# AJIT KUMAR NAG v. GENERAL MANAGER, INDIAN OIL CORPORATION LTD. AND ORS

- **Citation:** [2005] Supp. 3 S.C.R. 314
- **Court:** Supreme Court of India
- **Decided:** 2005-09-19
- **Case number:** Civil Appeal No. 4544 of 2005
- **Bench:** S.N. Variava, C.K. Thakker, Tarun Chatterjee
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/ajit-kumar-nag-v-general-manager-indian-oil-corporation-ltd-and-ors-20882
- **Pages:** 28

## Headnote

Service Law:
C
Dismissal-Principles of natural Justice-Certified Standing Orders of
Indian Oil Corporation-Clause (vi) of Standing Order 20-Validity-Appellant
was a senior officer at the Haldia Refinery of JGC-Allegation that appellant
led by a bunch of hooligans visited the Refinery Hospital and assaulted the
CMG-General Manager of the Corporation dismissed him without holding
D any inquiry exercising power under clause (vi) of Standing Order 20-Writ
petition challenging the dismissal order dismissed by the High Court-Filed
SLP to this Court-Also filed a writ petition under Article 32 challenging the
constitutional validity of clause (vi) of Standing Order 20 as being violative
of natural justice and Article I 4-Held, since sufficient safeguards have been
provided in the Standing Orders, the same cannot be held arbitrary,
E unreasonable, or ultra vires Article I 4 of the Constitution.
Services-Dismissal without enquiry-Standing Order 20(vi)-Validity
of action taken-Appellant found to have led a bunch of hooligans to Haldia
Refinery Hospital and assaulting and abusing the Chief Medical Officer thereby
creating terror-General Manager on going through the complaints of various
p persons, satisfied that appellant indulged in the acts of violence without any
valid reason or compelling circumstances or provocation-General Manager
dispensed with the enquiry under Standing Order 20 (iii) and exercised power
under Standing Order (vi) and passed the dismissal order-Acts of misconduct
were found to be very grave and serious by the Appellate Authority alsoHeld, exercise of power under Standing Order 20 (vi) in the circumstances,
G cannot be held to be arbitrary, unreasonable or mala fide and does not
require interference in the exercise of power of judicial review by the Court.
Standing Order 20 (vi)-Constitutional validity-Article 14-Standing
Order 20 clause (vi) permits dismissal without enquiry on satisfaction of the
General Manager about expediency of not keeping a workman in serviceI-1
314
l
i
NIT KUMAR NAGv. GEN. MAN., INDIAN OIL CORPN. LTD.
3 J 5
Plea that it is a drastic provision which totally excludes application of natural A
justice that too on the satisfaction of General Manager-Held, a provision
cannot be declared arbitrary, ultra vires or unconstitutional merely because
there is possibility of abuse or misuse of such power.
Article 31 I-Civil servant-Employees of a corporation-Held, cannot
be said to be holding a civil post under the Union or a State and not entitled B
to protection of Article 311.
Disciplinary action-Appellant acquitted of criminal charges by the
Court-Held, the said order would not debar the employer from taking action
in accordance with Rules and Regulations in force.
Res judicata-Applicability-Appel/ant had not challenged the vires of
clause (vij of Standing Order 20 before the High Court-Held, could still be
permitted to argue the case on the vires or validity of clause (vij.
c
Appellant dismissed from service without enquiry by the General D
Manager in exercise of power under clause (vi) of Standing Order 20. The
Appellate Authority also found the acts of misconduct very grave and
serious. The High Court dismissed the writ petition challenging the
dismissal order. Hence, appeal to this court. Appellant also filed a writ
petition under Article 32 challenging the constitutional validity of clause
W
E
Appellant, inter alia, contended that even though the provisions of
Article 311 do not apply to him being an employee of the corporation, the
general principles behind it would apply to the employees of the
Corporation also. He also submitted that the Corporation being the State
within the meaning of Article 12, Article 14 would apply to it and an order F
passed arbitrary and without complying with the principles of natural
justice must be held null and void. It was also submitted that clause (vi)
of Standing Order 20 is arbitrary, irrational and unreasonable.
Dismissing the appeal and the petition, the Co

## Text

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A
AJIT KUMAR NAG
v.
GENERAL MANAGER, INDIAN OIL CORPORATION LTD.
AND ORS.
B
SEPTEMBER 19, 2005
[S.N. VARIAVA, C.K. THAKKER AND TARUN CHATTERJEE, JJ.]
Service Law:
C
Dismissal-Principles of natural Justice-Certified Standing Orders of
Indian Oil Corporation-Clause (vi) of Standing Order 20-Validity-Appellant
was a senior officer at the Haldia Refinery of JGC-Allegation that appellant
led by a bunch of hooligans visited the Refinery Hospital and assaulted the
CMG-General Manager of the Corporation dismissed him without holding
D any inquiry exercising power under clause (vi) of Standing Order 20-Writ
petition challenging the dismissal order dismissed by the High Court-Filed
SLP to this Court-Also filed a writ petition under Article 32 challenging the
constitutional validity of clause (vi) of Standing Order 20 as being violative
of natural justice and Article I 4-Held, since sufficient safeguards have been
provided in the Standing Orders, the same cannot be held arbitrary,
E unreasonable, or ultra vires Article I 4 of the Constitution.
Services-Dismissal without enquiry-Standing Order 20(vi)-Validity
of action taken-Appellant found to have led a bunch of hooligans to Haldia
Refinery Hospital and assaulting and abusing the Chief Medical Officer thereby
creating terror-General Manager on going through the complaints of various
p persons, satisfied that appellant indulged in the acts of violence without any
valid reason or compelling circumstances or provocation-General Manager
dispensed with the enquiry under Standing Order 20 (iii) and exercised power
under Standing Order (vi) and passed the dismissal order-Acts of misconduct
were found to be very grave and serious by the Appellate Authority alsoHeld, exercise of power under Standing Order 20 (vi) in the circumstances,
G cannot be held to be arbitrary, unreasonable or mala fide and does not
require interference in the exercise of power of judicial review by the Court.
Standing Order 20 (vi)-Constitutional validity-Article 14-Standing
Order 20 clause (vi) permits dismissal without enquiry on satisfaction of the
General Manager about expediency of not keeping a workman in serviceI-1
314
l
i
NIT KUMAR NAGv. GEN. MAN., INDIAN OIL CORPN. LTD.
3 J 5
Plea that it is a drastic provision which totally excludes application of natural A
justice that too on the satisfaction of General Manager-Held, a provision
cannot be declared arbitrary, ultra vires or unconstitutional merely because
there is possibility of abuse or misuse of such power.
Article 31 I-Civil servant-Employees of a corporation-Held, cannot
be said to be holding a civil post under the Union or a State and not entitled B
to protection of Article 311.
Disciplinary action-Appellant acquitted of criminal charges by the
Court-Held, the said order would not debar the employer from taking action
in accordance with Rules and Regulations in force.
Res judicata-Applicability-Appel/ant had not challenged the vires of
clause (vij of Standing Order 20 before the High Court-Held, could still be
permitted to argue the case on the vires or validity of clause (vij.
c
Appellant dismissed from service without enquiry by the General D
Manager in exercise of power under clause (vi) of Standing Order 20. The
Appellate Authority also found the acts of misconduct very grave and
serious. The High Court dismissed the writ petition challenging the
dismissal order. Hence, appeal to this court. Appellant also filed a writ
petition under Article 32 challenging the constitutional validity of clause
W
E
Appellant, inter alia, contended that even though the provisions of
Article 311 do not apply to him being an employee of the corporation, the
general principles behind it would apply to the employees of the
Corporation also. He also submitted that the Corporation being the State
within the meaning of Article 12, Article 14 would apply to it and an order F
passed arbitrary and without complying with the principles of natural
justice must be held null and void. It was also submitted that clause (vi)
of Standing Order 20 is arbitrary, irrational and unreasonable.
Dismissing the appeal and the petition, the Court
HELD : 1. In view of the various pronouncements of the Court, there
is no doubt that the respondent Corporation is right in submitting that
the appellant cannot invoke Article 311 by describing him as holding 'civil
post' under the Union or a State. Article 311 of the Constitution, therefore,
has no application to facts of the case. [325-F-G[
G
H
316
SUPREME COURT REPORTS [2005] SUPP. 3 S.C.R.
A
Dr. S.L. Agarwal v. General Manager, Hindustan Steel Limited
(Hindustan Steel Limited/), [1970) 3 SCR 363, relied on.
Workmen of Hindustan Steel Limited v. Hindustan Steel Limited
(Hindustan Steel Limited//), [1984] Supp SCC 554, disapproved.
B
Hari Pada Khan v. Union of India, [1996] l SCC 536, distinguished.
2.1. It is well settled that a provision which is otherwise legal, valid
and intra vires cannot be declared unconstitutional or ultra vires merely
on the ground that there is possibility of abuse or misuse of such power.
If the provision is legal and valid, it will remain in the statute book.
C Conversely if the provision is arbitrary, ultra vires or unconstitutional, it
has to be declared as such notwithstanding the laudable object underlying
it. (332-G-H; 333-AJ
2.2. General Manager is the highest administrative head of the
Corporation. So it cannot be contended that the power has been conferred
D on a petty officer of the Corporation. The Court is unable to uphold the
contention that Clause (vi) of Standing Order 20 confers blanket or
uncanalised power on the General Manager. In the opinion of Court,
sufficient guidelines and safeguards have been provided in the Standing
Orders, themselves, such as (i) the power is conferred on the highest
administrative head of the Corporation; (ii) eventualities have been
E specifically and expressly stated in Clause (vi) of Standing Order 20; (iii)
satisfaction of the General Manager that such an eventually has arisen;
(vi) recording of reasons in writing; and (v) right of appeal against the
decision of the General Manager. Such a provision cannot be held
arbitrary or unreasonable, violative of Article 14 of the Constitution.
F
[332-C-D-E-F]
2.3. Since sufficient safeguards have been provided in the Standing
Orders and action taken by the General Manager under Standing Order
20(vi) could be challenged in appeal under Standing Order 21 and in the
High Court under Article 226/227 and in this Court under Article 32/136
G of the Constitution, the same cannot be held arbitrary, unreasonable or
ultra vires Article 14 of the Constitution. If in a given case, there is abuse
or misuse of power, such action or order would be bad. It would, however
not make Standing Order 20(vi) ultra vires. In the facts and circumstances
of the present case the General Manager was satisfied that it was not in
the interest of the security of the refinery and the staff to continue the
H appellant in the employment of the Corporation and accordingly he had
AJIT KUMAR NAGv. GEN. MAN., INDIAN OIL CORPN. LTD. [THAKKER, J.]
3 J 7
·dispensed with the enquiry under Standing Order 20 (iii) and exercised A
power under Standing Order 20(vi) and passed the dismissal order. In the
opinion of the Court such action can never be termed arbitrary, irrational
or unreasonable. [333-G-H; 334-A; 337-B-C-D]
Union of India v. Tulsi Ram Patel, (1985] 3 SCC 398; A. Thanga/ Kunju
Musaliar v. M Venkatacha/am Potti and Anr., (1995] 2 SCR 1196; State of B
Rajasthan v. Union of India, [1977] 3 SCC 592; Sushi! Kumar v. Union of
India, [2005] 6 SCC 281 and Satyavir Singh v. Union of India, [1985] 4 SCC
252; relied on.
Central Inland Water Transport Corporation v. Brajo Nath Ganguly,
(1986] 3 SCC 156 and Delhi Transport Corporation v. Delhi Transport C
Corporation Mazdoor Congress, [1991) Supp 1 SCC 600, not applicable.
3. Principles of natural justice are not rigid or immutable and hence
they cannot be imprisoned in a straight jacket. They must yield to and
change with exigencies of situation. They must be confined within their D
limits and cannot be allowed to run wild. While interpreting legal
provisions, a court of law cannot be unmindful of hard realities of life. In
our opinion, the approach of the Court in dealing with such cases should
be pragmatic rather than pedantic, realistic rather than doctrinaire,
functional rather than formal and practical rather than 'precedential'.
(335-D-E-F] E
R v. University of Cambridge, (1723) 1Str557 and Charan Lal Sahu
v. Union of India, (Bhopal Gas Disaster), (1990] 1 SCC 613, referred to.
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4544 of 2005.
From the Judgment and Order dated 6.2.2004 of the Calcutta High
Court in F.M.A. No. 3093 of 2002.
WITH
Writ Petition (Civil) No. 703 of 2004.
P.P. Rao, Raja Chatterjee and G.S. Chatterjee with him for the Appellant.
Ashok Grover, V.N. Koura and Ms. Paramjit Benipal for Mis. Arputham,
Aruna & Co. for the Respondents.
The Judgment of the Court was delivered by
F
G
H
A
B
c
318
SUPREME COURT REPORTS [2005] SUPP. 3 S.C.R.
C.K. THAKKER, J. Civil Appeal No. 4544 of2005 is directed against·
the judgment and order passed by the Division Bench of the High Court of
Calcutta on February 6, 2004 in FMA No. 3093 of 2002 confirming the
judgment and order passed by the learned single Judge on July 9, 2002 in
Writ Petition No. 10667 (W) of 1999.
Writ Petition No . .703 of 2004 is instituted by the petitioner in this
Court ur.der Article 32 of the Constitution challenging the validity of Clause
(vi) of Standing Order 20 of the Certified Standing Orders of the Indian Oil
Corporation Ltd.-respondent herein being arbitrary and against the principles
of natural justice.
To appreciate the controversy raised in the matters, relevant facts may
be stated in brief.
The appellant in Civil Appeal No. 4544 of 2005 (petitioner in Writ
Petition No. 703 of 2004) joined the service of Indian Oil Corporation
D ('Corporation' for short) at Haldia Refinery in 1973. He was a senior officer
of the Corporation. He asserted that all throughout his service record was
good and satisfactory. He was sincere and efficient and has worked with
dedication. At several occasions, he received appreciation for his work. There
was no grievance or complaint by the authorities and he continued to be a
'devoted employee' of the Corporation. It was, no doubt, stated that in 1987,
E a charge sheet was issued against him but according to the appellant,
subsequently, the Corporation was satisfied on the explanation submitted by
the appellant that there was no substance in the allegations and the same was,
therefore, withdrawn. On I !th March, 1988, the appellant was promoted as
Operator 'A' Special Grade. It is the case of the appellant that his next door
F neighbour was one Mrs. Parul Jana, who was Sister-in-Charge in the Refinery
Hospital at Haldia. Parul Jana was treating the appellant as her brother. The
relationship between both the families was close and cordial and whenever
necessary, Parul Jana used to call the appellant as one of her family members.
Parul Jana suddenly developed heart problem in May, 1999. She was, therefore,
required to be admitted for treatment in Apollo Hospital, Madras. At late
G night hours on 5th May, 1999, two sons of Parul Jana rushed to the appellant
in grave anxiety and informed him that they failed to get positive information
about their mother and they were extremely worried. They, therefore, requested
the appellant to extend his helping hand to get proper information about the
health of their mother. The appellant advised them to go to the Refinery
H Hospital. Since the Refinery Hospital, Haldia had referred the case of Parul
NITKUMARNAGv. GEN.MAN.,INDIANOILCORPN. LTD. [THAKKER,J.)
319
Jana to Apollo Hospital, Madras, they would be able to get information from A
Haldia Hospital. Sons of Parul Jana requested the appellant to accompany
them to the hospital. The appellant being an employee and well-known for
his work in the hospital, could not refuse the reasonable request of two
persons and accordingly accompanied them. On reaching the hospital, they
found the office of the Chief Medical Officer, Dr. Bhattacharya, open and he B
was also available. According to the appellant, two sons of Parul Jana
approached Dr. Bhattacharya and requested him to give information about
their mother who was ailing and admitted to Apollo Hospital, Madras. Dr.
Bhattacharya said nothing in spite of repeated requests by sons of Parul Jana.
On the contrary, Dr. Bhattacharya without any reason, flared up and told
them that he was not supposed to provide information about Parul Jana to C
anyone and everyone. When sons of Parul Jana insisted to have information
from Dr. Bhattacharya, the latter told them that they should not worry about
their mother and in the event of her death, the Corporation would arrange to
bring the dead body from Apollo Hospital, Madras to Haldia and the body
would be handed over to the sons. According to the appellant, he continued D
to be a silent spectator all throughout. Sons of Parul Jana were seriously
shocked and disturbed on such statement being made and they raised objection
against the behaviour of Dr. Bhattacharya. Dr. Bhattacharya called several
persons in the hospital and directed them to throw all persons including the
appellant out of the hospital premises. Sons of Parul Jana could not control E
themselves. The appellant was also not spared. Being a heart patient and
already had undergone heart surgery, he was very much upset as outsiders
brought by Dr. Bhattacharya started pushing and dragging the persons
including the appellant and sons of Parul Jana out of the hospital. The appellant
was bewildered and motionless for some time. The appellant apprehended
that Dr. Bhattacharya would create a situation which may adversely affect F
appellant's health. There was heated exchange of words which resulted in
commotion. There was scuffle on the arrival of outsiders and two sons of
Parul Jana out of hospital premises. The appellant immediately contacted the
General Manager (Projects) and requested him to help to control the situation.
When the General Manager reached the hospital, the appellant explained the G
situation to him. The General Manager also met Dr. Bhattacharya to get true
and correct facts as to how the incident had happened. The General Manager
then advised the appellant to go back. Immediately, the appellant left the
hospital. In the entire incident, asserted the appellant, save and except
accompanying sons of Parul Jana, he did nothing. He was not involved in the
incident in any manner whatsoever. It was the Chief Medical Officer, who H
320
SUPREME COURT REPORTS [2005] SUPP. 3 S.C.R.
A alone was responsible for the entire unfortunate situation. He also inflicted
injuries on two sons of Parul Jana. Dr. Bhattacharya, however, cooked up a
false case against the appellant alleging that the appellant had assaulted and
injured him. On 6th May, 1999, i.e. on the next day, the Chief Medical
Officer, Dr. Bhattacharya reported to the management that at the late night
B hours of 5th May, 1999, the appellant led by a bunch of hooligans had visited
the hospital, assaulted him, i.e. Dr. Bhattacharya and abused and threatened
other officers. On the basis of the said complaint, on the same day, i.e., on
6th May, 1999, the General Manager of the Corporation dismissed the appellant
for allegedly assaulting the Chief Medical Officer. No notice was issued, no
explanation was sought, no charge sheet was filed, no disciplinary enquiry
C was instituted and no opportunity of hearing was afforded to the appellant.
It was stated that in the interest of security of Refinery, the General Manager
had to take firm action immediately. Criminal proceedings were also initiated
and a criminal case was filed against the appellant for offences punishable
under Sections 147, 149, 341, 323 and 506 of the Indian Penal Code. The
D General Secretary ofHaldia Refinery Employees' Union objected to unlawful
and arbitrary dismissal of the appellant and wrote a letter to the Corporation
requesting it to reinstate the appellant. No positive action, however, was
taken by the Corporation. In the circumstances, the appellant was constrained
to approach the High Court of Calcutta by filing a Writ Petition on May 12,
1999. On May 13, 1999, the learned single Judge, in view of the urgency of
E the matter, dispensed with the requirement of Writ Rules, took up the matter
for admission-hearing and directed the appellant to serve copies of the writ
petition alongwith annexures upon all respondents within a week and to file
affidavit of service on the next returnable date which was fixed as 28th June,
1999. Ex parte ad-interim relief was also granted till June 30, 1999. Being
F aggrieved by the order passed by the learned single Judge granting ex parte
ad-interim relief, the Corporation approached the Division Bench and the
Division Bench by an order dated June 22, 1999 set aside the order passed
by the learned single Judge. According to the Division Bench, in the facts
and circumstances of the case, it was not proper for the learned single Judge
G to have passed ex parte ad-interim order. The appeal was accordingly disposed
of. So far as criminal case is concerned, the learned Judicial Magistrate
before whom the case was placed for hearing disposed it of on 5th April,
2002 and the appellant was acquitted. The Writ Petition came up for hearing
before the learned single Judge who dismissed it on July 9, 2002. The appellant
preferred an appeal before the Division Bench against the order passed by the
H
AJITKUMARNAG1'. GEN. MAN., INDIANOJLCORPN. LTD. [THAKKER,J.]
32 J
learned single Judge which, as stated above, came to be dismissed by the A
Division Bench. Against the said order, the appellant had approached this
Court by filing Special Leave Petition on May 17, 2004.
- When the matter was placed for admission on July 27, 2004, notice was
issued by this Court. On July 25, 2005, it was placed before a two Judge
Bench. Leave was granted and the Court passed the following order:
B
"Delay condoned.
Leave granted.
In view of the fact that there are conflicting decisions in the case C
of Workmen of Hindustan Steel Ltd. v. Hindustan Steel Ltd. and Ors.,
reported in [1984] (Suppl.) SCC 554 and in the case Haripada Khan
v. Union of India and Ors .. reported in [ 1996] I SCC 536 it will be
appropriate that this matter be considered by a larger Bench. Papers
be placed before Hon'ble the Chief Justice for necessary orders."
It may be stated at this stage that on November 20, 2004, the appellant
herein instituted a substantive petition under Article 32 of the Constitution
and challenged the validity and vires of Clause (vi) of Standing Order 20 of
D
the Certified Standing Orders of the Indian Oil Corporation since he had not
challenged the validity of the Standing Orders before the High Court of
Calcutta. On January 20, 2005, notice was issued and the Writ Petition was E
ordered to be tagged with S.L.P.(C) No. 21248 of 2004 (Civil Appeal NO.
4544 of 2005). That is how, both the matters have been placed before us.
We have heard the learned counsel for the parties.
Mr. P.P. Rao, learned Senior Advocate, appearing on behalf of the F
appellant contended that the respondent-Corporation is 'State' within the
meaning of Article 12 of the Constitution and every action of the Corporation,
therefore, must be in conformity with the fundamental rights guaranteed by
Part III of the Constitution. According to him, Standing Order 20, and in
particular Clause (vi) thereof, is arbitrary, irrational and ultra vires Article 14 G
of the Constitution inasmuch as it empowers and authorizes the General
Manager of the Corporation to dismiss an employee without following the
rule of audi alteram partem and without observing the principles of natural
justice. Such a rule, submitted Mr. Rao, violates the fundamental principles
of justice and infringes Article 14. A similar provision in the nature of second
proviso to Article 311 (2) of the Constitution have been interpreted in several H
322
SUPREME COURT REPORTS [2005) SUPP. 3 S.C.R.
A cases by this Court and it has been held that save and except grave situations,
no employee can be dismissed or removed from service without observing
the rules of natural justice. Such provisions have also been held to be bad and
against public policy under Section 23 of the Contract Act, 1872. Even if
there is a term in the contract or in a Rule, it is liable to be struck down as
B arbitrary and ultra vires Article 14 as also Article 311 (2) of the Constitution.
The counsel also submitted that the learned single Judge as well as the Division
Bench were wrong in not relying upon the decisions cited at the Bar and in
mechanically and blindly applying Clause (vi) of the Standing Order 20.
Even on merits, the appellant could not be held liable. He had merely
C accompanied the two sons of Parul Jana to the hospital. The unfortunate
incident was. the result of the behaviour of the Chief Medical Officer for
which, he alone was responsible and the appellant could not be punished for
the misdeeds of Dr. Bhattacharya. It was further submitted by Mr. Rao that
this is a fit case in which necessary guidelines are required to be issued by
this Court so that blanket and uncanalised· power under the said provision
D may not be misused by the General Manager. It was also submitted that when
the criminal case was registered against the appellant and he was acquitted
0
of the charges levelled against him, it was incumbent on the Corporation to
reinstate him in service with full back wages. Finally, it was submitted that
the appellant has reached the age of superannuation. The question of
E reinstatement is thus academic. It was, therefore, prayed that keeping in view
the totality of facts, the order passed by the General Manager may be quashed
and set aside by directing the respondent to extend monetary benefits to the
appellant.
The learned counsel for the respondent-Corporation, on the other hand,
p supported the order. It was stated that .the appellant cannot be said to be an
employee holding "civil post" under Part XIV of the Constitution and, as
such, he cannot claim protection of Article 311. He is governed by the Rules,
Regulations and Standing Orders of the Corporation. The Corporation is
governed by the Certified Standing Orders. Clause (iii) of Standing Order 20
provides for disciplinary enquiry against an employee of the Corporation and
G taking of appropriate action on the basis of such enquiry. Clause (vi) of
Standing Order 20, however, deals with special procedure in certain cases
and empowers the General Manager to dismiss or remove a workman in
certain circumstances. In bona fide exercise of the said power, the General
Manager passed an order on 6th May, 1999 and dismissed the appellant from
H service. The order is a speaking order recording reasons as to what compelled
\
NIT KUMAR NAG v. GEN. MAN., INDIAN OIL CORPN. LTD. [THAKKER, l.]
323
the General Manager to treat the case as exceptional in nature and the General A
Manager was constrained to exercise his power under the said provision. It
was also submitted that from the order, it is clear that the appellant misbehaved
with the staff of the hospital and assaulted the Chief Medical Officer and
caused injuries. To ensure maintenance of discipline and taking into account
several statements, the General Manager had taken the impugned action. B
Such an action cannot be said to be arbitrary, irrational or abuse of power.
The counsel submitted that acquittal by a criminal court is hardly a relevant
factor so far as exercise of power by the General Manager is concerned:
Standing Order 20 (vi) relates to special procedure in cases of exceptional
nature. Such a provision cannot be said to be ultra vires Article 14 of the
Constitution. As far as Article 311 is concerned, it does not apply to employees C
of the Corporation and hence, it cannot be invoked or pressed into service by
the appellant. It was further submitted that the appellant had challenged the
order of dismissal by filing a petition but he did not challenge the validity or
vires of Clause (vi) of Standing Order 20 before the learned single Judge or
before the Division Bench and argued the matter on merits and the case was
decided against him. He, therefore, now cannot be permitted to challenge the D
validity of Clause (vi) of Standing Order 20 before this Court as such challenge
would be barred by res judicata or by constructive res judicata. It was also
submitted that the order passed by the General Manager is subject to appeal
under Standing Order 21 of the Standing Orders and the appellant had
exercised the said right by filing an appeal. The Appellate Authority considered E
the relevant provisions of Standing Orders as also the order dated 6th May,
1999 passed by the General Manager and having applied its mind to the facts
and circumstances, dismissed the appeal observing that there was no ground
to interfere with the punishment imposed on the appellant. It was, therefore,
submitted that no case has been made out by the appellant and the appeal
deserves to be dismissed. Since the appellant had not challenged the validity F
:if Clause (vi) of Stranding Order 20 before the High Court, his petition is not
maintainable and may also be dismissed.
Having heard the learned counsel for the parties, we are of the view
that the appeal as well as the writ petition deserve to be dismissed. So far as
preliminary objection as to maintainability of the petition in this Court and
the applicability of res judicata in the appeal is concerned, it is true that the
appellant had not taken the ground as to vires of Clause (vi) of Standing
Order 20 either before the learned single Judge or before the Division Bench
G
of the High Court. At the same time, however, when he has approached this
Court against the decision of the High Court and has raised this ground, it H
324
SUPREME COURT REPORTS [2005] SUPP. 3 S.C.R.
A would not be appropriate to preclude him from arguing the case on the vires
or validity of Clause (vi) of the Standing Order 20. Moreover, he has also
filed a substantive petition for the said purpose under Article 32 of the
Constitution. The preliminary objection, therefore, does not impress us and
we have allowed both the parties to argue the case on vires of Standing Order
B 20(vi) as well as on merits.
As far as acquittal of the appellant by a criminal court is concerned, in
our opinion, the said order does not preclude the Corporation from taking an
action if it is otherwise permissible. In our judgment, the law is fairly well
settled. Acquittal by a criminal court would not debar an employer from
C exercising power in accordance with Rules and Regulations in force. The two
proceedings - criminal and departmental are entirely different. They operate
in different fields and have different objectives. Whereas the object of criminal
trial is to inflict appropriate punishment on offender, the purpose of enquiry
proceedings is to deal with the delinquent departmentally and to impose
penalty in accordance with service Rules. In a criminal trial, incriminating
D statement made by the accused in certain circumstances or before certain
officers is totally inadmissible in evidence. Such strict rules of evidence and
procedure would not apply to departmental proceedings. The degree of proof
which is necessary to order a conviction is different from the degree of proof
necessary to record the commission of delinquency. The rule relating to
E appreciation of evidence in the two proceedings is also not similar. Jn criminal
law, burden of proof is on the prosecution and unless the prosecution is able
to prove the guilt of the accused 'beyond reasonable doubt', he cannot be
convicted by a court of law. In departmental enquiry, on the other hand,
penalty can be imposed on the delinquent officer on a finding recorded on
the basis of 'preponderance of probability'. Acquittal of the appellant by a
F Judicial Magistrate, therefore, does not ipso facto absolve him from the liability
under the disciplinary jurisdiction of the Corporation. We are, therefore,
unable to uphold the contention of the appellant that since he was acquitted
by a criminal court, the impugned order dismissing him from service deserves
to be quashed and set aside.
G
As far as the status of the appellant is concerned, it must be stated that
Mr. Rao, Senior Advocate fairly conceded at the hearing of the appeal and
the writ petition that the appellant is not governed by Article 311 of the
Constitution since he cannot be said to be 'civil servant'. Jn this connection,
it will be profitable to refer to a decision of the Constitution Bench of this
H Court in Dr. S. L. Agarwal v. General Manager, Hindustan Steel limited
AJITKUMARNAGr. GEN. MAN, INDIANOILCORPN. LTD. [THAKKER,J.)
325
(Hindustan Steel Limited!), and [1970] 3 SCR 363 ; [1970] l SCC 177. In A
that case, A was appointed as Assistant Surgeon by the Board of Directors
of the Corporation for one year. After completion of the probation period, he
was employed on contract basis and his services were terminated in accordance
with the terms of the contract. He filed a writ petition in the High Court
contending that his services were wrongly terminated which was violative of B
Article 311 of the Constitution. The Corporation contended that Article 311
was not applicable to him as he was employed by the Corporation and he
neither belonged to Civil Service of the Union nor held a civil post under the
Union.
Upholding the objection and considering the ambit and scope of Article C
311, this Court held that an employee of a Corporation cannot be said to have
held a 'civil post' and, therefore, not entitled to protection of Article 311.
According to the Court, the Corporation could not be said to be a 'department
of the Government' and employees of such Corporation were not employees
under the Union. The Corporation has an independent existence and the
appellant was not entitled to invoke Article 311. Hindustan Steel Limited (I) D
has been followed by this Court in several cases. [See Sukhdev Singh and
Ors. v. Bhagatram Sardar Singh Raghuvanshi and Anr., [1975] 1 SCC 421,
Som Prakash Rekhi v. Union of India, [1981] I SCC 449, A.L. Kalra v.
Project and Equipment Corporation of India Ltd., [1984] 3 SCC 316, Tekraj
Vasandi v. Union of India a.'1d Ors., [1988] I SCC 236, Pyare Lal Sharma E
v. Managing Director and Ors., [1989] 3 SCC 448, State Bank of India v.
S. Vijay Kumar, [1990] 4 SCC 481 and Satinder Singh Arora v. State Bank
of Patia/a, [1992] Supp 2 SCC 224]
In view of the above pronouncements of this Court, there is no doubt
that the respondent-Corporation is right in submitting that the appellant cannot p
invoke Article 311 by describing him as holding 'civil post' under the Union
or a State. Article 311 of the Constitution, therefore, has no application to the
facts of the case.
Mr. Rao, however, placed strong reliance on a decision of two Judge
Bench of this Court in Workmen of Hindustan Steel Limited & Anr. v. G
Hindustan Steel Limited & Ors., (Hindustan Steel 11); [1984] Supp SCC 554.
In that case, the employer dismissed a workman without holding enquiry and
without giving him an opportunity of being heard. The power was exercised
under Standing Order 32 of the Certified Standing Orders of Corporation.
Standing Order 32 read thus :
H
A
B
c
D
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SUPREME COURT REPORTS [20051 SUPP. 3 S.C.R.
"32. Special Procedure in certain cases.-Where workman has been·
convicted for a criminal offence in a court of law or where the General
Manager is satisfied, for reasons to be recorded in writing, that it is
inexpedient or against the interests of security to continue to employ
the workman, the workman may be removed or dismissed from service
without following the procedure laid down in Standing Order 31."
The language of Standing Order 32 is 'more or less' similar to Standing
Order 20 (vi) of the Certified Standing Orders of the respondent-Corporation
which reads as under :
"Where a workman has been convicted for a criminal offence in a
Court of Law or where the General Manager is satisfied for reasons
to be recorded in writing, that it is neither expedient nor in the interest
of security to continue the workman, the workman may be removed
or dismissed from service without following the procedure laid down
under III of this Clause."
The workman challenged the action inter alia on the ground that
provision of Standing Order 32 is irrational, arbitrary and violative of Article
311. The Court proceeded to consider the objection against Standing Order
32 on the touchstone of Article 311. Describing the provision as 'archaic
standing order reminiscent of the days of hire and fire' relied upon by a
E public sector undertaking to sustain an utterly unsustainable order and to
justify an action taken in violation of the principles of natural justice, the
Court stated that such a provision could not stand. Reproducing Article 311
of the Constitution, the Court held that the minimum requirement of observance
of principle of natural justice could not be dispensed with and the action
taken by the Corporation was illegal and unlawful. The Court, therefore,
F directed the Corporation to 'recall and cancel the order' by reinstating the
workman. The Corporation was granted an opportunity to recast its Standing
Order 32 to be brought in conformity with the second proviso to Article
311(2) of the Constitution.
G
The endeavour of Mr. Rao before us is that the above case was a case
of termination of service of an employee of the Corporation. The Standing
Order which came up for consideration in that case was 'more or less' similar
to the Standing Order with which we are concerned. In spite of the fact that
the employee was engaged by the Corporation, the Court considered the
provisions of Article 311 of the Constitution and the principles applicable to
H civil servants. It was, therefore, submitted that in the present case also, the
AnTKUMARNAG,..GEN.MANAGER,INDIANOILCORP.LTD.[TIIAKKER,J.J
327
ratio laid down in that case may be applied and the impugned order passed A
by the Corporation may be set aside.
We are unable to agree with Mr. Rao. It is no doubt true that the
provision which came up for consideration before a two Judge Bench in
Hindustan Steel Limited (II) was against an order passed by the Corporation.
It was similar to Clause (vi) of Standing Order 20 which this Court is called B
upon to consider. At the same time, however, it cannot be overlooked that
two Judge Bench proceeded to consider the validity of the provision on the
anvil of Article 311 which could not be attracted as it was not applicable. The
point was settled and finally decided by the Constitution Bench of this Court
in Hindustan Steel Limited (!). Unfortunately, however, the attention of the C
Court was not invited to the said case and in Hindustan Steel Limited (II), the
Court proceeded as if the employees of the Corporation were governed by
Article 311. Hindustan Steel Limited (II) is thus per incuriam. It could not
have applied Article 311 had the attention of the two Judge Bench been
drawn to the decision of the Constitution Bench in Hindustan Steel Limited D
(!).
At the time of admission hearing, reference was also made to another
two Judge Bench decision of this Court in Hari Pada Khan v. Union of India
and Ors., [ 1996] I SCC 536. In that case, the petitioner who was a permanent
staff member of Indian Oil Corporation was involved in theft of oil and a E
First Information Report was lodged against him. On the basis of that report,
a criminal case was registered and he was arrested. Relying on Standing
Order 20 (iv) of the Corporation, he was dismissed from service. Standing
Order 20(iv), as then stood, was similar to present Standing Order 20(vi) and
empowered the General Manager of the Corporation to dismiss a workman
if he had been convicted for a criminal offence in a court of law or if the F
General Manager was satisfied for reasons to be recorded in writing that it
was neither expedient nor in the interest of the Corporation to continue the
workman in service.
Standing Order 20(iv) read thus;
"Where a workman has been convicted for a criminal offence in a
Court of Law or where the General Manager is satisfied for reasons
G
to be recorded in writing, that there is neither expedient nor in the
interest of security to continue the workman, the workman may be
removed or dismissed from service without followir.g the procedure H
328
SUPREME COURT REPORTS [2005] SUPP. 3 S.C.R.
A
laid down under III of this clause."
The action of the Corporation was challenged by the dismissed employee.
Upholding the order of the Corporation, this Court held that the action could
be taken. The Court stated that the rule had been made by the Corporation
with the intention to prevent an employee of the Corporation served with a
B charge sheet and arrest in furtherance thereof from continuing in service.
Mr. Rao, however, placed reliance on the following observations :
"Of course it would be subject to the result of the trial. Continuance
of the officer involved in an offence would be an affront to good and
C
disciplined conduct of workmen. His continuance in service of the
Corporation would demoralize the service. Therefore, it was most
expedient in the public interest not to hold any fu.ther enquiry and
terminate his services forthwith. However, it would be subject to the
result of the trial."
D
The endeavour of Mr. Rao is that this Court had expressly stated in
Hari Pada Khan that an order of dismissal from service would be subject to
result of the trial. In the present case, a criminal case was registered against
the appellant and he was prosecuted. The prosecution, how~ver, resulted in
acquittal of the appellant. As per the ratio in Hari Pada Khan, submitted Mr.
E Rao, the appellant is entitled to reinstatement.
We are unable to accept the contention. It is true that in Hari Pada
Khan, this Court upheld the order of dismissal by expressly observing that it
would_ be subject to result of trial but what Mr. Rao forgets is that in Hari
Pada Khan, the power was exercised by the General Manager not under the
F second part of the Standing Order 20 (iv), but on the first part thereof, which
covered cases of conviction of a workman for a criminal offence. The second
part dealt with satisfaction of the General Manager about expediency of not
keeping a workman in service. Since the power was exercised by the General
Manager on the first part and the basis was registration of a of criminal case
G against the workman, obviously, this Court was justified in observing that
when the action was taken on the basis of pendency of a criminal case, the
action of dismissal of the workman must abide by the result of the trial. The
facts of the case before us are totally different. In this case, the General
Manager has exercised the power under the second part of the Standing
Order 20(vi) which empowered him to take action on satisfaction for reasons
H
AJIT KUMAR NAG v. GEN. MAN., INDIAN OIL CORPN. LTD. [THAKKER, J.]
3 29
to be recorded in writing that it was not in the interest of security to continue A
the workman in service. The direction in Hari Pada Khan, therefore, does not
apply to the factual matrix of the present case for claiming relief by the
appellant.
The appellant in Hari Pada Khan relied upon Hindustan Steel Limited
(II), and submitted that in that case, this Court struck down a similar provision B
being violative of natural justice and also violative of Article 14.