S.Sundaramurthy v. The Managing Director, Tamil Nadu Handloom Development, Corporation Ltd., Kuralagam, 4th Floor, Chennai-600 108 & Ors.

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED: 14.7.2009CORAMTHE HONOURABLE MR.JUSTICE R.SUDHAKARWrit Petition No.19555 of 2003 S.Sundaramurthy. ..Petitioner vs.1. The Managing Director, Tamil Nadu Handloom Development, Corporation Ltd., Kuralagam, 4th Floor, Chennai-600 108.2. The Chairman, Tamil Nadu Handloom Development Corporation Ltd., Kuralagam, 4th Floor, Chennai-600 108.3. The Board of Directors Tamil Nadu Handloom Development Corporation Ltd., Kuralagam, Chennai-600 108. ..RespondentsWrit Petition is filed under Article 226 of the Constitution ofIndia praying to issue a Writ of Certiorari calling for records ofthe second respondent culminated in and by his proceedingsHDC/Rc.1758/99 G1 dated 9.5.2002 as confirmed by the first respondentin and by his proceedings Na.Ka.No.1758/99 G1 dated 23.4.2003 andquash the same.For Petitioner : Mr.V.Bharathidasan For Respondents : Mr.T.Seenivasan Additional Government Pleader for R1 : No appearance for R2 and R3 https://hcservices.ecourts.gov.in/hcservices/ O R D E RThe Writ Petition is filed praying to issue a Writ of Certioraricalling for records of the second respondent culminated in and by hisproceedings HDC/Rc.1758/99 G1 dated 9.5.2002 as confirmed by thefirst respondent in and by his proceedings Na.Ka.No.1758/99 G1 dated23.4.2003 and quash the same.2. The brief facts of the case is as follows:- The writpetitioner was working as Manager in the Tamil Nadu HandloomDevelopment Corporation. One Muthupalani was working as LoanInspector. During the period 1993-1999. It appears that the saidMuthupalani while collecting the outstanding amount misappropriatedthe money and failed to deposit the said amount to the account of therespondent corporation. The petitioner, the Branch Manager and asenior officer is stated to be negligent in dealing with the saidsubordinate employee. According to the respondent corporation,petitioner should have taken reasonable care and caution andsupervised the work of the said Muthupalani. If the petitioner wasvigilant, the embezzlement or misappropriation of the amount byThiru Muthupalani would have come to light much earlier and avoidedthe loss to the respondent corporation. According to the respondentcorporation, the said Muthupalani had embezzled a sum of Rs.10.45lakhs and after realising some amount, Rs.4.01 lakhs was pendingrecovery. There is also loss of interest. Based on the above, acharge memo was issued to the petitioner and on completion ofenquiry, he was imposed with punishment of one year increment cutwithout cumulative effect and the period of suspension was treated asearned leave. The above said punishment was imposed on 29.2.2000.Thereafter, the Board reviewed the punishment and by proceedingsdated 28.9.2001, the order dated 29.2.2000 imposing the punishment asabove, was revoked. The enquiry was done de novo. Petitionerparticipated in the de novo enquiry. The charges were found to beproved in the de novo proceedings and the second show-cause noticewas issued with regard to punishment to be imposed. An explanationwas given by the petitioner. The Chairman of the respondentCorporation by proceedings in HDC/Rc.1758/99/G1 dated 9.5.2002imposed punishment of removal from service. As against the orderdated 9.5.2002, petitioner filed appeal dated 3.6.2002 to theSecretary, The Staff Committee, Tamil Nadu Handloom DevelopmentCorporation. The said appeal was rejected by a Resolution No.2832dated 31.3.2003 and the same was informed by a letter dated23.4.2003. 3. Challenging the said communication dated 23.4.2003, presentwrit petition has been filed inter alia contending as follows:-(i) The amount was misappropriated by one Muthupalani and not bythe petitioner. https://hcservices.ecourts.gov.in/hcservices/ (ii) The amount misappropriated which remains unpaid afterrecovery is Rs.4,01,827.45 and the interest amount is Rs.2,82,048.93in all Rs.6,83,876.38. According to the petitioner, the subordinateofficer Muthupalani has paid a sum of Rs.5.35 lakhs which amount hasto be deducted from the total liability. If the amount repaid istaken into consideration, the loss caused by the subordinate officeris meagre.(iii) There is no allegation that the amount wasmisappropriated by the petitioner and that the petitioner hadknowledge of the same.(iv) On the first occasion, the Managing Director imposed thepunishment of one year increment cut without cumulative effect,whereas on the second round, the extremely harsh punishment ofremoval from service was passed. The punishment imposed by theauthority for the delinquency charged is shockingly disproportionate.(v) The further grievance of the petitioner is that as per theStaff Regulation, the appeal should be decided by the Staff Committeeof the Tamil Nadu Handloom Development Corporation and not by theBoard. Therefore, there is an infirmity in the appeal proceedings.(vi) The delinquency charged is between 1993 to 2000 and thepetitioner was working as Manager only for a period of eight monthsin the year 1999-2000.4. Learned Additional Government Pleader on the other handcontended that the principles of natural justice have beenscrupulously followed. The enquiry officer has come to theconclusion that the petitioner is guilty of the delinquency chargedand therefore, the punishment of removal from service finding thatthe petitioner failed to take proper care and caution and supervisethe subordinate officer, does not require reconsideration.5. As regards the plea that the appeal should not have beendecided by the Board, it is contended that the Board has got power asrevisional authority to deal with any order or proceedings passed bythe lower authority. The appeal though filed before the StaffCommittee was taken up by the Board and rejected on 31.3.2003 andcommunicated by proceedings dated 23.4.2003 by the Chairman. TheResolution of the Board dated 31.3.2003 was also annexed with thecommunication dated 23.4.2003 which is under challenge. Hence,there is no infirmity as alleged.6. The main contention of the learned counsel for thepetitioner is on the ground that the subordinate officer has acceptedhis guilt and paid most of amount. There is no charge ofmisappropriation by the petitioner. Therefore, the only delinquencyas against the petitioner is that there was a failure on the part of https://hcservices.ecourts.gov.in/hcservices/ the petitioner to supervise the Loan Inspector from time to time.This according to the petitioner is due to heavy workload and thedetails of accounting is usually taken up at every quarter. In anyevent his tenure as Manager to control the Line Inspector ThiruMuthupalani was only a short period. Apparently, the Board whileconsidering the case of the petitioner has merely stated that theappeal petition dated 3.6.2002 was considered and rejected and therecovery order has been passed. There appears to be no applicationof mind to the various issues raised by the petitioner in appeal andthe proceedings of the Board is cryptic and bereft of reasons.7. In S.N.Mukherjee – vs. - Union of India (1990)4 SCC 594 theApex Court held in para 36 as follows:-"36. Reasons, when recorded by anadministrative authority in an order passed by itwhile exercising quasi-judicial functions, wouldno doubt facilitate the exercise of itsjurisdiction by the appellate or supervisoryauthority. But the other considerations, referredto above, which have also weighed with this Courtin holding that an administrative authority mustrecord reasons for its decision, are of no lesssignificance. These considerations show that therecording of reasons by an administrativeauthority serves a salutary purpose, namely, itexcludes chances of arbitrariness and ensures adegree of fairness in the process of decisionmaking. The said purpose would apply equally toall decisions and its application cannot beconfined to decisions which are subject to appeal,revision or judicial review. In our opinion,therefore, the requirement that reasons berecorded should govern the decisions of anadministrative authority exercising quasi-judicialfunctions irrespective of the fact whether thedecision is subject to appeal, revision onjudicial review. It may, however, be added thatit is not required that the reasons should be aselaborate as in the decision of a court of law.The extent and nature of the reasons would dependon particular facts and circumstances. What isnecessary is that the reasons are clear andexplicit so as to indicate that the authority hasgiven due consideration to the points incontroversy. The need for recording of reasonsis greater in a case where the order is passed atthe original stage." https://hcservices.ecourts.gov.in/hcservices/

8. The Board while deciding the case of the petitioner,apparently has not given any reason as to why the appeal is rejectedand whether it has a power to review the order of the lower authorityor to exercise the power of appellate jurisdiction. Recording ofreasons is a sine quinine for application of mind. In this case, theappeal has been rejected summarily. For that reason, the Court is ofthe view that the order dated 23.4.2003 enclosing the Board'sproceedings stands set aside. The matter is remitted back to theBoard or the Appellate Authority as to case may be to decide theappeal on merits after affording an opportunity to the petitioner inperson. The proceedings to be concluded within a period of six weeksfrom the date of receipt of a copy of this order. Petitioner isentitled to submit further representation in support of the appeal.Accordingly, this writ petition is allowed in part. No costs.sd/-Asst.Registrar/true copy/Sub Asst.RegistrartsTo 1. The Managing Director, Tamil Nadu Handloom Development Corporation Ltd., Kuralagam, 4th Floor, Chennai-600 108.2. The Chairman, Tamil Nadu Handloom Development Corporation Ltd., Kuralagam, 4th Floor, Chennai-600 108.3. The Board of Directors Tamil Nadu Handloom Development Corporation Ltd., Kuralagam, Chennai-600 108.+ 1 c.c. to Mr. V. Bharathidasan, Advocate. S.R.No.31184. Order in W.P.No.19555 of 2003BV (CO)GSK 22.07.2009.