CHAIRMAN-CUM-MANAGING DIRECTOR, MAHANADI COALFIELDS LIMITED versus SRI RABINDRANATH CHOUBEY

Citation: [2020] 8 S.C.R. 1 · Decided: 27-05-2020 · Supreme Court of India · Bench: ARUN MISHRA · Disposal: Disposed off

Cited by 4 judgment(s) · cites 27 · see the full citation network in Lexace

Judgment (excerpt)

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[2020] 8 S.C.R. 1
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CHAIRMAN-CUM-MANAGING DIRECTOR,
MAHANADI COALFIELDS LIMITED
v.
SRI RABINDRANATH CHOUBEY
(Civil Appeal No. 9693 of 2013)
MAY 27, 2020
[ARUN MISHRA,  M. R. SHAH AND AJAY RASTOGI, JJ.]
Service Law: Disciplinary proceeding – Superannuation –
Payment of gratuity/Dismissal from service – Whether it is
permissible for the employer to withhold the payment of gratuity of
the employee even after his superannuation from service because
of the pendency of the disciplinary proceedings against him and
where departmental enquiry had been instituted against an employee
while he was in service and continued after he attained the age of
superannuation whether the punishment of dismissal can be imposed
on being found guilty of misconduct in view of the provisions in
r.34.2 of the Conduct, Discipline & Appeal Rules of 1978 made by
the employer – Held: Per M.R.Shah, J. (for himself and Arun
Mishra, J.) – An employer has a right to withhold the gratuity during
the pendency of the disciplinary proceedings, and the disciplinary
authority has powers to impose the penalty of dismissal/major penalty
upon the employee even after his attaining the age of
superannuation, as the disciplinary proceedings were initiated while
the employee was in service – The Payment of Gratuity Act, 1972
govern the conditions concerning payment of gratuity – It cannot
control and provide with respect to an employer’s right to hold a
departmental inquiry after retirement, and there is no provision
prescribing what kind of punishment can be imposed in the
departmental inquiry if it is continued after attaining the age of
superannuation – The relevant rules would govern such matters –
Since no statutory provisions of the Payment of Gratuity Act, 1972
come in the way of the CDA Rules to continue the inquiry after
superannuation of the employee in case it was instituted while he
was in service and his deemed continuance in service; thus, no
fetter is caused upon operation of Rule 34.2 providing for a
continuation of the inquiry and deemed continuation of the employee
in service after the age of superannuation – At the conclusion of
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SUPREME COURT REPORTS
[2020] 8 S.C.R.
such disciplinary proceedings any of the penalty provided under
Rule 27 of the CDA Rules can be imposed by the authority including
the order of dismissal and apart from that in case pecuniary loss
had been caused that can be recovered –Per Ajay Rastogi, J. (Partly
dissenting): After conclusion of the disciplinary inquiry, if an
employee/delinquent is held guilty, indeed a penalty can be inflicted
upon him who stood retired from service and what should be the
nature of penalty would always depend on the relevant scheme of
Rules and on the facts and circumstances of each case, but either
of the substantive penalties specified under Rule 27 of the Rules,
1978 including dismissal from service are not open to be inflicted
on conclusion of the disciplinary proceedings and the punishment
of forfeiture of gratuity commensurate with the nature of guilt may
be inflicted upon a delinquent employee provided under Rule 34.3
of Rules, 1978 read with sub-section (6) of s.4 of the Act, 1972 –
Payment of Gratuity Act, 1972.
Disposing of the appeal, the Court
HELD:
PER M. R. SHAH, J. (FOR HIMSELF AND ARUN
MISHRA, J.)
1.1 Indisputably, the respondent was governed by the CDA
Rules. Therefore, Rules 34.2 and 34.3 of the CDA Rules shall be
applicable and the respondent-employee shall be governed by
the said provisions. Rule 34 permits the management to withhold
the gratuity during the pendency of the disciplinary proceedings.
Rule 34.2 permits the disciplinary proceedings to be continued
and concluded even after the employee has attained the age of
superannuation, provided the disciplinary proceedings are
instituted while the employee was in service. It also further
provides that such disciplinary proceedings shall be deemed to
be the proceedings and shall be continued and concluded by the
authority by which it was commenced in the same manner as if
the employee had continued in service. Therefore, as such, on a
fair reading of Rule 34.2 of the CDA Rules, an employee shall be
deemed to be continued in service, after he attains the age of
superannuation/retired, for the limited purpose of continuing and
concluding the disciplinary proceedings which were instituted
while the employee was in service. Therefore, at the conclusion
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of such disciplinary proceed

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