IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN TUESDAY, THE 2ND MARCH 2010 / 11TH PHALGUNA 1931 WP(C).No. 18682 of 2005(Y) -------------------------- PETITIONER(S): --------------- V.G.RAJAN, RTD.SUPERINTENDENT, KERALA STATE ELECTRICITY BOARD, RESDING AT RAGAM NIVAS, ADICHIPUZHA P.O. RANNY, PERUNAD, PATHANAMTHITTA. BY ADV. SRI.S.RAMESH BABU RESPONDENT(S): --------------- 1. THE KERALA STATE ELECTRICITYBOARD, REPRESENTED BY ITS SECRETARY, VYDYTUHI BHAVAN, PATTOM, THIRUVANANTHAPURAM. 2. THE DEPUTY CHIEF ENGINEER, TRANSMISSION CIRCLE, NALLALAM, KOZHIKODE. 3. THE ACCOUNTS OFFICER,(PENSION AUDIT), VYDYUTHI BHAVANAM, PATTOM, THIRUVANANTHAPURAM. ADV. SRI.K.S.ANIL, SC, KSEB FOR R1 TO 3 SRI. ASHOK M. CHERIAN. THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 02/03/2010, THE COURT, ON THE SAME DAY, DELIVERED THE FOLLOWING: PETITIONER'S EXHIBITS: W.P.C. NO. 18682/2005 --------------------------------------------------------------------- EXT.P1 TRUE COPY OF MEMO OF CHARGES DT. 3-11-1992. EXT.P2 WRITTEN STATEMENT OF DEFENCE DT. 19-11-1992. EXT.P3 MEMO OF CHARGES DT. 7-6-1993. EXT.P4 MEMO OF CHARGES DT. 17-9-1993. EXT.P5 STATEMENT SHOWING THE ALLEGED LIABILITY OF THE PETITIONER. EXT.P6 TRUE COPY OF ENQUIRY REPORT. EXT.P7 ORDER DT. 15-12-2004. EXT.P8 TRUE COPY OF PENSION AUTHORISATION LETTER. EXT. P9ORDER DT. 30-11-1984. EXT.P10 REPRESENTATION OF PETITIONER. EXT.P11 COMMUNICATION DST. 23-7-2005. [TRUE COPY] P.S TO JUDGE. S. Siri Jagan, J. =-=-=-=-=-=-=-=--=-=-=-=-=-=-=-=-=-= W.P(C) No. 18682 of 2005 =-=-=-=-=-=-=-=-=--=-=-=-=-=-=-=-=-= Dated this, the 2nd day of March, 2010. J U D G M E N T The petitioner retired from the service of the Kerala State Electricity Board as a Superintendent on 30-9-2004. Prior to his promotion as Superintendent, the petitioner was working as Assistant Store Keeper, Transmission Circle, Nallalam. When he was to be relieved from the post of Assistant Store Keeper, the petitioner was directed to hand over the materials under his custody to the Store Keeper. In spite of repeated directions, he did not do so. He actually handed over the materials under his custody only after 8 years. On verification of the stock in his custody, shortage of materials as detailed in Ext. P 5 were detected. Disciplinary proceedings were initiated against the petitioner for disobedience of lawful orders of the superior authorities, dereliction of duty causing loss to the Board and misappropriation of materials belonging to the Board. An enquiry was conducted in which the petitioner participated. After considering the evidence adduced in the enquiry, the enquiry officer submitted Ext. P6 report finding the petitioner guilty of gross misconduct, dereliction of duty, insubordination and misappropriation of the properties of the Board amounting to Rs. 8,24,441/-. Based on that enquiry report, Ext. P7 order was passed by the disciplinary authority directing recovery of the amount of Rs. 8,24,441/- from the petitioner. Since the petitioner did not pay the same, the amounts were sought to be recovered from his retirement benefits and retirement benefits were withhold except minimum pension at the rate of Rs. 1275/-. It is under the above circumstances, the petitioner has filed this writ petition seeking the following prayers: “a. issue a writ of certiorari calling for the records leading upto Ext. P 6 and quash the same. W.P.C. No. 18682/2005 -: 2 :- b. issue a writ of mandamus commanding the respondents to forthwith sanction disburse gratuity (Rs.3,50,000/-), provident fund (Rs.55,466/-), pension commutation (Rs. 3,25,607/-) terminal leave surrender (Rs.64, 728/-), arrear D.A (Rs. 55,547/-) as also full pension from 10/2004 onward forthwith to the petitioner with statutory interest thereon at 12% per annum till the date of payment.” 2. A statement has been filed by the Kerala State Electricity Board seeking to justify their action. The petitioner has also filed a reply affidavit. 3. I have considered the rival contentions in detail. 4. As far as the challenge against Ext. P6 is concerned, the petitioner does not contend that the enquiry proceedings are vitiated by violation of principles of natural justice or procedure prescribed by rules. His only contention is that the findings are not correct. He challenges the findings on grounds A, B and C of the writ petition which read thus: “A. The assumption in imposition of the huge liability is that the petitioner has misappropriated the items though in fact it is only a case of shortage in materials which arose because of improper accounting as also irregular method of keeping and distribution of materials and stock. A mere reading of Ext. P5 which is the statement prepared by the 2nd respondent for imposition of the liability would show that the short items are not items which would be the subject matter of misappropriation by anyone much less the petitioner. The items are exclusively used for Board's purposes and Board being the sole purveyor of Electricity in the State, these items or of any value in general. This is more particularly so of those items in Ext. P5 of substantial value which mainly consists of huge 66KV CT transformers each valued up to Rs. 50,000/- By no stretch of imagination can a charge be laid that the petitioner has misappropriated such large items of particular use only for the Board. This is a case where essentially due to inherent defects in the Board's system of storing, transporting and recording the usage of materials shortages are seen in the accounts. These transformers metering equipments and other materials required for supply of electricity have in fact been used by the Board at various sites. But want of proper records have hampered the petitioner and has resulted in the “shortage” on paper. As a matter of fact there is no shortage. However, the Board has without adequate enquiry as to the W.P.C. No. 18682/2005 -: 3 :- whereabouts of the transformers etc., imposed liability on the petitioner and even suggested that the petitioner has 'misappropriated” the items found short. B. Even a cursory reading of Ext. P5 shall undeniably reveal the fact that imposition of huge liability pertains to materials which cannot but be used by Kerala State Electricity Board alone since they are monopoly items which are exclusively reserved to be used by State Electricity Boards. For example item Sl. No. 1 to 44, 58 to 61, 63, 66, 67, 68, 79, 81 to 90 are solely and exclusively tower parts intended for the erection of High Tension Towers carrying 220 KV/110 KV/66 KV High Tension lines. Under the provisions of Electricity Supply and no individual or private Company can erect such High Tension lines. The above tower parts are designed with accurate slots and holes as per the drawings of the tower and no parts can be used for any other purposes except for which it is designed and moulded. More particularly, they are galvanised bearing numbers of each part and as such no body can use it for any other personal purposes as they are significantly identifiable and traceable even for a layman. Similarly, item no. 93 to 96 are current transformers which can be used only in substations owned by the K.S.E.B. No private person or private Company can erect or establish a substation. Likewise item No. 101 to 119 are conductors and control cables which are exclusively used in high tension lines and substations. No private individual or establishment can utilize them in any way. Similarly, item Nos. 126 to 180 are line materials which could be used only in LT and HT Lines which are erected and owned by K.S.E.B. No private individual or establishment can utilize the same for any personal purposes since Electricity Supply Act does not permit anybody else to draw electric lines either LT or HT or EHT. Similar is the case with regard to other items also. The petitioner affirms that only a negligible item amounting to 1% or 2% of the total liability can be used for any personal purpose by anybody. The controlling authorities who are technically competent and qualified to understand the real aspects of the issue have attributed these liabilities on the petitioner. A meticulous study of the items listed for liability by any competent technical person can reveal the fact that these items could be and can be used only by Electricity Board ad none else can handle such items. C. Besides as per the prevailing orders Assistant Engineers were the actual custodian of stores and store materials. The petitioner had no direct control of the stock yard and godown. Most of the materials found short are stored and kept in the open yard without proper fencing and watch and ward. The Assistant Engineer had full control and custody of the stores materials and in this bonafide interest of works he had issued such monopoly and exclusive items without proper accounting. The Board has issued clear cut directions and guidelines regarding the custody and control of the stores materials. True copy of the same is W.P.C. No. 18682/2005 -: 4 :- produced herewith and marked as Ext. P9. Several similar orders were issued subsequently regarding the control and custody of the stores being entrusted to the Assistant Engineers. Accordingly, Assistant Engineer, Stores has been managing and controlling the stores transactions. Besides the petitioner's substitute Sri. N.K. Kunju had issued numerous items of valuable materials to different field officers in his absence and the petitioner had kept photocopies of such intents and requisitions. Regarding the same the petitioner has submitted several representations to his controlling authorities true copy of one of which is produced herewith and marked as Ext. P10. Ext. P10 evidences that frequent issue of materials were done in the absence of the petitioner and also proves that the delay in handing over is due to the non-cooperation of his substitute Sri. N.K. Kunju who was intensely interested in travelling with an aim of drawing travelling allowances which very often amounted to Rs.1000 to 1500 per month.” On a reading of Ext. P6, I do not find that the petitioner has taken such contentions before the enquiry officer, In fact, before the enquiry officer, he did not dispute the fact that the stores were under his custody. He also did not dispute the fact that on verification of the accounts, shortage as detailed in Ext. P5 had been detected. The petitioner heavily relies on the findings in Ext. P6 to the effect that there was no evidence to show that the petitioner had amassed wealth disproportionate to his known source of income. The petitioner's contention is that a mere look at the list of articles found short as per Ext. P5, it is clear that none of the materials mentioned therein are capable of being misappropriated and used by anybody insofar as the same are monopoly items, which could have been used by State Electricity Boards alone. According to the petitioner, therefore, the petitioner could not have misappropriated the materials. The petitioner's contention is that in such circumstances, the only conclusion possible is that there was no shortage and those materials were actually used in the field, which was not properly accounted. 5. I do not think that I can countenance such a contention. If W.P.C. No. 18682/2005 -: 5 :- I do so, then it would be utter chaos in the Electricity Board because on the strength of such a finding anybody can get away with even misappropriation. Before the enquiry officer, the petitioner did not dispute the fact that the petitioner was the custodian of the stores as the Assistant Store Keeper. He also did not dispute the fact that materials worth Rs. 8,24,441/- were found short in the stock. Then it is for the petitioner to explain the discrepancy. If the petitioner cannot explain the discrepancy, even if there is no misappropriation, the petitioner is bound to make good the loss caused to the Board. That alone has been directed as per Ext. P7 order. Therefore, I do not find anything wrong with Ext. P6 enquiry report or Ext. P7 order directing recovery of an amount of Rs. 8,24,441/- from the petitioner. 6. The next question that arises for consideration is as to whether the amounts can be adjusted against the retirement benefits due to the petitioner. The amounts which have been withheld are provident fund amount, gratuity amount, pension commutation amount, terminal leave surrender salary and arrears of D.A. Before dealing with this question, I have to consider an incidental question as to whether the petitioner is entitled to gratuity as per the Payment of Gratuity Act, insofar as in the statement filed by the Kerala State Electricity Board, they have taken a contention that as per the Kerala Service Rules which have been made applicable to employees of the Board, the maximum gratuity payable is Rs. 2,80,000/-. But that question is no more res integra insofar as a Division Bench of this Court has already held that employees of the Kerala State Electricity Board are entitled to gratuity as provided under the Payment of Gratuity Act. Of course, the Electricity Board has taken that judgment in appeal before the Supreme Court, which is pending. However, unless the judgment of the Division Bench is reversed by the Supreme Court, the petitioner is also entitled to gratuity as per W.P.C. No. 18682/2005 -: 6 :- the Payment of Gratuity Act. It is not disputed before me that going by his last drawn salary, the petitioner is entitled to the maximum gratuity provided in the statute. At the relevant time, the maximum gratuity payable under the Payment of Gratuity Act was Rs. 3,50,000/-. Therefore, the petitioner is entitled to Rs. 3,50,000/- towards gratuity. 7. The next question that has to be considered is as to which all retirement benefits due to the petitioner can be adjusted against the loss caused to the Board. The petitioner has not raised any contention in respect of the same. But, I find that the provident fund, terminal leave surrender salary and arrears of D.A can be adjusted against the loss caused to the Board. As far as gratuity is concerned, Payment of Gratuity Act permits forfeiture of gratuity in cases where an employee is punished for misconduct involving loss to the employer to the extent of the loss. Here, by Exts. P6 and P7, the petitioner has been found to have been guilty of the misconduct of loss to the Kerala State Electricity Board. Therefore, the amount of gratuity to the extent of loss caused to the Board can be forfeited. As such, the amount of gratuity of Rs. 3,50,000/- is liable to be forfeited against the amount of Rs. 8,24,441/-. 8. But, it is a different question when it comes to commuted value of pension and pension. Counsel for the Board was unable to point out any provision of law, which permits recovery from pension payable to an employee. In fact, the K.S.R prescribes recovery only from DCRG and not from other retirement benefits. As such, the pension commutation amount and actual pension cannot be proceeded against for recovery of amounts due as per Ext. P7. In the above circumstances, the petitioner is entitled to disbursal of the commuted value of pension and pension due to him as per Rules. There is a dispute as to whether the pension commutation amount is W.P.C. No. 18682/2005 -: 7 :- Rs. 3,24,607/- as claimed by the petitioner or whether it is Rs. 2,73,431/- as stated in the statement filed. The petitioner has not chosen to controvert the contention in the statement in the reply affidavit filed by the petitioner. Therefore, I am inclined to accept the figure in the statement as Rs. 2,73,431/-. 9. Admittedly, the petitioner has been paid only Rs. 1275/- as minimum pension. There is no order of the Board withholding pension from the petitioner under any provision of law. Therefore, the petitioner cannot be denied pension due to him as per the Rules. In the above circumstances, while repelling the challenge against Exts. P6 and P7, I direct the respondents to pay to the petitioner the commuted value of pension and regular pension due to the petitioner in accordance with the rules as expeditiously as possible, at any rate, within two months from the date of receipt of a copy of this judgment. However, this would be without prejudice to the right of the Board to recover the balance amount due from the petitioner out of Rs. 8,24,441/- after adjusting those terminal benefits found to be liable to be adjusted as above, by resorting to other remedies available to them under law. The writ petition is disposed of as above. Sd/- S. Siri Jagan, Judge. Tds/