The Chairman, New Delhi Municipal Council v. Dr. G. S. Thind

(i) shall not be instituted save with the sanction of the President,

(ii) shall not be in respect of any event which took place more than four years before such institution, and

(iii) shall be conducted by such authority and in such place as the President may direct and in accordance with the procedure applicable to departmental proceedings in which an order of dismissal from service could be made in relation to the Government servant during his service. “the CCS (Pension) Rules” hereinafter “the CCS (CCA) Rule” hereinafter Dr. G. S. Thind14, who was also convicted by the learned Trial Court, along with Aggarwal, by the judgment dated 23 July 2013, for having committed offences under Section 120B, 418, 420 IPC and Section 13(1)(d) and 13(2) of the PC. Act. He was also sentenced by the learned Trial Court on 31 July 2013 to undergo three years RI with fine of ₹ 10,000/- for the offences punishable under Section 120-B & 420 IPC, three years’ RI with fine of ₹ 25,000/- for the offences punishable under Section 13(1)(d) and 13(2) of the PC. Act. The judgment and sentence was suspended by this Court in appeal by an order dated 24 September 2013.

10. The only difference in the case of Thind vis a vis Aggarwal, was that no show cause notice was issued to Thind prior to his superannuation as during the pendency of the criminal proceedings, Thind superannuated on 31 December 2006. He was sanctioned provisional pension in terms of Rule 69 of CCS (Pension) Rule.

11. As in the case of Aggarwal, Thind was also issued a show cause notice on 30 May 2017 under Rule 9(1) of the Pension Rules read with Rule 19(1) of the CCS (CCA) Rules, proposing to withdraw his pension and gratuity in full. Thind also challenged the said show cause notice before the Tribunal by OA 2137/2017.

12. Before the issuance of the aforesaid show cause notices dated 30 May 2017 to Aggarwal and Thind, forming subject matter of the challenge in the OAs instituted by them, the NDMC had promulgated “Thind”, hereinafter the New Delhi Municipal Council (Conditions of Service of Municipal Officers) Regulations, 201615. The Notification has been extracted in full by the Tribunal in the impugned judgment. We, however, deem it necessary only to extract Regulations 4 and 5 of the 2016 Regulations as under:

“the 2016 Regulation” hereinafter New Delhi Municipal Fund”, “the Medical Officer of Health” and “the Medical Board”. (2) Any power under the service rules (other than the power to make service rules) exercisable – (a) by the President, shall be exercised by the Chairperson; (b) by the Head of Department, shall be exercised by the Secretary or such other municipal officer as the Chairperson may, by order, specify; and

(c) by the Head of Office, shall be exercised by the

13. Regulation 4, therefore, applied to the NDMC, various statutory Rules, including the CCS (Pension) Rules.

14. In their respective Original Applications, Aggarwal and Thind sought quashing of the show cause notices dated 30 May 2017 issued to them and a declaration that the 2016 Notification was illegal, arbitrary and unconstitutional.

15. The Tribunal has, in the impugned judgment, basically addressed three issues. The first is with respect to the legality and validity of the content of the show cause notices dated 30 May 2017, in the backdrop of their content. The second is the validity of the 2016 notification. The third is with respect to Rule 9(2)(b) of the Pension Rule. Observation/findings of the Tribunal and Analysis and Findings in respect thereof:

16. We may note the findings of the Tribunal, on each of the issues thus.

17. Apropos the show cause notices dated 30 May 2017 under challenge before the Tribunal, the Tribunal, in paragraph 20 of the impugned judgment, notes certain typographical errors in the show cause notices and proceeds to hold that, even if the typographical errors were to be ignored, the show cause notices stood vitiated for having invoked Rule 19 of the CCS (CCA) Rules, which could not be invoked against a retired employee.

18. Ms. Sriparna Chatterjee, learned Counsel for the petitioner submits that the show cause notices have been issued under Rule 9(1) of the CCS (Pension) Rules as made applicable mutatis mutandis to the NDMC vide the 2016 Notification and that the reference to Rule 19(1) of the CCA (CCS) Rules was only apropos the procedure prescribed in the said rule.

19. We need not enter into that aspect as, even if it were to be assumed that Rule 19(1) of the CCA (CCS) Rule was not applicable, it is settled law that a mere mention of an erroneous provision does not vitiate executive action, provided the action was otherwise exercised within the powers conferred on the concerned authority. We may refer in this context to the following exordium, to be found in N. Mani v Sangeetha Theatre16: “9. It is well settled that if an authority has a power under the law merely because while exercising that power the source of power is not specifically referred to or a reference is made to a wrong provision of law, that by itself does not vitiate the exercise of power so long as the power does exist and can be traced to a source available in law.” The finding, of the Tribunal, that the reference to Rule 19 of the CCS (CCA) Rules vitiated the show cause notice cannot, therefore, sustain.

20. The second ground on which the Tribunal has proceeded is reflected in paras 24, 25 and 28 to 31 of the impugned judgment, which merit reproduction in extenso thus:

services. Further, rule 9 of the Pension Rules is framed in such a way that there does not exist any scope for one and the same authority to accord sanction and then to act as the disciplinary authority. When there was a valid reason and definite purpose in keeping these powers separate, a legal regime, which has the effect of obliterating the line of distinction tends to become untenable.

29. In a typical show cause notice or a charge memorandum issued against a retired employee proposing punishment, the first sentence would denote the factum of the sanction accorded by the President. The disciplinary authority vis-a-vis an employee who is in service cannot ipso facto function as the disciplinary authority after the employee retires. It is only on being conferred the power to do so, under rule 9 (2) (b) (iii) of the Pension Rules, that either the very disciplinary authority or some other authority, can discharge such functions.

30. Keeping in view the intricacies involved in these matters, and to avoid any defects in exercise of power in this behalf, the Ministry of Home Affairs, Government of India issued office memorandum dated 04.08.1964 stipulating standard forms, one for according sanction, and the other for initiation of proceedings. According to these forms, the authority who is conferred with the power to conduct departmental proceedings is to be nominated while according sanction, and that in turn must be mentioned in the memorandum that is to be issued to the employee. The typical order, according sanction reads as under: “STANDARD FORM OF SANCTION UNDER Rule 9 OF THE CENTRAL CIVIL SERVICES (PENSION) RULES, 1972 No. …………………………………….. Government of India Ministry/Department of ------ ORDER WHEREAS it has been made to appear that Shri ……………..while serving as ………….. in the Ministry/Department ……………….. from …………………… to ………………. was (here specify briefly the imputations of misconduct or misbehaviour in respect of which it is proposed to institute departmental proceedings): NOW, THEREFORE, in exercise of the powers conferred on him by sub-clause (i) of Clause (b) of sub-rule (2) of Rule 9 of the Central Civil Services (Pension) Rules, 1972, the President hereby accords sanction to the departmental proceedings against the said Shri …………………… The President further directs that the said departmental proceedings shall be conducted in accordance with the procedure laid down in Rules 14 and 15 of the CCS (CCA) Rules, 1965, by ………………………. (here specify the authority by whom the departmental proceedings should be conducted) at ……………… (here specify the place at which the departmental proceedings would be conducted). By order and in the name of the President” The form of memorandum is prescribed as under: “STANDARD FORM OF CHARGE-SHEET FOR PROCEEDINGS UNDER RULE 9 OF THE CENTRAL CIVIL SERVICES (PENSION) RULES, 1972 No. …………………………………….. Government of India Ministry/Department of ------ MEMORANDUM Dated the ……………………………. In pursuance of the sanction accorded by the President under Rule 9 of the Central Civil Services (Pension) Rules, 1972, for instituting departmental proceedings against Shri..........................., vide Ministry/Department of.............................Order No...................................., dated,.................................it is proposed to hold an inquiry against the said Shri...................... in accordance with the procedure laid down in Rules 14 and 15 of the CCS (CCA) Rules, 1965. The enquiry shall be conducted by...............................(here specify the authority by whom the departmental proceedings are to be conducted in accordance with the Presidential sanction) at................................ (here specify the name of the place where proceedings are to be conducted)....” (Remaining part of the form omitted, as not necessary for the case).

31. It may be noted that not only the factum of the President according sanction, but also his naming the authority to conduct departmental proceedings figure in both the standard forms. If we examine the impugned show cause notices in the light of these requirements, it becomes crystal clear that there is no mention to the factum or event of the President or his equivalent, according sanction for initiation of disciplinary proceedings against the applicants. Equally, the notices are silent as to the authority who is conferred with the power to conduct the departmental proceedings. For all practical purposes, the first respondent, i.e., the Chairman of the NDMC, acted as the President, as well as the disciplinary authority. There was not even a mention of rule 9 in the impugned order.

21. Apropos these observations and findings, Mr. Padma Kumar, learned Counsel for the respondents was in agreement with the submissions of Ms. Chatterjee, learned counsel for the petitioners that the discussion on Rule 9 (2) of the CCS (Pension) Rules was actually tangential to the issue in controversy, as show cause notices dated 30 May 2017 have been issued under Rule 9 (1) and not under Rule 9 (2) of the CCS (Pension) Rules.

22. On this aspect, learned counsels are, therefore, ad idem.

23. The submission is correct. The show cause notices were expressly issued under Rule 9 (1) of the CCS (Pension) Rules. Rule 9 (1) reserves right with the President to withhold pension or gratuity in whole or in part, if, in any departmental or judicial proceedings, the pensioner was found guilty of grave misconduct or negligence during the period of service.

24. Invocation of the issuance of the show cause notice to a retired government servant, proposing withholding of his pension and gratuity wholly or in part, following a finding, in judicial proceedings of grave misconduct having been committed by such government servant, is an exercise which was well within the power and province under Rule 9 (1).

25. The Chairperson of the NDMC was, therefore, exercising the powers conferred on the President under Rule 9 (1) of the CCS (Pension) Rules, and made applicable mutatis mutandis to the NDMC under the 2016 notification. There was, therefore, no exercise of jurisdiction by the Chairperson in terms of Rule 9 (2) of the CCS (Pension) Rules or, for that matter, Rule 5 (2) of the 2016 Regulations.

26. The Tribunal was, therefore, clearly in error in treating the show cause notice dated 30 May 2017 as being referrable to Rule 9 (2) of the CCS (Pension) Rules.

27. That said, however, we cannot rest our discussion here because the Tribunal has gone to the extent of holding that the President was not a competent disciplinary authority in terms of Rule 9 (2) (b) of the CCS (Pension) Rules. This finding, in our view, is completely unsustainable in law. The Tribunal has proceeded on the premise that Rule 9 (2) (b) envisages two distinct authorities, one being a sanctioning authority and the second being the disciplinary authority. According to the findings of the Tribunal, the President is only the sanctioning authority, and he is incompetent to act as the disciplinary authority. The Tribunal has, for this purpose, sought to contradistinguish clauses (i) and (iii) of Rule 9 (2) (b) of the CCS (Pension) Rules.

28. Ms. Chatterjee submits, in this context, and we agree with her that interpretation by the Tribunal on Rule 9 (2) (b) (iii) is fundamentally flawed. The Tribunal has treated Rule 9 (2) (b) (iii) as empowering the President to appoint another authority to function as disciplinary authority. This finding is incorrect and reflects a fundamentally erroneous understanding of Rule 9 (2) (b) (iii). Rule 9 envisages one, and only one, disciplinary authority, who is the President. Rule 9 (2) (b)

(iii) empowers the President to appoint an authority to conduct the disciplinary proceedings. This would be analogous to appointing an Inquiry Officer to inquire into the charges against the official concerned. It does not mean that the President is the sanctioning authority under Rule 9 (2) (b) (i) and that there is another authority who would act as disciplinary authority under Rule 9 (2) (b) (iii).

29. The Supreme Court has, in several decisions, including D.V. Kapoor v Union of India17 held that the President who is the competent disciplinary authority to take a decision to withhold or withdraw the pension in under Rule 9 of the CCS (Pension) Rules. For ready reference, paras 4, 5, 8, 9 and 10 of the decision in D.V. Kapoor may be reproduced thus: “4. At page 190-D (SCC p. 327, para 36) it is stated that pension as a retirement benefit is in consonance with and furtherance of the goals of the Constitution. The goals for which pension is paid themselves give a fillip and push to the policy of setting up a welfare State because by pension the socialist goal of security from cradle to grave is assured at least when it is most needed and least available, namely in the fall of life. Therefore, when a government employee is sought to be deprived of his pensionary right which he had earned while rendering services under the State, such a deprivation must be in accordance with law. Rule 9(1) of the Rules provides thus: “9.(1) The President reserves to himself the right of withholding or withdrawing a pension or part thereof, whether permanently or for a specified period, and of ordering recovery from a pension of the whole or part of any pecuniary loss caused to the government, if, in any departmental or judicial proceedings, the pensioner is found guilty of grave misconduct or negligence during the period of his service including service rendered upon reemployment after retirement:

Provided that the Union Public Service Commission shall be consulted before any final orders are passed: Provided further that where a part of pension is withheld or withdrawn, the amount of such pension shall not be reduced below the amount of rupees sixty per mensem.”

5. Therefore, it is clear that the President reserves to himself the right to withhold or withdraw the whole pension or a part thereof whether permanently or for specified period. The President also is empowered to order recovery from a pensioner of the whole or part of any pecuniary loss caused to the government, if in any proceeding in the departmental enquiry or judicial proceedings the pensioner is found guilty of grave misconduct or negligence during the period of his service including service rendered upon reemployment after retirement. *****

8. It is seen that the President has reserved to himself the right to withhold pension in whole or in part thereof whether permanently or for a specified period or he can recover from pension of the whole or part of any pecuniary loss caused by the government employee to the government subject to the minimum. The condition precedent is that in any departmental enquiry or the judicial proceedings, the pensioner is found guilty of grave misconduct or negligence during the period of his service of the original or on re-employment. The condition precedent thereto is that there should be a finding that the delinquent is guilty of grave misconduct or negligence in the discharge of public duty in office, as defined in Rule 8(5), Explanation (b) which is an inclusive definition, i.e. the scope is wide of the mark dependent on the facts and circumstances in a given case. Myriad situations may arise depending on the ingenuity with which misconduct or irregularity is committed. It is not necessary to further probe into the scope and meaning of the words ‘grave misconduct or negligence’ and under what circumstances the findings in this regard are held proved. It is suffice that charges in this case are that the appellant was guilty of wilful misconduct in not reporting to duty after his transfer from Indian High Commission at London to the office of External Affairs Ministry, Government of India, New Delhi. The Inquiry Officer found that though the appellant derelicted his duty to report to duty, it was not wilful for the reasons that he could not move due to his wife's illness and he recommended to sympathetically consider the case of the appellant and the President accepted this finding, but decided to withhold gratuity and payment of pension in consultation with the Union Public Service Commission.

9. As seen the exercise of the power by the President is hedged with a condition precedent that a finding should be recorded either in departmental enquiry or judicial proceedings that the pensioner committed grave misconduct or negligence in the discharge of his duty while in office, subject of the charge. In the absence of such a finding the President is without authority of law to impose penalty of withholding pension as a measure of punishment either in whole or in part permanently or for a specified period, or to order recovery of the pecuniary loss in whole or in part from the pension of the employee, subject to minimum of Rs 60.

10. Rule 9 of the Rules empowers the President only to withhold or withdraw pension permanently or for a specified period in whole or in part or to order recovery of pecuniary loss caused to the State in whole or in part subject to minimum. The employee's right to pension is a statutory right. The measure of deprivation therefore, must be correlative to or commensurate with the gravity of the grave misconduct or irregularity as it offends the right to assistance at the evening of his life as assured under Article 41 of the Constitution. The impugned order discloses that the President withheld on permanent basis the payment of gratuity in addition to pension. The right to gratuity is also a statutory right. The appellant was not charged with nor was given an opportunity that his gratuity would be withheld as a measure of punishment. No provision of law has been brought to our notice under which, the President is empowered to withhold gratuity as well, after his retirement as a measure of punishment. Therefore, the order to withhold the gratuity as a measure of penalty is obviously illegal and is devoid of jurisdiction.”

30. D.V. Kapoor, we may note, was subsequently followed by the Supreme Court in Nisha Priya Bhatia v UOI18.

31. We, therefore, are unable to sustain the findings of the Tribunal that the President was not competent to act as a disciplinary authority in Rule 9 (2) of the CCS (Pension) Rules.

32. Rule 9(2), however, as we have noted, never came for consideration in the present case and, therefore, the entire discussion on Rule 9(2) and the power of the President thereunder by the Tribunal in the impugned order was, as learned counsel mutually agree, tangential to the issues in hand and, in a sense, obiter. We, however, are constrained to hold that the findings of the Tribunal to the effect that the President was not competent to act as a disciplinary authority in a case which fell under Rule 9(2)(iii) of the CCS (Pension) Rules is unsustainable in law.

33. The Tribunal has further faulted the show cause notices issued to the Aggarwal and Thind on the ground that the cause of action for issuing the show cause notices arose at the time when they were convicted and that, therefore, the law which would apply in the matter of institution of disciplinary proceedings against them would be the law which applied at the time of their conviction. This somewhat surprising finding is reflected in para 33 of the impugned judgment, which reads thus:

34. If the above finding of the Tribunals were to be accepted, it would become impossible to proceed against any government servant after he has retired, in respect of misconduct committed prior to retirement. This would render Rule 9(2) of the CCS (Pension) Rules completely redundant and otiose.

35. There is no question of invoking the cause of action principle when it comes to issuance of a show cause notice under Rule 9(2). The competence of the authority to issue the show cause notice has to be determined on the date when the show cause notice is issued, and not on the date when the officer was convicted. The only condition that applies under Rule 9(2)(b) is to be found in clause (ii) thereof which proscribes the issuance of such a show cause notice with respect to an incident which took place more than four years prior thereof. If the Tribunal’s reasoning in para 33 is accepted, this provision would also be rendered otiose.

36. We, therefore, set aside the observation of the Tribunal in para 33 of the impugned judgment that the competence and authority to institute the disciplinary proceedings would be reckoned on the date of the conviction of the officer concerned. We clarify that the competence and the authority would have to be reckoned as on the date the show cause notice is issued, or the disciplinary proceedings are instituted, and not with respect to the date of conviction.

37. The Tribunal has also proceeded to set aside the 2016 notification. The impugned judgment, however, does not contain any independent reasoning as to why the 2016 notification was ultra vires or was otherwise unconstitutional. The only reasoning in the impugned judgment with respect to the power of the Chairperson of the NDMC to exercise jurisdiction in terms of Rule 9(2) of the CCS (Pension) Rules, as made applicable to the NDMC by the 2016 notification.

38. To our mind, there is absolutely no infirmity in the 2016 notification. It was always open to the NDMC to adopt the various rules applicable to government servants. This adoption has been made in legitimate exercise of the power conferred on the Chairperson of the NDMC. We cannot, therefore, approve the decision of the Tribunal to set aside the 2016 notification.

39. Resultantly, the impugned judgment of the Tribunal, being unsustainable on law, is quashed and set aside. This shall, however, not operate as a fetter any other ground being urged by the respondents with respect to the legality of the disciplinary proceedings which, we are informed, have culminated in the passing of the punishment order, to challenge which they have already been granted liberty by the Tribunal. The respondents shall be entitled to urge all other grounds save and except those which stand concluded by this judgment, in their challenge to the punishment awarded to them.

40. Subject to the aforesaid limited caveat, these writ petitions are allowed and the impugned judgment passed by the learned Tribunal is quashed and set aside.

41. There shall be no orders as to costs.

C. HARI SHANKAR, J.