# Bhagwati Prasad Verma v. State of U.P. and others

- **Citation:** (2007) 3 ILRA 815
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2007-09-10
- **Case number:** Civil Misc. Writ Petition No. 52482 of 2003
- **Bench:** V.M. Sahai, Shishir Kumar
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/bhagwati-prasad-verma-v-state-of-u-p-and-others-41213
- **Pages:** 17

## Headnote

816 INDIAN LAW REPORTS ALLAHABAD SERIES [2007
Sri. B.P. Singh
Sri. Veer Singh
S.C.

Uttar Pradesh Retirement benefits Rules1961-Rule-9-recovery
from
gratuityafter
retirement-Disciplinary
proceedings initiated -inquiry officer out
of four allegations reported one charge
proved- show cause notice issued-duly
replied by petitioner- no formal inquiry
indicating date, place and time to appear
before the officer given- inquiry being
contrary to rule 99 in violation of
principle of Natural justice - recovery
from
gratuity
can
not
be
made-
necessary direction issued with 9%
interest in case of default in payment.

Held: Para 22 & 42

In the circumstances we are of the
opinion that gratuity is not part of
pension. Both are conceptually different.
In other words, recovery from gratuity
and family pension for the loss, suffered
by the Government due to negligence or
misconduct of the employee can be made
by
the
government
provided
the
procedure as laid down in Regulation
351-A of the Civil Service Regulations is
followed with regard to limitation and
compliance
of
principles
of
natural
justice etc. In the instant case no notice
or opportunity had been given by the
State
Government
informing
the
petitioner
that
as
a
measure
of
punishment his gratuity is liable to be
withheld or forfeited. In absence of any
notice or opportunity the order of the
State
Government
withholding
the
gratuity of the petitioner is without
jurisdiction. The petitioner is entitled to
his gratuity.

Thereafter, the inquiry officer did not fix
any date, time and place for holding the
inquiry. The inquiry officer was under a
statutory duty to intimate the petitioner
of the date, time and place of the
inquiry. This was not done. The inquiry
officer after considering the explanation
of the petitioner straightway submitted
the inquiry report to the government.
The inquiry proceedings were, thus,
vitiated. The inquiry was contrary to U.P.
Government
Servants
(Discipline
&
Appeal) Rules, 1999. We, therefore, hold
that the inquiry proceedings as well as
the inquiry report were in violation of
the principles of natural justice.
Case law discussed
1998(4) AWC 595, AIR 2004 SC-1462, 1993(1)
SCC 47, JT 1994(2) 569, JT 2006(9) SC 567,
2006(2) ESC ( All) 1294, 2005(4) ESC 2899,
2004(3) UPLBEC 2864

## Text

_Characters 0–39,982 of 56,932. This is a partial read: ask again with offset=39982 for what follows._

3 All] Bhagwati Prasad Verma V. State of U.P. and others
815
cases of All India Institute of Medical
Sciences Employees' Union (Regd.) Vs.
Union of India (1996) (11) SCC 582,
Gangadhar Janardan Mhatre Vs. State of
Maharastra (2004) 7 SCC 768, Minu
Kumari Vs. State of Bihar 2006(4) SCC
359 and Hari Singh Vs. State of U.P.
(2006) 5 SCC 733.

The Apex Court has held as under:-

6. "4. When the information is laid
down with the police but no action in that
behalf is taken, the complainant [can
under Section 190 read with Section 200
of the Code lay] the complaint before the
Magistrate having jurisdiction to take
cognizance of the offence and the
Magistrate is required to enquire into
complaint as provided in Chapter XV of
the Code. In case the Magistrate after
recording evidence finds a prima facie
case, instead of issuing process to the
accused, he is empowered to direct the
police concerned to investigate into the
offence under Chapter XII of the Code
and to submit a report. If he finds that the
complaint does not disclose any offence
to take further action, he is empowered to
dismiss the complaint under Section 203
of the Code. In case he finds that the
complaint/evidence recorded prima facie
discloses an offence, he is empowered to
taken cognizance of the offence and
[could] issue process to the accused."

19. In the case of Ramesh Kumari
Vs. State (NCT of Delhi) and others
(2006) 1 SCC (Criminal) 678, the division
bench of the Hon'ble Apex Court held that
it was the duty of the police to register a
case under Section 154 Cr.P.C. and the
genuineness
or
credibility
of
the
allegations could not be considered at this
stage. But in the case of Aleque Padamsee
(supra), this ruling has been distinguished
and explained and it has been held that the
correct position in law, therefore, is that
the police officials ought to register the
FIR whenever facts brought to their notice
show that cognizable offence has been
made out. In case the police officials fail
to do so the modalities to be adopted are
as set out in Section 190 read with Section
200 of the Code.

20. Therefore, the Magistrate cannot
be held to be bound to direct for
registration of case on every application
filed under Section 156 (3) Cr.P.C.
otherwise this provision would result in
harassment to innocent persons and
become a tool for shrewd litigants.

21. Thus I come to the conclusion
that there is nothing illegal in the
impugned order and the application under
Section 482 Cr.P.C. is devoid of merits
and is liable to be dismissed and is hereby
dismissed.
---------
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 10.09.2007

BEFORE
THE HON'BLE V.M. SAHAI, J.
THE HON'BLE SHISHIR KUMAR, J.

Civil Misc. Writ Petition No. 52482 of 2003

Bhagwati Prasad Verma
...Petitioner
Versus
State of U.P. and others ...Respondents

Counsel for the Petitioner:
Sri. H.M.B. Sinha

Counsel for the Respondents:
Sri. R.K. Saxena
816 INDIAN LAW REPORTS ALLAHABAD SERIES [2007
Sri. B.P. Singh
Sri. Veer Singh
S.C.

Uttar Pradesh Retirement benefits Rules1961-Rule-9-recovery
from
gratuityafter
retirement-Disciplinary
proceedings initiated -inquiry officer out
of four allegations reported one charge
proved- show cause notice issued-duly
replied by petitioner- no formal inquiry
indicating date, place and time to appear
before the officer given- inquiry being
contrary to rule 99 in violation of
principle of Natural justice - recovery
from
gratuity
can
not
be
made-
necessary direction issued with 9%
interest in case of default in payment.

Held: Para 22 & 42

In the circumstances we are of the
opinion that gratuity is not part of
pension. Both are conceptually different.
In other words, recovery from gratuity
and family pension for the loss, suffered
by the Government due to negligence or
misconduct of the employee can be made
by
the
government
provided
the
procedure as laid down in Regulation
351-A of the Civil Service Regulations is
followed with regard to limitation and
compliance
of
principles
of
natural
justice etc. In the instant case no notice
or opportunity had been given by the
State
Government
informing
the
petitioner
that
as
a
measure
of
punishment his gratuity is liable to be
withheld or forfeited. In absence of any
notice or opportunity the order of the
State
Government
withholding
the
gratuity of the petitioner is without
jurisdiction. The petitioner is entitled to
his gratuity.

Thereafter, the inquiry officer did not fix
any date, time and place for holding the
inquiry. The inquiry officer was under a
statutory duty to intimate the petitioner
of the date, time and place of the
inquiry. This was not done. The inquiry
officer after considering the explanation
of the petitioner straightway submitted
the inquiry report to the government.
The inquiry proceedings were, thus,
vitiated. The inquiry was contrary to U.P.
Government
Servants
(Discipline
&
Appeal) Rules, 1999. We, therefore, hold
that the inquiry proceedings as well as
the inquiry report were in violation of
the principles of natural justice.
Case law discussed
1998(4) AWC 595, AIR 2004 SC-1462, 1993(1)
SCC 47, JT 1994(2) 569, JT 2006(9) SC 567,
2006(2) ESC ( All) 1294, 2005(4) ESC 2899,
2004(3) UPLBEC 2864

(Delivered by Hon'ble V.M. Sahai, J.)

1. The questions that arise for
consideration in this petition filed by a
retired government servant are whether
Gratuity can be withheld or forfeited
under Regulation 351-A of the Civil
Service Regulations; whether payment of
Gratuity can be stopped under the Uttar
Pradesh Retirement Benefit Rules, 1961
and the Uttar Pradesh Liberalised Pension
Rules,
1961,
without
initiating
proceedings under the aforesaid rules;
whether the inquiry suffered for noncompliance of principles of natural justice
and whether permanent curtailment of 5%
pension under Regulation 351-A of the
Civil Service Regulations was arbitrary
and contrary to law?

2. The petitioner was selected and
appointed in 1964 by the Public Service
Commission,
U.P
as
a
teacher
in
Government Inter College. He was
promoted as lecturer in 1974. In 1991 he
was promoted to the post of Vice
Principal. In 1994 he was promoted on the
post of District Non Formal Education
Officer and was posted at Allahabad. He
retired from service on 31st July 1996.
After about two years of superannuation
the Governor on 22.6.1998 granted
3 All] Bhagwati Prasad Verma V. State of U.P. and others
817
sanction for institution of disciplinary
proceedings under Regulation 351-A of
the Civil Service Regulations (in brief the
Regulations). Shri Shyam Narain Rai,
Director of Education III Allahabad was
appointed as inquiry officer. The inquiry
officer
sent
a
charge
sheet
dated
22.6.1998 on four counts. It was served
on the petitioner on 14.7.1998. The
petitioner
submitted
his
reply
on
28.7.1998. The inquiry officer submitted
the report dated 31.8.1998 on 12.10.1998.
A copy of the inquiry report, as directed
by the State Government, was sent on
4.5.2001 to the petitioner by Joint
Director of Education, Allahabad Region.
He by another letter dated 23.8.2001
asked the petitioner to submit his
representation to the inquiry report. The
petitioner made a representation on
4.9.2001. The inquiry officer exonerated
the petitioner of the first charge. He found
him guilty of second and third charge and
the fourth charge was found to be
technically proved. The State Government
acting on the report of inquiry officer
found the petitioner guilty of the charges
and directed under Regulation 351-A of
the Civil Service Regulations that the
payment of gratuity to the petitioner
should be stopped and an amount of 25%
of the pension payable to the petitioner be
deducted and referred the matter to the
Commission
for
its
opinion.
The
Commission agreeing with the view of the
State Government that gratuity payable to
the
petitioner
should
be
stopped,
recommended that instead of 25% only
5% of the pension amount be deducted.
Thereafter the State Government passed
the impugned order dated 3.5.2002,
directing that petitioner's gratuity be
stopped and 5% deduction be made from
his pension permanently. However, the
other post retiral benefits were released to
the
petitioner.
The
petitioner
has
challenged the order dated 3.5.2002 by
means of this writ petition.

3. In the counter affidavit filed by
the Joint Director of Education (Basic),
U.P. it has been stated that while the
petitioner was posted as District Non
Formal Education Officer at Allahabad,
certain irregularities
were found in
purchase of some departmental items,
therefore, after his retirement Regulation
351-A was invoked.

4. In the counter affidavit to the
amendment application filed by the
Deputy Director of Education, Services-II
it has been stated that permission under
Regulation 351-A was granted by the
Governor on 22.6.1998 and thereafter
charge sheet was served. In both the
counter affidavits it has been stated that
ample opportunity of hearing was given to
the petitioner during the inquiry. The
inquiry proceedings were concluded,
according
to
the
respondents,
in
accordance with the principles of natural
justice.

5. In the supplementary counter
affidavit sworn on 21.5.2007 and filed on
25.5.2007 in pursuance to the direction of
this court, it is admitted that no date of
inquiry was fixed. Neither the petitioner
was summoned to participate in inquiry
nor he was heard. It is, however, stated
that the inquiry officer while serving the
charge sheet had clearly mentioned that
the petitioner may indicate the evidence
he proposed to rely and whether he
desired oral hearing. What was the effect
of it in the inquiry and whether it was
sufficient compliance of the principles of
natural justice would be discussed by us a
little later while considering whether the
818 INDIAN LAW REPORTS ALLAHABAD SERIES [2007
impugned order suffered from violation of
principles of natural justice.

6. We have heard Sri H.M.B. Sinha,
learned counsel for the petitioner and Sri
R.K. Saxena, learned standing counsel
appearing for the respondents who has
also produced the records.

7. Learned counsel for the petitioner
has urged that no opportunity of hearing
was afforded to the petitioner by the
inquiry officer after submission of the
reply to the charge sheet nor any date,
time and place for inquiry was fixed. The
inquiry officer submitted his report, only
after
considering
the reply of the
petitioner which was in violation of
principles of natural justice and contrary
to U.P. Government Servants (Discipline
& Appeal) Rules, 1999, and on the basis
of such an inquiry report no punishment
could be imposed on the petitioner by the
State Government. Learned counsel has
further urged that gratuity payable to the
petitioner could not be stopped by the
respondents under Regulation 351-A, in
view of The Uttar Pradesh Retirement
Benefits Rules, 1961 and Uttar Pradesh
Liberalised Pension Rules 1961. He urged
that the entire disciplinary proceedings,
being time barred, were liable to be set
aside, in view of the fact that the
petitioner had retired from service in July
1996, and he is at present about 70 years
of age. The learned counsel further
submitted that even if the charges were
found to be proved it was at the most an
irregularity
and
not
misconduct
or
negligence, much less grave misconduct.
The learned counsel lastly urged that the
provisions of U. P. Pension Cases
(Submission, Disposal And Avoidance Of
Delay) Rules, 1995 being mandatory in
nature and the disciplinary proceedings
having been completed beyond the time
limit fixed by the rules are liable to be
quashed.

8. On the other hand the learned
Standing Counsel by placing reliance on
the counter affidavits and supplementary
counter affidavit has urged that full
opportunity of hearing was afforded to the
petitioner. The inquiry proceedings were
concluded by the inquiry officer in
accordance with principles of natural
justice. The inquiry report and the order
passed by the State Government under
Regulation 351-A were liable to be
upheld as there was no violation of U.P.
Government
Servants
(Discipline
&
Appeal) Rules, 1999, The Uttar Pradesh
Retirement Benefits Rules, 1961 and
Uttar Pradesh Liberalised Pension Rules
1961. The provisions of U. P. Pension
Cases
(Submission,
Disposal
And
Avoidance Of Delay) Rules, 1995 are
directory in nature. The writ petition has
no merits and is liable to be dismissed.

9. Before considering the arguments
raised by the learned counsel for the
parties we consider it necessary to notice
the provisions relating to withholding and
curtailment of pension and gratuity. We
may also mention that we propose to
consider first the legality of stopping
payment of gratuity, then the order
curtailing pension, and in the end the
finding whether the order was liable to be
quashed for violation of principles of
natural justice, and in any case the
proceedings under Regulation 351-A
having not been completed within three
months as provided by U. P. Pension
Cases
(Submission,
Disposal
And
Avoidance Of Delay) Rules, 1995, are
liable to be set aside.
3 All] Bhagwati Prasad Verma V. State of U.P. and others
819
10. Regulation 351-A of the Civil
Service Regulations, which had been
framed under Proviso to Article 309 of
the Constitution, is extracted below :-

"351-A .- The Governor reserves to
himself the right of withholding or
withdrawing a pension or any part of it,
whether permanently or for a specified
period and the right of ordering the
recovery from a pension of the whole or
part of any pecuniary loss caused to
Government, if the pensioner is found in
departmental or judicial proceedings to
have been guilty of grave misconduct, or
to
have
caused
pecuniary
loss
to
Government by misconduct or negligence,
during his service, including service
rendered
on
re-employment
after
retirement. Provided that

(a) such departmental proceedings, if
not instituted while the officer was on
duty either before retirement or during
reemployment.
(i) shall not be instituted save with the
sanction of the Governor;
(ii) shall be in respect of an event which
took place not more than four years
before the institution of such proceedings;
and
(iii) shall be conducted by such authority
and in such place or places as the
Governor may direct and in accordance
with
the
procedure
applicable
to
proceedings on which an order of
dismissal from service may be made.
(b) judicial proceedings, if not instituted
while the officer was on duty either before
retirement or during re-employment, shall
have been instituted in accordance with
sub-clause (ii) of clause (a); and
(c) the Public Service Commission, U.P.,
shall be consulted before final orders are
passed.
(Provided further that if the order passed
by the Governor relates to a case dealt
with
under
the
Uttar
Pradesh
Disciplinary Proceedings (Administrative
Tribunal) Rules, 1947, it shall not be
necessary to consult Public Service
Commission.)

Explanation-- For the purposes of this
article-

(a) departmental proceedings shall be
deemed to have been instituted when the
charges framed against the pensioner are
issued to him, or, if the officer has been
placed under suspension from an earlier
date, on such date; and
(b) judicial proceedings shall be deemed
to have been instituted:
(i) in the case of criminal proceedings,
on the date on which a complaint is
made, or a charge-sheet is submitted,
to a criminal court; and
(ii) in the case of civil proceedings, on
the date on which the plaint is
presented or, as the case may be, an
application is made, to a civil court."

11. The Governor under this rule can
withhold or curtail the pension and direct
recovery of the pecuniary loss suffered by
the government even after retirement for
the reasons mentioned in the rule. The
rule lays down not only the circumstances
in which the right can be exercised but it
further details the manner of institution of
proceedings against a retired employee,
the period during which it can be
instituted and the manner in which the
inquiry can be completed, resulting in
withholding or curtailment of pension and
recovery for pecuniary loss suffered by
the government. But it does not provide
for
withholding
gratuity
or
family
pension.
820 INDIAN LAW REPORTS ALLAHABAD SERIES [2007
12. These were provided by two set
of rules framed by the State Government
in the year 1961. The Uttar Pradesh
Retirement Benefits Rules, 1961 and
Uttar Pradesh Liberalised Pension Rules
1961. Rule 3(f) of the Uttar Pradesh
Liberalised Pension Rules 1961 was
framed in exercise of powers conferred by
Proviso to Article 309 of the Constitution
by the Governor of Uttar Pradesh which
came into force on 1.4.1961. Rule 3(f)
defines 'Officer' as a government servant,
whether belonging to superior or inferior
service, who holds a lien on a permanent
pensionable post under the Government
or would have held a lien on such a post
had his lien not been suspended. The
word 'Qualifying Service' under rule 3(h)
means service which qualifies for pension
in accordance with the provisions of the
Civil Service Regulations. Rule 2 lays
down that these rules shall apply to all
officers under the rule making control of
the Governor who become eligible for
pension after the promulgation of these
rules and to all the serving officers who
are eligible for pension. Rule 3 provides
that an officer shall, on retirement, be
paid gratuity. Rule 5 provides for family
pension and Rule 6 provides for pension.

13. Rule 8 provides that the pension
actually payable under the proviso to rule
6 shall be paid to the officer till the date
of his death. If the officer dies before
retirement, no pension is payable. Rule 9
provides for commutation of pension and
rule 10 provides that Government will
have the right to effect recoveries from
gratuity or family pension sanctioned
under Parts I and II in the same
circumstances as recoveries can be
effected from an ordinary pension under
Regulation 351-A of the Civil Service
Regulations. Relevant rule 10 (1) of the
aforesaid Rules is extracted as under:-

"10. (1) Government will have the
right to effect recoveries from a gratuity
or family pension sanctioned under Parts I
and II in the same circumstances as
recoveries can be effected from an
ordinary pension under Article 351-A of
the Civil Service Regulations."

14. The other set of Rules is known
as the Uttar Pradesh Retirement Benefits
Rules, 1961 which has been framed under
Proviso to Article 309 of the Constitution
of India by the Governor and has come
into force with effect from 1.4.1961.
These Rules apply to all officers under the
rule making power of the Governor other
than those who retired before the date of
the coming into force of these rules. Rule
3(6) defines the word 'officer' which
means a government servant (whether
belonging to superior or inferior service)
who holds a lien on a permanent
pensionable post under the Government
or would have held a lien on such a post
had his lien not been suspended. Rule 3(8)
of the aforesaid Rules defines the word
'qualifying service' which means service
which qualifies for pension in accordance
with the provisions of Regulation 368 of
the Civil Service Regulations. Rule 4
provides the payment of pension. Rule 5
provides
for
death-cum-retirement
gratuity. Rule 7 provides for family
pension
and
Rule
8
provides
for
commutation of pension. Rule 9 provides
for recovery. The relevant Rule 9(1) is
extracted below:-

"9. (1) Government will have the
right to effect recoveries from a gratuity
or family pension sanctioned under Parts
II and III in the same circumstances as
3 All] Bhagwati Prasad Verma V. State of U.P. and others
821
recoveries can be effected from an
ordinary pension under Article 351-A of
the Civil Service Regulations."

15. From a combined reading of
Regulation 351-A of the Civil Service
Regulations with two set of rules, namely
the Uttar Pradesh Liberalised Pension
Rules 1961 and Uttar Pradesh Retirement
Benefits Rules, 1961 it is clear that the
pension, gratuity and family pension of a
government servant can be withheld or
curtailed permanently or for a specified
period and pecuniary loss caused to the
government can be recovered even after
retirement. Further such action can be
taken for pension under Regulation 351-A
of the Civil Service Regulations whereas
for gratuity and family pension it can be
proceeded with under the U.P. Rules.
Another significant feature is that the
substantive and procedural law for taking
action against the employee is provided
by Regulation 351-A of the Civil Service
Regulations. The U.P. Rules on the other
hand, instead of providing any procedure
for taking action for recovery from
gratuity and family pension adopted the
'same circumstances' as mentioned in
Regulation 351-A of the Civil Service
Regulations. The question is what is the
effect in law of it. Two questions need
consideration. One, whether it resulted in
adopting
both,
the
substantive
and
procedural law as provided in Regulation
351-A of the Civil Service Regulations
and second, whether the rules can be
stretched to mean that gratuity can be
withheld or stopped while exercising
powers under Regulation 351-A of the
Civil Service Regulations. As mentioned
earlier the action for recovery from
gratuity can be taken, only, under the U.P.
Rules.
By
adopting
the
'same
circumstances'
as
mentioned
in
Regulation 351-A of the Civil Service
Regulations, it shall be understood that
gratuity can be stopped or withheld for
grave misconduct or recovery can be
made for misconduct and negligence. But
the rule stops here. It is silent about the
procedure
for
determining
grave
misconduct or misconduct etc. It may
result in rendering the rule unworkable.
The intent of the Rule making authority
being clear, the rule in our opinion should
be
read
harmoniously
to
avoid
it
becoming redundant by construing it to
read in the circumstances and the manner
provided in Regulation 351-A of the Civil
Service Regulations. But by no principle
of construction or rule of interpretation
the rule can be read as empowering the
government to withhold gratuity or effect
recovery from it while proceeding under
Regulation 351-A of the Civil Service
Regulations for withholding or curtailing
pension. Consequently, if the gratuity was
to be forfeited or withheld, it was
necessary for the respondents to issue
notice for it in the inquiry and proceed in
accordance with law. From the sanction
granted by the Governor it is clear that it
was for withholding or curtailing pension
under Regulation 351-A of the Civil
Service Regulations, and the sanction was
not for gratuity. Therefore, the order of
the State Government directing stopping
of gratuity cannot be upheld.

16. The learned standing counsel
relying on the division bench decision of
this court in Krishna Kumar v State of
U.P. and others, 1998 (4) AWC 595
vehemently urged that under Regulation
351-A of the Civil Service Regulations,
recovery can be made, for the loss
suffered by the Government, from the
gratuity which was payable to the
employee. We have carefully gone
822 INDIAN LAW REPORTS ALLAHABAD SERIES [2007
through this decision. The Division Bench
held that for the loss suffered by the
Government gratuity could be forfeited.
The bench relied on section 4(6)(1) of the
Payment of Gratuity Act, 1972. We
respectfully find that the Division Bench
has not considered section 2(e) of the
Payment of Gratuity Act, 1972 which in
clear terms lays down that the Payment of
Gratuity Act, 1972 would not apply to a
person who holds a post under the Central
Government or a State Government and is
governed by any other Act or by any rules
providing
for
payment
of
gratuity.
Therefore, the Payment of Gratuity Act,
1972 was not applicable as the employee
before
the
division
bench
was
a
government servant, working as Deputy
Excise Commissioner. The decision, in
our opinion, is of no help to the
respondents. We may also mention that
the Apex Court in Ahmedabad Private
Primary
Teacher
Association
v.
Administrative Officer, AIR 2004 SC
1426 held that in view of the definition of
employee in section 2(e) of the Payment
of Gratuity Act, 1972 gratuity could be
paid to the skilled, semi-skilled, unskilled,
manual, supervisory, technical, clerical,
managerial and administrative employees
covered by labour enactments.

17. However, we proceed to
examine, whether gratuity can be deemed
to be included in pension. Gratuity is a
statutory right. When a government
servant is sought to be deprived of his
gratuity, such deprivation must be in
accordance with law. It is paid to the
employee to tide over post retirement
hardship and inconveniences. If the
employee has committed misconduct or
caused loss to the government then it
cannot be said that the employee has
rendered such a service so as to make him
entitled to receive the favour of the grant
of gratuity for the services rendered by
him to the Government.

18. Pensionary benefits, on the other
hand, are the benefits which arise out of
the service condition that after retirement
one should be given some benefits so that
he can maintain himself. But pension is
not a charity or bounty nor it is gratuitous
payment solely dependent on the whim or
sweet will of the employer. It is earned
for
rendering
long
service
and
is
described
as
deferred
portion
of
compensation for past services.

19. At this stage it is necessary to
extract Article 366(17) of the Constitution
of India which reads as under:-

"Article
366
Pension
-
(17)
"Pension" means a pension, whether
contributory
or
not,
of
any
kind
whatsoever payable to or in respect of
any person, and includes retired pay so
payable, a gratuity so payable and any
sum or sums so payable by way of the
return, with or without interest thereon or
any
other
addition
thereto,
of
subscriptions to a provident fund."

20. The apex court in Jarnail Singh
v Secretary, Ministry of Home Affairs
and others, (1993) 1 SCC 47 has held
that pension includes gratuity. In another
decision State of U.P. v. U.P. University
Colleges Pensioners' Association, JT
1994(2) SC 569 the apex court considered
and explained Jarnail Singh's case and
held that pension and gratuity are
conceptually different. It is necessary to
extract paragraphs 13, 14 and 15 of the
aforesaid decision of the apex court which
are as under:
3 All] Bhagwati Prasad Verma V. State of U.P. and others
823
"13. Before we express our views on
the aforesaid matter, we would deal with
the submission of Shri Jain that gratuity
has to be taken as a part of pension, to
support which contention our attention
has been invited to this court's judgment
in Jarnail Singh's case (supra). Perusal of
that judgment shows that gratuity was
taken to be a part of pension because of
the definition of "pension" as given in
clause (o) of sub-rule (i) of rule 3 of
Central Civil Services (Pension) Rules,
1972. It is because of this definition that
the case of D.V. Kapoor v. Union of India,
1990 (4) SCC 314, in which it had been
held that gratuity was not a part of
pension, was not followed, as the bench
which decided that case had not been
referred to the aforesaid definition of
pension. Similar observation was made in
Jarnail Singh's case regarding F.R.
Jaisuratnam v. Union of India, 1990
(Supp.) SCC 604 wherein also gratuity
was not regarded as part of pension
without noting the above noted definition.
14. To buttress his aforesaid submission,
Shri Jain also refers to clause (17) of
Article 366 of the Constitution which has
defined pension to include gratuity.
Merely because what has been stated in
clause (17) it cannot be held that gratuity
has to be taken always and for all
purposes as part of pension, because this
definition apparently has enlarged the
meaning of the word "pension" by stating
that this would include gratuity. It is well
known that legislature very often wants to
give enlarged meaning to a particular
word and this is done by stating that the
defined word would include some named
related subjects also.

15. We, therefore, state that either
because of what was stated in Jarnail
Singh's case or the way 'pension' has been
defined in the Constitution, it cannot be
held that pension and gratuity are
conceptually same, as stated in paragraph
9 of Jarnail Singh's case to which our
attention
is
invited
by
Shri
Jain.
According to us, this Court took the view
in question in Jarnail Singh because of
the definition of the word 'pension' in the
concerned rule, otherwise, what was held
in D.V. Kapoor and F.R. Jaisuratnam
cases seem to be correct legal position."

21. Therefore, the gratuity being
conceptually different cannot be deemed
to be included in pension.

Regulation 41 of the Civil Service
Regulations provides as under:-

"41. Pension - Except when the term
"Pension" is used contradistinction to
gratuity "Pension" includes Gratuity."

22. The expression 'contradistinction'
means distinction by contrast or opposite
qualities. To distinguish one thing from
other, by contrasting. The question is
whether
pension
includes
gratuity.
Pension is not a bounty of the State. It is
the right of a government servant. It
provides
economic
security
after
superannuation by assured periodical
payments till the employee is alive. The
right to gratuity is a statutory right, it is
paid once after superannuation by the
employer. For depriving the government
employee of his gratuity, opportunity has
to
be
given,
before
forfeiting
or
withholding
it
as
a
measure
of
punishment. Rule 10 of the Uttar Pradesh
Liberalised Pension Rules, 1961 and rule
9 of the Uttar Pradesh Retirement
Benefits Rules, 1961 lay down the law for
effecting recovery from the government
employee from his gratuity. It can be
824 INDIAN LAW REPORTS ALLAHABAD SERIES [2007
recovered in the same circumstances as
recovery
is
effected
from
ordinary
pension under Regulation 351-A of the
Civil Service Regulations. Under these
rules the expression gratuity has been
used in contradistinction to pension.
Therefore, regulation 41 of the Civil
Service Regulations is of no help to the
respondents. Had gratuity been included
in pension then under Rule 10 of the Uttar
Pradesh Liberalised Pension Rules, 1961
or rule 9 of the Uttar Pradesh Retirement
Benefits Rules, 1961 there was no
necessity of mentioning that recovery
could be made from gratuity and family
pension. The rule making authority was
conscious that under Regulation 351-A of
the Civil Service Regulations recovery
could be made from pension only,
therefore, both the Rules of 1961
provided for recovery from gratuity and
family pension. In the circumstances we
are of the opinion that gratuity is not part
of
pension.
Both
are
conceptually
different. In other words, recovery from
gratuity and family pension for the loss,
suffered by the Government due to
negligence or misconduct of the employee
can be made by the government provided
the procedure as laid down in Regulation
351-A of the Civil Service Regulations is
followed with regard to limitation and
compliance of principles of natural justice
etc. In the instant case no notice or
opportunity had been given by the State
Government informing the petitioner that
as a measure of punishment his gratuity is
liable to be withheld or forfeited. In
absence of any notice or opportunity the
order
of
the
State
Government
withholding the gratuity of the petitioner
is without jurisdiction. The petitioner is
entitled to his gratuity.

23. We have already held that
gratuity of a retired employee in the State
cannot be withheld nor can recovery be
made from it treating it as pension. The
learned standing counsel vehemently
relied on the decision of the Apex Court
in State of U.P. and others v. Harihar
Bhole Nath JT 2006 (9) SC 567. We
have gone through it carefully. This
decision was not concerned with stopping
of gratuity. The Hon'ble Apex Court, no
doubt, has observed in paragraph 11 that
gratuity and pension were covered in
Regulation 351-A read with Regulation
470 of the Civil Service Regulations, but
in view of what has been stated above
gratuity of an employee could be stopped
only if the proceedings for it were taken
under U.P. Pension Rules 1961. It being a
special provision for the recovery of
gratuity, the gratuity cannot be stopped by
deeming it to be included in pension
under Regulation 351-A.

24. We may further mention that the
State Government had issued notice under
Regulation 351-A of the Civil Service
Regulations. We have already extracted it
earlier. It provides for recovery from
pension. It does not provide recovery
from gratuity. The State Government has
not proceeded to recover the amount
under Rule 10 of the U.P. Liberalised
Pension Service Rules, 1961 or under
Rule 9 of the Uttar Pradesh Retirement
Benefits Rules, 1961. Both the Rules are
independent of Regulation 351-A of the
Regulations. Under these rules it is
nowhere provided that pension includes
gratuity. As observed earlier pension is
subject matter of Regulation 351-A,
whereas gratuity can be recovered under
the aforesaid rules. The State Government
has not chosen to proceed with the
recovery under the rules but it has
3 All] Bhagwati Prasad Verma V. State of U.P. and others
825
proceeded
to
initiate
departmental
disciplinary proceedings to make recovery
under
Regulation
351-A.
Therefore,
recovery, if any, could be made, only
from the pension of the petitioner. It could
not be made from the gratuity. In our
opinion, gratuity has wrongly been
withheld by the respondents, which is
liable to be paid to the petitioner
forthwith.

25. We would now examine whether
the order withholding 5% pension can be
upheld.
We
have
already extracted
Regulation
351-A.
It
provides
for
withholding
or
withdrawing
pension
permanently or for specific period if the
pensioner is found guilty of grave
misconduct in departmental disciplinary
proceedings or to have caused pecuniary
loss to government by misconduct or
negligence during his service. The use of
two expressions grave misconduct for
withholding pension and misconduct or
negligence for pecuniary loss brings out
fully the scope and purpose of the
Regulations. Misconduct literally means
wrong or improper conduct. It may be
failure to do what is required by law to be
done. In other words, omission to follow a
rule without any intention may amount to
misconduct. Therefore, where there is
pecuniary loss of the government by
failure or omission to follow any rule or
law deliberately or otherwise, it may
amount to misconduct or negligence and
it can be recovered from the pension. But
withholding
or
forfeiting
pension
permanently or for a specified period, can
only be for grave misconduct. The use of
the word grave misconduct makes it
abundantly clear that it is not every
omission or failure which can attract this
provision. According to the Black's Law
Dictionary the word 'misconduct' is of
wide import. But once it has been
qualified with the word grave, its ambit is
curtailed. It intends to convey that the
action can be taken only if the omission or
failure is not ordinary but something
more. Mere neglect or default may not be
covered by it. In service jurisprudence
grave has its own connotation. It is not a
mistake or mere irregularity. Pension is a
right of an employee. It cannot be
withheld
or
curtailed
for
technical
omission.

26. We may now advert to the
charges framed against the petitioner to
decide whether the petitioner could be
held guilty of grave misconduct on the
findings recorded by the inquiry officer
accepted by the State Government and
whether it warrants the punishment of
permanent curtailment of 5% pension.
Four charges were framed against the
petitioner. He was exonerated of the first
charge by the inquiry officer.

27. The second charge was that for
students kit new pencil, new rubber and
new scale were to be purchased and
distributed as per the letter of Director of
Education, (Basic) U.P. and Chairman,
U.P. Basic Shiksha Parishad, Allahabad
dated 9.3.1994. In the district there were
2100 centres and the number of students
of both the years to whom the kits were to
be distributed were 52,400. For them
2,89,600 new pencils, 1,57,200 new
rubbers and 1,04,800 new scales were to
be purchased but the petitioner had
purchased 4,20,000 new pencils, 3,15,000
new rubbers and 10,500 new scales which
were more than norms fixed by the G.O.
dated
9.3.1994. The petitioner was
charged
for
excess
payment
of
Rs.4,10,988/-. The petitioner submitted in
his reply that this letter dated 9.3.1994
826 INDIAN LAW REPORTS ALLAHABAD SERIES [2007
was not received in his office. He has
made purchases as per the norms fixed in
the letter issued by the Directorate dated
January 1989. Since the purchases of
scales was less than the norms fixed in
1994 no action was taken for it. With
regard to pencils and rubbers the inquiry
officer found that the letter dated 9.3.1994
was in the knowledge of the petitioner,
therefore, he was guilty of making excess
purchase of 1,30,400 pencils @ Rs.1.20/-
per
pencil
total
Rs.1,56,480/-
and
1,57,800 rubbers @ Rs.1/- per rubber total
Rs.1,57,800/-.
In
the
supplementary
counter affidavit filed on 25.5.2007 it is
stated that from the records available in
the office it was clear that out of 4,20,000
pencils purchased by the petitioner
4,00,000 were distributed to students. The
distribution of remaining 20,000 pencils
could not be verified as records were not
available. Similarly, out of 3,15,000
rubbers 3,00,000 were found to be
distributed to students. The distribution of
remaining 15,000 rubbers could not be
verified as records were not available.

28. It is further not denied that no
opportunity of hearing was afforded by
the inquiry officer. The question is
whether in the circumstances this charge
was proved and even assuming it to be so,
was it sufficient to warrant the finding
that the petitioner was guilty of grave
misconduct or misconduct or negligence?
Even though the findings recorded by the
inquiry officer that the petitioner had
knowledge of the 1994 G.O., cannot be
gone into by this court in writ jurisdiction
but there is no finding that the purchases
made by the petitioner were not in
accordance with the 1989 G.O. There is
no finding that the petitioner was guilty of
embezzlement or the pencils and rubbers
purchased
by
the
petitioner
were
misutilised
by
him
and
were
not
distributed to the students.

29. In absence of any finding that
purchases were not contrary to earlier
G.O. of 1989 coupled with failure of
opportunity to the petitioner in the inquiry
it could not be said that the petitioner had
misutilised the funds or was guilty of
embezzlement or grave misconduct within
the meaning of Regulation 351-A of the
Civil Service Regulations.

30. The third charge was that
payment of trade tax (sales tax) could
have been avoided by obtaining Form 3-D
from the trade tax department. The
explanation of the petitioner was that
despite letters and even personal meeting
with the Trade Tax Officer the form could
not be issued as they were not available
with the trade tax department. It was
alleged that the correspondence in this
regard was available in the office of Zila
Anuapcharik Shiksha Adhikari, which
may be verified. The inquiry officer did
not find that the explanation of the
petitioner that he had written many letters
to the trade tax officer and also personally
contacted him for Form no.3-D and the
trade tax officer informed him that the
form was not available was incorrect.