IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN TUESDAY, THE 4TH AUGUST 2009 / 13TH SRAVANA 1931 WP(C).No. 11543 of 2007(Y) -------------------------- PETITIONER(S): --------------- R.PANKAJAKSHAN PILLAI, ASSISTANT MANAGER, UNITED INDIA INSURANCE COMPANY LTD., REGIONAL OFFICE, KOCHI. BY ADV. SRI.K.JAJU BABU SMT.M.U.VIJAYALAKSHMI RESPONDENT(S): --------------- 1. THE UNITED INDIA INSURANCE COMPANY LTD., REPRESENTED BY ITS CHAIRMAN & MANAGING DIRECTOR, REGD.OFFICE: PB NO.676, WHITES ROAD, CHENNAI-14. 2. THE CHAIRMAN CUM MANAGING DIRECTOR, THE UNITED INDIA INSURANCE COMPANY LTD., REGD.OFFICE: PB NO.676,WHITES ROAD, CHENNAI-14. 3. THE GENERAL MANAGER, THE UNITED INDIA INSURANCE COMPANY LTD., REGD.OFFICE: PB NO.676,WHITES ROAD, CHENNAI-14. 4. THE ASSISTANT GENERAL MANAGER, THE UNITED INDIA INSURANCE COMPANY LTD., REGD.OFFICE: PB NO.676,WHITES ROAD, CHENNAI-14. ADV. SRI.N.NANDAKUMARA MENON, SENIOR ADVOCATE FOR R1 TO 3 SRI.P.K.MANOJKUMAR FOR R1 TO 3 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 04/08/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C). No. 11543/2007 APPENDIX PETITIONER'S EXHIBITS: P1. COPY OF THE REPORT DTD.23.3.2000 ISSUED BY THE SRI.RAMACHANDRAN, S.I. OF POLICE (RTD) TO THE BRANCH MANAGER, UNITED INDIA INSURANCE CO., CHALAKKUDY. P2. COPY OF THE LETTER DTD.7.8.2000 TO SRI.K.CHANDRASEKHARAN P3. COPY OF THE LETTER DTD.28.8.2000 BEFORE THE SRI.DIVISIONAL MANAGER, THRISSUR. P4. COPY OF THE LETTER DTD.11.10.2000 BY SRI.K.SURESH, SR.DIVIDIONAL MANAGER TO THE PETITIONER. P5. COPY OF THE LETTER DTD.27.10.2000 BEFORE THE CLAIMS TRIBUNAL SUBMITTED BY THE PETITIONER. P6. COPY OF THE LETTER DTD.13.12.2000 BEFORE K.CHANDRASEKHARAN, ASST.ADMN. OFFICER, UII, CHALAKKUDY BRANCH. P7. COPY OF THE NOTICE DTD.7.3.2001 BY THE SENIOR DIVISIONAL MANAGER TO THE PETITIONER. P8. COPY OF THE QUESTIONNAIRE TO THE PETITIONER. P9. COPY OF THE REPLY DTD.2.5.2003 BEFORE THE REGIONAL MANAGER, UII CO. LTD., REGIONAL OFFICER, KOCHI. P10. COPY OF THE ACKNOWLEDGMENT OF THE APPLICATION FOR VOLUNTARY RETIREMENT DTD.16.1.2004. P11. COPY OF THE MEMO OF CHARGES DTD.22.3.04. P12. COPY OF THE ENQUIRY REPORT DTD.17.1.2001 BY THE INSURANCE INVESTIGATOR. P13. COPY OF THE ENQUIRY REPORT DTD.14.3.2001 OF THE INSURANCE INVESTIGATOR. P14. COPY OF THE POLICE REPORT BY THE S.I. OF POLICE, KOLLAM WEST. P15. COPY OF THE NOTE DTD.8.1.2001 BY THE SR.DIVISIONAL MANAGER, MR.K.B.SURESH. P16. COPY OF THE COMMUNICATION DTD.7.7.2005 BY R4 TO THE PETITIONER. P17. COPY OF THE REPLY DTD.20.4.2004 BEFORE THE REGIONAL MANAGER, REGIONAL OFFICE, KOCHI. P18. COPY OF THE WRITTEN REQUEST DTD.9.8.04 BEFORE THE ENQUIRY OFFICER. P19. COPY OF THE PROCEEDINGS DTD.9.8.2004. P20. COPY OF THE REQUEST DTD.18.10.2004 TO THE ENQUIRY AUTHORITY. P21. COPY OF THE PROCEEDINGS DTD.18.10.2004 ISSUED BY THE ENQUIRY AUTHORITY. P22. COPY OF THE RELEVANT PAGE OF DISPATCH REGISTER. P23. COPY OF THE REQUEST DTD.9.8.2004 OF THE PETITIONER BEFORE THE ENQUIRY AUTHORITY, UNITED INDIA INSURANCE COMPANY, CHENNAI. P24. COPY OF THE ENQUIRY REPORT DTD.16.11.2004 BY THE ENQUIRY OFFICER TO THE PETITIONER. P25. COPY OF THE LETTER DTD.19.5.2006 ISSUED BY THE MANAGER, REGIONAL OFFICE, KOCHI TO THE DIVISIONAL OFFICE, II, ERNAKULAM. P26. COPY OF THE REPRESENTATION DTD.26.12.2004 BEFORE R4. P27. COPY OF THE ORDER DTD.6.4.2005 BY R4. P28. COPY OF THE GENERAL INSURANCE (CONDUCT, DISCIPLINE & APPEAL) RULES 1975. P29. COPY OF THE APPEAL MEMORANDUM DTD.1.8.2005 BEFORE THE APPELLATE AUTHORITY, VIGILANCE DEPARTMENT, CHENNAI. P30. COPY OF THE ORDER DTD.26.6.2006 BY R3. P31. COPY OF THE MEMORIAL DTD.25.10.2006 BEFORE R2. P32. COPY OF THE ORDER DTD.9.2.2007 BY R2. P33. COPY OF THE REQUEST UNDER RIGHT TO INFORMATION ACT, 2005 BY THE PETITIONER DTD.15.5.08. P34. COPY OF THE REPLY TO EXT.P33, DTD.16.6.08. Sdk+ ///True copy/// P.A. to Judge S.SIRI JAGAN, J. ================== W.P(C).No.11543 of 2007 ================== Dated this the 4th day of August, 2009 J U D G M E N T The petitioner is a former employee of the United India Insurance Company Ltd., the 1st respondent herein. The petitioner is challenging the disciplinary proceedings initiated and concluded against him, while he was in service, resulting in imposition on him the punishment of reduction in the basic pay by 10 steps. 2. The case of the petitioner is as follows:- While he was working as a Branch Manager of Chalakkudy Branch, during 1999-2000, an insurance claim in respect of a burglary and house breaking insurance policy was raised by one Sri.R.C.Pillai. The claim was enquired through an approved surveyor who filed a report verifying the burglary and the damages. The surveyor was one Sri.K.H.Muhammed Ashraf. He recommended a claim for Rs.35,800/-. An empanelled investigator, one Sri.M.Ramachandran Nair, investigated the claim and filed Ext.P1 dated 23.3.2006 supporting the report of the surveyor. That claim was processed by the Development Officer, Sri.K.F.Jose, and verified by the Assistant Administrative Officer, Sri.K.Chandrasekharan. Sri. Madhusoodhanan, Senior Assistant finalised the claim voucher settling the same for Rs.30,000/-. A cheque for the said amount was issued on 14.6.2000 to the insured. While so, W.P.C.11543/07 2 the petitioner enquired with the said Sri.K.Chandrasekharan as to why sale proceeds of 3181 claim files out of the 7831 claim files disposed of by him were not forwarded. The petitioner issued Ext.P2 letter dated 7.8.2000 directing the said Sri.K.Chandrasekharan to remit the amount along with a detailed list of articles sold. Sri.K.Chandrasekharan admitted the disposal and remitted an amount of Rs.1078/-. In respect of the same, the petitioner forwarded Ext.P3 report dated 28.8.2000 to the Senior Divisional Manger, Thrissur, for further action. It is thereafter, the petitioner was issued with Ext.P4 letter dated 11.10.2000 alleging certain irregularities in the settlement of the above said burglary claim of Rs.30,000/-. The petitioner replied to the same by Ext.P5. In the meanwhile, by Ext.P6 dated 13.12.2000, the petitioner again directed Sri.K.Chandrasekharan to remit the balance amount due from him. By Ext.P7 dated 7.3.2001, the petitioner was transferred from Chalakkudy Branch office to Ernakulam and he was informed that the CBI has asked them to get the petitioner's table opened by the petitioner in the presence of witnesses. Thereafter, the petitioner was served with Ext.P8 questionnaire asking certain questions regarding the insurance claim. The petitioner submitted Ext.P9 reply. In that reply, the petitioner alleged that said proceedings have been initiated on account of the petitioner's action against Sri.K.Chandrasekharan for non-payment of W.P.C.11543/07 3 the price of the disposed claim files and, instead of taking further proceedings against him, the said Sri.K.Chandrasekharan was rewarded by promotion to a higher category. While so, the petitioner submitted an application for voluntary retirement, which was acknowledged by Ext.P10. However, he was not permitted to retire voluntarily in spite of his request. Thereafter, the petitioner was served with Ext.P11 charge memo and statement of imputation of misconduct, along with list of documents and list of witnesses. The company had, in the meanwhile, engaged the services of one Sri.George Thattil for conducting an investigation into the burglary claim of Sri.R.C.Pillai. He submitted Ext.P12 report in which he stated that, on enquiry with the police at Kollam, the Police Station did not have any records regarding the burglary, which was the basis for the claim settled by the petitioner. By Ext.P15 report dated 8.1.2001, the Senior Divisional Manager also reported that the insurance claim was bogus. Subsequently, an enquiry officer was appointed and the petitioner participated in the enquiry proceedings. In the course of the enquiry proceedings, the petitioner filed Ext.P18 application before the enquiry officer requesting for examination of two witnesses viz., Sri.R.C.Pillai and Sri.M.D.Unnikrishnan, the then Senior Divisional Manager of the company at Kollam. In Ext.P19 summary of the daily proceedings in the enquiry on 9.8.2004, it has been recorded that the petitioner had W.P.C.11543/07 4 requested for examination of those witnesses and that the relevance or otherwise of those witnesses shall be decided at the appropriate time as may deem fit. In the enquiry, the management had cited originally nine witnesses and later on three more. But out of the same, they examined only seven. The petitioner filed Ext.P20 request seeking production of the report of the CBI referred to in the deposition of Sri.Remesh Mankuzhy, Vigilance Officer of the company, in the course of the enquiry proceedings. In that he also requested that he may be permitted to examine the Divisional Manager of Kollam Divisional Office, Sri.M.D.Unnikrishnan to prove the fact that the appointment of the surveyor was as per the suggestion of the then Kollam Divisional Manager. He also sought examination of the other witnesses whom the management had not examined from their list of witnesses whose statements were included as the list of documents in the enquiry. In the summary of the proceedings of the enquiry held on 18.10.2004 viz., Ext.P21, the enquiry officer rejected the request of the petitioner for production of documents and examination of witnesses on the ground that the request is considered to be not material to the enquiry and the documents are privileged one. Thereafter, under cover of Ext.P24 report dated 6.12.2004, the Assistant General Manager, who was the disciplinary authority, forwarded a copy of the enquiry report to the petitioner asking for representation against the findings in the W.P.C.11543/07 5 enquiry report. The petitioner submitted Ext.P26 representation. By Ext.P27 order dated 6.4.2005, the disciplinary authority imposed on the petitioner the punishment of reduction in the basic pay by 13 steps in the time scale applicable to the petitioner. The petitioner filed Ext.P29 appeal before the appellate authority against the order of punishment. By Ext.P30 order dated 26.6.2006, the appellate authority, while confirming the guilt of the petitioner, reduced the punishment to one of reduction in the basic pay by 10 steps in the time scale applicable to the petitioner, instead of 13 steps. The petitioner filed a review petition which was rejected by Ext.P32. The petitioner is challenging Exts.P11, P16, P27, P30 and P32, seeking the following reliefs: “i) issue a writ of certiorari or appropriate writ, order or direction calling for the records leading to Exts.P11, P16, P27, P30 and P32 and quash the same and grant all consequential benefits to the petitioner; ii) issue a writ of mandamus or appropriate writ, order or direction directing the respondents to consider the case of the petitioner for promotion untrammeled by Exts.P11, P16, P27, P30 and P32 forthwith; iii) issue a writ of certiorari or appropriate writ, order or direction, directing the respondents to consider Ext.P10 application and grant the benefit of special voluntary retirement to the petitioner. iv) issue such other and further relief as this Hon'ble Court may deem fit and proper in the facts and circumstances of the case; and; v) award costs of this Petition.” 3. The primary contention of the petitioner is one of violation W.P.C.11543/07 6 of principles of natural justice in the enquiry. According to him, one of the charges in Ext.P11 is that the petitioner had appointed the surveyor and investigator without concurrence of the Divisional Officer, Kollam. The Divisional Officer, Kollam was Sri.M.D.Unnikrishnan, whom the petitioner had cited as a witness and requested the enquiry officer to examine him as a witness, which was refused. The petitioner would contend that as the appointment of the surveyor and investigator without the concurrence of the Divisional Officer, Kollam, was one of the charges in the charge sheet, the petitioner could have disproved the same only by examining the Divisional Officer, for which, the petitioner had submitted a petition before the enquiry officer, which was rejected, which amounts to violation of principles of natural justice. Secondly, he would point out that Sri.Remesh Mankuzhy, Vigilance Officer of the company, who was examined as a witnesses in the enquiry, referred to a CBI report on the same subject matter. The petitioner sought production of that report, which would be very relevant to prove the innocence of the petitioner, which was refused by the enquiry officer on the ground that the report is a privileged one. Lastly, the petitioner would point out that in Ext.P11 charge memo three witnesses cited by the management, viz., M/s. V.K.Menon, Senior Assistant, K.Chandrasekharan, Assistant Administrative Officer, Branch Office, Chalakkudy and George Sam, Record Clerk, Branch W.P.C.11543/07 7 Office, Chalakkudy were not examined in the enquiry. According to the petitioner, the specific stand of the petitioner was that the entire proceedings were initiated on account of the proceedings initiated by the petitioner against Sri.K.Chandrasekharan. Therefore, examination of the Sri.K.Chandrasekharan was necessary to prove victimization. Further, he points out that the list of documents included the statements of Sri.V.K.Menon, Sri.K.Chandrasekharan and George Sam. One of the allegations against the petitioner was that he removed the file relating to the claim file of Sri.R.C.Pillai and, Sri.George Sam, Record Clerk deposed that the claim file was given by him to the petitioner, which was not returned. Therefore, according to the petitioner, the examination of the said witnesses was very important to the defence of the petitioner, for which only he had requested before the enquiry officer, which had been flatly rejected on the ground that such request is considered to be not material to the enquiry. He further submits that how the CBI report, production of which was requested by him, is a privileged one has not been explained either by the enquiry officer or the disciplinary authority. The petitioner would take a further contention that a delinquent is entitled to an opportunity to file representation not only against the enquiry report but also against the proposed punishment. He would submit that in Ext.P24 show cause notice, the disciplinary authority had already W.P.C.11543/07 8 concluded that he agreed with the findings of the enquiry authority and, therefore, the principles of natural justice had not been complied with. He further submits that the petitioner has not been given an opportunity to show cause against the proposed punishment, which also amounts to violation of principles of natural justice. 4. A counter affidavit and additional counter affidavit have been filed by the 1st respondent. According to the 1st respondent, there is absolutely no violation of principles of natural justice. The 1st respondent would submit that the enquiry officer rightly rejected the request of the petitioner for production of the documents and examination of witnesses. The counsel for the 1st respondent would submit that production of documents and examination of defence witnesses in support of his case are to be done by the delinquent himself. He also quotes sub rule (3), (8) and (14) of Rule 25 of the General Insurance (Conduct, Discipline and Appeal) Rules, 1975, applicable to the employees of the 1st respondent company. He argues that if the petitioner wanted to examine any witness, responsibility to produce those witness is squarely on the petitioner, which he had not done. That cannot be cited as a violation of principles of natural justice. He would further submit that in so far as the management is not relying on the documents, production of which was sought by the petitioner, those documents are irrelevant for the purpose of the W.P.C.11543/07 9 enquiry. It is further contended that regarding the examination of witnesses, what the petitioner wanted was to examine the management witnesses as management witnesses, which cannot be permitted. If the petitioner wanted to examine those witnesses, it was for him to produce the witnesses and examine them. Neither the management nor the enquiry officer had any duty to produce the witnesses. As regards the contention regarding lack of second opportunity to show cause against the proposed punishment, he would rely on paragraph 25 of the Supreme Court decision in MANAGING DIRECTOR, ECIL, HYDERABAD AND OTHERS v. B.KARUNAKAR AND OTHERS [(1993) 4 SCC 727] for the proposition that after the 42nd amendment of the Constitution, the second opportunity has been dispensed with. 5. Reply affidavits have also been filed by the petitioner refuting the contentions of the respondents in the counter affidavit and additional additional counter affidavit. 6. I have considered the rival contentions in detail. 7. Although several contentions have been raised including the validity of the findings in the enquiry, in so far as a decision in favour of the petitioner on the contention of violation of principles of natural justice itself would vitiate the enquiry, I shall consider the same first. Ext.P11 is the memo of charges, which reads thus: W.P.C.11543/07 10 “Shri.R.Pankajakshan Pillai was working as Branch Manager, BO, Chalakudy during the years 1999-2000. Whilst working as such, he obtained a proposal for Burglary and Housebreaking insurance and issued a policy bearing no. 100602/46/05/16/3383/99 for the period 04.05.99 on 03.05.00 for a sum insured of Rs.100000/- to Shri.R.C.Pillai. It is found that he filled up incompletely the said proposal and signed the same himself without obtaining the list of items to be insured as required. A bogus claim bearing no.46/4954 for burglary which allegedly took place on 12.08.99 was approved and paid by Shri.R.Pankajakshan Pillai in collusion with the Surveyor and Investigator, both appointed by him, without the concurrence of DO Quilon, for Rs.30000/- despite absence of specific critical documents namely, FIR, Non-traceable certificate/Police Report. Shri.R.Pankajakshan Pillai passed the relevant claim voucher bearing no.985 and discharged the same himself and thus caused issuance of cheque no.088024 dated 14.06.2000. It was revealed that the said premises was vacant at the time of alleged burglary and that no burglary actually took place although there was an attempt thereat. Shri.R.Pankajakshan Pillai removed the said claim file in order not to leave behind a trail and thus camouflaged various acts of misconducts as detailed above. By the above acts Shri.R.Pankajakshan Pillai displayed lack of absolute integrity, devotion to duty and acted dishonestly and in a grossly negligent manner which was prejudicial to the interest of the Company thereby violating rules 3(1)(i), (ii) read in conjunction with Rules 4(1), (5) and (9) of GI(CDA) Rules, 1975.” (underlining supplied) As is clear from the same, one of the allegations therein against the petitioner is that the surveyor and investigator were appointed by the petitioner without concurrence of the Divisional Officer, Kollam. It is also specifically stated therein that the petitioner removed the claim file relating to the alleged bogus claim in order not to leave behind a trail and thus camouflaged various acts of misconducts committed by him. By Ext.P18 request dated 9.8.2004, the petitioner requested to examine Sri.M.D.Unnikrishnan, the then Senior Divisional Manager of the Kollam office. In Ext.P19 summary of the proceedings of enquiry W.P.C.11543/07 11 dated 9.8.2004, the enquiry officer had specifically stated that the relevance or otherwise of those additional witnesses shall be decided at appropriate time as may deem fit. In Ext.P20 request to the enquiry officer, the petitioner had requested thus: “1. In the deposition of Shri.Ramesh Mankuzhi, Vigilance Office [sic], RO Kochi, I noted a reference that CBI is investigating on the matter. I humbly pray that the report of the above investigation may be made available to me. This pray [sic] is made, as I find no reason for keeping it a privileged document since no national interest, security or defence secrets, any threat or intimidation of witnesses are involved. Also there is no privacy right involved. If it is privileged, the reason for claiming the privilege may kindly be informed. At any rate procedural fairness demands that I will be communicated the gist or summary of CBI findings. 2. On 9/8/04 I prayed for the inclusion of two additional witnesses, viz., the insured and the then Divisional Manager of Kollam Divisional Office, Since I found that the list of witnesses annexed to the charge sheet is incomplete. By examination of the above witnesses the fact of the proposal, the fact of theft, the fact of loss due to theft and the fact that the appointment of surveyor was as per the suggestion of the then Kollam Divisional Manager can be further established. 3. All the witnesses cited by the Management has not been examined which will cause prejudice to my defence. No reasonable effort should be spared for producing the PW's since otherwise I will not be able to prove my innocence and also the chance of cross- examination is lost.” 8. In Ext.P21 summary of the proceedings of the enquiry on 18.10.2004, in spite of the request of the petitioner, it has been stated thus: “Sri.R.Pankajakshan Pillai, CO has submitted the letter dated 18/10/2004 requesting for investigation report of Sri.Remesh Mankuzhy, vigilance officer, gist of summary of CBI findings and requesting for examination for all management witnesses to prove his innocence. Since the request is considered to be not material to the enquiry and the documents are privileged one, the same has not been considered.” W.P.C.11543/07 12 9. In view of the fact that one of the specific allegations in Ext.P11 memo of charges is that the surveyor and investigator were appointed by the petitioner without concurrence from the Divisional Officer, Kollam, the question as to whether the petitioner had obtained concurrence from the Divisional Officer, Kollam is a very relevant aspect in the enquiry. As is clear from Ext.P20, the petitioner had specifically claimed that the appointment of the surveyor was as per the suggestion of the Divisional Manager, Kollam. The petitioner could have proved the same only by examining the Divisional Manager of Kollam office. The contention of the learned counsel for the respondents that since the surveyor and investigator had stated in the enquiry that they were engaged by the petitioner, the examination of the Divisional Officer was not relevant and does not prejudice the petitioner, does not appeal to me. By examining the DO, the petitioner could attempt to disprove the evidence of the surveyor and the investigator. Further, even if the petitioner is guilty, if the DO admits that the petitioner had consulted him on the appointment of the surveyor and the investigator, that would certainly be a mitigating circumstance affecting the penalty. That being so, the finding of the enquiry officer that the request for examination of that witness is not material is totally perverse. 10. Again one of the allegations in Ext.P11 memo of charges is W.P.C.11543/07 13 that the petitioner removed the claim file in order to destroy the evidence. In the list of witnesses annexed to the memo of charges, one Sri.George Sam, Record Clerk of Chalakkudy Branch Office was cited as a witness in the list of witnesses appended to Ext.P11 memo of charges. The statement of Sri.George Sam, Record Clerk of the Branch Office, Chalakkudy, is one of the documents in the list of documents appended to the charge memo. It is more than evident that for proving the allegation that the petitioner removed the claim file from the Chalakudy office, the statement of Sri.George Sam has been relied upon. Therefore, the evidence of Sri.George Sam is very material to the enquiry. Hence the finding of the enquiry officer that the request to examine that witness is not material to the enquiry is also perverse. The petitioner had a specific contention that the whole proceedings started only because the petitioner initiated proceedings against Sri.K.Chandrasekharan. Apart from that, the statement of Sri.K.Chandrasekharan is also relied upon by citing him as a witness in the list of witnesses submitted before the enquiry officer. Therefore, at least in respect of Sri.K.Chandrasekharan and Sri.George Sam, there cannot be any doubt that their evidence is very material to the enquiry. Therefore, the finding of the enquiry officer that the request for examining them is not material, is totally unsustainable. The petitioner, by Ext.P20, specifically requested for production of the W.P.C.11543/07 14 report of the CBI referred to in the deposition of Sri.Remesh Mankuzhy. It cannot said that it is not a material document because the report of the CBI is in respect of the same incident. The enquiry officer has not explained how that document is a privileged one. The counsel for the 1st respondent also could not satisfy me that the same is a privileged document. If that enquiry report contained any finding in favour of the petitioner, that would certainly be one document which the petitioner can rely upon to prove his innocence. Therefore, refusal to summon that document is clearly violation of principles of natural justice. In view of the above findings, I have no doubt in my mind that the enquiry is unsustainable for violation of principles of natural justice. 11. The counsel for the respondents would submit that the enquiry officer has no powers to summon witnesses and