HON’BLE SHRI G.S.SINGHVI, THE CHIEF JUSTICE Writ Petition No.2250 of 1995 Between: K.Santaiah …..Petitioner AND Managing Director, A.P.State Meat and Poultry Development Corporation Ltd., Shantinagar, Hyderabad. …..Respondent :: O R D E R :: Counsel for the petitioner : Shri Tuhin Kumar for Shri B.Nageswara Rao Counsel for the respondent : Shri D.Prabhakar Reddy Date: 27-09-2006 This is a petition for quashing proceedings No.5715/E-1/91-1 dated 07-12-1994 issued by the Managing Director of Andhra Pradesh State Meat and Poultry Development Corporation Limited (hereinafter described as ‘the respondent’) whereby he dismissed the petitioner from service and also ordered recovery of Rs.20,285/- from him. The Facts: While he was working as Poultry Assistant at Poultry Marketing Centre, Srikakulam, Shri Thirlangi Satyam, son of Surnayanarayana, Resident of China Harichandrapuram Village made a complaint to the Anti-Corruption Bureau (for short ‘the ACB’) that Dr. T.Ashok Kumar, Assistant Manager and the petitioner had demanded Rs.150/- for issue of certificate on the basis of which his son could get electricity connection for his poultry shed. On the next day, i.e., 15-11- 1991, the ACB officers laid trap. After money was handed over to the petitioner, the complainant signalled to the Deputy Superintendent of Police, ACB, who was waiting outside with witnesses. The Deputy Superintendent of Police, ACB subjected Dr. T.Ashok Kumar to phenolphthalein test, but the same was found negative. However, when the petitioner was subjected to same test, the colour of the solution turned pink. Dr. T.Ashok Kumar and the petitioner were arrested on 16-11-1991, but were released on bail on self-sureties. In the course of investigation, the ACB also discovered that both T.Ashok Kumar and the petitioner had indulged in other financial irregularities and the latter had misappropriated Rs.20,285/-. After completing the investigation, the ACB submitted report with the recommendation that departmental action be taken against Dr.T.Ashok Kumar and the petitioner. On receipt of the report of the ACB, the respondent issued order dated 22-08-1992 vide which he appointed Dr. K.Subba Rao, Regional Manager of the Corporation as enquiry officer. The latter issued memo No.Roc.No.269-E/91 dated -3-1993 for holding enquiry against Dr. T.Ashok Kumar and the petitioner on the following charges: “1. Allegation of corruption in ACB trap on 15-11-1991 against Dr. Ashok Kumar, Asst. Manager and Shri K.Santaiah, Poultry Assistant of Poultry Marketing Centre, Srikakulam. 2. Financial irregularities and mismanagement committed in the proper maintenance of cash book, receipts etc. relating to financial transactions, deliberate misappropriation of Corporation money of Rs.20,285/- by Sri K.Santaiah, Poultry Assistant by not bringing the stock of 65 bags feed into the stock register wilfully and with malafide intention. 3. Administrative inaction noticed in the issue of certificate for granting electricity tariff concession in contradiction to the prescribed procedure. The petitioner filed reply and denied the charges. Thereafter, the Regional Manager of the Corporation conducted a detailed enquiry and submitted report dated 31-12-1993 with the finding that Charge Nos.1 and 2 have been proved against the petitioner. The findings and conclusions recorded by the enquiry officer in respect of charge Nos.1 and 2 are extracted below: “SPECIFIC FINDINGS OF THE ENQUIRY OFFICER ON THE CHARGE WITH REFERENCE TO EXPLANATION GIVEN BY THE OFFICERS AND EVIDENCE/WITNESS RECORDED 1. The complainant Sri T.Satyam has approached Dr. T.Ashok Kumar, Asst. Manager with the application of T.Ravi Kumar dated 26-8-1991 is a fact. 2. It is also a fact that a letter/certificate addressed to A.P. State Electricity Board for L.T.tariff dated 4-9- 1991 has prepared, taken the signature of the party, but taken back and cancelled the same along with cash memo of the same date for Rs.100/-. The AO-1 and AO- 2 given the reason that the complainant expressed his inability and requested for exemption from paying fee Rs.100/-. This was denied by the complainant, stated his helplessness to pay the bribe amount of Rs.150/- but not Rs.100/- as fee. 3. The complainant approached again on 15-11-1991 for a certificate. AO-1 and AO-2 prepared a certificate and signed with date 15-11-1991 along with a cash memo Rs.29,251/- with a date 11-11-1991 and handed over the original certificate. When the variation in dates was questioned by complainant, both AO-1 and AO-2 informed, for convenience of accounts adjustments later. 4. Complainant Satyam during enquiry and cross- examination by Enquiry Officer AO-1 and AO-2 reiterated his earlier stand stating that both AO-1 and AO-2 made him to go round the office number of times to make him to pay bribe amount, also denied having taken change from Santhayya, Poultry Asst. 5. Mediators C.H.Sivarama Prasad and Ommi Atchutharam Assistant Executive Engineers both have corroborated their earlier stand, stating that what has happened on 15th and 16th November 1991 as per mediator report I and II were correct in which recovery of tainted money and positive result to phenolphthalein test from the hands of AO-2 Santhayya and negative result from AO-1 Ashok kumar hands. In defence both Ashok Kumar and Santhayya denied having asked for the money and accepted, but took only Rs.100/- towards Corporation prescribed fee and Santhayya accepted another Rs.150/- for a change of 15 Nos. of ten rupees notes from the complainant. When AO-1 was questioned on this, said to have heard word ‘CHANGE’. But the complainant has denied this, also stated that he was not allowed to move from the place by ACB officials, since the search on person complainant during post trap proceeding No., 15 Nos. Ten rupees notes were found and going for nature call by complainant before trap but not after trap has been further supported by statement given by A.C.B. Inspector, Sri Ramachandra Rao during enquiry. 6. Seizure of huge amount of Rs.35,661-35 by ACB having no accounts and incomplete cash book and related books and accounts further drive to the point of suspicious nature of activities at the unit. 7. CONCLUSIVE REMARKS OF THE ENQUIRY OFFICER Though the ACB came to the conclusion that the allegations proved beyond any reasonable doubt against both the accused officers and at the same time admitting that the evidence against AO-1 is not strong enough to prosecute in the court of law and in view of contention of AO- 1 that his demand part of the bribe amount was not proved, its acceptance by AO-1 was also not proved, so also no independent witness to support the demand, with benefit of doubt given for AO-1, in spite of circumstantial evidences, it is desirable not to view the issue seriously against Asst. Manager Dr. T.Ashok Kumar. With regard to AO-2 Santhaiah there is strong evidence against him as the tainted amount was recovered from him with positive phenolphthalein test and absent of 15 Nos. of 10 rupees notes from the complainant as contested by AO-2 Santhaiah, action may be taken as deemed fit. SPECIFIC FINDINGS OF THE ENQUIRY OFFICER ON CHARGE WITH REFERENCE TO EXPLANATION GIVEN BY BOTH THE OFFICERS AND EVIDENCE/WITNESSES RECORDED The ACB seized an amount of Rs.38,160-65 on 15-11-1991 from both Asst. Manager, Ashok Kumar and Poultry Assistant Santhayya and they admitted they do not have accounts for the amount. An amount of Rs.35,661-35 was remitted into the bank as sale proceeds of feed, Eggs, Dressed chicken etc., on 16-11-1991 (excluding Rs.250/- seized by ACB Rs.2,000/- personal cash of Poultry Assistant Santhaiah and Rs.499-30 U.D.Pay), proper receipts and accounts were shown only for Rs.27,394-35 and the remaining amount of Rs.8,267/- was simply brought into sales ledger and from there to cash book without raising any cash receipt, an unauthenticated procedure to receive cash etc., from any source. Understandable both were silent on the issue in their explanation. This pertains to different items such as Eggs, Dressed Chicken, Medicines, Cattle feed extension etc. The ACB have seized various records and Registers and cash receipt book in use thereby deprived them of scope to adjust the amounts fully by raising cash memos. But they could succeed partly through another cash receipt book, exclusively used for sundry debtors collections which the ACB have no knowledge and left behind to the tune of Rs.27,394-35 only leaving the balance Rs.8,267/- since it pertains to Eggs, Dressed chicken, medicines extension cattle feed etc., for which no credit sales practice and hence no debtors. Thus having no option, except to bring into sales ledger without raising cash memos to make up the amount Rs.35,661-35. Thus it appears both Ashok Kumar and Poultry Assistant Santhayya were habituated to handle the Corporation money to suit to their personal selfish ends temporarily, has been confirmed the way they both kept the Corporation money to a tune of Rs.35,661- 35 p. being sale proceeds without raising a single cash receipt during a period of 5 days 11-11-1991 to 15-11- 1991. Another incident of glaring financial misappropriation to a tune of Rs.20,255-00 being the cost of 65 bags of poultry/cattle feed under inter unit transfer from PMC Vizag under credit memo No.39045 dt. 20-11-91. The feed was received and acknowledged by Poultry Assistant, Santhayya but not brought into stock register. In their explanation to the charge, the Asst. Manager, Ashok Kumar says that he was on leave, hence nothing to do admitting that he signed the attendance Register and cash book by mistake. He was sanctioned casual leave from 20th to 22nd for 3 days and later extended. Whereas the Poultry Assistant Santhayya having admitted the receipt of the 65 bags, denied misappropriation as he kept the same in the custody of Asst. Manager since he was on duty on that day because of his signing of Registers. Whereas Ashok Kumar, Asst. Manager says, irrespective of his signing of Registers, the entire feed transactions were handled by Poultry Assistant Santhayya irrespective of his absence/presence on leave produced a Xerox copy of statement of account of feed given by Santhayya in his own hand writing from 17-11-1991 on which day the Asst. Manager was on leave with instructions to Poultry Asst. to look after routine work and continued till 27th November, 1991 on the day the Poultry Asst. gave a statement writing “HANDED OVER” to Asst. Manager on 27-11-1991. During the period the entire both receipts and sales accounts exhibited tallied with the stock register, except the disputed consignment of 20th. The contention of the Poultry Asst. Santhaiah that the stock of 65 bags of 20th were omitted in the statement as the Asst. Manager was on duty does not stand or not correct as another consignment of 25-11-1991 received and acknowledged by him while the Asst. Manager was on duty could find place along with another on 23rd in the statement of account and stock register given for the period from 17th to 26th November 1991. CONCLUSIVE REMARKS OF ENQUIRY OFFICER: It is my opinion they both Dr. Ashok Kumar and Poultry Assistant K.Santhayya were habituated to temporary misappropriation of Corporation money by not remitting regularly i.e. every day or two, on large scale, from the way a staggering amount of Rs.35,661-35 being the sale proceeds are kept pending without raising a single cash bill of any nature for days together as admitted by them to be punished suitably. Misappropriation of Rs.20,285/- being the cost of 65 bags of Poultry/Cattle feed supplied on 20-11-1991, is a deliberate intentional mischief played by Poultry Assistant Santhayya to be punished and the amount recovered.” The Enquiry Officer also held that charge No.3 is established against Dr. T.Ashok Kumar. The respondent accepted the enquiry report and issued notice dated 02-05-1994 to the petitioner to show cause as to why he may not be dismissed from service and an amount of Rs.20,285/- may not be recovered from him. The petitioner submitted reply dated 01-08-1994. He challenged the show cause notice on the following grounds: 1) That no specific charge was framed against him and he could not be punished on the basis of general allegations, 2) that copy of the ACB report was not supplied to him, 3) that the Enquiry Officer had prejudged his guilt, 4) that the Enquiry Officer did not record his own findings. He simply relied on the ACB report, and 5) that he was being discriminated in the matter of imposition of punishment. The respondent rejected the points raised by the petitioner and confirmed the proposed penalty. This is evident from the following extracts of order dated 07-12-1994: “ DISCUSSIONS OF THE ABOVE EXPLANATION WITH REFERENCE TO FINDINGS OF THE ENQUIRY OFFICER IN RESPECT OF CHARGES AGAINST SRI K.SANTHAIAH ON THE FOLLOWING COUNTS: 1. The charges were originated from the combined involvement of both Dr. T.Ashok Kumar, and Sri K.Santhaiah, in the trap case conducted by the ACB followed by certain financial irregularities which came to light in the departmental enquiry in the maintenance of cash receipts and stock register resulting in the missing of stock entry receipt of 65 bags of feed worth Rs.20,255/- for which Sri Santhaiah was held accountable as per the findings of the Enquiry Officer. Though the Charge Memo issued by the E.O., in one proceeding to both delinquent officials (Dr. T.Ashok Kumar and Sri K.Santhaiah) every charge has individually and jointly pointed out their involvement of responsibility and accountability. Hence the charges framed against each individual concerned was specific to the extent relevant to each. 2) Every charge framed against the delinquent official concerned fully discussed the ground on which it was to be framed. Hence the individual’s saying that the base of the charge was not given against each charge is not correct. 3) Almost the entire content of the ACB report was reproduced while framing charges against both Dr. T.Ashok Kumar and Sri K.Santhaiah by the Enquiry Officer. Further there is no reason for him to ask for the ACB report, since he failed to say specifically on which point he wants the entire ACB report. 4) The delinquent himself has stated in his explanation that although there was no specific job chart for him, he rendered all the assistance to the A.M. in the day to day running of the office. Having maintained the records concerning to feed stock and cash receipt books all along, his saying now that he is not to be held responsible for missing entry and the value of the received stock of 65 bags of feed is ridiculous and cannot be acceptable. There should have been either the stock physically available or the revenue for the value of the stock if really sold. Neither of these two exists which amounts to clear misappropriation of the amount (Rs.20,255/-). He was given every opportunity by the E.O. during the enquiry and concluded the enquiry with reference to the merits and the material connected to the case. Hence, his saying that he was denied reasonable opportunities is not correct. 5) Insofar as the trap case is concerned against him, the findings of the ACB report shall be the basis, which have exhibited the guilt of the concerned officials as per the evidences. The question of failure of the E.O. in drawing independent conclusions on the report of ACB in trap case will arise only when there is something new that comes to light in the departmental enquiry other than what ACB report suggests as per their investigation. 6) The E.O. has specifically reported in his finding that Dr. T.Ashok Kumar, A.M. was on casual leave from 17- 11-1991 to 26-11-1991 during which period the endorsement of arrangement made was that the P.A. to look after the routine work of the unit which was substantiated with the statement given in writing by the P.A. as handed over to the A.M. on 27-11-1991. The E.O. has further maintained that during the said period of leave Dr. T.Ashok Kumar both the receipts and sales account exhibited by P.A. was tallied with the stock register except the receipt of consignment (65) bags of feed supplied on 20-11-1991. The E.O. therefore categorically disagreed and condemned the argument/logic put forth by P.A., that 65 bags received by him on 20-11-1991 were handed over to A.M. and omitted in the statement as the A.M. was on duty, as malafides and criminal intention of the P.A. (Santhaiah) to misappropriate the value of feed stock of 65 bags worth Rs.20,255/-. The findings of the E.O. therefore be given credence on the counts of irregularity and substantiated the guilt on the part of Sri K.Santhaiah. His further argument that original complaint was against Dr. T.Ashok Kumar, but not against him is not acceptable, since the ACB trap case has proved guilty of K.Santhaiah, P.A., beyond any doubt as per the report of the ACB, which is unpardonable offence committed by him constituting breach of trust.” Shri Tuhin Kumar argued that the order of punishment should be declared nullity and quashed because it was not preceded by an enquiry held in accordance with the provisions of the Andhra Pradesh Civil Services (Disciplinary Proceedings Tribunal) Act, 1960 (for short ‘the 1960 Act’). Learned counsel submitted that in view of the mandate of Section 4 of the 1960 Act, enquiry against the petitioner could have been held only by the Tribunal and not by Regional Manager of the Corporation, and therefore, the enquiry report prepared by him could not have been made basis for passing order dated 7-12-1994. In support of this argument, Shri Tuhin Kumar relied on the judgment of the Supreme Court in State of Andhra Pradesh v. K.Ramachandran[1]. Learned counsel then argued that the order of punishment is liable to be nullified on the ground of violation of rules of natural justice because the petitioner was not given effective opportunity of hearing. He submitted that the action initiated against the petitioner was founded on the report prepared by the ACB, but copy thereof was not supplied to him despite demand and on that account, he could not effectively put forward his defence. Lastly, Sri Tuhin Kumar argued that the punishment of dismissal imposed on the petitioner should be quashed on the ground of violation of Articles 14 and 16 of the Constitution and also on the ground that the same is wholly arbitrary and disproportionate to the misconduct found proved. Learned counsel pointed out that even though Dr. T.Ashok Kumar was the main culprit, he was let off with a minor penalty of stoppage of one increment, whereas his client has been dismissed from service. In support of this argument, Shri Tuhin Kumar relied on the judgments of the Supreme Court in Brij Nandan Kansal v. State of U.P.[2], Mohd. Quaramuddin v. State of A.P.[3], State Bank of Patiala v. S.K.Sharma[4] and State Bank of India v. D.C.Agarwal[5]. He also relied on the judgments of the Madras High Court in Management, Indian Oil Corporation, Madras v. The Presiding Officer, II Additional Labour Court, Madras [6] and of this Court in Gade Jogi Reddy v. Commissioner, Survey Settlement and Land Records, A.P.[7]. Shri D.Prabhakar Reddy, learned counsel for the respondent argued that the provisions of the 1960 Act are not applicable to the employees of the Corporation and, therefore, punishment imposed on the petitioner cannot be nullified on the ground that enquiry was not conducted by the Tribunal constituted under Section 3 of that Act. He then argued that the petitioner’s complaint regarding non-supply of copy of the ACB report should be rejected because substance of the report was incorporated in the charge sheet and also because during enquiry proceedings, he did not make any grievance about non-supply of copy of the ACB report. On the issue of discrimination in the matter of imposition of punishment, Shri Prabhakar Reddy defended the verdict of the respondent by arguing that while T.Ashok Kumar was not found guilty of the charge of accepting money for issue of certificate and misappropriation of funds, whereas both the charges were proved against the petitioner. I have considered the respective submissions and minutely scrutinised the record. The first question which calls for determination is whether the enquiry report and order of punishment are liable to be quashed on the ground of violation of the provisions of the 1960 Act. Section 4 of the 1960 Act, as it stood before its amendment by Andhra Pradesh Amendment Act No.6 of 1993 was as under: “Cases to be referred to Tribunal: 4. The Government shall refer to the Tribunal for inquiry and report, such cases as may be prescribed, of allegations of misconduct on the part of Government servants.” By Andhra Pradesh Amendment Act No.6 of 1993, the word ‘shall’ appearing in Section 4 has been substituted with the word ‘may’. The term ‘Government Servant’ as defined under Section 2(b) of the un-amended Act was as under: “ ‘Government Servant’ means a person in the civil service of the State.” The definition of the term ‘Government Servant’ was also amended by Andhra Pradesh Amendment Act No.6 of 1993. As per the amended Section 2 (b), the term ‘Government Servant’ means a person appointed to public services or to a post in connection with the affairs of the State of Andhra Pradesh. A conjoint reading of the definition of ‘Government Servant’ and Section 4 of the 1960 Act (un-amended) shows that the State Government was obliged to refer the cases of misconduct on the part of government servants to the Tribunal constituted under Section 3 and further action was required to be taken on the basis of the report prepared by the Tribunal. However, these provisions do not have any bearing on the petitioner’s case because Section 4 is applicable only to the government servants and not to the employees of the instrumentalities and agencies of the State like the Corporation. It is not the pleaded case of the petitioner that he was a Government Servant or was a person appointed in connection with the affairs of the State of Andhra Pradesh. Therefore, the enquiry in respect of the misconduct committed by him was not required to be entrusted to the Tribunal and the proceedings of enquiry conducted by the Regional Manager of the Corporation as also the consequential order passed by the respondent cannot be quashed on the ground of non-compliance of Section 4 of the 1960 Act. The ratio of the judgment of the Supreme Court in State of Andhra Pradesh v. K.Ramachandran (supra) has no bearing on the petitioner’s case. The only issue considered in that case was whether under the amended Section 4, whereby the Government was given option to refer the enquiry to the Tribunal, was applicable to pre-amendment misconduct. The Supreme Court answered the question in negative and held that enquiry into the misconduct prior to the amendment of Section 4 had to be entrusted to the Tribunal. The question whether the provisions of the 1960 Act are applicable to the employees other than the government servants was neither considered nor decided by the Supreme Court. Therefore, that judgment cannot be treated as laying down a proposition that an enquiry into the misconduct committed by the employees of the statutory or non-statutory Government Corporations/Agencies/Instrumentalities was required to be entrusted to the Tribunal. The next point which merits consideration is whether the proceedings of enquiry held against the petitioner and the order of punishment are liable to be invalidated on the ground of violation of rules of natural justice. The substratum of the petitioner’s challenge on this ground lies in his assertion that copy of the ACB report which constituted foundation of enquiry was not supplied to him. In this context, it is apposite to mention that in Memo dated -3-1993 issued by the Regional Manager of the Corporation, the relevant extracts of the report of the ACB were reproduced. This appears to be the reason why the petitioner did not make any grievance about non- supply of copy of the ACB report either at the stage of filing written explanation to the charge sheet or during the course of enquiry. For the first time, he made a complaint on this score in reply dated 01-08- 1994 filed by him to contest the proposed penalty of dismissal from service. It is, therefore, reasonable to infer that the petitioner’s defence was not prejudiced on account of non-supply of the