Maharashtra State Road Transport Corporation vs Girdharilal Lorinchand Puri and Others

Pendse. J.

This appeal is preferred by Maharashtra State Road Transport Corporation to challenge legality of Judgment and decree dated April 20, 1992 passed by learned single Judge in Suit No. 1399 of 1976 awarding a sum of Rs. 52,950.25 alongwith interest at the rate of 6% p. a. from the date of decree till realisation in favour of respondent. The facts which gave rise to the passing of the decree are as follows :-

The appellants are a statutory corporation constituted under the Road transport Corporation''s Act, 1950 and are carrying on business of operating transport services in the State of Maharashtra. The respondent joined the service of the appellants on July 5, 1950 as Assistant Secretary (Legislation). The respondent was promoted from time to time and was holding the post of Legal Adviser in year 1969. The service conditions of the employees of the appellants are regulated by the Bombay State Transport Employees'' Service Regulations issued u/s 45 of the Road Transport Corporation''s Act, 1950. chapter V deals with the subject of disciplinary action and punishment and Regulation 61 provides for termination of the service of an employee by giving calendar month''s notice in cases where the employee is not holding a permanent appointment. The regulation provides for holding of a departmental enquiry in cases of imposition of penalty for misconduct. Regulation 80 provides that the Corporation may specify acts of misconduct or omission and also prescribe a procedure for dealing with cases of acts of misconduct and imposition of punishment. In exercise of powers conferred under Regulation 80, the appellants framed rules known as "Discipline and appeal procedure for the Bombay State Transport Corporation Employees". The rules define acts of misconduct and the punishment which may be imposed. Regulation 81 sets out that "Notwithstanding the provisions of Regulation 61, the services of an employee, if he has been convicted in a criminal Court or has been declared insolvent by a Competent Court, shall be liable to be terminated without notice."

Maruti Shivram Sable, a private truck owner whose truck was involved in accident with the bus of the appellants and against whom the appellants has filed Suit No. 90 of 1968 for recovery of damages in the Court of Civil Judge, Junior Division, Bhor, complained to Anti-Corruption Bureau that the respondent had demanded illegal gratification to settle the claim. The Anti-Corruption Bureau set up a trap and arrested the respondent. The anti-Corruption Bureau file Special Case No. 2 of 1971 against the respondent u/s 161 of India Penal Code read with Section 5(1) of the Prevention of Corruption Act. Pending the trial, on October 8, 1969 the appellants decided to hold departmental enquiry against the respondent in respondent was served with the charge-sheet and order of suspension, pending the departmental enquiry. The charges levelled were collusion with outsiders to deprive the Corporation of a legitimate revenue, indiscipline, gross negligence resulting in serious loss to the Corporation, fraud, dishonesty and misappropriation of funds of the Corporation, acts involving moral turpitude and taking bribe or illegal gratification. The respondent, after service of charge-sheet, instituted Civil Suit No. 2966 of 1970 in City Civil Court, Bombay against the appellants seeking a permanent injunction restraining the Corporation from holding or proceeding with the departmental enquiry. the City Civil Court, Bombay granted interim injunction restraining Corporation from proceeding with the departmental enquiry by order dated April 28, 1970. The appellants, feeling aggrieved, preferred Appeal No. 202 of 1970 in this Court and on July 1, 1970 a consent order was passed whereby the appellants were allowed to proceed with the departmental enquiry but were prevented from passing final order imposing punishment. Prior to this order, the respondent reached age of superannuation on May 7, 1970 but on May 4, 1970 the Corporation had passed order providing that the respondent will continue in service beyond the date of his retirement and order of suspension will continue to hod filed pending the conclusion of departmental enquiry. The order was necessitated to enable the appellants to continue the departmental enquiry and to prevent the respondent from demanding retire mental benefits.

The criminal trial instituted against the respondent was taken up for hearing by Special Judge, Bombay and charge-sheet was served on January 28, 1971. The respondent raised preliminary objection to the maintainability of the trial by claiming that the respondent was not a public servant. The Trial Judge accepted the preliminary objection and passed order of discharge. The government of Maharashtra challenged the order by filing revision in this Court and the order was set aside and the Special Judge was directed to proceed with the prosecution. Thereupon, the Special judge renumbered the case as Special Case No. 6 of 1972 and after conclusion of the trial, found that the respondent was guilty of the offence charged and imposed punishment by judgment dated November 16, 1972. The respondent preferred Appeal No. 1456 of 1972 to challenge the order of conviction and sentence but the appeal ended in dismissal by judgment dated September 4, 1974 delivered by this Court.

The departmental enquiry which was pending against the respondent was not concluded till the date of disposal of criminal appeal filed by the respondent in this court and on September 4, 1974 the appellants issued an order terminating service of the respondent in exercise of powers conferred under Regulation 81. The departmental enquiry thereafter became redundant.

The respondent instituted Suit No. 1399 of 1976 on the Original Side of this Court in September 1976 seeking decree for an amount of Rs. 95,000/- against the appellants. The respondent also sought decree for Rs. 23,908/- which according to the respondent was arrears in respect of provident fund from the trustees of the Provident Fund Trust set up by the appellants. The respondent also claimed a sum of Rs. 15000/- from the trustees towards the claim of gratuity. The respondent claimed that all these amounts should be paid alongwith interest at the rate of 6% p. a. from the date of the suit till the date of realisation. The gravamen of the complaint of the plaintiff was that the conviction by Special Judge on the charge of the Corporation was not ipso facto sufficient to terminate the service of the respondent. It was claimed that it was necessary for the Corporation to proceed with the departmental enquiry which was commenced and which had remained unfinished till the date of conviction and as the enquiry was not concluded, the order of termination which amounts to punishment was illegal. The respondent claimed that the services of the respondent were extended even beyond the date of superannuation and therefore the respondent is entitled to full salary alongwith the benefit of provident fund and gratuity till the date of termination under Regulation 81. The suit was resisted by the appellants by pointing out that the respondent was dismissed from employment in accordance with Regulation 81 and the services of respondent were kept under suspension right from October 18, 1969. The appellants claimed that an employee who has been convicted of a criminal charge involving moral turpitude cannot claim that a separate departmental enquiry is necessary before terminating the services. The appellants also pointed out that the services of the respondent were extended on reaching age of superannuation only because of pending departmental enquiry and pending criminal trial and by no stretch of imagination, the respondent can claim that his full salary alongwith provident fund and gratuity should be paid till the conclusion of the criminal trial. The Trial Judge on this pleading framed three issues. The first issue was whether the order of termination deprives the respondent of his retire mental benefits and the answer was in the negative. The second issue was whether the respondent was entitled to the balance of the salary for the period commencing from October 18, 1969 to September 4, 1974 i.e., from the date when the respondent was placed under suspension till the date of passing an order of termination of services and which is long after the respondent reached age of superannuation and the answer to the issue was in the affirmative. The parties did not lead any oral evidence and the learned trial Judge came to the conclusion that the order of termination amounts to dismissal and consequently the respondent will not be entitled to claim amount of gratuity in accordance with Rule 11(i) (b) of the Gratuity Fund Regulations framed by the Corporation. The learned Judge then by curious mode of reasoning came to the conclusion that the order of termination should be deemed to have been passed by revoking the order of suspension and by implicit reinstatement of the respondent in service. The Trial Judge held that before passing the order of termination, the respondent shall be deemed to be reinstated in service and as the departmental enquiry was not concluded, the respondent is entitled to the full salary as well as the amount of provident fund. The Trial Judge then calculated the amount as Rs. 52,950.25 and passed decree for the said amount alongwith interest at the rate of 6% p. a. The decree passed by the Trial Judge is under challenge.

The respondent has preferred cross-objections seeking a sum of Rs. 17,959.05 and the break up is Rs. 15,000/- being the amount of gratuity and Rs. 2,959.05 being the ex-gratia amount paid in lieu of bonus for the years 1969 to 1974. Both the appeal and cross-objections are disposed of by this judgment.

Shri Sawant, learned counsel appearing on behalf of the appellants, submitted that the decree passed by the Trial Judge is entirely unsustainable and the logic which led to the Trial Judge holding that the respondent was deemed to have been reinstated in service prior to the date of order of termination is impossible to appreciate. Shri Sawant urged that the Trial Judge came to the conclusion that the respondent was properly dismissed in exercise of powers conferred under Regulation 81 and thereafter by a curious reasoning proceeded to decree the claim by holding that the respondent was entitled to the salary from the date of suspension till the date of passing of the order of termination. Shri Sawant wondered as under what law the Trial Judge could have awarded the full salary even after the date of respondent reaching the age of superannuation. We find considerable merit in the contention of the learned counsel and in our judgment, the decree passed by Trial Judge is entirely unsustainable.

As mentioned hereinabove, Regulation 81 enables the Corporation to terminate the services of an employee without holding any enquiry whatsoever in case the employee is convicted by competent Criminal Court. It is not in dispute that the respondent was convicted by competent Criminal Court and the charge involved moral turpitude. Apart from the facts which gave rise to criminal prosecution, the respondent was involved in several other misconducts and the appellants had commenced departmental enquiry in respect of those other misconducts. The charges levelled against the delinquent did not include the charge which led to filing of criminal prosecution. The appellants had power to suspend the respondent while holding a departmental enquiry and could have also in dependently suspended the respondent in lieu of the framing of charge of a serious nature by competent Criminal Court. Before the departmental enquiry could be concluded or the criminal trial reached conclusion, the respondent reached his age of superannuation. The rules and regulations framed by the appellants permit continuation of departmental enquiry inspite of the delinquent reaching the age of superannuation and in exercise of those powers, the appellants informed the respondent that the services shall be deemed to have extended for the purpose of conclusion of the departmental enquiry. The deemed extention of services can, by no stretch of imagination, be understood as giving extention to the employee to enable him to draw full salary alongwith the provident fund. In our judgment, the claim made by the respondent seeking full salary alongwith the provident fund and gratuity was wholly misconceived and the Trial Judge was in error in decreeing the claim.

Shri Oak, learned counsel appearing on behalf of the respondent, submitted that mere conviction by competent criminal Court involving moral turpitude is not sufficient to warrant termination of the employer and it was incumbent upon the appellants to hold departmental enquiry. The submission is merely to be stated to be rejected. The plain wording of regulation 81 leaves no manner of doubt that the appellants were entitled to terminate the services without holding enquiry after the respondent was convicted by the criminal Court. The principle that services of an employee can be terminated without holding any enquiry on conviction of criminal Court involving moral turpitude is well settled and is in existence in every employment including the government services.

Shri Oak referred to the decision of the Supreme Court reported in The Divisional Personnel Officer, Southern Railway and Another Vs. T.R. Chellappan and Others, , in support of the contention that conviction by competent Court is not sufficient. We are unable to find any observation in the decision to sustain the claim. It hardly requires to be stated that every conviction by criminal Court is not sufficient to warrant dismissal because some of the convictions do not involve moral turpitude or are in respect of a technical offence. Conviction in such cases is not suffice for dismissal of an employee, but can it ever be suggested by any stretch of imagination that conviction or charge of accepting illegal gratification is not sufficient to dismiss an employee and departmental enquiry is a must in respect of the said charge. In our judgment, the contention that conviction in the present case was not sufficient is devoid of any merit. Shri Oak then submitted that Regulation 81 does not confer power upon the appellants to dismiss an employee and the submission was advanced by urging that the expression ''termination'' which occurs in Regulation 81 is not equivalent to the expression '' dismissal''. The submission is without any substance and is merely required to be stated to be rejected. Even the learned single Judge was unable to find any merit in the submission and very lightly observed that the plain reading of the regulation makes it crystal clear that the expression ''termination'' means ''dismissal''. Shri Oak then contended that the departmental enquiry was abandoned by the appellants and therefore it must be assumed that the appellants had reinstated the respondent in services before serving the order of dismissal. Curiously, the learned Trial Judge observed that the departmental enquiry did not come to an end and was abandoned. Shri Sawant submitted and in our judgment very correctly that the enquiry was not abandoned but had become redundant in view of the order of dismissal passed in pursuance of recording of conviction of the respondent by competent criminal Court. The appellants had not abandoned the enquiry or had exonerated the respondent or had withdrawn the charges levelled against him but continuation of the departmental enquiry was unnecessary as the respondent could have been dismissed independently of the charges levelled in the enquiry because of the conviction by the criminal Court. The observation of the Trial Judge that the order of reinstatement has to be inferred because there was implicit revocation and supersession of earlier order passed on the very day when the order of termination was passed is impossible to imagine. It surpasses our imagination as to how the Trial Judge could have inferred that on the day of order of dismissal, there was an implicit revocation of the order of suspension and reinstatement of the respondent. In our Judgment, the Trial Judge misread the point for determination by these observations. The submission of Shri Oak that on reaching the age of superannuation the services of respondent were extended and therefore the respondent should be deemed to have been reinstated in service is without any substance. As mentioned hereinabove, the extention was given only for the purpose of concluding the departmental enquiry and which was not longer necessary in view of the order passed by the criminal Court. In our judgment, the respondent was not entitled to the reliefs sought in the suit.

Shri Oak then submitted that in any event, the respondent is entitled to the amount of gratuity. The submission cannot be accepted and was very rightly turned down by the learned Single Judge. The appellants have framed Gratuity Fund Regulations, 1968 and Regulation 11(i) (b) reads as follows :-

"No gratuity shall be payable nor granted, to any officer who even if he has rendered the continuous service of the prescribed number of years, is retired or dismissed from service for misconduct"

Once it is established that the respondent was dismissed from services for misconduct, then the claim for gratuity cannot be sustained. In our judgment, the respondent was not entitled to any relief whatsoever and the suit was misconceived and the Trial Judge was in error in partly decreeing the suit. In our judgment, the cross objections filed by the respondent must also fail.

Accordingly, appeal is allowed and judgment and decree dated April 20, 1992 passed by learned Single Judge in Suit No. 1399 of 1976 is set aside and the Suit stands dismissed. The respondent shall pay the costs of the appellants throughout. Cross-objections are dismissed with costs.