SCR 518;m Amarkant Chaudhary v. State of Bihar, [1984] 2 SCR

299; Baidyanath Mahapatra v. State of Orissa, [1989] 4 SCC

664; Barium Chemicals v. Company Law Board, AIR (1967) SC

295; Vallukunnel v. Reserve Bank of India, AIR 1962 SC 1371;

Maneka Gandhi's case, AIR 1978 SC 579, Referred to.

JUDGMENT:

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 869 of 1987.

From the Judgment and Order dated 22.12.1981 of the

Orissa High Court in Original Judicature Case No. 412 of

1976.

WITH

CA No. 870 of 1987

R.K. Garg and A.K. Panda for the Appellants.

C.S. Srinivasa Rao for the Respondent.

The Judgment of the Court was delivered by

B.P. JEEVAN REDDY,J. 1. These appeals raise the

question-whether it is permissible to the government to

order compulsory retirement of a government servant on the

basis of material which includes uncommunicated adverse

remarks. While the appellants (government servants,

compulsory retired) rely upon the decisions of this court in

Brij Mohan Singh Chopra, [1987] 2 S.C.C. 1988 and Baidyanath

Mahapatra, [1989] 4 S.C.C. 664, in support of their

contention that it is not permissible, the respondent-

government relies upon the decision in M.E. Reddy. [1980] 1

S.C.R. 736 to contend that it is permissible to the

government to take into consideration uncommunicated

adverse remarks also while taking a decision to retire a

government servant compulsorily.

2. The appellants in both the appeals have been

compulsorily retired by the government of Orissa in exercise

of the power conferred upon it by the first proviso to Rule

71 (a) of the Orissa Service Code. Since the relevant facts

in both the appeals are similar, it would be sufficient if

we set out the facts in Civil Appeal No. 869 of 1987.

841

3. The appellant, Sri Baikuntha Nath Das was appointed

as a Pharmacist (then designated as Compounder) by the Civil

Surgeon, Mayurbhanj on 15.3.1951. By an order dated

13.2.1976 the government of Orissa retired him compulsorily

under the first proviso to sub-rule of Rule 71 of the Orissa

Service Code. The order reads as follows:

``In exercise of the powers conferred under the

first proviso to sub-rule (a) of rule 71 of Orissa

Service Code, the Government of Orissa is pleased

to order the retirement of Sri Baikunthanath Das,

Pharmacist now working under the Chief District

Medical Officer, Mayurbhanj on the expiry of three

months from the date of service of this order on

him.

By order of the Governor.''

4. The petitioner challenged the same in the High Court

of Orissa by way of a writ petition, being O.J.C.No. 412

of 1976. His case was that the order was based on no

material and that it was the result of ill-will and malice

the Chief District Medical Officer bore towards him. The

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petitioner was transferred by the said officer from place to

place and was also placed under suspension at one stage. He

submitted that his entire service has been spot-less and

that at no time were any adverse entries in his

confidential character rolls communicated to him. In the

counter-affidavit filed on behalf of the government, it was

submitted that the decision to retire the petitioner

compulsorily was taken by the Review Committee and not by

the Chief Medical Officer. It was submitted that besides the

remarks made in the confidential character rolls, other

material was also taken into consideration by the Review

Committee and that it arrived at its decision bonafide and

in public interest which decision was accepted and approved

by the government. The allegation of malafides was denied.

5. The High Court looked into the proceedings of the

Review Committee and the confidential character rolls of the

petitioner and dismissed the writ petition on the following

reasoning: An order of compulsory retirement after putting

in the prescribed qualifying period of service does not

amount to punishment as has been repeatedly held by this

court. The order in question was passed by the State

Government and not by the Chief Medical Officer. It is true

that the confidential character roll of the petitioner

contained several remarks adverse to him which were, no

doubt, not communicated to him, but the decision of this

court in Union of India

842

v. M.E.Reddy, [1980] 1 S.C.R. 736, holds that uncommunicated

adverse remarks can also be relied upon while passing an

order of compulsory retirement. The said adverse remarks

have been made by successive Civil Surgeons and not by the

particular Chief District Medical Officer against whom the

petitioner has alleged malafides. It is unlikely that all

the Chief District Medical Officers were prejudiced against

the petitioner. In particular, the court observed, "the

materials placed before us do not justify a conclusion that

the remarks in the confidential character rolls had not duly

and properly been recorded." The decision to retire has been

taken by the Review Committee on proper material and there

are no grounds to interfere with its decision, it opined.

6. The adverse remarks made against the petitioner - in

the words of the High Court - are to the following effect:

"......most insincere, irregular in habits and

negligent and besides being a person of doubtful

integrity, he had been quarrelsome with his

colleagues and superior officers and had been

creating problems for the administration."

7. Rule 71 (a) alongwith the first proviso appended

thereto - which alone is relevant for our purpose - reads

thus:

"71. (a) Except as otherwise provided in the other

clauses of this rule the date of compulsory

retirement of a Government servant, except a

ministerial servant who was in Government

service on the 31st March, 1939 and Class IV

Government servant, is the date on which he or she

attains the age of 58 years subject to the

condition that a review shall be conducted in

respect of the Government servant in the 55th year

of age in order to determine whether he/she should

be allowed to remain in service upto the date of

the completion of the age of 58 years or retired on

completing the age of 55 years in the public

interest:

Provided that a Government servant may retire from

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service any time after completing thirty years

qualifying service or on attaining the age of fifty

years, by giving a notice in writing to the

appropriate authority at least three months before

the date on which he wishes to retire or by giving

the said notice to the

843

said authority before such shorter period as

Government may allow in any case. It shall be open

to the appropriate authority to withhold permission

to a Government servant who seeks to retire under

this rule, if he is under suspension or if

inquires against him are in progress. The

appropriate authority may also require any officer

to retire in public interest any time after he has

completed thirty years qualifying service or

attained the age of fifty years, by giving a notice

in writing to the Government servant at least three

months before the date on which he is required to

retire or by giving three months pay and allowances

in lieu of such notice. xx xx xx"

8. It is evident that the latter half of the proviso

which empowers the government to retire a government servant

in public interest after he completes 30 years of qualifying

service or after attaining the age of 50 years is in pari

materia with the Fundamental Rule 56(j).

9. The Government of Orissa had issued certain

instructions in this behalf. According to these

instructions, the Review Committee, if it is of the opinion

that a particular government servant should be retired

compulsorily, must make a proposal recording its full

reasons therefor. The administrative department controlling

the services to which the particular government servant

belongs, will then process the proposal and put it up to the

government for final orders.

10. In Shyam Lal v. State of Uttar Pradesh, [1955] 1

S.C.R. 26, a Constitution Bench of this court held that an

order of compulsory retirement is not a punishment nor is

there any stigma attached to it. It said:

"There is no such element of charge or imputation

in the case of compulsory retirement. The two

requirements for compulsory retirement are that the

officer has completed twenty five years' service

and that it is in the public interest to dispense

with his further services. It is true that this

power of compulsory retirement may be used when the

authority exercising 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 sentence of Note 1

to Article 465-A make it abundantly clear that an

imputation or charge is not in terms made a

condition for the exercise of the power.

844

In other words, a compulsory retirement has no

stigma or implication of misbehaviour or

incapacity."

11. In Shivacharana v. State of Mysore, A.I.R. 1965 S.C.

280, another Constitution Bench reaffirmed the said

principle and held that "Whether or not the petitioner's

retirement was in the public interest, is a matter for the

State Government to consider and as to the plea that the

order is arbitrary and illegal, it is impossible to hold on

the material placed by the petitioner before us that the

said order suffers from the vice of malafides."

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12. As far back as 1970, a Division Bench of this court

comprising J.C. Shah and K.S. Hegde, JJ. held in Union of

India v. J.N Sinha, [1971] 1 S.C.R. 791, that an order of

compulsory retirement made under F.R. 56 (j) does not

involve any civil consequences, that the employee retired

thereunder does not lose any of the rights acquired by him

before retirement and that the said rule is not intended for

taking any penal action against the government servant. It

was pointed out that the said rule embodies one of the

facets of the pleasure doctrine embodied in Article 310 of

the Constitution and that the rule holds the balance between

the rights of the individual Government servant and the

interest of the public. The rule is intended it was

explained, to enable the Government to energise its

machinery and to make it efficient by compulsory retiring

those who in its opinion should not be there in public

interest. It was also held that rules of natural justice are

not attracted in such a case. If the appropriate authority

forms the requisite opinion bonafide, it was held, its

opinion cannot be challenged before the courts though it is

open to an aggrieved party to contend that the requisite

opinion has not been formed or that it is based on

collateral grounds or that it is an arbitrary decision. It

is significant to notice that this decision was rendered

after the decisions of this court in State of Orissa v.

Dr.Binapani Devi, [1967] 2 S.C.R. 625 and A.K.Kraipak v.

Union of India, A.I.R. 1970 S.C. 150.Indeed, the said

decisions were relied upon to contend that even in such a

case the principles of natural justice required an

opportunity to be given to the government servant to show

cause against the proposed action. The contention, was not

accepted as stated above. The principles enunciated in the

decision have been accepted and followed in many a later

decision. There has never been a dissent - not until 1987.

13. In R.L. Butial v. Union of India, relied upon by

the appellant's

845

counsel, the Constitution Bench considered a case where the

government servant was denied the promotion and later

retired compulsorily under F.R. 56(j) on the basis of

adverse entries in his confidential records. The appellant,

an electrical engineer, entered the service of Simla

Electricity Board in 1934. In 1940, he was transferred to

Central Electricity Commission - later designated as Central

Water and Power Commission (Power Wing). In 1955 he was

promoted to the post of Director wherein he was confirmed in

the year 1960. In his confidential reports relating to the

years 1964 and 1965, certain adverse remarks were made.

They were communicated to him. He made a representation

asking for specific instances on the basis of which the said

adverse remarks were made. These representations were

rejected. Meanwhile, a vacancy arose in the higher post. The

appellant was overlooked both in the year 1964 as well as in

1965 by the Departmental Promotion Committee and the

U.P.S.C. On August 15, 1967, on his completing 55 years of

age, he was compulsorily retired under F.R. 56(j). Thereupon

he filed three writ petitions in the High Court challenging

the said adverse entries as also the order of compulsory

retirement. The writ petitions were dismissed whereupon

the matters were brought to this court on the basis of a

certificate. The Constitution Bench enunciated the following

propositions:

1. The rules framed by the Central Water and Power

Commission on the subject of maintenance of confidential

reports show that a confidential report is intended to be a

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general assessment of work performed by the government

servant and that the said reports are maintained to serve as

a data of operative merit when question of promotion,

confirmation etc. arose. Ordinarily, they are not to contain

specific instances except where a specific instance has

led to a censure or a warning. In such situation alone, a

reasonable opportunity has to be afforded to the government

servant to present his case. No opportunity need be given

before the entries are made. Making of an adverse entry does

not amount to inflicting a penalty.

2. When the petitioner was overlooked for promotion his

representations against the adverse remarks were still

pending. But inasmuch as the said representations were

rejected later there was no occasion for reviewing the

decision not to promote the appellant. Withholding a

promotion is not a penalty under the Central Service Rules.

Hence, no enquiry was required to be held before deciding

not to promote the

846

appellant-more so, when the promotion was on the basis of

selection and not on the basis of seniority alone.

3. So far as the order of compulsory retirement was

concerned, it was based upon a consideration of his entire

service record including his confidential reports. The

adverse remarks in such reports, were communicated from time

to time and the representations made by the appellant were

rejected. It is only thereafter that the decision to retire

him compulsorily was taken and, therefore, there was no

ground to interfere with the said order.

14. It is evident that in this case, the question

arising for our consideration viz, whether uncommunicated

adverse remarks can be taken into consideration alongwith

other material for compulsorily retiring a government

servant did not arise for consideration. That question arose

directly in Union of India v. M.E.Reddy.

15. The respondent, M.E. Reddy belonged to Indian Police

Services. He was retired compulsorily under Rule 16 (3) of

All India Service (Death-cum-Retirement Rules) 1958 -

corresponding to F.R. 56 (j). The contention of the

respondent was that the order was passed on non-existing

material inasmuch as at no time were any adverse remarks

communicated to him. His contention was that had there been

any adverse entries they ought to have been communicated to

him under the rules. The said contention was dealt with in

the following words:-

"......This argument, in our opinion, appears to

be based on a serious misconception. In the first

place, under the various rules on the subject it is

not every adverse entry or remarks that has to be

communicated to the officer concerned. The

superior officer may make certain remarks

while assessing the work and conduct of subordinate

officer based on his personal supervision or

contract. Some of these remarks may be purely

innocuous, or may be connected with general

reputation of honesty or integrity that a

particular officer enjoys. It will indeed be

difficult if not impossible to prove by positive

evidence that a particular officer is dishonest but

those who have had the opportunity to watch the

performance of the said officer from close quarters

are in a position to know the nature and character

not only of his performance but also of the

847

reputation that he enjoys".

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16. The Learned Judges referred to the decisions in

R.L.Butail,J.N.Sinha and several other decisions of this

court and held that the confidential reports, even though

not communicated to the officer concerned, can certainly be

considered by the appointing authority while passing the

order of compulsory retirement. in this connection, they

relied upon the principle in J.N. Sinha that principles of

natural justices are not attracted in the case of compulsory

retirement since it is neither a punishment nor does it

involve any civil consequences.

17. the principle of the above decision was followed in Dr.

N.V.Puttabhatta v.State of Mysore, A.I.R. 1972 S.C. 2185, a

decision rendered by A.N.Grover and G.K.Mitter , J.J.

Indeed, the contention of the appellant in this case was

that since an order of compulsory retirement has adverse

effects upon the career and prospects of the government

servant, the order must be passed in accordance with

principles of natural justice. It was contended that before

passing the order, a notice to show cause against the order

proposed must be given to the government servant . Reliance

was placed upon the decisions in Binapani Devi and Kraipak.

This contention was negatived following the decision in

J.N.Sinha. It was also pointed out, applying the principles

of Shivacharana that an order of compulsory retirement is

not a punishment nor does it involve any stigma or

implication or misbehaviour. Another contention urged in

this case was that the order of compulsory retirement was

based upon uncommunicated adverse remarks and that the

appellant was also not afforded an opportunity to make a

representation against the same. At the relevant time, no

appeal lay against the orders passed upon the

representation. Dealing with the said contention, the court

observed:

"as the confidential reports rules stood at the

relevant time, the appellant could not have

appealed against the adverse remarks and if the

opinion of the government to retire him

compulsorily was based primarily on the said

report, he could only challange the order if he was

in a position to show that the remarks were

arbitrary and malafide."

18. Yet another contention which is relevant to the present

case is this : the retirement of the appellant therein was

ordered under Rule 235 of Mysore Civil Services Rules. The

language of the said rule corresponded to

848

F.R.56(j) but it did not contain the word "absolute" as is

found in F.R.56(j). An argument was sought to be built up

on the said difference in language but the same was rejected

holding that even in the absence of the word "absolute" the

position remains the same. We are refering to the said

aspect in as much as the proviso to Rule 71 (a) of the

Orissa Service Code, concerned in the appeals before us,

also does not contain the word "absolute".

19. In (A.I.R.1980 S.C.1894) Gian Singh Mann v. Punjab and

Haryana High Court, a Bench consisting of Krishna Iyer and

Pathak, JJ. reiterated the principle that an order of

compulsory retirement does not amount to punishment and that

no stigma or implication of misbehaviour is intended or

attached to such an order.

20. In O.N.G.C v. Iskandar Ali, a probationer was terminated

on the basis of adverse remarks made in his assessment roll.

A Bench comprising three learned Judges (Fazal Ali, A.C.

Gupta and Kailasam, JJ.) held that the order of termination

in that case was an order of termination simpliciter without

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involving any stigma or any civil consequences. Since the

respondent was a probationer, he had no right to the post.

The remarks in his assessment roll disclosed that the

respondent was not found suitable for being retained in

service and even though some sort of enquiry was commenced,

it was not proceeded with. The appointing authority

considered it expedient to terminate the service of the

respondent in the circumstances and such an order was beyond

challenge on the ground of violation of Article 311.

21. This court has taken the view in certain cases that

while taking a decision to retire a government servant under

Rule 56(j), more importance should be attached to the

confidential records of the later years and that much

importance should not be attached to the record relating to

earlier years or to the early years of service. In Brij

Bihari Lal Agarwal v. High Court of Madhya Pradesh, [1981] 2

S.C.R 29, upon which strong reliance is placed by the

appellant's counsel - a Bench comprising Pathak and Chinappa

Reddy,JJ. observed thus:

".......What we would like to add is that when

considering the question of compulsory retirement,

while it is not doubt desirable to make an overall

assessment of the Government servant's record,

more than ordinary value should be attached to the

confidential reports pertaining to the years

immediately

849

preceding such consideration. It is possible that a

Government servant may possess a somewhat erratic

record in the early years of service, but with the

passage of time he may have so greatly improved

that it would be of advantage to continue him in

service up to the statutory age of superannuation.

Whatever value the confidential reports of earlier

years may possess, those pertaining to the later

years are not only of direct relevance but also of

utmost importance."

22. We may mention that the order of compulsory

retirement in the above case is dated 28th September, 1979.

The High Court took into account the confidential reports

relating to the period prior to 1966 which were also not

communicated to the concerned officer. However, the decision

is based not upon the non-communication of adverse remarks

but on the ground that they were too far in the past. It was

observed that reliance on such record has the effect of

denying an opportunity of improvement to the officer

concerned. The decision in Baldev Raj Chaddha v. Union of

India, [1981] 1 S.C.R. 430, is to the same effect. In J.D.

Srivastava v. State of Madhya Pradesh, [1984] 2 S.C.R. 466,

it was held by a Bench of three learned Judges that adverse

reports prior to the promotion of the officer cannot

reasonably form a basis for forming an opinion to retire

him. The reports relied upon for retiring the appellant were

more than 20 years old and there was no other material upon

which the said decision could be based. It was held that

reliance on such stale entries cannot be placed for retiring

a person compulsorily, particularly when the officer

concerned was promoted subsequent to such entries.

23. We now come to the decision in Brij Mohan Singh

Chopra v. State of Punjab, relied upon by the learned

counsel for the petitioner. In this case, there were no

adverse entries in the confidential records of the appellant

for a period of five years prior to the impugned order.

Within five years, there were two adverse entries. In

neither of them, however, was his integrity doubted. These

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adverse remarks were not communicated to him. The Bench

consisting of E.S. Venkataramiah and K.N. Singh JJ. quashed

it on two grounds viz.,

1. It would not be reasonable and just to consider

adverse entries of remote past and to ignore good entries of

recent past. If entries for a period of more than 10 years

past are taken into account it would be an act of

850

digging out past to get some material to make an order

against the employee.

2. In Gurdyal Singh Fiji v. State of Punjab, [1979] 3

S.C.R. 518 and Amarkant Chaudhary v. State of Bihar, [1984]

2 S.C.R. 299, it was held that unless an adverse report is

communicated and representation, if any, made by the

employee is considered, it may not be acted upon to deny the

promotion. The same consideration applies where the

adverse entries are taken into account in retiring an

employee pre-maturely from service. K.N. Singh, J. speaking

for the Bench observed: "it would be unjust and unfair and

contrary to principles of natural justice to retire pre-

maturely a government employee on the basis of adverse

entries which are either not communicated to him or if

communicated, representations made against those entries are

not considered and disposed of".

This is the first case in which the principles of

natural justice were imported in the case of compulsory

retirement even though it was held expressly in J.N. Sinha

that the said principles are not attracted. This view was

reiterated by K.N. Singh, J. again in [1989] 4 S.C.C. 664

Baidyanath Mahapatra v. State of Orissa, (Bench comprising

of K.N. Singh and M.H. Kania, JJ.). In this case, the Review

Committee took into account the entire service record of the

employee including the adverse remarks relating to the year

1969 to 1982 (barring certain intervening years for which no

adverse remarks were made). The employee had joined the

Orissa Government service as an Assistant Engineer in 1955.

In 1961 he was promoted to the post of Executive Engineer

and in 1976 to the post of Superintending Engineer. In 1979

he was allowed to cross the efficiency bar with effect from

1.1.1979. He was compulsorily retired by an order dated

10.11.1983. The Bench held in the first instance that the

adverse entries for the period prior to his promotion as

Superintending Engineer cannot be taken into account. It was

held that if the officer was promoted to a higher post, and

that too a selection post, notwithstanding such adverse

entries, it must be presumed that the said entries lost

their significance and cannot be revived to retire the

officer compulsorily. Regarding the adverse entries for the

subsequent years and in particular relating to the years

1981-82 and 1982-83 it was found that though the said

adverse remarks were communicated, the period prescribed for

making a representation had not expired. The Bench observed:

".......These facts make it amply clear that the

appellant's

851

representation against the aforesaid adverse

remarks for the years 1981-82 and 1982-83 was

pending and the same had not been considered or

disposed of on the date of impugned order was

issued. It is settled view that it is not

permissible to prematurely retire a government

servant on the basis of adverse entries,

representations against which are not considered

and disposed of. See Brij Mohan Singh Chopra v.

State of Punjab."

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24. On the above basis, it was held that the Review

Committee ought to have waited till the expiry of the period

prescribed for making representation against the said

remarks and if any representation was made it should have

been considered and disposed of before they could be taken

into consideration for forming the requisite opinion. In

other words, it was held that it was not open to the Review

Committee and the government to rely upon the said adverse

entries relating to the years 1981-82 and 1982-83, in the

circumstances. Unfortunately, the decision in J.N. Sinha was

not brought to the notice of the learned Judges when

deciding the above two cases.

25. The basis of the decisions in Brij Mohan Singh

Chopra and Baidyanath Mahapatra, it appears, is that while

passing an order of compulsory retirement, the authority

must act consistent with the principles of natural justice.

It is said to expressly in Brij Mohan Singh Chopra. This

premise, if carried to its logical end, would also mean

affording an opportunity to the concerned government servant

to show cause against the action proposed and all that it

involves. It is true that these decisions do not go to that

extent but limit their holding to only one facet of the rule

viz., `acting upon undisclosed material to the prejudice of

a man is a violation of the principle of natural justice.'

This holding is in direct conflict with the decision in

J.N.Sinha which excludes application of principles of

natural justice. As pointed out above, J.N. Sinha was

decided after, and expressly refers to the decisions in,

Binapani Devi and Kraipak and yet holds that principles of

natural justice are not attracted in a case of compulsory

retirement. The question is which of the two views is the

correct one. While answering this question, it is necessary

to keep the following factors in mind: (a) Compulsory

retirement provided by F.R. 56 (j) or other corresponding

rules, is not a punishment. It does not involve any stigma

nor any implication of misbehaviour or incapacity. Three

Constitution Benches have said so vide Shyam Lal

Shivacharana and R.L.

852

Butail. (b) F.R. 56 (j) as also the first proviso to Rule

71(a) of the Orissa Service Code, empower the government to

order compulsory retirement of a government servant if in

their "opinion", it is in the public interest so to do. This

means that the action has to be taken on the subjective

satisfaction of the government. In R.L. Butail, the

Constitution Bench observed:

"......In Union of India v. Col J.N. Sinha this

Court stated that F.R. 56(j) in express terms

confers on the appropriate authority an absolute

right to retire a Government servant on his

attaining the age of 55 years if such authority is

of the opinion that it is in public interest so to

do. The decision further states:

"If that authority, bona fide forms that opinion,

the correctness of that opinion cannot be

challenged before courts. It is open to an

aggrieved party to contend that the requisite

opinion has not been formed or the decision is

based on collateral grounds or that it is an

arbitrary decision."

26. The law on the subjective satisfaction has been

dealt with elaborately in Barium Chemicals v. Company Law

Board, AIR 1967 S.C. 295. At page 323, Shelat, J., after

referring to several decisions dealing with action taken on

subjective satisfaction, observed thus:

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"Bearing in mind these principles the provisions of

S. 237 (b) may now be examined. The clause empowers

the Central Government and by reason of delegation

of its powers the Board to appoint inspectors to

investigate the affairs of the company, if "in the

opinion of the Central Government" (now the Board)

there are circumstances "suggesting" what is stated

in the three sub-clauses. The power is executive

and the opinion requisite before an order can be

made is of the Central Government or the Board as

the case may be and not of a Court. Therefore, the

Court cannot substitute its own opinion for the

opinion of the authority. But the question is,

whether the entire action under the section is

subjective?"

27. The learned Judges then referred to certain other

decisions including the decision in Vallukunnel v. Reserve

Bank of India, AIR 1962 S.C. 1371 and concluded as follows:

853

"Therefore, the words, "reason to believe" or "in

the opinion of"do not always lead to the

construction that the process of entertaining

"reason to believe" or "the opinion" is an

altogether subjective process not lending itself

even to a limited scrutiny by the court that such

"reason to believe" or "opinion" was not formed on

relevant facts or within the limits or as Lord

Radcliffe and Lord Reid called the restraints of

the statute as an alternative safeguard to rule of

natural justice where the function is

administrative."

28. The blurring of the dividing line between a quasi-

judicial order and an administrative order, pointed out in

Kraipak has no effect upon the above position, more so when

compulsory retirement is not a punishment nor does it imply

any stigma. Kraipak- or for that matter, Maneka Gandhi -

cannot be understood as doing away with the concept of

subjective satisfaction.

29. On the above premises, it follows, in our respectful

opinion that the view taken in J.N. Sinha is the correct one

viz., principles of natural justice are not attracted in a

case of compulsory retirement under F.R. 56(j) or a rule

corresponding to it. In this context, we may point out a

practical difficulty arising from the simultaneous operation

of two rules enunciated in Brij Mohan Singh Chopra. On one

hand, it is stated that only the entries of last ten years

should be seen and on the other hand, it is stated that if

there are any adverse remarks therein, they must not only be

communicated but the representations made against them

should be considered and disposed of before they can be

taken into consideration. Where do we draw the line in the

matter of disposal of representation. Does it mean, disposal

by the appropriate authority alone or does it include appeal

as well. Even if the appeal is dismissed, the government

servant may file a revision or make a representation to a

still higher authority. He may also approach a court or

Tribunal for expunging those remarks. Should the government

wait until all these stages are over. All that would

naturally take a long time by which time, these reports

would also have become stale. A government servant so minded

can adopt one or the other proceeding to keep the matter

alive. This is an additional reason for holding that the

principle of M.E. Reddy should be preferred over Brij Mohan

Singh Chopra and Baidyanath Mahapatra, on the question of

taking into consideration uncommunicated adverse remarks.

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854

30. Another factor to be borne in mind is this: most

often, the authority which made the adverse remarks and the

authority competent to retire him compulsorily are not the

same. There is no reason to presume that the authority

competent to retire him will not act bonafide or will not

consider the entire record dispassionately. As the decided

cases show, very often, a Review Committee consisting of

more than one responsible official is constituted to examine

the cases and make their recommendation to the government.

The Review Committee, or the government, would not naturally

be swayed by one or two remarks, favourable or adverse. They

would form an opinion on a totality of consideration of the

entire record - including representations, if any, made by

the government servant against the above remarks - of course

attaching more importance to later period of his service.

Another circumstance to be borne in mind is the unlikelihood

of succession of officers making unfounded remarks against a

government servant.

31. We may not be understood as saying either that

adverse remarks need not be communicated or that the

representations, if any, submitted by the government servant

(against such remarks) need not be considered or disposed

of. The adverse remarks ought to be communicated in the

normal course, as required by the Rules/orders in that

behalf. Any representations made against them would and

should also be dealt with in the normal course, with

reasonable promptitude. All that we are saying is that the

action under F.R.56(j) (or the Rule corresponding to it)

need not await the disposal or final disposal of such

representation or representations, as the case may be. In

some cases, it may happen that some adverse remarks of the

recent years are not communicated or if communicated, the

representation received in that behalf are pending

consideration. On this account alone, the action under

F.R.56(j) need not be held back. There is reason to presume

that the Review Committee or the government, if it chooses

to take into consideration such uncommunicated remarks,

would not be conscious or cognizant of the fact that they

are not communicated to the government servant and that he

was not given an opportunity to explain or rebut the same.

Similarly, if any representation made by the government

servant is there, it shall also be taken into consideration.

We may reiterate that not only the Review Committee is

generally composed of high and responsible officers, the

power is vested in government alone and not in a minor

official. It is unlikely that adverse remarks over a number

of years remain uncommunicated and yet they are made the

primary basis of action. Such an unlikely situation if

indeed present, may be indicative of malice in law. We may

855

mention in this connection that the remedy provided by

Article 226 of the Constitution is no less an important

safeguard. Even with its well-known constraints, the remedy

is an effective check against mala fide, perverse or

arbitrary action.

At this stage, we think it appropriate to append a note

of clarification. What is normally required to be

communicated is adverse remarks - not every remark, comment

or observation made in the confidential rolls. There may be

any number of remarks, observations and comments, which do

not constitute adverse remarks, but are yet relevant for the

purpose of F.R. 56(j) or a Rule corresponding to it. The

object and purposes for which this power is to be exercised

are well-stated in J.N. Sinha and other decisions referred

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supra.

32. The following principles emerge from the above

discussion:

(i) An order of compulsory retirement is not a

punishment. It implies no stigma nor any suggestion of

misbehaviour.

(ii) The order has to be passed by the government on

forming the opinion that it is in the public interest to

retire a government servant compulsorily. The order is

passed on the subjective satisfaction of the government.

(iii) Principles of natural justice have no place in the

context of an order of compulsory retirement. This does not

mean that judicial scrutiny is excluded altogether. While

the High Court or this Court would not examine the matter as

an appellate court, they may interfere if they are satisfied

that the order is passed (a) mala fide or (b) that it is

based on no evidence or (c) that it is arbitrary - in the

sense that no reasonable person would form the requisite

opinion on the given material; in short, if it is found to

be perverse order.

(iv) The government (or the Review Committee, as the

case may be) shall have to consider the entire record of

service before taking a decision in the matter - of course

attaching more importance to record of and performance

during the later years. The record to be so considered would

naturally include the entries in the confidential

records/character rolls, both favourable and adverse. If a

government servant is promoted to a higher post

notwithstanding the adverse remarks, such remarks lose their

856

sting, more so, if the promotion is based upon merit

(selection) and not upon seniority.

(v) An order of compulsory retirement is not liable to

be quashed by a Court merely on the showing that while

passing it uncommunicated adverse remarks were also taken

into consideration. That circumstance by itself cannot be a

basis for interfere. Interference is permissible only on the

grounds mentioned in (iii) above. This aspect has been

discussed in paras 29 to 31 above.

33. Before parting with the case, we must refer to an

argument urged by Sri R.K. Garg. He stressed what is called,

the new concept of Article 14 as adumberated in Maneka

Gandhi (A.I.R. 1978 S.C. 579) and submitted on that basis

that any and every arbitrary action is open to judicial

scrutiny. The general principle evolved in the said decision

is not in issue here. We are concerned mainly with the

question whether a facet of principle of natural justice -

audi alteram partem - is attracted in the case of compulsory

retirement. In other words, the question is whether acting

upon undisclosed material is a ground for quashing the order

of compulsory retirement. Since we have held that the nature

of the function is not quasi-judicial in nature and because

the action has to be taken on the subjective satisfaction of

the Government, there is no room for importing the said

facet of natural justice in such a case, more particularly

when an order of compulsory retirement is not a punishment

nor does it involve any stigma.

34. So far as the appeals before us are concerned, the

High Court which has looked into the relevant record and

confidential records has opined that the order of compulsory

retirement was based not merely upon the said adverse

remarks but other material as well. Secondly, it has also

found that the material placed before them does not justify

the conclusion that the said remarks were not recorded duly

or properly. In the circumstances, it cannot be said that

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the order of compulsory retirement suffers from mala fides

or that it is based on no evidence or that it is arbitrary.

35. For the above reason, both the appeals are dismissed

but in circumstances of the case, we make no order as to

costs.

V.P.R. Appeals

dismissed.

857