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Judgment
V. Kameswar Rao, J
The present petition has been filed by the petitioner with the following prayers:
“In view of the aforementioned facts and circumstances, it is most respectfully prayed that this Hon’ble Court may be graciously
pleased to:-
a) Issue a writ in the nature of certiorari quashing the decision of respondent No.1 contained in Office Memorandum dated 10.09.2015 and
09.02.2016;
b) Issue a writ in the nature of certiorari quashing the decision of the respondent No.2 as contained in order dated 10.12.2015 withholding
the petitioner’s retiral benefits on the ground that vigilance clearance is awaited from respondent No.1 which is contrary to their Rules
and also provisions of law;
d) issue a writ in the nature of mandamus directing the respondent to release the petitioner’s retiral benefits with upto date interest @
18% per annum;
e) Pass such other of further order(s) as may be deemed fit and proper in facts and circumstances of the present case.â€
The facts as averred by the petitioner in the writ petition are, he joined the respondent no. 2 as Director (Finance) on January 4, 2006. On
November 26, 2010, he was appointed as Chairman and Managing Director in terms of the procedure followed by the Government of India through
PESB. On September 30, 2014, the petitioner superannuated from service but his retiral dues were not released on the ground of pendency of
vigilance clearance from respondent no.1 which according to him is in clear violation of applicable Rule 30A of Cement Corporation of India Conduct,
Disciplinary and Appeal Rules. It is averred that respondent no.2 vide its communication dated September 10, 2015 to the Department of Public
Enterprise requesting therein to list out / earmark the name of the petitioner for not considering him to the post of non-official Director on the Board of
any CPSE. The petitioner filed a Writ Petition (Civil) No. 10041/2015 on October 16, 2015. On October 28, 2015, this Court had passed the order in
the said Writ Petition directing the respondent no.2 to treat the Writ Petition as a representation and decide it within a period of six weeks by passing a
speaking order and if need be, the petitioner be call for clarification. It is averred that on December 10, 2015 respondent no.2 passed an order
reiterating the petitioner’s retiral dues have been withheld on the ground of pendency of vigilance clearance. On February 9, 2016, respondent
no.1 also passed an order reiterating that the impugned order was passed on the advice and opinion of CVC.
It is contended by Ms. Anju Bhattacharya, learned counsel appearing for the petitioner that the impugned orders with regard to stoppage of retiral
dues and the exclusion of the petitioner from the panel for consideration as Independent Director on the Board of CPSE is legally untenable. She
qualifies her submission by stating that, in so far as the retiral dues are concerned, the petitioner having retired and as no disciplinary proceedings have
been initiated before retirement, respondent no. 2 could not have withheld the same. On the aspect of the exclusion of the petitioner from the panel for
consideration as Independent Director is concerned, the same being on the advice of the CVC, such an order could not have been passed without
supplying the petitioner a copy of the advice of the CVC. She also state that action against the petitioner being complete and final with the issuance of
order dated July 17, 2015 by the respondent no.1 whereby the competent authority has conveyed displeasure to the petitioner for the irregularities
alleged to have been committed, nothing further required to be done nor is permissible in law, the respondents could not have withheld the retiral
benefits. She would also refer to an amendment brought to Rule 30A of CCI Limited Conduct, Disciplinary and Appeal Rules in the following manner:
“The employee against whom disciplinary proceedings have been initiated will cease to be in service on the date of superannuation but
the disciplinary proceedings will continue as if he was in service until the proceedings are concluded and final order is passed in respect
thereof. The concerned employee will not receive any pay and/or allowance after the date of superannuation. He will also not be entitled
for the payment of retirement benefits till the proceedings are completed and final order is passed thereon except his own contribution of
CPFâ€.
It is her case that the retiral benefits are not bounty but property and cannot be withheld without due process of law and according to her
concedingly there is no rule stipulating, even if no disciplinary proceedings have been initiated against the petitioner before retirement, still the retiral
benefits can be withheld. In this regard, she would rely upon the Judgment of the Supreme Court in the case reported as 2013 (12) SCC 2010 State of
Jharkhand and Ors. v. Jitender Kumar Srivastava and Anr. On the aspect of supply of CVC advice before passing impugned order is concerned, she
would rely upon the judgment of the Supreme Court in the case reported as 1993 (1) SCC 13 State Bank of India and Ors. v. D.C. Aggarwal and
Anr.
On the other hand Mr. Umesh Sharma, learned counsel appearing for the respondent no.1 would draw my attention to the counter-affidavit filed by
the said respondent to contend that a complaint dated June 1, 2011 was received through CVC’s OM dated October 10, 2011 alleging that,
Cement was sold by CCI on credit to M/s. Maruti Enterprises, Dimapur and M/s. Nagaland Hardware Store, Imphal during November, 2010 to
January, 2011 without taking equivalent security deposit and uncovered sale was protected by taking post-dated cheques. A report on the above
allegation was forwarded to CVC after examining the report from the CVO, CCI and comments of CMD, CCI dated October 16, 2012 in response to
the letter of the vigilance of the respondent no.1 dated October 8, 2012 to the petitioner, who was then holding the post of the CMD of the respondent
no.2 / organization. The comments dated October 16, 2012 were forwarded by the Director (HR) of the respondent no.2 clearly stating that they were
issued with the approval of the petitioner. It is his submission that the petitioner was provided an opportunity to explain his position and the same was
examined by the respondent no.1 while forwarding the report to CVC. Thereafter, CVC vide OM dated December 24, 2014 observed that sale on
credit was allowed against the combined value of security deposit and post-dated cheques. The values of sale transactions during November, 2010 â€
January, 2011 were always more than the value of available security deposit with CCI. Since PDC (post-dated cheques) cannot be termed as security
tool, it was noted that the respondent no.2 / CCI’s interest were not adequately safeguarded during sale transactions and undue financial leverage
was given to the buyers. Vigilance report has mentioned that CCI Board in its meeting dated January 24, 2011 has directed to restrict the credit sale
value up to the limit of BG / SD submitted by the parties. He would state two parties were allowed to take cement of the value of Rs.2.74 Crores and
Rs.2.57 Crores on credit by submitting SD of only Rs.52 Lacs. This direction of CCI Board was not followed and undue benefits were passed on the
two parties. CVC had asked to fix responsibility for the above irregularities.
According to Mr. Sharma, CVO, CCI had further investigated the issue on the directions of the respondent no.1 and a detailed report was received
from him. From the report of CVO, CCI, it was observed that the petitioner was fully aware of the fact that cement was being sold in excess of bank
guarantee / security deposit to two parties in violation of marketing guidelines. It is his submission that as the petitioner had retired as CMD and in
terms of the CCI/CDA Rules, disciplinary proceedings could not be initiated against him after retirement, the competent authority approved, taking of
following actions against the petitioner for the irregularities committed by him: (i) conveying displeasure of the competent authority; (ii) exclusion of the
petitioner from the centralized list of persons maintained by Department of Public Enterprises for consideration for appointment as Independent
Director on the Board of Directors of CPSEs. He would state that after the advice of CVC and approval of the competent authority an order
conveying displeasure of the competent authority was issued vide letter dated July 17, 2015. Further a communication with respect to exclusion of the
petitioner for consideration for appointment as Independent Director was conveyed to the Secretary, Department of Public Enterprises vide letter
dated September 10, 2015. A copy thereof was marked to the CVC, CCI and the petitioner herein. He states, the exclusion of the petitioner for
Independent Director of the Board was taken as per the advice of the CVC and approval of the Minister after considering the reports on the matter
received from CVO, CCI and comments of the petitioner. In other words, the final decision was taken by the competent authority after examining all
the aspects of the case and after consultation with CVC. In so far as the release of the retiral benefits are concerned, he states, in the absence of any
vigilance clearance from the CVC, the benefits have not been released.
Mr. Sanjiv Sen, learned Senior Counsel appearing for respondent no.2 would make similar submissions as made by Mr. Sharma. He has drawn my
attention to the counter-affidavit filed by respondent no.2 to the petition.
Having heard the learned counsel for the parties, the issue which arises for consideration is whether (i) the respondent no.2 would have withheld
the retiral benefits of the petitioner and (ii) excluded the petitioner for consideration as Independent Director on the Board of Directors of CPSEs.
In so far as issue no.(i) is concerned, there is no dispute that the petitioner had attained the age of superannuation of September 30, 2014. The
terms of appointment of petitioner annexed as Annexure P-7 contemplates that the petitioner as Chairman and Managing Director of the respondent
no.2 CCI, was to be governed by the Conduct and Discipline Rules framed by the CCI with a modification that the disciplinary authority in his case
would be the President of India. The relevant amendment brought to Rule 30A of the CCI Conduct, Discipline and Appeal Rules, which is already
extracted above clearly stipulates the disciplinary proceedings, which have been initiated while an employee is in service on the date of superannuation
would continue even thereafter as if he is in service; the employee will not receive any pay or any other allowances after the date of superannuation.
It is also stated, he would not be entitled to retirement benefits till the proceedings are complete and final order is passed therein except his own
contribution to CPF.
It is a conceded case of the parties that no disciplinary proceedings had been initiated against the petitioner while he was in service on the subject
matter of allegations which was investigated by the CVC or for that matter for any other misdemeanor. At least nothing has been brought to the
notice of the court in that regard. In the absence of disciplinary proceedings having been initiated against the petitioner on or before September 30,
2014, no ground existed for withholding the retiral benefits of the petitioner. No doubt, the allegations against the petitioner were serious, but nothing
precluded the authorities to issue a chargesheet before his date of superannuation on September 30, 2014. That apart, it is important to note that vide
communication dated July 17, 2015, which according to the respondents was issued on the advice of the CVC, the competent authority, i.e., the
President has communicated displeasure to the petitioner for the irregularities committed by him. The said order, even though has not been challenged,
is a final order in so far as the irregularities are concerned. If that be so, the issue of irregularities which were investigated by the CVC had attained
finality. Surely, the terminal benefits could not have been withheld. The reliance placed by Ms. Bhattacharya on the judgment of the Supreme Court in
the case of State of Jharkhand and Ors. v. Jitender Kumar Srivastava and Anr.(supra) is justified, wherein in Para 17 the Supreme Court has held as
under:-
It hardly needs to be emphasized that the execution instructions are not having statutory character, and therefore, cannot be termed as
law within the meaning of the aforesaid Article 300-A. On the basis of such a circular, which is not having force of law, the appellant
cannot withhold even a part a pension or gratuity. As we noticed above, so far as statutory Rules are concerned, there is no provision for
withholding pension or gratuity in the given situation. Had there been any such provision in these Rules, the position would have been
different.â€
The plea of the learned counsel for the respondents that there was no vigilance clearance from the CVC for release of the retiral benefits is
concerned, the same  would be inconsequential for more than one reason, (i) it has not been pointed out by the learned counsel for the respondents
as to what action they have taken to write to CVC for giving the vigilance clearance. To say that they are not empowered to communicate with the
CVC is not justified. Surely, respondent no.1 which has been  communicating with the CVC could have written to the CVC in that regard and
sought the vigilance clearance, (2) even in the absence of vigilance clearance in view of the position of the Rules and the law of the Supreme Court,
the respondents could not have withheld the retiral benefits after displeasure on the irregularities has been conveyed to the petitioner. The order dated
December 10, 2015, is set aside. I only note the attention drawn by Ms. Bhattacharya to letters at Page 184 of the paper book wherein she had
referred to certain cases of respondent no.2 / organization to contend that the benefits were withheld to certain officers because of the pendency of
the disciplinary proceedings on the date of superannuation.
In so far as the plea of Ms. Bhattacharya that the exclusion of the petitioner for consideration for appointment as Independent Director is
concerned, the same was by relying upon the comments given by the respondent no.2 / organization on October 16, 2012 on a communication received
from the respondent no.1 and as such could not have been considered as a reply of the petitioner and that too without supplying a copy of the CVC
advice is appealing.
I have seen the communication dated October 16, 2012, which were general comments of the respondent no.2 / Company when the petitioner was
the CMD of the company. Nothing has been placed on record to show that specific comments were asked from the petitioner on the proposed action
of excluding him for consideration as Independent Director in different companies of CPSEs. Such an action would be in conformity with the
principles of natural justice to enable the petitioner reply to the proposed action. The same should be by giving a copy of the advice of the CVC, to
enable the petitioner know the reasons for the said action. Accordingly, the order dated September 10, 2015 to the extent a decision has been
communicated to the petitioner excluding him for consideration as Independent Director on the Board of Directors of CPSE is set aside.
In view of my above discussion, the petitioner shall be entitled to the retiral benefits with interest @ 9% per annum to be released within a period
of two months. As I have set aside the order dated September 10, 2015, respondents shall be within their rights to seek reply from the petitioner on the
proposed action of excluding the petitioner from the panel for consideration as Independent Director in different companies of CPSEs by giving a copy
of the advice of the CVC within four weeks to enable the petitioner file reply to the same within three weeks thereafter and consider the same and
pass a final order within four weeks from the receipt of reply. If the petitioner is still aggrieved, he can seek such remedy as available in law. The
petition stands disposed of. No costs.
CM Nos. 7698/2016 (for stay) & 10460/2016 (for direction)
Dismissed as infructuous.