Calcutta High Court Upholds Misconduct Finding Against SAIL Employee For Encroaching On Company Land
The Calcutta High Court has upheld disciplinary proceedings initiated against a Steel Authority of India Limited (SAIL) employee for unauthorized use and encroachment of company land, while partly granting relief by setting aside the punishment insofar as it imposed reduction of pay “with cumulative effect”.A Division Bench comprising Justice Sujoy Paul and Justice Partha Sarathi Sen...
The Calcutta High Court has upheld disciplinary proceedings initiated against a Steel Authority of India Limited (SAIL) employee for unauthorized use and encroachment of company land, while partly granting relief by setting aside the punishment insofar as it imposed reduction of pay “with cumulative effect”.
A Division Bench comprising Justice Sujoy Paul and Justice Partha Sarathi Sen held that the employee's act of constructing a brick wall structure and fencing over SAIL land amounted to “misconduct” under the company's standing orders.
However, the Court ruled that the disciplinary authority could not impose a punishment not specifically contemplated under the governing rules.
The Court observed: “It would be highly unjust to impose penalty by a disciplinary authority against a delinquent which is not provided either in the statute or in the rules dealing with punishment as a result of misconduct proved in a disciplinary proceeding.”
The petitioner, Debnath Swarnakar, had challenged an order of the Central Administrative Tribunal refusing to interfere with disciplinary action taken against him by SAIL authorities.
According to the record, Swarnakar and his wife were granted lease of two SAIL quarters in 2003. During 2010–11, SAIL authorities found that he had allegedly raised fencing and a brick wall by encroaching upon company land measuring around 4620 sq. ft. Despite repeated notices and requests to remove the encroachment, the structures were not removed, leading to initiation of disciplinary proceedings.
An enquiry officer found the charge of “unauthorized use of company's land” proved. Consequently, the disciplinary authority imposed punishment of reduction of basic pay by one stage with cumulative effect. The departmental appeal and review were also rejected.
Before the High Court, the petitioner argued that under SAIL's lease scheme, appurtenant land beyond 1.5 times the plinth area could be used for horticultural purposes. It was also argued that any alleged violation of lease conditions was contractual in nature and could only be addressed under the Public Premises (Eviction of Unauthorised Occupants) Act, 1971, and not through disciplinary proceedings.
Reliance was placed on the Bombay High Court judgment in Nandita B. Palekar v. Y.S. Kasbekar to contend that breach of contractual conditions cannot automatically amount to misconduct.
Rejecting the contention, the Bench noted that Clause 29(xix) of SAIL's standing orders expressly treated “unauthorised use of company's quarters or lands” as misconduct.
The Court found that sufficient materials existed to show that the petitioner had raised fencing and construction beyond permissible limits and had effectively admitted the same in replies submitted to the authorities.
The Bench held: “The alleged action of the delinquent very much comes under the purview of act of misconduct.”
At the same time, the Court examined whether the punishment imposed was legally sustainable. It noted that Clause 30 of the standing orders provided for “stoppage of increment” as a major penalty but did not specifically authorize reduction of pay with cumulative effect.
Relying on decisions of the Supreme Court in Vijay Singh v. State of U.P. and Punjab State Electricity Board v. Raj Kumar Goel, the Court held that a punishment not prescribed under the rules could not be imposed by a disciplinary authority.
The Bench observed that reduction of pay with cumulative effect has permanent adverse financial consequences and amounted to a harsher punishment than what was contemplated under the standing orders.
Accordingly, while upholding the finding of misconduct and reduction of pay by one stage, the Court quashed the portion of the punishment imposing the reduction “with cumulative effect”.
Since the employee had already retired, the Court directed SAIL authorities to release arrears of pay and retiral dues within 180 working days along with 3% simple interest from the date of superannuation till actual payment.
Case Title: Debnath Swarnakar v. The Steel Authority of India & Ors
Case No: WP.CT 20 OF 2022