BHARAT SANCHAR NIGAM LTD. v. MANILAL AMBALAL PATEL

1. This appeal by special leave is directed against the judgment of the High Court in Special Civil Application filed under Articles 226 and 227 of the Constitution of India by the appellants wherein appellants challenged the order dated 29.10.2013 passed by the Central Administrative Tribunal (hereinafter referred to as the "Tribunal"). The Tribunal by the impugned order quashed order dated 12.03.2013 and directed the appellants to pay interest at the rate applicable to the Provident Fund deposits 2019 INSC 337 for the delay occurred in payment of DCRG and Commuted Value of Pension (hereinafter referred to as the "CVP") from 01.08.2008 till the date of payment.

2. The first respondent (hereinafter referred to as the "applicant"), who filed the application before the Tribunal was granted provisional pension by proceeding dated 04.08.2008. It reads as follows:- “Sub: Retirement on superannuation of 31.7.2008 A/N- Cases of officers of STS of Executive Grade (Ad-hoc) Regarding. In accordance with BSNL New Delhi order No. 35/1/2007 Pers-1 date 3.7.2008 and on approval of the competent authority, the following officers of STS of Executive Grade) adhoc permanently abscribed in BSNL are permitted to retire from BSNL services on attaining the age of superannuation w.e.f. 31.7.2007 (A/N).

┌───────────────────────────────────────────────────────────────────────────┐
│      superannuation w.e.f. 31.7.2007 (A/N).                               │
│         Sl. Name of Officer        Staff  No./ERP Present                 │
│         No.                        No.            working                 │
│                                                   unit                    │
├───────────────────────────────────────────────────────────────────────────┤
│         1.   Sh. J.R. Sathwara, DE 10913/7005735  PGMTD                   │
│                                                   Ahmedabad               │
│         2.   Sh. B.P. Mishra, DE   12277/7021009  PGMTD                   │
│                                                   Vadodara                │
│         3.   Sh. P.P. Panchal, DE 11560/7016759   PGMTD                   │
│                                                   Vadodara                │
│         4.   Sh.N.N. Chaniyara, DE 13808/7025957  GMTD     –              │
│                                                   Rajkot                  │
│         5.   Sh. M.A. Patel, DE    11719/7021051  PGMTD                   │
│                                                   Surat                   │
│      2. The BSNL C.O. ND has intimated that the vigilance                 │
│      clearance in respect of Shri M.A. Paatel, (SL. No. 5)                │
│      DE, O/o PGMTD Surat has not received from Vigilance                  │
│      Cell of BSNL and therefore the officer shall be given                │
│      only provisional pension and the DCRG and CVP shall                  │
│      be withheld till the conclusion of the vigilance/                    │
│      disciplinary case as per CCS (Pension) rules 1972.                   │
│      3. It may please be ensured that there is no Vig/                    │
│      Disc case pending or contemplated against any of the                 │
│      above officer mentioned above as on the date of                      │
│      retirement. If any such case comes to notice, only                   │
│      provisional pension shall be granted to the officer                  │
│      (s) and his DCRG and CVP shall be withheld till the                  │
│      Vigilance clearance is accorded.                                     │
│      4. Copy of the charge relinquishing report may be                    │
│      sent to this office in respect of all concerned.”                    │
│ Though,    the    Anti-Corruption          Bureau        (hereinafter     │
│ referred   to    as   the     "ACB")     had   registered     a    case   │
│ against    the   applicant,      the     investigating       officer,     │
│ however,    had       found    no       evidence    against        him.   │
└───────────────────────────────────────────────────────────────────────────┘

38. The question, however, arises whether as has been found by both, the Tribunal and the High Court, this should be treated as a case where the applicant should be granted interest from the date of his retirement on account of the fact that on the date of his retirement there was neither the departmental proceeding nor a judicial proceeding.

39. As far as the argument of the learned ASG that there was a departmental proceeding pending by virtue of the fact that an order of suspension was passed within the meaning of Rule 9(6), which we have already referred to, we are of the view that there is no merit in the said contention. While the applicant was placed under suspension, in the year 1997, it is equally indisputable that the said suspension was revoked in the year 1999 well before the date of superannuation of the applicant. It is not the law that to constitute a departmental proceeding that a Government servant has been placed under suspension at some point of time of his career. What is contemplated is that there must be a suspension when the applicant would have otherwise retired on superannuation. In this case the suspension stood revoked several years prior to his date of superannuation. Therefore, the suspension which was subsequently revoked cannot constitute suspension within the meaning of Rule 9(6)(b) of the Pension Rules and we have no hesitation in repelling the argument of learned ASG.

40. A case under the Prevention of Corruption Act was lodged against the applicant. However, the ACB, in the course of investigation apparently was not able to muster enough material to prosecute the case. This resulted in the agency filing what is described as Asummary. The A-summary came to be dealt with in the following manner by the Sessions Judge: "Heard. Accused is traceable. There is no question of granting "A" Summary. it is nobody's case that accused is absconding. If at all, I.O. fact that evidence is not sufficient to prosecute the accused. He may apply under Section 169 of Cr.P.C. Hence rejected as it is not tenable at law."

41. This order was passed prior to the date of superannuation of the applicant. It is, therefore, that Criminal Revision Application No.52 of 2007 came to be filed before the High Court of Gujarat. By order dated 30.03.2012, the revision came to be allowed. It is noticed that the applicant opposed the revision. The A-summary was to be given in a case where the case is found to be true but the accused is absconding. Further, if the evidence against the accused is not sufficient to prosecute the accused, also A-summary could be given. The High Court took the view as follows: "The report made to the Court below by the investigating officer was, therefore, made under Section 173 of the Code and the Court was required to pass an order under Section 173(4) of the Code, which the Special Court has failed to do. The order passed by the learned Principal District and Sessions Judge, Banaskantha at Palanpur, dated 03.05.2006 is, therefore, set aside. The prayer sought by the investigating officer for Summary "A" is allowed. Accordingly, present revision application is allowed. Rule is made absolute to the aforesaid extent. Muddamal currency note be confiscated to the State."

42. It is true that well before his retirement the agency which had no doubt conducted a trap against the applicant, had itself found that there was no material in view of subsequent developments. It could be said that this is a case where the applicant was exonerated by the agency well before the date of his retirement. No doubt this is not a case where the applicant has been acquitted honourably after trial. In fact, there was never a trial and the case was not sent up for trial in view of the submission of A-summary.

43. The other question also must be considered and that question is whether there was a judicial proceeding pending at the time of the retirement. A perusal of Rule 9 of the Pension Rules would show that Government had a right to withhold the pension or gratuity or both either in full or in part or withdraw a pension in full or in part either permanently or for the specified period. Government is also authorized to order recovery from pension or gratuity of the whole or in part of any pecuniary loss caused, if in any departmental or judicial proceeding, the pensioner is found guilty of grave misconduct or negligence during the period of his service which includes service after reemployment. Thereafter, sub-rule 9(6) deals with what constitutes when a departmental or a judicial proceeding will be deemed to commence. Judicial proceedings are divided into two categories. First category is a criminal proceeding. Second category is civil proceeding. As far as civil proceeding is concerned, it is deemed to be instituted when a plaint is presented. In other words, upon presentation of a plaint in a civil case judicial proceeding commences. In the case of a criminal proceeding by the deeming provision, it is deemed to have been instituted for the purpose of Rule 9 when the complaint or report of a police officer is made, but that is not sufficient. In a case where a complaint or a report of a police officer is made to a Court, it should culminate in cognizance being taken by the Magistrate, for the department to contend that the date of the complaint or report is to be the date of institution of the proceedings.

44. From the order of the Sessions Judge which alone is produced, it is not clear that cognizance was taken. The criminal revision is a criminal proceeding. But the case was about the ‘A’ diary not being accepted. If the criminal revision was dismissed then the matter would have been proceeded with by the Sessions Judge. It is in the region of conjecture as to what would have followed suit. At the time of the retirement, the authorities could not have divined what would happen in the revision. No doubt, the purport of the revision petition was that the State wanted the ‘A’ Summary to be accepted. The acceptance of ‘A’ Summary which, in fact, was ordered by the High Court would have brought the litigation as against the applicant to an end. In so far as, we later propose to render our finding on the effect of no application being filed under Rule 13(3) and also keeping in mind that the applicant did not take steps to challenge the order dated 04.08.2008, we would think that much may not turn on our even accepting the view of the High Court, that there was no criminal proceeding as on the date of the retirement. It also must be noted that the present is not a case where the authorities acted without any material at all even. We proceed on the basis that the criminal revision petition is not criminal proceeding under Rule (9) of the Pension Rules. A view was taken by the authorities regarding the same at the point of time which could not be said to have been taken without any basis at all. This, we say as the basis for interest on CVP can only be state action which is arbitrary. It is relevant to note that both sides proceeded on the basis that there was a proceeding within the meaning of Rule 9 and 69 of the Pension Rules. Further, even at the time when the order dated 04.08.2008 was passed it was open to the applicant to complain that there was no judicial proceeding, having regard to the nature of the proceeding pending in the High Court. The applicant instead chose not to question the sanctioning of provisional pension under Rule 69 and continued to receive the provisional pension. We will notice the consequences of the said order on his right to apply under Rule 13(1).

45. We have noticed that a claim for interest in regard to CVP may lie when an application has been made in time under rule 13(3) and the payment is delayed. But in a case where application is made under Rule 13(1) which can be made within a period of one year from the date of retirement, the same would have to be processed and undoubtedly at the earliest it must be brought to its logical culmination as per the rules. But certainly, in a case falling under Rule 13(1) there can be no question of paying interest from the date of retirement as the application itself is predicated after the date of retirement. No doubt the question as to payment of interest even in such cases would arise based on the date of application and the reasonableness of the time taken in processing it and the arbitrariness in a particular case in delaying the matter. This we say for the reason that as held in by this Court in S.K. Dua (supra) the premise on which interest can be granted in the case of CVP also is the breach of Articles 14 and 21 and it is a matter to be decided on the facts of each case.

46. It is significant to note that in this case the applicant has no case even that he made an application within the meaning of Rule 13(3) of the Commutation Rules as contemplated before three months of his retirement. Nothing stood in the way of the applicant applying under Rule 13(3) apparently. If on the other hand, there was any legal impediment which stood in the way, then also he cannot claim the CVP on retirement. Without having made such an application under the Commutation Rules, it is clear that there can be no question of even becoming entitled to commute pension w.e.f. first day following his retirement. The Tribunal and the High Court have completely overlooked the conspectus of the Rules. The Tribunal, in fact, has proceeded to consider the matter from the standpoint of interest payable on gratuity which also was claimed by the applicant and has not focused on the question relating to the point of time when CVP becomes payable, and that the nature of CVP being one dependent entirely on an application from the Government servant and therefore we have no hesitation in coming to the conclusion that the direction to pay interest on the CVP, as ordered by the Tribunal, from the date of retirement from 01.08.2008 is clearly erroneous. Now, as far as Rule 13(1) is concerned, it enables a person who is in receipt of a pension under Rule 12, to apply after retirement but within one year thereof for CVP. It is true that the applicant was not in receipt of any pension under Rule 12 and therefore, he could not have applied under Rule 13(1). This is for the reason that as per order dated 04.08.2008, he was to be given provisional pension which as we have noted was under Rule 69 of the Pension Rules. The applicant, however, proceeded to accept the provisional pension. It is true that the effect of the order dated 04.08.2008 of the sanctioning of the provisional pension under Rule 69, was that he was precluded from applying for commuting the provisional pension, in view of Rule 4 and on the other hand, as he was not in receipt of superannuation pension, he could not have filed an application under Rule 13(1). Thus, a question may arise. Having issued order dated 04.08.2008, the effect of which we have clarified, should interest be ordered on the basis that the applicant was prevented from applying for CVP under Rule 13(1). We have already found that the applicant was not precluded from making any application under Rule 13(3). Had he done so, his claim for interest from the date of retirement could have been considered under Articles 14 and 21. We also take note of the fact that the applicant did not challenge the order dated 04.08.2008 and he continued to accept the provisional pension sanctioned thereunder. There could be no question of granting interest from the date of retirement in view of the absence of any application under Rule 13(3). We make it clear that we are not pronouncing about the liability to interest on DCRG amount which is not subject matter of controversy before us and the direction to pay interest on gratuity is not being interfered with.

47. In the light of this, we are of the view, the appeal is to be allowed as above. We do so. The impugned order will stand set-aside and the order of the Tribunal directing payment of interest on CVP shall stand set-aside. No order as to costs ....................... J. (ASHOK BHUSHAN) ...................... J. (K.M. JOSEPH) New Delhi, March 8, 2019.