C^i'yo IN THE HIGH COURT OF JUDICATURE AT BILASPUR CHHATTISGARH W.P.(S).NO.^J&3 12007 PETITIONERS ...••!y ^^•-"^ l^€'.^ ..-<y *>*•";''-'' „...-•' ^'' RESPONDENT ,cs^ao-**-' -co?? •^ ^°^» i.R.Yadav Age about 59year, S/oShriL.P.Yadav S.E.(P.W.D. Bridge) Raigarh B-5, Darogapara, Civil Line, Raigarh Distt. - Raigarh (C.G.) VERSUS itate Govt. ofChhattisgarh Through Deupty Secretary PublicWorks Department D.K.S. Bhawan, Distt.-Raipur(C.G.) WRIT PETITION UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA w < ./ HIGH COURT OF CHHATTISGARH : BILASPUR Writ Petition (S) No. 2936 of 2007 Petitioner Ganpati Pawar Versus Respondent State Govt. of Chhattisgarh Writ Petidon fS) No. 3103 of2007 Petitioner N. R.Yadav Versus Respondent State Govt. of Chhattisgarh WRIT PETITION UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA (SB: Hon'ble Shri Satish K. Agnihotri J.) Shri Ajay Shrivastava, Advocate for the petitioners. Shri A. V. Shridhar and Shri N. N. Roy, Panel Lawyers for the respondent. O RDER •/< - (Passed on this &! day ofFebruaiy, 2010) 1. Challenge in both the writ petitions i.e. Writ Petition (S) Nos 2936/2007 and 3103/2007, is to the order dated 11.4.2007 (Annexure P/l), whereby a total sum of Rs. 40,36,500/- (Rupees Forty Lacs Thirty Sbs Thousand and Five Hundred only), in equal proportion i.e. Rs. 20,'18,250/-, has been directed to be recovered from the salary and allowances of both the petitioners for causing loss to the Governnient. 2. Brief facts, in nutshell, are that at the relevant period the petitioner Shri Ganpati Pawar ( Shri G. P. Pawar) was working on the post of Sub Divisional Officer, Public Works Department, Bridge Sub Division, Raipur and the petitioner Shri N. R. Yadav was working on the post of Executive Engineer, Bridge Division, Raipur. It is evident that a contract was given to M/s Surya Infrastructure, Hyderabad (for short 'the Contractor') for construction of a high standard bridge on Mahanadi (Bilahighat) at the Navapara Rajim - Navagarh road. The Conta-actor, without completion of the assigned work left the site, thus on the risk and cost of the Contractor a new tender was invited for completion of the remaining work. On enquiry it was discovered that some advance was given to the Contracfor for purchase of machines and materials but without inforination and knowledge of the authorities concerned, the Contractor removed the machines and raaterials from the site. The F.D.R. of Rs. 11,85,QOO/-, deposited by the Confa-actor was forged, thus a total sum of Rs. 52,31,500/- was assessed to be recovered frora the Contractor. In addidon to that for completion of the work, which was left over by the Contractor, approximately a sum of Rs. 1 Crore was to be spent. The Contractor had also submitted forged Bank solvency at the tiine of registration. Thus, a loss of approximately Rs. 1.50 Crore has been caused by the conduct of the Contractor to the State. The charge against the petitioner Shri Ganpati Pawar is fhat due to his non application of mind and lack of supervision, such a loss was caused to the State. In regard to the same work and the same Contractor, it was alleged against the pefidoner Shri N. R. Yadav that the verification of the F.D.R. submitted by the Contractor was not done in time from the concerned Bank. Since no care was taken for the security of the machines and materials, therefore the Contractor could reinove the same and as such an amount of Rs. 40,36,500/- could not be recovered from the Contractor, thereby a loss has been caused to the State. The payruent of ,"; \ /'sa®ia1 ¥^^^/ 7. Rs. 1,65,000/- was made to the Contractor forvconstr[iction of diverted route, whereas there was no provision for such a work under the one time contract agreement. For all these lapses, the petitioner Shri N. R. Yadav was responsible. For the above charges show cause notices were issued to the petitioners on 8.4.2005 and 4.5.2005, respectively, which were replied by them. Thereafter, by the impugned order dated 11.4.2007 (Annexure P/l), after dealing with the charges levelled against both the petitioners and considering their reply, both the petitioners were held liable for causing a total loss of Rs. 40,36,500/- to the State. Accordingly, it was directed that the above aruount in equal proportionate i.e. Rs. 20,18,250/- may be recovered from both the petitioners. Subsequently, by order dated 26.4.2007 (Annexure P/2) it was directed that recovery of a suin of Rs. 1000/- may be started from the salary of the petitioner Shri Ganpati Pawar froin the month of April, 2007. Learned counsel appearing for the petitioners would submit .that on the similar allegations, the Contractor was held liable for causing the loss of Rs. 52,31,500/- with interest at the rate of 18% p.a. In this sequence, the Collector, Raipur by memo dated 31.5.2005 (Annexure P/4 in W.P.(S) No. 3103/2007) requested the Collector, District East Godawari (Kakinada), Andhra Pradesh for recoveiy of th'e money from the Contractor through revenue recovery certificate. Mr. Shrivastava would further submit that since recovery of a huge amount towards loss caused to the State is involved, it was imperative upon the disciplinary authority to hold a regular enquity against the petitioners, as provided iri~~^ule 16 of the Civil Services (Classification, Control and Appeal) Rules,.1966 ( for short 'the Rules, 1966'). In absence of such enquiiy, the impugned order of recovery is not sustainable in law. 8. On the other hand, learned counsel appearing for the respondent/State would submit that the petitioners being Incharge of the contract work, it was obligatory upon them to have had close wateh on the entire work, perfornied by the Contractor. Since they were not vigilant rather negligent in their duties, the impugned order of recoveiy for the loss caused to the State is just and proper. It is not a case where the petitioners were never given an opportunity to explain their conduct. The show cause notices were issued to the petitioners and after considering their reply and other factors the impugned order was passed in accordance with law, after thoughtful consideration by the concerned authorities at various levels. 9. Mr. Shridhar would furfher submit that according to the provisions of Rule 10 of the Rule, 1966, recovery can be made from the salary and allowances of the petitioners for causing pecuniaiy loss to the Governraent due to the negligence of the employee. The matter was examined by the concerned authorities in detail and thereafter a reasoned order of recovery has been passed. Thus, the petitioners are not entitled to any relief. 10. I have heard learned counsel appearing for the parties and perused the pleadings and documents appended thereto. - / 11. It is evident that the charge sheet dated 4.5.2005 (Annexure P/2 in W.P.No. 3103/2007) was issued to the petitioner Shri N. R. Yadav to initiate departmental enquiry under Rule 13 of the Rules, 1966, holding that he was liable for disciplinary action under the provisions of Rule 10 and 14 of the Rules, 1966. The petitioner submitted his detailed reply on 1.6.2005 (Annexure P/3 in W.P.No. 3103/2007), denying all the charges levelled against him. 12. It is further evident that a show cause notice dated 8.4.2005 (Annexure P/3 in W.P.No. 2936/2007) was issued to the petitioner Shri Ganpati Pawar for initiating disciplinary enquiry against him under the provisions of the Rules 1966. The petitioner submitted his reply on 19.4.2004 (Annexure P/4 in W.P.No. 2936/2007). 13. It is profitable to quote Rule 10 of the Rules, 1966, which reads as under : "10. Penalties.- The following penalties may, for good and sufficient reasons and as hereinafter provided, be imposed on a Governmient servant, namely :- Minor penalties :- (i) Censure; (ii) Withholding of his promotion; (iii) Recovery from his pay of the whole or part of any pecuniary loss caused by him to the Government by negligence or breach of order; (iv) Withholding of increments of pay or stagnation allowance; Major Penalties :- (v) Reduction to a lower stage in the time scale of pay for a specified period with further directions as to whether or not, the Governraent sen/ant will earn incremerits of pay or the stagnation allowance, as the case may be, during the period, on such reduction and whether on the expiry of such period, the reduction will or will not have the effect of postponing the further increments of his pay or stagnation allowance; Note.- The expression "reduction to a lower stage in the time scale of pay" shall also include reduction of pay from the stage of pay drawn by a Government servaTit~6f account of grant of stagnation allowance of any. (vi) Reduction to a lower time scale of pay, grade, post or service which shall ordinarily be a bar to the promotion of the Governnient sen/ant to the time scale of pay, grade, post or service from which he was reduced, with or without further directions regarding conditions of restoration to the grade or post or service from which the Government servant was reduced and his seniority and pay on such restoration to that grade, post or service; (vii) Coinpulsoiy retirement; (viii) Removal from service which shall not be a disqualification for future employment under the Government; (bc) Dismissal from service which shall ordinarily be a disqualification for future employment under the Government; Explanation. - The following shall not amount to a penalty within the meaning of this rule, naraely :- (i) withholding of increments of pay of a Government servant for his failure to pass any departmental examination in accordance with the rules or orders governing the service to which he belongs or post which he holds or the terms of his appointa-nent; (ii) stoppage of a Government servant at the efficiency bar in the time scale of pay on the ground of his unfitness to cross the bar; (iii) non-promotion of a Government servant, whether in a substantive or officiating capacity, after consideration of his case, to a service, grade or post for promotion to which he is eligible; (iv) reversion of a Government seryant officiating in a higher service, grade or post to a lower service, grade or post, on the ground that he is considered to be unsuitable for such higher service, grade or post or on any administrative ground unconnected with his conduct; (v) reversion of a Government servant, appointed on probation to any other service, grade or post, to his permanent service, grade or post during or at the end of the period of probation in accordance with the terms of his appointment or the rules and orders governing such probation; (vi) replacement of the services of .a Government servant, whose services had been borrowed froru the Union Government or any other State Government or an authority under the control of any Government, at the disposal of the authority frora which the service of such Government servant had been borrowed; (vii) compulsory retireinent of a Government servant is accordance with the provisions relating to his superannuation or retirement; (viii) termination of the services; (a) (b) (c) of a Govemment serv&ELL-'^'ppointed on probation, during or at the end of the period of his probation, in accordance with the terms of his appointment or the rules and orders ;overning such probation; or of a temporaiy Government servant appointed until further orders on the ground that his services are no longer required; or of a Government servant, employed under an agreement, in accordance with the terms of such agreeraent;' 14. 15. Rule 14 of the Rules, 1966 provides that no order imposing any ofthe penalties specified in clauses (v) to (us) ofRule 10 shall be imposed without holding an inquiry. Rule 16 ofthe Rules, 1966 reads as under: "16. Procedure for imposihg mlnor penalties.—(1)Subject to the provisions of sub-rule (3) of Rule 15, no order imposing on a Government servant any of the penalties specified in clauses (i) to (iv) of Rule 10 and Rule 11 shall be made except after— (a) informing the Government servant in writing of the proposal to take action against him and of the imputations of misconduct or misbehaviour on which it is proposed to be taken, and given him a reasonable opportunity of making such representation as he may wish to raake against the proposal; (b) holding an inquiry in the manner laid down in sub-rules (3) to (23) of Rule 14, in every case in which the disciplinary authorities is of the opinion that such inquiry is necessary; (c) taking the representation, if any, submitted by the Government servant under clause (a) and the record of inquiry, if any, held under clause (b) into consideration; (d) recording a finding on each imputation of misconduct or misbehaviour; and (e) consulting the commission where such consultation is necessary. (1-a) Notwithstanding anything contained in clause (b) of sub-rule (1), if in a case it is proposed after considering the representation, if any, made by the "'$ •^, 1 Government Servant under clause (a) of that sub-rule to withhold increraents of pay of Stagnation Allowance and such wlthholdinj or increraents of pay or Stagnation Allowance is likely to effect adversely the amount of pension payable to the Government Servant or to withhold increments of pay or Stagnation allowance for a period exceeding three years of to withhold increments of pay or Stagnation allowance with cumulative effect for any period, an inquiry shall be held in the manner laid down in sub-rules (3) to (23) of Rule 14, before making any order imposing on thc Government seryant any such penally. (2) The record of the proceedings in such cases shall include— (i) a copy of the intimation to the Governruent serpant of the proposal to take action against him; (ii) a copy of the statement of imputation of raisconduct or misbehaviour delivered to him; (iii) his representation, if any; (iv) the evidence produced during the mquiry; (v) the advise of the commission, if any; (vi) the findings on each imputation of misconduct or misbehaviour; and (vii) the orders on the case together with the reasons therefor. 16. On bare perusal of Explanation to Rule 10 it appears that the recovery froni the pay of the whole or part of any pecuniary loss caused to the Governraent by any employee by negligence or breach of any order amounts to a penalty which may affect service prospects of the employee. Rule 16 provides that no penalty specified in clauses (i) to (iv) of Rule 10 and 11 shall be imposed after informing the Govemment servant in writing of the proposal to take action against him and of the imputations of misconduct or misbehaviour on which it is proposed to be taken, and giving him a reasonable opportunity of making such representation as he may wish to make against the proposal. Rule 16 (1) (b) of the Rules, 1966 provides that where the disciplinary authority is of the opinion that enquiry is necessary, the enquiry may be held in the same manner as specified in sub-rule (3) to (23) ofRule 14. 17. The recovery of the pecuniary loss, alleged to have been caused by the petitioners to the Government may be a minor penalty under the provisions of Rule 10 of the Rules, however, the allegation of negligence cannot be established without holding a proper enquiiy. 18. In the present case, the pecuniary loss, as has been found to have been cause by the petitioners, is to the tune. of Rs. 40 Lacs and odd. There are three aspects which have to be examined before imposition of a penalty of recoveiy of financial/pecuniary loss caused to fhe Government. Firstly, what is the pecuniary loss; secondly, who was responsible for the loss; and thirdly, whether the loss was caused by negligence or breach of order. It is not the case of the State that there was any breach of the order. Only negligence has been alleged and found proved, on reply to the show cause notice. It was stated that the petitioners have failed to examine the documents filed by the Contractor properiy and as such, they were negligent. Further, they have not kept proper supervision on the work. 19. The principle of audi alterem partem does not confine to only the Courts and judicial proceedings, but to other proceedings also, which result into effecting person/property or other rights ofthe parties in dispute. The principle applies with equal force in the proceedings, which effect liability for recovery of financial loss also. ^ 20. In Suresh Chandra Nanhorya v. Rajendra Rajak and Others1, the Supreme Court observed as under: "8. Natural justice is an inseparable ingredient of faimess and reasonableness. It is even said that the principles of natural justice must be read into unoccupied interstices of the statute, unless there is a clear mandate to the contraiy. 11. Natural justice is the essence of fair adjudication, deeply rooted in tradition and conscience, to be ranked as fundamental. The purpose of following the principles of natural justice is the prevention of miscarriage ofjustice." 21. In Shekhar Ghosh v. Union of India and Another2, the Supreme Court while dealing with the serious allegations made against the eraployee observed as under: "23......A11 the necessaiy ingredients of principles of natural justice were thus required to be complied with. The appellant as noticed hereinbefore had not been given adequate opportunity of hearing inasmuch as: (z) the hearing was sought to be given was a 'post- decisional one, which is bad in law; (n) a copy of the complaint was not supplied to the appellant at furtherance if not proposed that a mistake was sought to be rectified; (ni) no charges were framed; (iv) no witness was examined; and [v] no inquiry officer arrived at any finding that the appellant was guilty of the charges levelled against him." 22. Looking from all angles, including gravity of the allegation, it is required to hold regular enquiry before establishing firstly, the amount of loss caused to the State; secondly, the person who is responsible for causing loss; and, thirdly, whether loss was caused by negligence or by breach of any order. Thus, the ' (2006) 7 SCC 800 2(2007)JSCC331 A-T impugned orders dated 11.4.2007 (Annexurte-^/T in both the writ petitions) are quashed, reserving liberty to the respondent/authorities to hold an enquiry for establishing the above stated facts and taking appropriate action thereafter, if so advised. 23. It is accordingly ordered. 24. Resultantly, the petitions are allowed. No order as to costs. Sd/- SatishK.Agnihotri Judge Thakur/ Gowri