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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO(s). 13448 OF 2015

(Arising out of S.L.P. (C) No. 9833 of 2015)

PAWAN KUMAR AGARWALA ... APPELLANT(S)

VERSUS

GENERAL MANAGER-II & APPOINTING AUTH.

STATE BANK OF INDIA & ORS. ...RESPONDENT(S)

O R D E R

Leave granted.

This appeal by special leave is filed by the

appellant as he is aggrieved of the judgment and order

dated 26.11.2014 passed by the Division Bench of the

Gauhati High Court at Guwahati in Writ Appeal No. 192

of 2014 holding that there was no negligence on the

part of the respondent (appellant herein) in

disbursing the loan and he had taken appropriate steps,

however, the other Manager of that Branch, who has been

found guilty and levied with lesser penalty, therefore,

the minor penalty would visit the respondent

(appellant herein). Accordingly, the Division Bench of

the High Court modified the penalty of dismissal to one

of reduction of one increment for one year and further

directed the appellant to be reinstated in service with

no back wages for the reason that he had already been

taking pension for the period and further clarified

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that the period of dismissal and the reinstatement

shall be reckoned as a continuity of service for the

purpose of pension and, accordingly, partly allowed the

Writ Appeal preferred by the Bank.

Aggrieved of the aforesaid portion of the

finding and the order of penalty imposed by the

Division Bench of the High Court by setting aside the

order of reinstatement with 25% back wages awarded by

the learned Single Judge of the High Court in the Writ

Petition filed by the appellant questioning the

correctness of the impugned judgment and order, the

present appeal is filed by the appellant, urging

various legal contentions.

Brief facts necessary to appreciate the rival

legal contentions urged on behalf of the parties to the

lis are that the disciplinary proceedings were

initiated against the appellant by issuing chargesheet

dated 28.10.2004 alleging that he had influenced the

Branch Manager of Hallydayganj Branch, against whom the

disciplinary proceedings were initiated and upon

finding him guilty, minor penalty of lesser punishment

was imposed on him for being negligent in giving the

loans. In the said proceedings, the appellant herein

was Defence Representative of the said Manager Mr.

Pradeep Kumar Das. The brief allegation contained in

the chargesheet was that he had influenced the Branch

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Manager of Hallydayganj Branch to sanction cash credit

facility sans disclosing earlier loan of Abdul Kuddus

Mondal and, therefore, he had failed to protect the

interests of the Bank. The second charge was about

illegal grant of cash facility. The said charges were

divided into six allegations, which were extracted in

the chargesheet. The said charges were denied by the

appellant herein, therefore, the enquiry officer was

appointed by the disciplinary authority to enquire into

the allegations made against him.

The enquiry officer found that allegation Nos.

1, 2, 4 and 6 are proved, however, allegation No. 3 is

partly proved and allegation No. 5 is not proved. He

found that the loan application of the loanee was

written by the appellant herein despite the fact that

it was within his knowledge that the borrower had

earlier taken loan from his Branch and even then the

appellant has helped the borrower to borrow more money

from the neighbouring branch without disclosing the

earlier transaction with the appellant's Branch.

The disciplinary authority has taken the view

that charge Nos. 3 and 5 also held to be proved from

the material on record without giving an opportunity to

the appellant herein to show cause as to why the

finding on those charges should not be reversed. The

disciplinary authority forwarded to the appellant

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herein the enquiry report after taking the view that

charge Nos. 3 and 5 were proved for which the appellant

submitted a reply on 22.11.2005.

In the meantime, in the disciplinary

proceedings against Mr. Pradeep Kumar Das, Branch

Manager of Hallydayganj Branch, where the borrower got

filled up the application through the appellant and

taken the loan without disclosing the borrowing/loan

from the appellant's Branch of the Bank, the

disciplinary authority, after concluding the enquiry

against Mr. Pradeep Kumar Das, awarded penalty of one

stage lower in the time-scale for a period of one year

without cumulative effect. The penalty was imposed

holding that the same will not adversely affect the

pension of the said delinquent Manager Mr. Pradeep

Kumar Das.

On 05.01.2006, the disciplinary authority, not

accepting the reply submitted by the appellant herein,

imposed the penalty of reduction of basic pay for 3

years. The Chief Vigilance Officer (“C.V.O.”) was of

the view that there was extreme mala fides on the part

of the appellant as he had acted against the interests

of the Bank, therefore, the stiff major penalty was

directed to be imposed upon him vide Order dated

01.02.2006. Accordingly, the Appointing Authority

passed the Order dated 24.04.2006 for removal of the

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appellant from service. Against the said order of

removal, the appellant filed an appeal before the

Appellate Authority, which came to be rejected vide

Order dated 18.11.2006 sans examining the merits of the

case and considering the legal contentions urged in the

memorandum of appeal. On 07.02.2007, the respondent-

Bank sanctioned pension and the appellant is drawing

pension since then.

Aggrieved of the order of the dismissal which

is affirmed by the Appellate Authority, the appellant

herein filed a writ petition before the Gauhati High

Court in the month of March, 2009. The Bank filed its

affidavit by way of reply in the said writ petition.

After hearing both the parties, the learned Single

Judge of the High Court by Order dated 04.03.2014

allowed the writ petition and granted reinstatement

with all service benefits and payment of back wages to

the extent of 25%. The learned Single Judge while

granting such relief adverted to the rival legal

contentions has recorded a finding of fact holding that

there was unfairness in the enquiry as the list of

witnesses and the copies of documents were not given to

the appellant and the finding of the enquiry officer

was held to be perverse.

The correctness of the said judgment and order

of the learned Single Judge of the High Court was

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challenged in the Writ Appeal filed by the respondents

herein before the Gauhati High Court. The Division

Bench of the High Court after considering the rival

legal contentions substituted the order of the learned

Single Judge by imposing penalty of reduction of one

increment for one year and reinstatement without back

wages since he was already drawing pension. The said

order passed by the Division Bench of the High Court

modifying the order of the learned Single Judge is

impugned in this civil appeal by the appellant, urging

various legal contentions.

It is contended by Mr. Vijay Hansaria, learned

senior counsel for the appellant, that the finding is

recorded by the learned Single Judge in the order

passed in writ petition after considering the rival

legal contentions that the statutory requirements to

conduct fair and reasonable enquiry, list of witnesses

and copies of documents were not furnished to the

appellant-officer, thereby conducting the enquiry

proceedings are vitiated and the findings recorded

against the appellant and the charges are perverse.

The said finding is placed on undisputed fact of non

furnishing of list of witnesses and copies of

documents which are the statutory requirements for

conduct of disciplinary proceedings. The Division

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Bench of the High Court has erroneously set aside the

same without there being any evidence on record that

the appellant is negligent and other acts of misconduct

in discharging his duties and reversed the finding of

the learned Single Judge in holding that the conduct

of the enquiry is not fair and reasonable and there is

non-compliance of the principles of natural justice in

conducting enquiry thereby grave prejudice has been

caused to the appellant herein. The learned Single

Judge has also referred to the judgment of this Court

in the case of State Bank of India and Ors. vs. K.P.

Narayanan Kutty, (2003) 2 SCC 449, while recording such

a finding holding that the finding of fact recorded by

the enquiry officer that the charges are proved is

perverse in law. Learned senior counsel further

contended that the disciplinary authority has to follow

the procedural safeguards provided under the

disciplinary Regulations. Not considering the reply to

the chargesheet given to the appellant herein by the

disciplinary authority, the action that would be taken

upon such disciplinary proceedings by recording the

finding by the enquiry officer holding that the charges

are proved, on the basis of evidence of the witnesses

whose names were not notified to the appellant and

copies of documents were not furnished to him which

were relied upon by the enquiry officer, thereby the

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case of the appellant was prejudiced, therefore, the

same will have serious civil consequences upon the

Service Conditions of the appellant, if the minor or

major penalties are imposed, including the order of

removal that is passed by the disciplinary authority.

Therefore, the learned senior counsel submitted that

the Division Bench without application of mind and

assigning valid and cogent reasons, not noticing the

undisputed facts that list of witnesses and copies of

documents were not provided to the appellant in the

enquiry proceeding, it has erroneously set aside the

order passed by the learned Single Judge, who has

assigned valid and cogent reasons in rendering the

finding of fact holding that the enquiry was not fair

and the same is not in accordance with the statutory

requirements of the Conduct and Disciplinary

Regulations and in compliance with the principles of

natural justice. The said conclusion arrived at by the

learned Single Judge is supported by the judgments of

this Court rendered in a catena of cases, particularly

in the case of S. A. Venkataraman vs. U.O.I. and Anr.,

AIR 1954 SC 375, this Court observed as follows:

“14. As the law stands at present, the only

purpose, for which an enquiry under Act 37

of 1850 could be made, is to help the

Government to come to a definite

conclusion regarding the misbehavior of a

public servant and thus enable it to

determine provisionally the punishment

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which should be imposed upon him prior to

giving him a reasonable opportunity of

showing cause, as is required under article

311(2) of the Constitution. An enquiry

under this Act is not at all compulsory and

it is quite open to the Government to adopt

any other method if it so chooses. It is a

matter of convenience merely and nothing

else.It is against this background that we

will have to examine the material

provisions of the Public Servants

(Inquiries), Act of 1850 and see whether

from the nature and result of the enquiry

which the Act contemplates it is at all

possible to say that the proceedings taken

or concluded under the Act amount to

prosecution and punishment for a criminal

offence.”

In Union of India vs. T.R. Varma, AIR 1957 SC

882, this Court observed that if a person whose

services have been wrongfully terminated is entitled

to institute an action to vindicate his rights.

“6. At the very outset, we have to observe

that a writ petition under Art. 226 is not

the appropriate proceeding for adjudication

of disputes like the present. Under the law,

a person whose services have been wrongfully

terminated, is entitled to institute an

action to vindicate his rights, and in such

an action, the Court will be competent to

award all the relief's to which he may be

entitled, including some which would not be

admissible in a writ petition.

It is well-settled that when an

alternative and equally efficacious remedy is

open to a litigant, he should be required to

pursue that remedy and not invoke the special

jurisdiction of the High Court to issue a

prerogative writ. It is true that the

existence of another remedy does not affect

the jurisdiction of the Court to issue a

writ; but, as observed by this Court in

Rashid Ahmed vs. Municipal Board, Kairana ,

[1950] S.C.R. 566 (AIR 1950 SC 163(A) ”the

existence of an adequate legal remedy is a

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thing to be taken into consideration in the

matter of granting writs ". Vide also K. S.

Rashid and Son vs. The Income-tax

Investigation Commission, 1954 SCR 738 at

p.747: (AIR 1954 SC 207 at p. 210)(B). And

where such remedy exists, it will be a sound

exercise of discretion to refuse to interfere

in a petition under Art. 226, unless there

are good grounds therefor. None such appears

in the present case. On the other hand, the

point for determination in this petition

whether the respondent was denied a

reasonable opportunity to present his case,

turns mainly on the question whether he was

prevented from cross- examining the

witnesses, who gave evidence in support of

the charge.

That is a question on which there is a

serious dispute, which cannot be

satisfactorily decided without taking

evidence. It is not the practice of Courts to

decide questions of that character in a writ

petition, and it would have been a proper

exercise of discretion in the present case if

the learned Judges had referred the

respondent to a suit.

In this appeal, we should have

ourselves adopted that course, and passed the

order which the learned Judges should have

passed. But we feel pressed by the fact that

the order dismissing the respondent having

been made on September 16, 1954, an action to

set it aside would now be time-barred. As the

High Court has gone into the matter on the

merits, we propose to dispose of this appeal

on a consideration of the merits.

10.Now, it is no doubt true that the

evidence of the respondent and his witnesses

was not taken in the mode prescribed in the

Evidence Act; but that Act has no application

to enquiries conducted by tribunals, even

though they may be judicial in character. The

law requires that such tribunals should

observe rules of natural justice in the

conduct of the enquiry, and if they do so,

their decision is not liable to be impeached

on the ground that the procedure followed was

not in accordance with that, which obtains in

a Court of law.

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Stating it broadly and without

intending it to be exhaustive, it may be

observed that rules of natural justice

require that a party should have the

opportunity of adducing all relevant evidence

on which he relies, that the evidence of the

opponent should be taken in his presence, and

that he should be given the opportunity of

cross-examining the witnesses examined by

that party, and that no materials should be

relied on against him without his being given

an opportunity of explaining them.

If these rules are satisfied, the

enquiry is not open to attack on the ground

that the procedure laid down in the Evidence

Act for taking evidence was not strictly

followed.”

Learned senior counsel for the appellant

vehemently challenged that the appellant is also

aggrieved of the non-grant of back wages by the

Division Bench and setting aside the grant of 25% back

wages awarded by the learned Single Judge and imposing

penalty of reduction of one increment for one year. The

said finding is recorded without there being any

evidence on record. He contended that because pension

amount does not substitute the grant of back wages,

particularly in the absence of any material with the

respondent-Bank, whatsoever, to deny the back wages, as

he was gainfully employed from the date of dismissal

and till passing of the impugned judgment and order by

the learned Single Judge and the Division Bench.

Further the learned Single Judge and the Division

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bench have not given any reason, whatsoever, in

depriving the back wages and imposing the penalty of

withholding increment without there being any evidence,

therefore, the same is contrary to the law laid down by

this Court in a catena of cases.

Per contra, Mr. Gaurav Agrawal, learned counsel

appearing for the respondents, sought to justify the

order passed by the Division Bench of the High Court

and submitted that the correctness of the impugned

judgment and order of the Division Bench is challenged

on various grounds by filing a Special Leave Petition

and further, alternatively, contended that, even

assuming the Special Leave Petition cannot be

entertained by this Court, even then the Division

Bench of the High Court in exercise of its

extraordinary and supervisory jurisdiction has done

justice to the parties in imposing minor penalty and

not granting back wages while awarding reinstatement

keeping in view that the appellant has been paid the

pension since 07.02.2007, therefore, he prayed for

dismissal of the Civil Appeal filed by the appellant

seeking for the reliefs, as stated above.

We have given our thoughtful considerations to

the rival contentions urged by the learned counsel for

the parties to the lis and have carefully perused the

materials on the record and examined the impugned

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Orders passed by both the learned Single Judge and the

Division Bench of the High Court.

The chargesheet was issued on 28.10.2004

against the appellant making 6 allegations against him

and it is undisputed fact that list of witnesses and

the copies of documents were not furnished to the

appellant. Further, the disciplinary authority has

reversed the findings on charge Nos. 3 and 5 without

giving an opportunity to the appellant to show cause in

the matter and, thereafter, the order of removal was

passed by the Appointing Authority on the advice of the

C.V.O. vide his opinion dated 01.02.2006 and further it

is brought on record that similarly placed person,

namely, Mr. Pradeep Kumar Das, the Manager of

Hallydayganj Branch, who has loaned the loan to one

Mr. Tapan Kumar Sangma, in his case they have imposed

lesser punishment of withholding one increment thereby

making discrimination in differently treating with the

appellant herein, which is violation of Article 14 of

the Constitution of India. Further, it is brought to

our notice by Mr. Vijay Hansaria, learned senior

counsel for the appellant that the loan amount lent by

Mr. Pradeep Kumas Das, the Manager of Hallydayganj

Branch, the same has been cleared by Mr. Tapan Kumar

Sangma with interest by paying Rs. 1,61,000/-. The

overdraft is beyond the permissible limit is held to be

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not proved. The finding of the learned Single Judge

while examining the entire enquiry report, on which

strong reliance is placed by the respondent-Bank, the

learned Single Judge in exercise of his extraordinary

and Original Jurisdiction examined the case on merits

and referred to Rule 68(1)(IX)(a) of the State Bank of

India Service Rules, wherein it mandates the

disciplinary authority to furnish the delinquent the

list of documents through which the charges are

proposed to be proved. It is the case of the appellant

that such a list of witnesses and copies of documents

were not furnished either by the disciplinary

authority or the enquiry officer which are vital

aspects of the case, based on which the finding is

recorded on the charges by the enquiry officer,

referred to supra, holding that the same are proved

against the appellant. Further, with regard to lending

of loan in favour of Mr. Tapan Kumar Sangma, the

learned Single Judge examined and recorded the finding

of fact stating that a sum of Rs. 2,13,595 was

recovered from the said loanee and it is stated that

the Power of Attorney furnished by Abdul Kuddus Mondal

was never utilized to recover the balance loan due of

Rs. 15,450/-, which will not be the negligence on the

part of the appellant, however, it will be negligence

of those responsible for loan recovery, a small unpaid

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amount had to be written off by the Bank. Further, with

reference to the opinion/report Exhibit D-4 furnished

in support of the disbursement of the loan clearly

disclosed the previous loans of the borrowers from the

Phulbari Branch but surprisingly neither the enquiry

officer nor the disciplinary authority or the C.V.O.

had taken note of the said opinion/report, which

establishes the bona fide of the appellant's action in

rendering assistance to his neighbouring Branch Manager

to meet the target for disbursal of contract finance by

the Hallydayganj Branch Manager. Upon the contention

urged on behalf of the appellant that taking multiple

loans is not prohibited in the S.B.I. and contract

finance were sanctioned for the 2 borrowers by the

Hallydayganj Branch Manager with full knowledge of the

previous loans taken by them from the Phulbari Branch,

the learned Single Judge has referred to non-furnishing

of the control return file of the Branch as well as the

Bank's Ledger sheets of the J.N. High School account

and Mr. Tapan Kumar Sangma accounts to the appellant at

the time of conducting enquiry on the charges to

defend the case by the appellant effectively, the same

was projected as cause for serious prejudice to the

case of the appellant as the said documents

established that the borrowers had availed similar

overdraft facility earlier and, in any case, this was

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within the permissible discretionary capacity of the

Manager of the Phulbari Branch. The learned Single

Judge on the basis of reliance placed by the

appellants's counsel upon the decision of this Court

in the case of State Bank of India & Ors. vs. K.P.

Narayanan Kutty, (supra), wherein it has been held the

the non compliance of the statutory requirements as

per the aforesaid rules, the action of the

disciplinary authority is inconsistent with the

principles of natural justice and the settled

principles of service jurisprudence. In the said case,

while concurring with the decision of this Court in

the case of Punjab National Bank vs. Kunj, (1998) 7

SCC 84, para 19 was quoted, which reads as follows:

“19. The result of the aforesaid discussion

would be that the principles of natural

justice have to be read into Regulation 7(2).

As a result thereof, whenever the

disciplinary authority disagrees with the

enquiry authority on any article of charge,

then before it records its own findings on

such charge, it must record its tentative

reasons for such disagreement and give to the

delinquent officer an opportunity to

represent before it records its findings. The

report of the enquiry officer containing its

findings will have to be conveyed and the

delinquent officer will have an opportunity

to persuade the disciplinary authority to

accept the favourable conclusion of the

enquiry officer. The principles of natural

justice, as we have already observed, require

the authority which has to take a final

decision and can impose a penalty, to give an

opportunity to the officer charged of

misconduct to file a representation before

the disciplinary authority records its

findings on the charges framed against the

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officer."

While dealing with the similar fact situation in

William Vincent Vitarelli v. Fred A. Seaton, Secretary

of the Interior, et al (359 U.S. 535 (1959) , the

learned Judge observed as follows:

“An executive agency must be rigorously held

to the standards by which it professes its

action to be judged. See Securities &

Exchange Commission v. Chenery Corp., 318

U.S. 80, 87—88, 63 S.Ct. 454, 459, 87 L.Ed.

626. Accordingly, if dismissal from

employment is based on a defined procedure,

even though generous beyond the requirements

that bind such agency, that procedure must be

scrupulously observed. See Service v. Dulles,

354 U.S. 363, 77 S.Ct. 1152, 1 L.Ed.2nd 1403.

This judicially evolved rule of

administrative law is now firmly established

and, if I may add, rightly so. He that takes

the procedural sword shall perish with that

sword.”

The said judgment in Vitarelli's case was

referred to by this Court in R.D. Shetty vs.

International Airport Authority, 1979 (3) SCC 489, the

relevant extract of which is quoted hereinunder:

“10……It is a well-settled rule of

administrative law that an executive

authority must be rigorously held to the

standards by which it professes its actions

to be judged and it must scrupulously observe

those standards on pain of invalidation of an

act in violation of them. This rule was

enunciated by Mr. Justice Frankfurter in

Viteralli v. Saton where the learned Judge

said:

‘An executive agency must be rigorously held

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to the standards by which it professes its

action to be judged. Accordingly, if

dismissal from employment is based on a

defined procedure, even though generous

beyond the requirements that bind such

agency, that procedure must be scrupulously

observed. This judicially evolved rule of

administrative law is now firmly established

and, if I may add, rightly so. He that takes

the procedural sword shall perish with the

sword.’

This Court accepted the rule as valid and

applicable in India in A.S. Ahluwalia v.

Punjab and in subsequent decision given in

Sukhdev v. Bhagatram, Mathew, J., quoted the

above-referred observations of Mr Justice

Frankfurter with approval. It may be noted

that this rule, though supportable also as an

emanation from Article 14, does not rest

merely on that article. It has an independent

existence apart from Article 14. It is a rule

of administrative law which has been

judicially evolved as a check against

exercise of arbitrary power by the executive

authority. If we turn to the judgment of Mr

Justice Frankfurter and examine it, we find

that he has not sought to draw support for

the rule from the equality clause of the

United States Constitution, but evolved it

purely as a rule of administrative law. Even

in England, the recent trend in

administrative law is in that direction as is

evident from what is stated at pp. 540-41 in

Prof Wade’s “Administrative Law”, 4th Edn.

There is no reason why we should hesitate to

adopt this rule as a part of our continually

expanding administrative law. Today with

tremendous expansion of welfare and social

service functions, increasing control of

material and economic resources and large

scale assumption of industrial and commercial

activities by the State, the power of the

executive Government to affect the lives of

the people is steadily growing. The

attainment of socio-economic justice being a

conscious end of State policy, there is a

vast and inevitable increase in the frequency

with which ordinary citizens come into

relationship of direct encounter with State

power-holders. This renders it necessary to

structure and restrict the power of the

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executive Government so as to prevent its

arbitrary application or exercise…..”

Further, the learned Single Judge has examined

the opinion sought for from the C.V.O. by the

disciplinary authority on the penalty to be imposed

upon the appellant, the C.V.O. has suggested the major

penalty of removal, the same is inconsistent with the

norms applicable in the Bank's disciplinary

proceedings. The learned Single Judge examined the

action of the disciplinary authority in relation to the

Branch Manager Hallydayganj Branch that facilitating

the second loan to the loanee, Mr. Tapan Kumar Sangma,

closely known to the said Manager, the same allegation

has been treated as a minor lapse, but in the context

of the appellant they have imposed major penalty, which

is a clear case of discrimination. The appellant's

admission with regard to writing the loan applications

of Abdul Kuddus Mondal and Hasanuzzaman to enable them

to avail contract finance from the Hallydayganj Branch,

the contention urged on behalf of the appellant is

examined and held that the said applicants had availed

loans to the extent of Rs. 10,000/- and Rs. 15,000/-

respectively from the Phulbari Branch of the S.B.I.,

projecting that minimal loss and both the loans were

cleared of, assuming that the disciplinary proceedings

were just and fair, learned senior counsel for the

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appellant argued that the minor punishment proposed by

the disciplinary authority of pay reduction should have

been considered reasonable in the context of the

charges. The learned Single Judge, after considering

the opinion/report DEX-4, held that the enquiry officer

did not base his conclusion on any incriminatory

materials and in fact the report DEX-4 was totally

ignored which would have established the innocence of

the delinquent and further held that the enquiry

officer conducted the enquiry sans furnishing the

copies of crucial documents and furnishing the list of

witnesses. It appears to be a case of denial of fair

opportunity to the delinquent in gross violation of

the procedural requirements of the Service Rules. That

finding is based on factual, undisputed facts and in

conformity with the law, therefore, in our opinion, the

learned Single Judge has rightly held that the enquiry

conducted against the appellant was unfair and the

findings recorded on the charges are perverse in law.

While recording such a finding the learned Single Judge

has also proceeded to hold that the enquiry was found

to be vitiated for the reason that the then Branch

Manager Mr. Pradeep Kumar Das of Hallydayganj Branch

was never examined in the enquiry and without his

evidence, conclusion on culpability of the delinquent

on the loans disbursed by the Branch Manager of

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Hallydayganj to the loanee could not have been

reasonably reached by anyone, including the enquiry

officer and imposing major penalty on the basis of the

C.V.O. without there being any legal evidence on

record, the enquiry was not properly conducted due to

non-furnishing the list of witnesses and copies of the

documents, therefore, the exercise of power on the

basis of the C.V.O.'s opinion for removal of the

appellant from service entail serious consequences.

Therefore, placing reliance on K.P. Narayanan Kutty

(supra), the learned Single Judge held that the action

taken in accepting the C.V.O.'s view and passing order

of removal is arbitrary, unreasonable and gross

violation of Article 14 of the Constitution of India.

Having said so, the learned Single Judge has set aside

the order of removal and granted reinstatement of the

appellant with 25% back wages in the absence of any

proof to show that he was gainfully employed from the

date of order of removal till the date of the decision

rendered by the learned Single Judge and the Division

Bench of the High Court, therefore, the same is

contrary to the law laid down by this Court in the case

of Deepali Gundu Surwase vs. Kranti Junior Adhyapak

Mahavidyalaya (D. ED.) & Ors., (2013) 10 SCC 324, para

38 is quoted hereinunder:

“38. The propositions which can be culled

out from the aforementioned judgments are:

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i) In cases of wrongful termination of

service, reinstatement with continuity of

service and back wages is the normal rule.

ii) The aforesaid rule is subject to the

rider that while deciding the issue of back

wages, the adjudicating authority or the

Court may take into consideration the length

of service of the employee/workman, the

nature of misconduct, if any, found

proved against the employee/workman, the

financial condition of the employer and

similar other factors.

iii) Ordinarily, an employee or workman

whose services are terminated and who is

desirous of getting back wages is required to

either plead or at least make a statement

before the adjudicating authority or the

Court of first instance that he/she was not

gainfully employed or was employed on

lesser wages. If the employer wants to avoid

payment of full back wages, then it has to

plead and also lead cogent evidence to

prove that the employee/workman was

gainfully employed and was getting wages

equal to the wages he/she was drawing prior

to the termination of service. This is so

because it is settled law that the burden of

proof of the existence of a particular

fact lies on the person who makes a positive

averments about its existence. It is always

easier to prove a positive fact than to

prove a negative fact. Therefore, once

the employee shows that he was not

employed, the onus lies on the employer to

specifically plead and prove that the

employee was gainfully employed and was

getting the same or substantially similar

emoluments.

iv) The cases in which the Labour

Court/Industrial Tribunal exercises power

under Section 11-A of the Industrial Disputes

Act, 1947 and finds that even though

the enquiry held against the

employee/workman is consistent with the

rules of natural justice and/or certified

standing orders, if any, but holds that the

punishment was disproportionate to the

misconduct found proved, then it will have

the discretion not to award full back wages.

However, if the Labour Court/Industrial

Tribunal finds that the employee or workman

Page 23 23

is not at all guilty of any misconduct or

that the employer had foisted a false

charge, then there will be ample

justification for award of full back wages.

v) The cases in which the competent Court

or Tribunal finds that the employer has

acted in gross violation of the statutory

provisions and/or the principles of natural

justice or is guilty of victimizing the

employee or workman, then the Court or

Tribunal concerned will be fully justified in

directing payment of full back wages. In such

cases, the superior Courts should not

exercise power under Article 226 or 136 of

the Constitution and interfere with the

award passed by the Labour Court, etc.,

merely because there is a possibility of

forming a different opinion on the

entitlement of the employee/workman to get

full back wages or the employer’s obligation

to pay the same. The Courts must keep in

view that in the cases of wrongful/illegal

termination of service, the wrongdoer is

the employer and the sufferer is the

employee/workman and there is no

justification to give a premium to the

employer of his wrongdoings by relieving him

of the burden to pay to the

employee/workman his dues in the form of full

back wages.

vi) In a number of cases, the superior

Courts have interfered with the award of

the primary adjudicatory authority on the

premise that finalization of litigation has

taken long time ignoring that in majority of

cases the parties are not responsible

for such delays. Lack of

infrastructure and manpower is the

principal cause for delay in the

disposal of cases. For this the litigants

cannot be blamed or penalised. It would

amount to grave injustice to an employee or

workman if he is denied back wages simply

because there is long lapse of time

between the termination of his service

and finality given to the order of

reinstatement. The Courts should bear in mind

that in most of these cases, the employer is

in an advantageous position vis-à-vis the

employee or workman. He can avail the

services of best legal brain for prolonging

the agony of the sufferer, i.e., the employee

Page 24 24

or workman, who can ill afford the luxury

of spending money on a lawyer with certain

amount of fame. Therefore, in such cases it

would be prudent to adopt the course

suggested in Hindustan Tin Works Private

Limited vs. Employees of Hindustan Tin Works

Private Limited, (1979) 2 SCC 80.

vii) The observation made in J.K. Synthetics

Ltd. v. K.P. Agrawal, (2007) 2 SCC 433 that

on reinstatement the employee/workman

cannot claim continuity of service as of

right is contrary to the ratio of the

judgments of three Judge Benches referred

to hereinabove and cannot be treated as

good law. This part of the judgment is also

against the very concept of reinstatement of

an employee/workman.”

For the reasons stated supra, we have examined

the case threadbare on the basis of the material placed

on record and rival legal contentions urged on behalf

of the parties, we hold that the finding of the

enquiry officer on the charges is vitiated on account

of non-compliance of the statutory Rules and the

principles of natural justice. In the absence of

evidence, the order of reinstatement sans full back

wages is unjustified in law. At best, the High Court

should have made deduction of the amount of pension

received by the appellant after awarding full back

wages for the period in question. In not doing so, the

orders of the learned Single Judge and the Division

Bench of the High Court are liable to be set aside

with regard to non-grant of full back wages.

Accordingly, we set aside the Orders of the Division

Page 25 25

Bench imposing the penalty of reduction of one

increment to the appellant for one year and restore and

modify the order of the learned Single Judge with

regard to award of reinstatement with full back wages

for the period from the date of removal till the date

of the appellant attaining the age of superannuation,

on the basis of periodical revisions of salary to the

appellant herein and deduct the pension amount from

the back wages payable to the appellant. The same shall

be paid to the appellant within eight weeks from the

date of receipt of the copy of this order.

The appeal is allowed in the aforesaid terms,

directions and observations.

...........................J.

(V. GOPALA GOWDA)

..........................J.

(AMITAVA ROY)

NEW DELHI,

NOVEMBER 17, 2015