*THE HON’BLE MR JUSTICE L.NARASIMHA REDDY W.P.No.14774 OF 2011 % 16.08.2011 Between: # D.Ramakrishna Reddy. …Petitioner And $ The Chairman-cum-Managing Director and others. …Respondents ! COUNSEL FOR PETITIONER: Sri M.N.Narasimha Reddy ^ COUNSEL FOR RESPONDENT No.1: Sri K.Srinivas Murthy ^ COUNSEL FOR RESPONDENT Nos.2 and 3: Sri P.Ravindra Reddy < Gist: > Head Note: ? CITATIONS: THE HON’BLE SRI JUSTICE L.NARASIMHA REDDY Writ Petition No.14774 of 2011 ORDER: The petitioner is working as a Senior Divisional Manager, Division–V, United Insurance Company Limited at Hyderabad. He was prosecuted for an offence under Section 3(1)(x) of SC & ST (Prevention of Atrocities) Act by the Court of Special Judge for Trail of Offences under SC and ST (POA)-cum-VI Additional Metropolitan Sessions Judge. Secunderabad. The trial Court convicted him and imposed the sentence, to suffer rigorous imprisonment of six months and to pay a fine of Rs.1,000/-, in default to undergo simple imprisonment for one month. The petitioner filed Criminal Appeal No.384 of 2009 before this Court against the said judgment. It is stated that this Court stayed the sentence but not the conviction. The Director and General Manager of the Company, 2nd respondent herein passed office order, dated 26.04.2011 dismissing the petitioner from service, on the basis of the conviction and sentence suffered by him. The petitioner challenges the same. He contends that the respondents did not conduct any departmental enquiry, much less initiated any disciplinary proceedings and straight away, the order of dismissal was passed. It is pleaded that even where an employee is convicted and sentenced for any offence, it becomes necessary to issue notice, and to conduct enquiry under the General Insurance (Conduct, Discipline and Appeal) Rules (for short ‘the Rules’). The petitioner further submits that the Rules, which are not applicable to the service conditions of the employees in the company, were invoked. On behalf of the respondents, a counter affidavit is filed. According to them, the Rules permit of imposition of punishment, in case an employee is convicted by the Court of law. The respondents contend that the Rules governing the service conditions of the employees of the company were followed. Sri M.N.Narasimha Reddy, learned counsel for the petitioner submits that the respondents have invoked the Rules, which do not apply to the service conditions of the petitioner. He further submits that the 1st respondent has not framed any independent rules, after the General Insurance (Business) Nationalization Act, 1972 (for short ‘the Act’) was enacted, and the Rules relied upon by the respondents were not framed as provided for under the said Act, much less they were placed before the Houses of Parliament for approval. He further submits that even if it is to be assumed that the Rules apply, it was obligatory on the part of the respondents to issue notice and to conduct enquiry. Sri K.Srinivas Murthy, learned counsel for the 1st respondent and Sri P.Ravindra Reddy, learned counsel for respondents 2 and 3, on the other hand, submit that the Rules have been framed strictly in accordance with the relevant provisions of law and the contention raised by the petitioner to the contrary is untenable. They further state that though Rules 25 to 27 of the Rules prescribe a detailed procedure to be followed before any punishment is imposed, against an employee, such a requirement is exempted under Rule 30 in certain cases including the instances, where an employee is convicted by a court on a criminal charge. They submit that once the petitioner has been convicted and sentenced, the inevitable consequence is that the punishment under the relevant provisions of law must be imposed. Two questions arise for consideration. They are, a) whether the relevant rules have been applied to the case of the petitioner; and b) whether the Rules have been followed in their letter and spirit, before the punishment of dismissal was imposed against the petitioner. On the first question, a detailed submission was made to the effect that the Rules followed by the respondents are not applicable, because they were not framed in accordance with the provisions of the Act. On a detailed consideration of the matter, this Court is satisfied that the Rules have been framed in accordance with the provisions of the Act and the procedural requirements were complied with. It is not essential to delve into the matter in detail, because the petitioner is not able to demonstrate that the plea raised by the respondents in the counter affidavit is not correct. As regards the second question, it is not in dispute that Rules 25 and 26 of the Rules mandate that before any major penalty is imposed against an employee of the Company, domestic enquiry must be conducted and that procedural requirements must be complied with. Rule 27 of the Rules deals with the procedure to be followed for imposing minor penalty. The petitioner was imposed the major penalty of dismissal and admittedly, neither an enquiry officer was appointed nor any departmental enquiry was conducted. The respondents take shelter under Rule 30 of the Rules. It reads as under: 30. Special Procedure in certain cases Notwithstanding anything contained in Rule 25 or 26 or 27, the competent authority may impose any of the penalties specified in Rule 23 in any of the following circumstances: i. the employee ha been convicted on a criminal charge, or on the strength or facts or conclusions arrived at by a judicial trial, or ii. where the competent authority is satisfied for reasons to be recorded by it in writing that it is not reasonably practicable to hold an inquiry in the manner provided in these Rules, or iii. Where the competent authority is satisfied that in the interest of the security of the Corporation/Subsidiary it is not expedient to hold any inquiry in the manner provided in these rules. iv. Where an employee has abandoned his post, the competent authority may consider the circumstances of the case and pass such orders thereon as it deems fit This Rule enables the competent authority to skip the procedure under Rules 25 and 26, in case of major penalty and Rule 27, in case of minor penalty, if the action is proposed under Clauses (i) to (iv). Here itself, it is necessary to mention that the procedure for imposition of major penalty involves three stages viz., (a) issuance of charge sheet, (b) conducting of a domestic enquiry by appointing an enquiry officer, if the charges are denied and (c) ascertaining the version of employee as to imposition of punishment, depending upon the findings of the enquiry officer. All the three requirements can be ignored, where the action is proposed is under Clauses (ii), (iii) and (iv). Where however the punishment is sought to be imposed by invoking Clause (i), a different situation arises. Since the conviction is ordered by a criminal Court, the necessity to issue a charge sheet much less to appoint an enquiry officer may not arise. At the stage of imposition of punishment, an amount of fairness is required to be exhibited. The provision does not differentiate the offences of which the employees are convicted. The Rules takes in its fold all the convictions, be it the one for petty traffic offence or the one for the gruesome murder. Law does not permit of bundling all of them together in the context of the consequences that flow form them. Unless an objective approach is adopted, it is quite possible, if not permissible, for a competent authority to impose the most serious punishment of dismissal, even for a traffic offence. Further, Rule 30 does not specify the nature of punishment that can be imposed. It is left to the discretion of the authority. In a given case, the competent authority may complete the ordeal by imposing a minor punishment, even where the employee is found guilty of a serious offence. Therefore, the principle of proportionality gets attracted here. The punishment, which the authority imposes on the basis of conviction of an employee, must be commensurate with the gravity of the offence. This can be effectively ensured, if only the employee is put on notice and his version is taken into account. In a given case, the employee may demonstrate that the conviction ordered is for an offence, which is totally unrelated to his duties and functions in the office or that the proposed punishment is totally disproportionate to the conviction and sentence imposed against him. No harm would be done to the organization, if notice is given in such cases. Hardly any problem arises where the situations covered by Clauses (ii), (iii) and (iv) are to be dealt with. Issuance of notice in cases arising under Clause (i) may help them in arriving at a just and proper conclusion; in the interest of the organization. It is a different matter that in a given case, the competent authority may not agree with the explanation offered by the employee. However, the reasons furnished by him for not agreeing with the version of the employee would be subject to judicial review and the Court would be in a better position to analyse as to what weighed with the competent authority, in coming to a particular conclusion. Hence, the writ petition is allowed and the impugned order is set aside. The 2nd respondent shall issue show cause notice to the petitioner, indicating the punishment, which he proposes to impose against him. It shall be open to the petitioner to submit explanation within 15 days from the date of receipt of the notice. The 2nd respondent shall pass appropriate orders thereon within four weeks from the date of receipt of the explanation, duly indicating the reasons in support of his conclusion. Till such time, the petitioner herein shall be deemed to be under suspension. There shall be no order as to costs. __________ 16.08.2011 Note: L.R.Copy to be marked. (B/o) JSU THE HON’BLE SRI JUSTICE L.NARASIMHA REDDY Writ Petition No.14774 of 2011 Date: 16.08.2011 JSU