IN THE HIGH COURT OF JUDICATURE AT PATNA CWJC No.7873 of 2009 RAM CHANDRA PRASAD THAKUR, SON OF LATE SHYAM NANDAN PRASAD THAKUR, RESIDENT OF VILLAGE – SHEMKALI, P.S. – KANTI, DISTRICT – MUZAFFARPUR, AT PRESENT MOHALLA – MANJHALIA, ADARDH, LANE NO.3, P.S. – SADAR, MUZAFFARPUR. …………… PETITIONER Versus 1. STATE FOOD CORPORATION, THROUGH THE MANAGING DIRECTOR, STATE FOOD CORPORATION, BIHAR, PATNA. 2. PRINCIPAL ADMINISTRATOR, STATE FOOD CORPORATION, BIHAR, PATNA. 3. DISTRICT MANAGER, BIHAR STATE FOOD CORPORATION, MUZAFFARPUR. ………….. RESPONDENTS WITH CWJC No.7933 of 2009 RAM CHANDRA PRASAD THAKUR, SON OF LATE SHYAM NANDAN PRASAD THAKUR, RESIDENT OF VILLAGE – SHRUKAHI, P.S. – KANTI, DISTRICT – MUZAFFARPUR, AT PRESENT MOHALLA – MANGHALIA, ADHARSH, LANE NO.3, P.S. – SADAR, MUZAFFARPUR. …………… PETITIONER Versus 1. BIHAR STATE FOOD CORPORATION, THROUGH MANAGING DIRECTOR, PATNA. 2. CHIEF AUDITOR, STATE FOOD CORPORATION, PATNA. 3. DISTRICT MANAGER, STATE FOOD CORPORATION, MUZAFFARPUR. ………….. RESPONDENTS ----------- Counsel for the Petitioner :- Mr. Banwari Sharma, Mr. Shiv Kumar Counsel for the Corporation :- Mr. R. P. Birnaway 04/ 09.09.2009 The petitioner retired in December, 2008 and it is not in dispute that since 2005 he had become paralyzed. 2 During his service tenure, he was Manager of various godowns of the Bihar State Food and Civil supplies Corporation (Respondent herein). It appears, in course of audit for several years it was found that there were lot of unexplained shortages in the stocks of godowns, on basis of which recoveries were made from the petitioner’s salary and apparently recoveries are being sought to be made from his retrial dues as well. In principle, there are two controversies involved in the two writ petitions; first, whether any recovery can be ordered or made without initiating any proceeding in that regard and secondly; whether after petitioner has retired, can a proceeding with the aid of Rule 43 (b) of the Bihar Pension Rules be taken up for recovery of interest on the alleged amounts. Before deciding the core legal issues, it must be noted that the recoveries relate to the period 1985 to about 1995 and then up to 2002. Recoveries were made from time to time and it is for recovery of interest on amounts found due in that period that too in 2009, after superannuation, with aid of Rule 43(b) fresh proceedings are sought to be initiated. 3 Mr. Banwari Sharma, learned counsel for the petitioner submits that firstly recovery of money from remuneration payable to the employee cannot be ordered except by and in a departmental proceedings. Respondents may have jurisdiction which can only be invoked a proceeding duly constituted in this regards. He submits that no proceeding whatsoever was ever initiated against the petitioner for recovery of any amount alleged to be due. Petitioner was not asked to give any explanation in course of any such proceedings nor was there any determination in any such proceeding as against the petitioner. Respondents suo motu determined the amounts, suo motu deducted the same and are continuing to deduct the same from remuneration payable pre and post superannuation to the petitioner that is impermissible. On this issue counter affidavit has been filed. In the counter affidavit nowhere it has been asserted that any proceeding was initiated or any adjudication done. This becomes significant as in the counter affidavit in paragraph no. 4 itself it is stated that the challenge of the petitioner is against the recoveries without proceedings, yet respondents 4 chose not to state that any proceeding was at all initiated. Only reliance is placed on Annexure – A to the counter affidavit being a purported letter of the petitioner which is of the year 2007 wherein the petitioner pointed out that he was suffering from paralysis since 2005 and needed money. He points out that whatever deductions were to be made, they may be made and the balance amount be paid to the petitioner. In my view, this is neither a proceeding nor a waiver of the obligation to initiate a proceeding. It is rather a desperate attempt by petitioner to get some money which is due to him. Learned counsel for the Corporation then points out that petitioner has filed a show cause in the proceedings. The purported show cause is Annexure – 7 to the first writ petition. A reference to the said show cause clearly discloses that it is in response to the notice impugned in the first writ petition which is a notice initiating proceedings for the first time in 2009 with aid of Rule 43(b) of the Bihar Pension Rules. It is not in relation to any proceeding which was ever earlier initiated for 5 recovery of any amount. Thus on the facts as found above, it is clear that various amounts have been realized from the petitioner, that those amounts were deducted for amounts allegedly payable to the petitioner in the period 1985 to 2002 without any proceedings at all. Those actions are, thus, illegal but to the extent deductions have already been made, they would be treated as fate accompli but no further deductions would be made on any account in that regards. Now coming to the second issue with regard to the proceeding which are sought to be initiated with the aid of Rule 43(b) of the Pension Rules. These proceedings are for recovery of interest on the amounts that were found to be due against the petitioner. First, it must be noted that the “event” which occasions initiation of proceedings with the aid of Rule 43(b) of the Pension Rules must have taken place within four years of the said invocation of Rule 43(b). Here admittedly, the amounts were due if at all between 1985 and 2002. If that be so then the interest becomes payable (even if it be assumed to be realizable) from that period itself. In my view having not taken any action for all these years, on that account now, after a lapse 6 of such a long period exceeding four years no action based on that can be taken. Learned counsel for the respondents submits that these lapses came to the knowledge of the respondents only recently. My answer to this is simple. It was open to the respondents to wake up and conduct their business properly in a lawful manner. Having slept over the matter for all these years, they cannot suddenly wake up and say that on waking up today I got the knowledge and the period of limitation will run from the knowledge so acquired. I regret my inability to accept such a submission. Respondents being a Public Corporation are dealing with public money. They are expecpted to be vigilant in the matter. They are not expected to sleep over the matter for decades and then wake up to take action. Though, slightly beyond the point under consideration, an issue similar had arisen in the case of Shri Krishan Vs. The Kurukshetra University, Kurukshetra since reported in AIR 1976 S.C. 376 wherein in paragraph no. 7 their Lordships were dealing with contention of fraud. The question was that a student filed his application for being permitted to appear 7 in an examination wherein the condition of eligibility was of minimum percentage of attendance. He was permitted to take the examination but when it came to declaration of result, the same was cancelled on the ground that he had inadequate percentage of attendance. University took a plea that his admissions to the examination was fraudulent. The Apex Court held that where a party is in a position to discover a fraud but takes no action in that regard, fraud is not established. It is not either a case of suggestio falsi or suppressio veri. Coming nearer home, a Division Bench of this Court, in LPA No. 446 of 1998 and analogous cases (Bihar State Electricity Board Vs. Sharda Prasad Sinha & Ors.) which appeal was dismissed on 21st May, 2006, held in relation to the third situation, contemplating therein with regard to the provision of Rule 43(b) that the time limit of four years to initiate the proceedings is from the date of “event”. The event must be such which resulted in misconduct or negligence that has caused pecuniary loss to the employer. This “event” may be of one day or may be continuing from day to day. What is required to be 8 assertained is whether by reason of the “event” the misconduct or the negligence of the employee stands established resulting in pecuniary loss to the employer. Their Lordships held that the “event” and the cut off date would be the last date of that action which completed the “event”. Their Lordships further countered the argument of the State that the time limit prescribed in respect of the event in a statute has to be reckoned from the date of knowledge of the event. Their Lordships in the Division Bench disagreed with any such proposition. In their view the period could only be extended if it was shown that the petitioner deliberately concealed the matter which with due deligence, could not be discovered. This would not cover cases where authorities sleep over the matter for decade and then start inquires about conduct of the officer which was done decade back. In view of the aforesaid, I have no hesitation in rejecting the claim of respondents Corporation that they only recently discovered the fact. They were required to get their accounts and their stocks audited and verified year to year. That was never done. Suddenly when people 9 approach the time for superannuation, these steps are taken up and recoveries made and interest ordered to be charged and recovered. Those cannot be covered within four year limitation period as provided in Rule 43(b) of the Pension Rules. In that view of the matter, the notice, as issued, being Annexure – 6 and the charge Annexure – 6A purporting to be in terms of Rule 43(b) as contained in the first writ petition, issued, long after petitioner’s superannuation and decades after the right of recovery arose, cannot be sustained and is quashed. Accordingly, Corporation is restrained from proceeding on those notices. So far as the second writ petition is concerned, namely, CWJC No. 7933 of 2009, the payment of arrears of salary and pensionary benefits at revise pay scales have to be calculated and paid over immediately. If from amount already paid, to the extent amounts have already been deducted as observed above it is fait accompli and no order is to be passed but no further deductions is permissible in absence of any proceedings having been initiated in that regards. The balance must be paid forthwith. 10 With these observations and directions, the two writ applications are allowed to the extent indicated above. Kundan (Navaniti Prasad Singh, J.)