Gratuity Can Be Withheld Until All Judicial Proceedings, Including Criminal Appeals, Conclude: Delhi High Court

Background Facts

The respondent was working as Tax Assistant in the Office of the Commissioner of Income Tax. The criminal proceedings were instituted against him while he was in service. The proceedings culminated in an order of conviction. The Special Judge, CBI passed sentence order dated 23 January 2012. The respondent superannuated on 31 December 2011. The respondent challenged the decision of the Special Judge by means of Criminal Appeal, which is still pending before the Delhi High Court.

In the Criminal Appeal, the High Court suspended the order of sentence of the respondent. The contention of the respondent was that the petitioner had illegally withheld the gratuity and leave encashment of the respondent.

The matter was referred to the Central Administrative Tribunal by filing of an Original Application. The Tribunal allowed the application by holding that no disciplinary proceedings had been instituted against the respondent, and more than four years have passed since the respondent superannuated. Therefore, no disciplinary proceedings could be instituted any further in view of the proscription contained in Rule 9(2)(b)3 of the Pension Rules, which prohibits initiation of disciplinary proceedings, against a retired Government servant, in respect of an event which took place more than four years prior to such initiation.

Aggrieved by the judgment of CAT, the Union of India filed a writ petition before High Court of Delhi.

It was argued by the petitioner that the Tribunal has not noticed the fact that Rule 69(1)(c) applies not merely in the case of pending departmental proceedings but also in the case of pending judicial proceedings.

It was further argued that the proceedings before the Special Judge had come to an end but the Criminal Appeal preferred by the respondent was still pending. Therefore, it was not possible to release the gratuity of the respondent due to Rule 69(1)(c) of the Pension Rules.

On the other hand, it was submitted by the respondent that the criminal proceedings have come to an end with the passing of the judgment by the Special Judge.

Findings and Observations of the Court

It was observed by the Division Bench that it is clear from Rule 69(1)(c) of the Pension Rules that the proscription against release of gratuity to an employee, who is facing judicial proceedings would continue till the judicial proceedings come to an end. The expression “judicial proceedings” would also include Criminal Appeal filed by the respondent, which continues to remain pending.

It was held by the Division Bench that the Tribunal had erred in restricting its consideration to the fact that no disciplinary proceedings have been initiated against the respondent, ignoring the fact that the judicial proceedings continued to remain pending against him.

It was further held by the court that there is no error in the decision of the petitioner to withhold the respondent's gratuity so long as the judicial proceedings in the form of Criminal Appeal continue to remain pending. It was held that once the criminal appeal is disposed of one way or the other, the respondent's claim for gratuity would revive.

With the aforesaid observations, the judgment of the Tribunal was quashed and set aside by the Division Bench. Consequently, the writ petition filed by the Union of India was allowed by the Division Bench.

Case Name : Union of India & Ors. v. Sh. Jamuna Dass

Case No. : W.P.(C) 2936/2021

Counsel for the Petitioners : Jagdish Chandra, CGSC with Lakshay Kumar and Maanya Saxena, Advs

Counsel for the Respondent : Prem Chand and Chander Bhan, Adv