# A. L, KALRA v. THE PJ,lOJECT & EQUIPMENT CORPORATION

- **Citation:** [1984] 3 S.C.R. 646
- **Court:** Supreme Court of India
- **Decided:** 1984-05-01
- **Case number:** Civil Appeal No. 2703 of 1981
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/a-l-kalra-v-the-pj-loject-equipment-corporation-8636
- **Pages:** 30

## Headnote

A
. B.
A. L, KALRA
v.
THE PJ,lOJECT & EQUIPMENT CORPORATION
OF INDIA LIMITED .
May 1, 1984 •
{0.A. DESAI, 0. CHINNAPPA REDDY AND A. VARADARAJAN, JJ;J<
A·
Writ Jm;isdictlon of the High {Co>rt ~nder Arilcie 22~ of the Constl(uilonP!fblt'c- ·sector· undertakings a_nd ·ot~er "inst'rumentalities of the State.,
C
whether amenab1e to the \vrif' jUrisdiCtion.
D
F
G
ff
B.
Ef!ttct of Conces$io1i. iit the Supreme Court by_ the State as _tO
th~
maintainability or amenablity to the
Writ jurisdiction-Though the
normal procedure is to ren1it to the High Court, the,. Supreme Court,
in order not to protract tne litigatiOtJ "involving ·the JivelihoOd of a party
befof~ it can lt_self hear the appear on nzeri ts. ·
C;_ · ConstitutiOn Of Ind1·a, · 1950 Aft. 1_4'-Whether there should be any
-sp?cific _pleading Jn the _Pe.1ition· pofnting out whether anyone else was·
either stmilarly situated as tire petitioner or disslffiilar/y treated. for
ente.rtaining the charge of discrimination· and· "granting relief .on that -
·ground.
.
';...__,
•
D.· Legislative Policy. wheth-!r judlcia/ly,reVif}wable by the courts-Const/.
tution of India, 1950 Arts.
226, 32 ond 13.
E.
C0nstitutloii of India· 1950~/Jistifzction between Par( XIV and Part III-
. oi the Conslitution-Whethe'r tlze employeeS of.the Corporatioit entitled
to the protecti.on under Part ){_JV of the Constitutioni
P .. Project and Equfpment Corpora,i"an of India _Ltd,
Employees• (Coitduct,
Discipline and Appeal) Rules, .l975-Rules4, 5 ond 25, Scope of-R«le
4 dOes not specify any miscand_uct .and Rufe- 5 does not_ specify that
violation of Rule 4 'is per se misconduct-No disciplinary_ ach'on, there·
fore ,will arise wider Rule 4 of the 1975 Rules.
•
G.. The Project allli Equipment Corporation of India House Building Advance
(Grant and Recovery) .Rules !111le 10. (J) (ii) and the Profits and
Equipments Corporation af India Ltd. conveyance _Advance (Grant an.d
Recovery) Rules 8 and 10 (J)-Whether the non-utilisation of the
advances within the StiPulared tim·e for the purposes of and ·no refund
.thereof imn.iediatel;Y On the- expirY. Of the periOd, ciJnstitlfte Hmisco1ufuCt"
within the meaning ·of the exprwion in Rule 4 (iJ. (iii) o} the 1975
'
.,
. A L. [(ALRA v. J>ROiECT EQPT. CORPN.
.
.
.•
647'
Rules and ifnot whether the domestic enquiry and. the puμishment of ·
A.·.
the disniissal of serviCi is · warrant"'ed •
. H.
Rttlief for a declaraiion in cases of cqntract for .publ!c etpp/oynient~
whether caJi!iot be :;jJecifically ellfOrced.
·
I.: Domestic. EnqiJiry-Whether the
Illquiry Officer. and the Puizishing
Authority niust give reasons before /he major punishment is impased..-'
Whether non giving of.the reasons- makes the decision of dismissal
arbitrary and against prtncip!es of natural j:1stice.
Th~ ·i>rojecit and EQuiPIDent CorPoration of India Ltd. -was formed
in t 9_71_ as a wholly own.ed subsidiary conip_any of State Trading cOrpo ..
radon, a Q.qvernmcat 'O{ lodia Undc1taking. ·In .1976 it was separated
· C
and since then it functions ·as a sep,ttrate.Government of India Undertaking.
·-
The appella'nt who joined th~ .!frvice unller the State Trading Corpo.
ration· origipally and Jater exercised hi> option to serve -the PrOject and
.E.quipment Corporation wilh effect ·rrom NoVenlb"er 9, 197.6.
The appeliant
while-working as Depuly Finance Manager Grade II ap,PHed for and- obtained
(a) an advance in the amount of Rs. 16,050 for purchasing a plot of 1aod on
April 4, 1979 for which be e,lecuted the ·.requisite agreement as rCquired .by
cthe Project & Equipment Corporation of .Jndia Ltd., House.Buildi:ag Advance
(Grent and Recovery) Rul'es, aμd (b) an advance in the amount of_ Rs. 11,000
for purchase of a n-ew mOior cyCle on July 7, 1979 as admissible under ''the·
P_roject and -Equipment Corporation conveyance Advanc~ (Grant and Reco.
very) Rules .. Under these rules- nori-utilisation of the amounts· within tho
time. limit will impose a liability of the refund. of t'be entife a·inount- forth"
with. tog

## Text

_Characters 0–39,938 of 80,098. This is a partial read: ask again with offset=39938 for what follows._

A
. B.
A. L, KALRA
v.
THE PJ,lOJECT & EQUIPMENT CORPORATION
OF INDIA LIMITED .
May 1, 1984 •
{0.A. DESAI, 0. CHINNAPPA REDDY AND A. VARADARAJAN, JJ;J<
A·
Writ Jm;isdictlon of the High {Co>rt ~nder Arilcie 22~ of the Constl(uilonP!fblt'c- ·sector· undertakings a_nd ·ot~er "inst'rumentalities of the State.,
C
whether amenab1e to the \vrif' jUrisdiCtion.
D
F
G
ff
B.
Ef!ttct of Conces$io1i. iit the Supreme Court by_ the State as _tO
th~
maintainability or amenablity to the
Writ jurisdiction-Though the
normal procedure is to ren1it to the High Court, the,. Supreme Court,
in order not to protract tne litigatiOtJ "involving ·the JivelihoOd of a party
befof~ it can lt_self hear the appear on nzeri ts. ·
C;_ · ConstitutiOn Of Ind1·a, · 1950 Aft. 1_4'-Whether there should be any
-sp?cific _pleading Jn the _Pe.1ition· pofnting out whether anyone else was·
either stmilarly situated as tire petitioner or disslffiilar/y treated. for
ente.rtaining the charge of discrimination· and· "granting relief .on that -
·ground.
.
';...__,
•
D.· Legislative Policy. wheth-!r judlcia/ly,reVif}wable by the courts-Const/.
tution of India, 1950 Arts.
226, 32 ond 13.
E.
C0nstitutloii of India· 1950~/Jistifzction between Par( XIV and Part III-
. oi the Conslitution-Whethe'r tlze employeeS of.the Corporatioit entitled
to the protecti.on under Part ){_JV of the Constitutioni
P .. Project and Equfpment Corpora,i"an of India _Ltd,
Employees• (Coitduct,
Discipline and Appeal) Rules, .l975-Rules4, 5 ond 25, Scope of-R«le
4 dOes not specify any miscand_uct .and Rufe- 5 does not_ specify that
violation of Rule 4 'is per se misconduct-No disciplinary_ ach'on, there·
fore ,will arise wider Rule 4 of the 1975 Rules.
•
G.. The Project allli Equipment Corporation of India House Building Advance
(Grant and Recovery) .Rules !111le 10. (J) (ii) and the Profits and
Equipments Corporation af India Ltd. conveyance _Advance (Grant an.d
Recovery) Rules 8 and 10 (J)-Whether the non-utilisation of the
advances within the StiPulared tim·e for the purposes of and ·no refund
.thereof imn.iediatel;Y On the- expirY. Of the periOd, ciJnstitlfte Hmisco1ufuCt"
within the meaning ·of the exprwion in Rule 4 (iJ. (iii) o} the 1975
'
.,
. A L. [(ALRA v. J>ROiECT EQPT. CORPN.
.
.
.•
647'
Rules and ifnot whether the domestic enquiry and. the puμishment of ·
A.·.
the disniissal of serviCi is · warrant"'ed •
. H.
Rttlief for a declaraiion in cases of cqntract for .publ!c etpp/oynient~
whether caJi!iot be :;jJecifically ellfOrced.
·
I.: Domestic. EnqiJiry-Whether the
Illquiry Officer. and the Puizishing
Authority niust give reasons before /he major punishment is impased..-'
Whether non giving of.the reasons- makes the decision of dismissal
arbitrary and against prtncip!es of natural j:1stice.
Th~ ·i>rojecit and EQuiPIDent CorPoration of India Ltd. -was formed
in t 9_71_ as a wholly own.ed subsidiary conip_any of State Trading cOrpo ..
radon, a Q.qvernmcat 'O{ lodia Undc1taking. ·In .1976 it was separated
· C
and since then it functions ·as a sep,ttrate.Government of India Undertaking.
·-
The appella'nt who joined th~ .!frvice unller the State Trading Corpo.
ration· origipally and Jater exercised hi> option to serve -the PrOject and
.E.quipment Corporation wilh effect ·rrom NoVenlb"er 9, 197.6.
The appeliant
while-working as Depuly Finance Manager Grade II ap,PHed for and- obtained
(a) an advance in the amount of Rs. 16,050 for purchasing a plot of 1aod on
April 4, 1979 for which be e,lecuted the ·.requisite agreement as rCquired .by
cthe Project & Equipment Corporation of .Jndia Ltd., House.Buildi:ag Advance
(Grent and Recovery) Rul'es, aμd (b) an advance in the amount of_ Rs. 11,000
for purchase of a n-ew mOior cyCle on July 7, 1979 as admissible under ''the·
P_roject and -Equipment Corporation conveyance Advanc~ (Grant and Reco.
very) Rules .. Under these rules- nori-utilisation of the amounts· within tho
time. limit will impose a liability of the refund. of t'be entife a·inount- forth"
with. tog~ther·with penal interest thereon:
The appellant failecJ to·uliiiso
the amounts and also· to re.fund the same.
Therefore, coercive steps were
taken to fecover the en_\ire amQuot of the House Building adv,ioce .from his
p·ay by_ stopping ihe· payment of his salary from 16th: N0Vember1 . 1979.
As regards the conveYance advance, the receipts• etc. for purchase made: in
1980 were accepted,
•
·
.
.
D.
E
F
On July 22, 1980 a ·memorandum was served upon the appellaO.t
statirig therein that the compet~nt authqrity proposeii to Dold an enquiry
against him. u·nder Rules 27 of the .Project anJ Equipment Corporation_ of
ladia· Employees (Conduct, Discipline & -··AppeaH Rules, 1975 in.respect
of the aforesaid misutilization or the advances.
The committee of Manage ..
m~nl i_a exerc_ise of.the powers _Conferred ·by
sub~rule (4) of Rule 27 of the
:a:
l97S- .rules aPpointed one Sri A.S. Na:ngi.l, its Chief Marketi.lg Manager as
the Eriquiry ·Officer to enquite into the two charges against ·the appellant.
The appellant sqbmitted on June 13, 1980 a detailed statement pointing·
out that for va.rious reasons therein mentioned so as to. explain why there
Was delay -in refunding ihe advance and speCifically pleaded .that in· view . of .
the fa~t that 'the· first advance was sought ·to· be recovered by WithbOldili_g
his sala:ry and
adju~ting the pay _towards-the·advance an_d charging penal
H
interest and in the second case by- accepting. the
~ocument evideaCiog
purcha.siJ of scoot.er· μo niiscond.uot could be said to ·have be.en committed
648
A
c
• sUPREME cotlRT REPORts
!19$4) 3 S.C.!t
..
by the app;llant and the di!~iplinary ··enquiry was, uncalled
for. . The
enquiry Officer· in hi.s report after ·recaputulating_ all.egations and explan'at.ion
simply concluded that the ·appellant bas contravened Rule IO (I) (c) (i)
of the House Building Advance Rlllcs,
~ad also rules 8 and 10 (I) of the·
Conveyance Advance Rules and ther·efore comm·itted miscondtiGt punisba·ble
under Rule 4 (I) (iii) of the 1975 Rules.
·
PUf$oant to the.report of the Enquiry Officer, the Executi.ve Director
for and on behalf of th-e Committee of Maaagement of the corporation m1de
an order PEC: P .5
(8) 77 dated February 4, 1981. stating that the
Committee __ of manag~ment agrees with .he findings of.th¢_ inquiry officer
and .imp()s~S the puaisl:imeat of _removi11- from ser_vjcc· with effect from ·the
date of. the order.
The appeal preferred to the Appellate Authority wa•
rejected as per tho Memorandum dated May 21, 1981 signed by one Anand
·Krishna. claiming.to aCt for and on behalf of the Bo~rd of Dire.ctors.
'
Tho. appella~t; therefore approacped the High Court of Delhi under
Art. 226 of th~ ·constituti~n questioniag4\he correctness and validity of 'the
findings of the inquiry officer and the decision of the Disciplinary Authority
as well .as th~ appellate iiuthori~y .. inter. alia <:>n the gro:Und that the. inquiry·
D-'
was held iu violation o( the princip!Cs of natuial justice and the q.tiasi-.
judicial authority failed to. give· reasons in support of its order and the ·action
_taken· against the appellant- \Vas per se arbitrary and Wola_tive of Arts.14 arid·,
16 of the ConstitUtion inasmuch as the_ . .a11egatiOc contb.ined in the _beads of·
.1charges, even. if·. unre-butted1 do
~ot · constitute . a misconduct within the
meaning- o_f the ·expression in· 197 5 ·Rules. In order to ·susiaiO the maintaioa .. :
bility of the writ petition, the app.ellant ·alSo c·onten_ded that the r"esp·ondent
·E
i.s an instiumentality of the State 11.nd is coalprehended i~ the eXpressioo 'oth~r
3Uthorit.y' in Art.
21 of the - Con.~titution.
The· wr·it
p.!titioll
came~u·p.
for admission before a Division ~·_}nch of the Delhi.· High Court. It WJS ·
]
'
dismiSSed in limine observing that 'the ·Writ petition is oot maiotajn1ble on
~
...
. the facts .preseQtly set ou.t in th" P'tition.
HJncJ tbi-s app°e1l
by sP.ecial ·
leave.
·
·. Allowing the appeal, the Court
..
•
HELD :
1 : 1. Public sectof u:1dertakiiig1 aa<l other instrumetlta·
Hties of the ·State.are compFc.h.ended in 'the expressio::i
1·otbcr. allthori.ty~'
in Article 12 of the CoustitutioQ.
[660A]
1.~ 2.
Once it is conceded· that the .respondent-corpor.ation is an ·
iilstrumentafity of the s.tate 'and; is therefore, ·compreherided in the ex'pression 'other authority' in Art.
12 of thel Constitution, it is indisputable
that it is amenable to the wrii: jurisdictio:i uoder Arts. 32 and '226·of the
CopStitution:· Apart from the conc·essioo, the tests .collated in th~ deCisioii
·of the. Coastitution B'nch of.,his:·Court i.n AJay f!asia etc. ·v. Khalid Mujlb
Sheravardi and Others etc. [1981] 2 S.CR. 79 for determining whether
a pa~ticular body is .an "instrumcnta.lity .of the S,tate are fμlly sat~sfied and
therCfore on precedent and conC.:ssioa it is satisfactorily establiShed that
ibe respond~nt~Corpdration ·is an· instrumentality of the 'State within tho.
••
.
.
.
. _,
A. L. KALRA v. PROJECT EQPl'. CORl~.
nieaning or the expression •other authority' under Art.
12 of ·t_h_e ·coasti~
A
: tution and is amenable t.o the writ juriS;diction.
The writ Petition filed by
the appellant in the High Court was thus maintainable.
[660D;E]. ·
2. \Vhen onCe it is conceded that the respondent was· amenable to
the wr.it jurisdiCtiOo,
th~ question _that \vi11 afise is whether ·th.e rQatter.
should be remitted fo the High Court as (he High Court bas rejected tho
writ petit_ion. in limfne on the ground that the reSpoi:iderit was nOt amenable
to the writ jurisdiction of the High Court.
In ord_er not to protract t_he
litigatioll hivOlving livC:lihood of tb_e party approaching -the ·supreme Court
for justice, t_he Court can set down the appeal for final hearing on nlerit_s,
which they did in the instant ·case.
[660F-H]
B
3:1. It cannot be said that executive actioil which results iIJ dellial
C~"'
of equal protection or- law or equality before law cannot be judicially reviewed ·n_or can_ be struck dGwa o!l the ground of arbitrariiless as biing·· violative
of Art. 14 .. [66JEcFJ
3:2. The scope and ambit of Article 14 have been the subject matter
of a catena of' decisions.
It is well settled that Article 1.4 strikes at arbi·
trariness ~in execu1ive/administrative _actioff because any action· that is arbitrary i.nust necessarily .invo·\ve the negation· Of 'equality.
One n·eed -not
confinO. the ·.denial_ .of equality to a co.mparative evalu..1tion between twci
persons to a·rri've .at a conclusi·on of discriminatory treatment.
An action
per se arbitrary itself denies equal protection of. law.· It is thus too late
in ihe day to· contend that an executive actjon shown to be arbitrari _is_ not
either judicially rcviewable or wi'1hia the teach of Article 14.
[662A, F-G, 663A-B]
. ,·
Ajay.Hasa;a etc. Khaiid MujMSheh>avardi and Ors [I9n] 2 s.c.R•
?9· E. p; Royappa v. State
of Tamil Nadu and aor. [1974] 2 ·s.C.R·
34S; .D. S. Naka,:a v. Union af India, [1983] l S. C. C. 305 and Maneka
Gandhi r. Union af India [1978] 2 S. C. R. 621 followe.d.
4. Wisdom Qf the _legislative-policy may not. ·be opeo to judicial review
btit ·when the wisdom takes the Concrete form of law, the same must stand
the tesfof being in tune· with the fundar#ental rights and if it.· t_renches upon
any of the_ fundamental rights; it is void as ordained by Art. 13, . Conceding
for the preseDt pufpose that legislative action follows a ~egislative pOlicy
and the legislative poli.cy is not judicially reviewable, Qut :whil~ giv~ng coo-•
crete shape to· the le_giSlative policy in the forrri of a statlile 1 -if the Jaw
violates any of t~e fundamental rights ·including Art ... 14, the same is void
to the . extent 'as provided iq. Ar_t. 13.
I( the law is void. being ,in violation
. of any ·of the fuadat1_1ent~l· rights set out in Part JI of the ·Constitution, it
. cannot be shielded on the ground that it enacts a legislative policy. [661P-1;1]
5. Even· if .the respondent. Gorporation_ is an intrumentality of the·
State as comprehended .;n Art. 12, yet the· employees of tho Corporation
are not governed by Part XIV of the Constitution, How~ver it could not bo
E
A
•
SUPRJJME COURT REPORTS
[l984j 3 s.c.it .
S<.l;d that ae protection Conferred by Part III on ·the public servant is com· ,
p"aratively !Si ~lf~~t1\,_, tl:t<\11 ibo one .conf.::rred. by Part XlV.
Thei:efore tne
distinction soug't1t
t..:> bJ dr-a wn be.tween· prcitection·. of part .XIV of the
Constitution find P>rt Ill has no significance.
[663B-C, 66SA]
Mandging Director. Uttar Pradesh Wareh<;Juslng Corpora'1ioh &· Anr. v.
n
Vinay Narayan Vajpayee; [1980] 2 SC R. 773 at p, 784, relied upon.
·c;:
I):
•
" G
H
'.
· 6:1.' Even.if the facts a)leged i.n two.heads. of charges are accepted as
.·wholly· -proved,. yet that
wo~ld not constitute misconduct as prescribed_- in
Ruic 5 )J.nd no pen.atty can be impo~ed '!Or such conduct, for tlle reason that
while Rule 25 whi_:;:h
pr_~scri'bcs penalties specifically provides that,any of" '
the penalties therein mentioned can be imposed on an employee for miscon'·.
duc·t com1nitted by hi1n.
Rulo 4 d1es ·not.specify a rnisc.oiiduct. Rule 4
styled as rGeneral' ·spe¢ifies a norm of bch1viour .btit do·.'s not specify that
its viOiation Will. co9stitute misconduct. In Rule 5, it i5 no.where stated
.{bat anythirig violative of Rule 4 would be per se a miscon.duct in ·any of
tho sub-cl:iuses of Rule 5 which specifies misconduct.
[6668 D]
6:2. A general expectation· of a .certain decent behaviour in -respect
of employ~es ·keeping in vi9w corporate :culture m·ay be a moral or -ethical
expectation. Failure to keep to s.uch high standard of moral; ethica'I or
a·ecorous b::baviour ·befitting an· officer of the compa'ny by itself ca.noot ·cons ti".'
tilt~ mjsconduct unless the specific conduct f?:lls ia any of the enumerated·
misconduct in Rule ·s.
Any atte1npt to telescopJ··Rule 4 into Rule 5 must ..
Qe looked up.on With appp::hcn.sion becau~e Rttle 4 .i~ vague and of a general
naturr and what is u11becoming of a public servant may vary ·with ·individuals
and expose · cmp!oyees to vagaries. of subjeGtiv.e cvatu1tion. ·What in a given
context v:ould constitute cOnduct unbecoming_ of a· Public servant to ho
tfeated as. miscondtict would ex-Pose a grey' area not amJnable to objective
evaluation. Where misconduct when prOved entails penal consequences.; 'it
is obligatory 9n the· employer to specify and if necC:ssafy d~fiJJe. it with
.pr.~cision and ac.curacy so that any· ex post factO intcrprctatio·n of some
. ·incident may not. be Camollfttges as ·n1isconduct.
[665D-G]
'
M/s Glaxo Laboratories (I) Ltd. v.
P'residing Of/icer, Labour Court,
Meerut & OthJrs; [1984] l_. S.C.C. I, followed.
7:1. Seeking advance arid grl\ntiog the same under r-elevant rilles is
at best a l~an transaction.
The transaction ma)' itsel{·provide for paymens
an.d the conseqilenccs. of failure to repay or .to·_ abide by the rules.. If the
rules for granting . the advance themselves provided the consequence of the
breach of conditions, it would be idle io go in. si:arc"h of any other conse'"
quence. by initiating any· disciplinary aclion in that"behalf unless the 1975
F.ules specifically inCorporate a rule that the bri::ach Of :1fousfl Building
Advance Rul·;s and the ·conveyance advance rules, would by themselves
·constitute a HmiscondUct". Therefore Rule 4 (l) (l)·is not only; not attatac ...
ted but u1 tbi~ cas_e no attempt_. was mad'e to establish the· correction. And
1'-
I
, .,
•.
~·
• -I
y
A· L. KARLA v. PROJEC'I' JlQPT. CORPN.
·651
as far as Rule 4 (1) (iii). is concerned, an advance not refur\ded in tinle
; A
where it was recovered by withholding the Salary of a highly placid officer
may not disclose a conduct uO.beComing of a public servant.
Tberefore, the
first head of charge is an eye-wash,
It , does Dot constitute· a misconduct
if it can ~be said to be one even_ if it re1nains unrebutted. ·The inquiry
officer h;!s not said one word_ bow· the uncontrOverted facts consistute a
conduct unbecoming of a public servant, or b·e failed to ffiainiain absolute
·integrity.
Regardi'ng the convey<1~ce advancer the.Position is the same. ·The
.:1 .B·
apr)eBant for no fai:ilt has been plloished sub-silencio.
-
..
·
,
.
[667F-H, 668A, D·E, 669H)
7:'2·.
Now if what ·is alleged as illisconduct do:s not cOnstitute mis·
conduct not_ by-· a·na1ysis or appraisal Of evidence, but"per se under l 97S ·
Rules the ·respond~nt had neither the- authority nor the jurisdiction nor ·the
power to impose any penalty for th~ alleged miscondu:;t.
An administrative·
C
authority \Vho ·pu~ports to act by its regutition must b-: h_eld bound bY the
regulation.
[670H, 671A]
·
8.
be dba,
service.
In the matt.er-of public em·ptoyment if th.! tCrmin1tion is_ held. to . ·
a declaratioD can. b~ grante!i that the man continues to be in ,
[67 tG, 672A]
. .
.
Sukhdev Sit:glf & Ors. v. Bhagatra1n
Sarda~ ·Singh ... Raghuvananshi &
Anr. · [1975). -3 S.C.R,.6l9 _@ 655. Western India Automobile A:,sociation v.
Industrial Tribunal, Bombay and Ors. [1949] F .. C.R. 321 at 340. ·
9:1. Jbe dut).- tcr give reasons would permit th:;:: ·court hea~hig a peti ..
tion 'ror a wflt of ·certiorar-i to•ex fa.::iC aqccrtaln whether there· is any errOr
apparent on the record. A sp~aki~~ order will at its b~st be. reasonable ind
at its _·worst be· a_t.least a plausible one.
If reasons for an· order are given
·. there will be.· Jess scope fOr arbitrary or Partial ex:erci se of p·ower aild the
order ex facie . will indicate wbethGr extr·aneous rn3.tters we're taken into
ccmsideration by authoritr passinll. the order.
[672D-E]
M. p. Industries Ltdc . .v. Union of India and Others [1966] l S. C, R.
466 at .472; Vadachala Mnda/iar v. Stare of Madras, A. I .. R. 1952 M;dras
276; Bhagat Raja v. Union of India· and Others; [1967].3 S.C.R. 302@ 320;
r"Cferred to.
9:2. l{~re, the findings of tho inquiry officer .are merely his · ipse dixit.
D
E
F
No. reasons ·are assigned for reaching the liμding·and while recapitualating
_O
evidence seif:contradictpry positiOns were adopted·that.either there was no
.. 1
misconduct or ther~ was some misconduct or double punishment" was already
iinposed.
Rule· 27 {19) c_asts an obligation u·pon .th·' inquiry officer at the
conciu!i.ion of the inquiry ti;> prep.ire a rep:ll:t which must inte.r a!ia inClude
the "findings _o.n- e:tcb ardcle of cbarg,~ and the rea"sons therCfor.
The report
is pfep.:ued in co.1travonPon o( tfle afonrrnen_tiOnod rule. The· situaliOn .is
further compounded by the fact t'iat tb' discipli.1ary authority which ii none
.. a
other ·than Com;nittee of Management of the ·corporatioa while accepting·
the feport_ of the-inquiry officer which itself was_ defective.did not- assigtt any
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SUPREME COURTS REMRTS
(1984] 3 sc.R.
reasons. for aCceptini'the.report of the inquiry officer·. Further sub rllle (ii)
of R_ulC 35 'provide& amongst othcis-.that the Api>ellate "AUthority' shall
·consider. whether -the findin·gS ~re justified or whether the penalty_ is ex_cesSive
or inadequate and pass appropriate Grders within three rnonth1 of th\J date-of
appeal. In order to- ascertain whetPer .the rule is complied whh, the- order of
the appella_te authority must show that it took intq consid.:rdtio,1 the
findings ·the quantum· of pen3lty a1ld
oth~r rclevJnt coasideiation'>. -There
is no material for showing that the appe!Jato· authority acted in COD'>OD tnce
with its obligation under Rul.e 35.
(67 lE-H, 67 3A·D-E]
9:3. '"Therefore, the orde"r of removal pas5ed by the_ Disciplinary
·Authority is illegal and inva.lid tttr the reasons (i) that the· :ictio:l is th<,>rougbly
· arbitrarY and is viola.tive or ,Att'. 14; (ii) that the· alleged misconduct ~oes
_not Cc·nstitute miscoadu:t within the 1975 Rules; (iii) that the inquiry
officer him.- elf found tbat pll:!ishment was already jmposed for the alleged
miscondq.ct by withholding the salary and the app;,llant could not be e:icposed
to double jeopardy; ·and (iv) ·th'!-t the finding~ of the inquiry- officer are unSup -
ported by reasons and. the order or the Discipliilary Auth~rity as well a'3 t"he
Appellate Authority suffer from the same vice.
[673H: 674A-B]
·10:1; Once the order-of removal from service is held'.to be illegal and
invalid ·arid the appellant being In public ~mpfoyment, the necJsSary dec1a ..
ration must follow that he.continues to be _in
service uninterr.uptedly. -Ordi-
~ narily, it is _well·scttled ·that if termirt1tion of service is ·held. to be bi\d, no
o-ttler punishtnent in th;~ guise of deaial of back. wages can be imposed and
th;irefore;
i~ mult as a necessary corollary .follow that he will be enti~led to
all the back wages oo the footing· that h ~ h<is Continued to be in Service
uniO.teiruptedly, ·rr ihe appellant had procured -an alternative employment he
wo_uld nofbe ·entitled to wages and salary -ftom the respondent. . But it is
eqtially true that an Cmployee depending.On salary for his survival when_ 'heis exposed to -the vagaries· of the court litigation cannot hold on to a slender
dist~nt hope Of jndicial process ~omlng to his rescue and not try to survive
by· a·ccePtini; an alternative eniploYmem, a hope Whi6h may tu~n out to b~ a
mifage .. ·Therefore, the appellant .was perfectly Justified _in
procuring all
31ternatlve.employment:in "order to keep his body ancl soul together as also
to bear the. expenses of litigatjon to Vindicate his hOaour, integrity and
character.
[6748-G]
· •
10:2." ItoWever, in t'1e instarit case, the _appellallt sho~ld be paid SO%
of the back wages for the r_est of the_ Period during -which he remah1ed
unemployed. This is so bec·ause the cOnduct of the appellant cannot be said·
to be entirely in consonance with corporate clilture. _As.a.highly placed
officer ~e.was bouJd to strengthen the corpo·rate culture and he should bave
acted withill. the ·spirit of ·-the re&ulations both for house building adv<ince
and ·conveyance advance, Which" are devised to help the employees.
There
has been· IaPSe in totallY complying-with ihese regulations -by the appeJlant
though it neither constitu.tes: misconduct to attr_act a penalty .ndr substantially
good enough for initiation of disciplinary inquiry,
-(6 75A-C]
,
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A.+· KALRA v. PROJECT EQPT. CORPN. (Desai, J.)
6.53 .·
.·
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2703 of 1981.
A:
,
From the Judgment and Order dated the 23rd July, 1981 of the
Delhi High Courtin C.W. No, 1648 of 1981.
M.K. Ramamurthi, L.C. Goyal and Ms. Sumitra
Goyal
for the Appellant.
Lal Narain Sinha, M.C. Bhanclare and P.P. Singh for the
Respondent.
The Judgment of the Court was delivered by
. DE~AT, J.
Failure to adju.st the antena to the operative channel· ·
and dipping the. he:d like the proverbial ostrich in the sand so as not
to view the changing kaleidos.cope of the law can alone be said to
be responsible for. this trivial matter to be liroright to this Com:t.
Respon<l~tit is the Projec.t & Equipment Corporation of India
Ltd. ('Corporation' for short) since its formation in 1971 a wholly
own~<l subsidiary company of State Trading Corporation ('STC' for
short), a Government of India Undertaking upto 1976 when it was ·.
separated and since then it functions as a Government. of India
undertaking .. The appellant A.L. Kalra joined as Upper 'Division
Clerk in the STC on August 6; 1963.
On November 1, 1969, he ·
came to. be promo.ted as Assist~nt and earned ·a further promotion on
M(ly 22, 19.74 as Accountant. On the setting up of the Corporation,
the appellant exercising his.option came to be transferred as Accoun-
. tarit to the Corporation on November 9, 1976. Under the relevant
conditions of transfer,· h.e continued to be governed in the matter of
recruitment and promotion by the relevant rules of the STC .. He was
· promoted in an officiating capawy as Deputy Jlinance Manager
Grade II on June 29, 1978 and he was put on probaticin after being
promoted as Deputy ·Finance Manager Grade II on regular basis
· effective from February 5, I 979.
The appellant applied for and
obtained. all' advance iri the amount of Rs. 16,050 for purchasing a
plot of land on April 4, 1979 for which he executed. the requisite
agreement on April 4, 1979: The rules under which adfance was
oblained are styled as 'The Project and Equipment Corporation was
India ·Ltd. House Building Advance (Grant' & Recovery) Rules
. ('Rules for House .Building Advance' for short) framed in exercise of
the powers conferred upon the· Board of Directors by the Articles of
· Ass0ciation of the Corporation. The appellant also applied for and
obtained an advance in the amount of Rs. 11,000/- for purchase of a
c
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SUPRE.ME COURT REPORTS
[1984l3 S.C.Jl. •
A
new motor cycle on July 7, 1979. This advance is governed by wliat
F
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. are styled as the Projects & Equipment Corporation of Indiit Ltd.
Conveyance
Advanc~ (Grant & Recovery) Rules
('Conveyance
Advance Rules' for short).
In respect of the house building advance. according to the
respondent-Corporation, in view of Rule JO (I) (c) (i) the appellant
was required to utilise. the amount drawn by him for the purpose for
which advance was granted within two months of drawal and submit
the documents evidencing the .purchase of plot within the prescribed
tim~ failing whic!f he.was liable to refund .at once the entire amount
together with interest to the· Corporation. .The agr~ement dated
April 4, 1979 executed by the appellant also obligated him to utilise
the advance for the purpose for which.the same was sanctioned and
to produce the;sale-deed for verification by the C'orporation failing
.which the whole of the advance had to be refunded with interest. Jt
was alleged that the appellant neither utilised the advance for the
purchas·e of plot nor refonded the amount despite several reminders
a·nd ultimately on November 13, 1979 a memorandum was served.
upon him cautioning him that if he failed to refund (be entire
amount forthwith, disciplinary proceedings will be initiated against
him. As the.appellant failed to comply with the request made in.·
the memorandum, his salary from Nove.mber .7, 1979 as a whole.was
withheld for adjusting the amount of advance and the interest payable thereon: He was also charged penal foterest for the default
committed by him. ·
.
·
·
In respect of the conveyance advance, which was sanctioned on
July 7, 1979, the.appellant is. alleged to have committed a default
0
by
not purchasing the motor cycle within a period of one month as
required by Rule 10 of ihe Conveyance Advance Rules, and 9n
Novembet 13, 1979 he was advise~o refund the amount by Novem"
ber 14, 1979 failing which he was t!)reatened with disciplinary action .
. It is,however, admitted that the appellant purchased a. scooter in
·. April, 1980 and submitted the dbcuments. which. appear to have be.en
accepted by the Corporation, The . balance. of advance was also
refunded •..
A memorandum dated JuJy 22; 1980. was served upon the
appellant stating therein that the competent auth6rity proposes to
hold an enquiry against him under Rule 27 of the. Project and
Equipment Cotporaticn of India Ltd. Employees' (Conduct, Disci·
pline & Appeal) Rules, 1975 ('1975 Rules' for short). There were
..
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A, L. KALRA v. PROJECT EQPT. CORPN. (Desai, J.)
655
two heads of charges in the charge-sheet \)rawn-up against the
A
appellant 01) which disciplinary enquiry was proposed to.be held,
:·These two heads of charges read as under.;
• ·
.
Shri A.L. Kalra while functioning as Deputy Finance
Manager-Grade ll in the Finance Division ·of the PEC
· during April,· 1979 applied and drew an advance of
Rs. 16,050 for purchase of a plot ofland a.t Faridabad .. - "t
he did not furnish the relevant doc~ments in the office nor
did he refund the amount of advance to the Corporation
within two months of the date of drawal of the advance as
:required under Rule 10 (I) (c) (i) of PEC House Building
Advance (Grant and Recovery) Rules.
Shri Kalra by his .above act exhibited lack of integrity
c
and conduct unbecoming of a public servant and violated
.,U ·
·· Rule 4 (!) & {iii) and Rule 5 (5) of the PEC Employees'
(Conduct, Discipline & Appeal) Rules and :Roule 10 (I) (c) (i)
of PEC House Building Advance (Grant & Recovery Rules
and thereby committed misconduct punishable under the
PEC employees (Conduct, Discipline ·and Appeal) Rules,
· 1975.
.
.
Article-II
Shri, A.L. Kalra drew a conveyance advance of
Rs. 11,000 in July, 1979 for purchasing a motor-cycle, but
did not utilise the amount for the abpv~ purpose and did
not furnish cash receipt etc. evidencing purchase of the
, vehicle within one month as required under Rule-8 of the
, PEC Conveyance Advance (Grant & Recovery) Rules. Nor
dLd he refund the amount of advance to the Corporation as
required under Rule 10(1) ibid.
.
Shri A.L Kalra by his above act exhibit~d lack ofinteg-.
rity
and conduct unbecoming of a Public servant and
violated Rule-4 (I) (i) & (iii) and· Rule 5 (5) of PEC Employees (Conduct, Discipline & Appeal) Rules and also violated
Rule-8 and Rule-10 (is ofthe PEC Conveyance Advanee
(Grant & R.ecovery) Rules and thereby committed miscon.
duct punishable under. the FEC Employe~;· (Conduct
.
.
.
.
.
.
_.' . .
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SUPREME COURT REPORfs·
·· [1984] 3 s.c.R.
Discipline & Appeal) Rules, 1975."
. The appl!'llant was a.lso asked to submit his defence statement
within 10 days from the date .of.the receipt of the memorandum.
The appellant by .his letter dated Feb~uary 13, 1980 requested for
extension·.of time to file the defence statement. fr appears ,that he
sought further extension of.time by thri;e weeks which ·request was
declined by the memorandum dated Feb: 23, 1980.
The Committee of Management in exercise of the powers
conferred by sub-rule (4) of Rule .27 of the 1975 ·Rules appoinletl
Shri A.'S .. Nangia, Chief Marketi1ig Manager as the Enquiry Officer
• to enquire into the charges against the appellant submitted on
June T3, 1980 a detailed statement pollltlng out that the inq"irj' was
the outcome of malice for various reasons therein mentioned and
· also explaining why there was delay in refunding the advances and
· specifically pleaded that in view of the fact that the first advance was
sought to be recovered by withholding his salary and adjusting' the
pay towards.advance and charging penal interest and in .the second·
case by accepting 'he document evidencing purchase· of scooter, no
misconduct could· be said to h11ve·been committed by the appeila.nt
and the diseiplinary enquiry was uncalled for.
Various other contentions were also raised in the defence statement. The iuqu·iry officer ·
conducted the enquiry in respect of the afore-mentioned two charges.
One U.S. Aggarwal, Finance Manager of the Corporation appeared ·
as ~resenting Officer. The apRellant conducted his o·wn defeJJce ..
In Para 4 bf fris report, the Inquiry officer states that the
'preliminary hearings of the inquiry was held. on 3rd and 9tl1 April,
1980 and then inquiry w~s held regularly on various dates from 23rd
April 1980 to 22nd May, 1980. The appellant was called upon io
submit his statement of defence which he had submitted on June
30, 1~80.
The findings purported to have been recorded·by the jf!quiry
officer were the subject matter of.a heated debate between t!ft, parties
· and therefore,· the report. of the. Inquiry Officer may be broadly
scanned here. · After re·capitulating in paras 1 to 4 the various stages
through which the enquiry progressed, in para 5, .it is stated that at
the 'preliminary hearing on 3rd April, 1980, Shri A.L Kalra, (appellant} pleaded guilty to all the charges mentioned in Annexure I and .
also agreed to the stateinent of imputation of his misconduct in
· support of the article$ of charges framed against him.' In part 5 (3),
the inquiry officer discussed \he first he&d of charge in respect of the
•
•
A. L. KALFA v. PR01£CT EQP l. CORPN. (Desai, J.)
house building advance. It was found as a fact that the advance
was taken for the purchase o( a pl•t and that the appellant had
negotiated for a purchase of a plot from Shri J.C. Chugh. who was
examined as a management witness and who admitted that he waited
for six months fo complete the transaction but after that he disposed
. of the plot. Evidence of Shri J.C. Chugh revealed that the deal was
, ·delayed because Haryana Estate ·officer demanded so111e additional
amount and'there was dispute between the appellant, the vendee an•d
J.C. Chugh, the vendor as to who should bear the extra burden. In.
paragraph 5.1.4 after 1ecapitulating the reminders sent to the appellant to refund the advance, it is observed that it is not clear from
the relevant ·rule as to which is the competent authority to grant
extension of tin1e for utilisation of the amount. And then in para~
graph 5.1.5 he recommended that the sanction of the competent
authority should be taken before granting any extension. There
ends the discussion on the charge in respect of house building
advance.
The inquiry officer then proceeded to examine the .second head ,
of the charge. After recapitulating the fact a~out sanction of
advance and drawal of the same, it was observed that the appellant
drew. the advance on July 9, 1979 and on April 7, 1980 he submitted
the documents such as cash receipt in respect of purchase of .a
scooter, insurance certificate, receipt of .balance amount deposited
,with the cashier, original insurance· policy and registration. book
evidencing the purchase of scooter. It is then observed that under
the relevant rules motor cycle had to be purchased· within one month
from the date of the drawal'Of the advance or else he should have
obtained fresh sanctiOn for the purchase of a scooter instead o~ a
motor cycle. ~hen comes the particular observation which may be ·
exira.cted :
..
"He (appellant) did not obtain any fresh sanction for
.purchase of a scooter but simply submitted the papers' for
regularisatioμ of the advance and although no specific letter
for sanction of the purchase of. a scooter was h~ued by the
Personnel Division yet the fact that lie Was asked to refutid
the balance amount taniamomtfs to ag;eeing defacto
sanction tor the !'lurchase of the same."
657
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The inquiry officer then proceeds to dispose of the contention
of the. appeUant. that in .other case~ of similar advance and default,
' no ac.tion was taken but he was singled out for a harsh treatment •
.' 658
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SUPREME COURT REPORTS
[1984]3 s.c.R.
for the reasons alleged by him but with which we are not concerne<l
·. at this stage. The inquiry offieer then noticed that the full salary
payable every month to the appellant was stopped'by the CorporationJrom November 16, 1979 in addition to .the inquiry under whicll
disciplinary action was proposed to be taken'. The inquiry officer
concluded his report as under :
•
"While deciding the oaie, t.he facf ihat the salary was .
stopped from 16th November, 1979 may be kept in view as
thi• may, I feel, tantamount to double punishment. Normally even ·where an employee is suspended certain amount
. of subsistence allowance is granted whereas in this case the
salary ·was completely stopped and nothing has been paid
since then."
What is referred to as the report of the enquiry which is minu-·
tely scanned in the preceeding· paragraphs merely seems to be the .
record of inquiry and recapitulation of allegations and explanation.
·what is styled as findings of the inquiry officer are separately filed
· being Arinexure• M to the petition. This is a bald document of two
paragraphs in which. the inquiry officer .records that the appellant has
contravened Rule lO (I) (c) (i) of House Building Advance Rules and
has thereby committed misconduct punishable urt.der Rule 4 (I) (iii)
of 1975 Rules. In paragraph 2, it is stated that the appellant has
· committed breach of Rule 8 and Rule I 0 (i) of the Conveyance
Advance Rules and has thertby ·committed misconduct punishable
under Rule 4 (I) (iii) of 1975 Rules.
By what process this conclusion
is reached or what evidence appealed to him. is left to speculation.
The reasons in support .of the conclusion ar~ conspicuous by their
absence .. The findings are the ipse dixit of the inquir~ officer.
Pursuant. to this report of the inquiry officer the· ·Executive
Director for 'and on 'behalf of the. Committee of Management of the
Corporati~n made an Order No. PEC.P ; 5 (8)/77 dated February 4,
1981. The heads of charges ar,e reproduced in paragraph 1. Pa(agraphs 2 and.3 are devoted to. the stages through which the enquiry
progressed. In. paragraph 4, the findings unsupported .by ~easons
are reproduced. In paragraph 5, it is stated. that the Committee of
Management agrees with the findings of ,the inquiry officer and
imposes the punishment .removal from service with effect from the
date of the order.
The app~llant preferred an appeal to the Appellate Authority
being the Board of Directors. of the Corporatic;iu (,Jn
f~bruary 211
•
,
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A. L. KALRA v. PROJErr EQP'r. CORPN. (Desdi, J.) •
· 1981. · One Anand Krishna claiming to act for and on. behalf of the
Board of birectors, Appellate Authority issued •memorandum dated
May 21, '1981, Annexure P to the petition in which it is stated that
the appeal of th.e appellant was cpnsidered by the Appellate Authority
and after going through the records of the case, the Appellate
Authority has dec.ided tt,. uphold the decision of the authority and to
confirm the penalty of removal imposed upon him.
The salient feature which flies into the face about the findings
recorded, by the inquiry officer and the· order by- the Disciplinary
. Authority as well as~e Appellate Authority is that none of them
made a reasoned order. or speaking order and their conelusions ace
. mere ipse dixit unsupported by any analysis of the evidence or r.;ason
in support of the conclusions.
•
The appellant approached the High ·court of Delhi under. Art.
226 of the Constitution questioning the . correctnegs and validity of
the findings of the inquiry officer and the decision of the Disdplinary
Authority as well as the Appellate Auth9rity inter a/ia'lon the ground
that the enquiry Was held in violation of the. principles'[of natural
justie!l and the quasi-jqdicial authority failed to give reasons in support of its order and _the action taken against the -appellant was per ·
se arbitrary and in violation of Art. 14 and Art. 16 . of the Constitution inasmuch as the allegations contained In the heads of charges,
even if unreb_utted, do_ not consitute a misconduct within the· meaning
of the expression iri,l 97 5 Rules. In order to sustain the maintain·
abilit of the writ petition, the appellant also contended that ·the
respondent is an instrumentality of the _State and is comprehended
in the cxpre!lsion 'other authority' in Art.
12 of the · Constitution .
. The writ petition came-up for admission _before a Division
. Bench. of the Delhi High Court. It was dismissed in Ii mine <¥>serving
that the writ petition is not maintainable on . the facts presently set
659
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o\\t in the petition. Hence this appeal by special leave.
. G
In order to obtain any decision on merits, the appellant will
·have to clear the roadblock about· Jhe maintainability of the writ
•. p~tition in the High Court. }tappily this untenable contention was
not pursued in this Court. In para: 2 (vi) of the counter-affidayit
filed by pne Mahartand Khokher on behalf of the respondents it was
unambiguously stated. that t~e 'respondent-Corporation is advised
not to dispute t)le • piaiptainability of the
petitjoner's petition as
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[ 1984} 3 S.C.R.
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regards applicability of Art. 12.of the Constitution.' Further in para
· 5.1 of the same affidavit, it was stated that as regards the assertion
of the appellant that the respondent-Corporation is an instrumentality
o{ the Central Government and hence withiμ Art. -12. of the Constitution, the respondent Corporation does not dispute the same.