G.K. Anbu & Ors. v. The Tamil Nadu Industrial Investment Corporation Limited

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED :19.01.2009C O R A M :THE HONOURABLE MR. JUSTICE K. CHANDRUW.P.Nos.3273 and 32090 of 2004G.K.Anbu.. Petitioner in W.P. No.3273 of 2004A.Mohan.. Petitioner in W.P. No.32090 of 2004-vs-1. The Tamil Nadu Industrial Investment Corporation Limited, rep.by its Managing Director, 692, Anna Salai, Nandanam, Chennai-600 035.2. The Board of Directors/Appellate Authority, rep.by its Managing Director, Tamil Nadu Industrial Investment Corporation Limited, 692, Anna Salai, Nandanam, Chennai-600 035. .. Respondents in both the writ petitionsPRAYER in WP.3273 of 2004 : Petition filed under Article 226 of theConstitution of India praying for the issuance of a writ ofcertiorarified mandamus calling for the records relating to theproceedings dated 27.3.2001 in proceedings No.ADMN/DW/2000-2001 of thefirst respondent and the proceedings No.TIIC/Admn. /DW/2003-04, dated12.1.2004 of the second respondent and quash the orders passed thereinand consequently direct the respondents to reinstate the petitioner intothe service of the respondents with all backwages, attendant and otherservice benefits arising therefrom. PRAYER in WP.32090 of 2004 : Petition filed under Article 226 of theConstitution of India praying for the issuance of a writ of certioraricalling for the records on the file of the respondents relating to theimpugned order passed by the first respondent, dated 27.3.2001 and theorder dated 12.1.2004 passed by the second respondent enhancing theorder of removal to dismissal of the petitioner from service and quashthe same. https://hcservices.ecourts.gov.in/hcservices/ For petitioner inW.P.No.3273 of 2004: Mr.Srinath SridevanFor petitioner inW.P.No.32090 of 2004: Mr.V.P.Raju For respondents inW.P.No.3273 of 2004: Mrs.Rita Chandrasekaran For respondents inW.P.No.32090 of 2004: Mr.M.R.Raghavan O R D E RW.P.No.3273 of 2004 filed by the petitioner, who was working as anOfficer in the Hosur Branch Office, challenges the order dated27.03.2001 in demoting the petitioner to the cadre of Junior Officer andas well as the order of the 2nd respondent appellate authority dated12.01.2004 in enhancing the punishment to one of dismissal from servicefrom the date of the order viz., 12.01.2004.2. The writ petition was admitted on 18.02.2004 and the prayer forinterim relief was rejected by this Court on that date. Subsequently,another application being W.P.M.P.NO.6232 of 2004 came to be filedseeking for a direction to reinstate the petitioner and this Court by anorder dated 19.05.2004 granted an interim order. Meanwhile, the stayapplication was dismissed on 22.09.2004 for want of representation andsubsequently it was restored. The respondent Corporation filed a vacatestay application in W.V.M.P.No.1281 of 2004. The said petition wasallowed and the petition for interim stay was dismissed by a commonorder dated 18.03.2005. 3. Similarly in W.P.No.32090 of 2004, the petitioner therein wasan Assistant Manager, who was earlier working as Branch Manager at theHosur Branch Office. By an order dated 27.03.2001, the 1st respondentremoved the petitioner from service. In his subsequent appeal, the Boardby an order dated 12.01.2004, modified the punishment into one ofdismissal. That writ petition was admitted on 05.11.2004. 4. On behalf of the respondents a counter affidavit dated Nil(June 2004), was filed in the first writ petition and another counteraffidavit dated 17.07.2008 was filed in the second writ petition. 5. The contention of the learned counsel for the petitioners weretwo fold. When the petitioner filed an appeal, the Managing Director1st respondent who had passed the initial order had participated in themeeting of the Board of Directors held on 16.12.2003. Therefore, theorder of the Board of Directors being the appellate authority isvitiated. Reliance was also placed upon the Judgement of the SupremeCourt in Institute of Chartered Accountants of India vs. L.K.Ratna and https://hcservices.ecourts.gov.in/hcservices/ others reported in (1986) 4 SCC 537 .6. In the present case, a copy of the minutes of the Board ofDirectors was produced by the respondents, which would show that at thetime of passing the order the Managing Director was one P.Prabhakaran,I.AS., whereas in the Board Meeting, the subsequent Managing DirectorTmt.D.Savitha, I.A.S., had participated.Since it is not the same person,who participated in the Board proceedings, the doctrine of personal biasdoes not arise. Therefore, the reliance placed upon L.K.Ratna's casecited supra has no relevance.7. The second contention raised by the petitioner in W.P.No.3273of 2004 is that had he not filed any appeal against the original orderof punishment, he would not have been visited with enhanced punishmentof dismissal and he cannot be worse of than a person who had not filedany appeal.He also submitted that another person by name A.Muruganandam,Branch Manager, who was also similarly charge sheeted was imposed with apunishment of reduction to a lower post, by an order dated 27.03.2001 bythe 1st respondent. He had not filed any appeal. He is continuing inservice. But in the case of the first petitioner, he was suffered withan initial punishment of reduction to a lower rank. But on appeal, thesame was enhanced to one of dismissal. However, the said defence maynot be available to the second writ petitioner, because in that case,original punishment was removal from service and in the appeal it hasonly been confirmed. 8. It is also seen from the records that in relation to the 2ndpetitioner (A.Mohan, Assistant Manager) an elaborate enquiry wasconducted against the petitioners,and after affording all opportunities,the misconduct by them were proved. The irregularities committed bythem in accepting unapproved supplier to supply substandard machinery tothe borrower disbursing a sum of Rs.11.44 lakhs to the borrower in spiteof adverse report by the concerned Loan Administrative Officer,fabricating valuation report of the Panel Valuer, furnishing falseinspection report along with the other two employees, reporting that themachinery were available in good condition and the power was available,disbursing loan amount to the borrower taking the value of the machinerythat 19.48 lakhs while the actual value was only 4.10 lakhs. 9. A detailed reasoning was given by the 1st respondent competentauthority. The appellate authority has given an opportunity of personalhearing to the petitioner and had passed a reasoned order. Therefore,there is very little scope for interfering with the penalty granted toA.Mohan, petitioner in W.P.N.32090 of 2004. In his case, the originalpunishment was one of removal from service. On appeal, the Board hadgiven the punishment into one of dismissal. There is hardly anydifference between a removal and a dismissal as both are major penaltiesunder the Service Rules. https://hcservices.ecourts.gov.in/hcservices/

10. However, the argument of the counsel for the petitioner inW.P.No.32090 of 2004 merits acceptance. While the said petitioner andA.Muruganandam were both charged for the very same misconduct, and afterenquiry, were imposed with the penalty of reduction in lower rank by thedisciplinary authority (1st respondent) only in the case of thepetitioner since he had filed an appeal to the Board of Directors, hispunishment was enhanced. The Board has power to revise and enhance thepunishment under 6.25 of the Service Rules either while hearing theappeal or on suo motu. The case of the petitioner who had filed anappeal the punishment was enhanced from reduction in rank to that ofdismissal from service. But in case of A.Muruganandam, the Board didnot think fit to enhance the punishment. This issue was raised in theaffidavit filed by the petitioner, in paragraph No.16.G, the relevantportion is extracted below:- "The petitioner submits that in a case likethis involving three accused officers and same set upcharges relying upon an incidence common for all, therespondents ought to have conducted a joint trial.On the other hand, all the three accused officershave been tried separately resulting in mis-carriageof justice. This is evident from the fact thatmerely because the petitioner had filed an appeal hispunishment was enhanced to that of dismissal fromservice while the other accused officer ThiruMuruganandham was allowed to continue in the demotedpost though there wee powers to the respondents toresort to suo moto revision, which they have failedto follow. Though the petitioner wanted to withdrawthe appeal the respondents ignored the request andproceeded to enhance the punishment, which would beunfair and arbitrary apart from being discriminatorywarranting interference by this Hon'ble Court".11. In response to this averment, in the counter affidavit datedNil June 2004, in paragraphs 18 and 19.(vii) the following avermentshave been made by the 1st respondent. "18. .... Regarding the case of anotherofficer, Thiru.A.Muruganandam, the respondents willbe taking further action as warranted after goingthrough the records..........19(vii) ..... The reference to anotherofficial of the Corporation has no relevance to thecase of the petitioner and if necessary, theappropriate authority will initiate suitable actionagainst him. The averment of the petitioner that hewanted to withdraw the appeal but the respondents https://hcservices.ecourts.gov.in/hcservices/ ignored his request and proceeded to enhance thepunishment, is specifically denied. Even if thepetitioner wanted to withdraw the appeal and it wasactually withdrawn, the Appellate Authority had thepower under Rule 6.25 (3) of the Service Rules of theCorporation to enhance the punishment irrespective ofwhether an appeal was preferred or not".12. When asked as to what action was taken against A.Muruganandam,as averred in paragraph 18 referred to above, Mrs.Rita Chandrasekaran,learned counsel for the respondents fairly conceded that no furtheraction was taken against A.Muruganandam and he is very much in service.Therefore, the case of Mr.Anbu is a clear case of discrimination adoptedby the 2nd respondent and which is hit by Articles 14 and 16 of theConstitution. 13. In Sengara Singh v. State of Punjab, reported in (1983) 4 SCC225, it was held that in the matter of punishment there should not beany discrimination among the persons who are similarly placed. Inparagraph 9, the Supreme Court held as follows:-''Para 9. .. .. ... Respondents failed to explain to the Courtthe distinguishing features and therefore, we are satisfied inputting all of them in same bracket. On that conclusion thetreatment meted to the present appellants suffers from the viceof arbitrariness and Article 14 forbids any arbitrary actionwhich would tantamount to denial of equality as guaranteed byArticle 14 of the Constitution. The Court must accordinglyinterpose and quash the discriminatory action''.14. The same view was reiterated in Harminder Singh -vs- State ofPunjab reported in 1984 (Supp) SCC 351 and it was observed in paragraph2 which is as follows:-''Para 2. At the hearing of these petitions, Mr P.R. Mridul,learned counsel who appeared for the respondents urged that theState of Punjab has filed a review petition against thedecision of this Court in Sengara Singh case1 rendered onAugust 2, 1983. It was further submitted that therefore, thisCourt should examine afresh the contentions which the State ofPunjab would like to advance in the present petitions. Anenquiry revealed that the review petition has already beenrejected. It was not possible for Mr Mridul to distinguish thecase of the present petitioners from those whose cases weredealt with in the aforementioned judgment by this Court. As anecessary corollary, the same result must follow''. 15. The Supreme Court in Bongaigaon Refinery & PetrochemicalsLtd.and others -vs- Girish Chandra Sarma reported in (2007) 7 SCC 206 https://hcservices.ecourts.gov.in/hcservices/ also dealt with the case of discrimination in the matter of punishment.The passages found in paragraphs 17 and 18 may be usefully reproducedbelow:- ''Para 17. ........All these three Committees haveprocessed the deal and it is only the respondent who hasbeen made a scapegoat. Para 18. After going through the report and thefinding recorded by the Division Bench of the High Court, weare of opinion that in fact the Division Bench correctlyassessed the situation that the respondent alone was made ascapegoat whereas the decision by all three Committees wasunanimous decision by all these members participating in thenegotiations and the price was finalised accordingly. It isnot the respondent alone who can be held responsible whenthe decision was taken by the Committees. If the decision ofthe committee stinks, it cannot be said that the respondentalone stinks; it will be arbitrary. If all fish stink, topick one and say only it stinks is unfair in the matter ofunanimous decision of the Committee''.16. The Supreme Court in a latest decision in Man Singh -vs- Stateof Haryana reported in 2008 AIR SCW 3424 in paragraph 19 observed asfollows:-''Para 19. We may reiterate the settled position of lawfor the benefit of the administrative authorities that anyact of the repository of power whether legislative oradministrative or quasi-judicial is open to challenge if itis so arbitrary or unreasonable that no fair minded authoritycould ever have made it. The concept of equality as enshrinedin Article 14 of the Constitution of India embraces theentire realm of State action. It would extend to anindividual as well not only when he is discriminated againstin the matter of exercise of right, but also in the matter ofimposing liability upon him. Equal is to be treated equallyeven in the matter of executive or administrative action. Asa matter of fact, the doctrine of equality is now turned as asynonym of fairness in the concept of justice and stands asthe most accepted methodology of a governmental action. Theadministrative action is to be just on the test of 'fairplay' and reasonableness. We have, therefore, examined thecase of the appellant in the light of the establisheddoctrine of equality and fair play. The principle is thesame, namely, that there should be no discrimination betweenthe appellant and HC Vijay Pal as regards the criteria ofpunishment of similar nature in departmentalproceedings... ... ..''17. In the light of the above binding precedents and the factualmatrix involved in W.P.No.3273 of 2004, the order of the 2nd respondent https://hcservices.ecourts.gov.in/hcservices/ dated 12.01.2004 will stand set aside and the order of the 1st respondentdated 27.03.2001 in imposing the punishment of placing the petitioner ina lower post will stand restored. The petitioner (G.K.Anbu) is entitledfor reinstatement in the lower post as ordered by the 1st respondent.Since he had not rendered any physical service, he may be eligible for50% of the backwages. Otherwise the interregnum period will be treatedas service for all practical purposes including for promotion andterminal benefits. The writ petition is allowed to the extent indicatedabove. 18. However, in W.P.No.32090 of 2004 the question of discriminationis not available. The 1st respondent has indicated the reasons toimpose the punishment of removal from service, which was subsequentlymodified into one of dismissal by the Board. Therefore, the said writpetition does not call for any interference and hence W.P.No.32090 of2004 will stand dismissed. However, there will be no order as to costs.Sd/-Asst.Registrar/True Copy/Sub.Asst.Registrarjs/rg To1. The Managing Director, Tamil Nadu Industrial Investment Corporation Limited, 692, Anna Salai, Nandanam, Chennai-600 035.2. The Managing Director, Board of Directors/Appellate Authority, Tamil Nadu Industrial Investment Corporation Limited, 692, Anna Salai, Nandanam, Chennai-600 035. + 1 cc to Mr.M.R.Raghavan,Advocate,SR.2075+ 1 cc to M/s.Aiyar & Dolia,Adovcate,SR.1642+ 1 cc to Mr.A.S.Thambuswamy,Advocate,SR.1730+ 1 cc to Mr.Srinath Sridevan,Advocate,SR.1939W.P.Nos. 3273 and 32090 of 2004VSK(CO)EM/27.1.09