Case: U. P. State Mineral Development Corporation and Another Vs. K. C. P. Sinha

2. The Corporation, a company registered under the Companies Act, 1956, is an undertaking of the Government of Uttar Pradesh. The respondent joined the Corporation on January 18, 1977. Initially he was appointed on the post of Marketing Officer. He was redesignated as Marketing Manager on April 16, 1977. He was confirmed on the post of Marketing Manager by order dated June 2, 1984 with effect from March 14, 1978. He started officiating as Chief Marketing Manager under order dated March 12, 1984. By order dated August 20, 1988, the respondent was compulsorily retired from service from the date of the said order. It was directed that in lieu of three months notice he would be entitled to the payment of a sum equivalent to the amount of salary and allowances, if any at the rate applicable to him just before the retirement. The said order was passed in exercise of the powers conferred by Rule 27(iv) of the Rules. The respondent filed a writ petition [W.P. No. 66/88] in the Allahabad High Court, Lucknow Bench, challenging the said order of compulsory retirement. The said writ petition has been allowed by the High Court by the impugned judgment dated February 20, 1990. The High Court has held that Rule 27(iv) of the Rules is violative of the provisions of Articles 14 and 16 of the Constitution inasmuch as it does not prescribe any minimum period of service and confers arbitrary powers on the authority who can pass an order for compulsory retirement of an employee after 1, 2, 5 or 10 years of services. Feeling aggrieved by the said judgment of the High Court the appellants have filed this appeal.

Reasoning:
In our opinion this submission is without substance. As pointed out by this Court in Shyam Lal (supra) compulsory retirement differs from dismissal or removal from service in the sense that while in the case of dismissal or removal involves loss of benefit already earned an officer who is compulsorily retired does not lose any part of the benefit that he has earned and on compulsory retirement he would be entitled to the benefit that he has actually earned and that there is no diminution of the accrued benefit (p. 42). It is not the case of the respondent that he has been denied the benefit which accrued to him, on the basis of his service in the Corporation. The fact that the respondent joined service at a late stage when he was about 41 years old and on account of his being compulsorily retired his services stood terminated after putting in about 9 years of service only does not mean that the order of compulsory retirement ceases to be an order for compulsory retirement and should be treated as an order for removal from service. Merely because the respondent would not be able to earn pension since he had not put in the prescribed period of qualifying service would not invalidate the order of compulsory retirement if it is otherwise found to have been passed in accordance with the requirement of Rule 27(iv)We are in agreement with the said view of the High Court. Insofar as the remarks are concerned, we are of the view that the same cannot be ignored only because the relevant file was taken away by Shri A.P. Singh, the Reviewing Officer, with him and the file was sent back after two years in 1987. No case of mala fides has been made out by the respondent against the Reviewing Officer. The said remarks contain a reflection on the integrity of the respondent in the matter of discharging his duties. Having regard to the said remarks it is not possible to hold that the compulsory retirement of the respondent by the appointing authority under order dated August 20, 1988 was not in public interest. We are therefore of the view that the order of compulsory retirement of the respondent does not suffer from any infirmity and the High Court was not justified in setting aside the said order.