After Superannuation, Only Government & Not Subordinate Authority Competent To Impose Penalty, As Per Rules : Orissa HC

Background Facts

The employee (appellant) was working as a Senior Clerk in the Office of the Accountant General, Odisha (A & E). He was placed under suspension by the District Education Officer. A departmental proceeding was initiated against him. It was alleged that he committed financial irregularities in the Office of the D.I. of Schools. However, later he was reinstated in service.

The departmental proceeding remained pending. He retired on superannuation. After his retirement, an Enquiring Officer was appointed to continue the proceeding. The enquiry report was submitted. The employee's pensionary benefits were withheld due to the pending proceeding. He approached the High Court for quashing of the proceeding. The Single Judge directed finalization of the proceeding within specified time.

However, the District Education Officer passed an order imposing penalty of recovery of Rs. 3,92,561 from employee's pensionary benefits. Aggrieved by the said order, he filed a writ petition before the High Court. The Single Judge declined to entertain the writ petition.

Aggrieved by the same, he filed the intra-Court appeal before the Division Bench.

It was argued by the employee that after his retirement, the disciplinary authority has no right to pass the final order of penalty under the Orissa Civil Services (CC & A) Rules, 1962. It was submitted that in view of Rule 7 of the Orissa Civil Services (Pension) Rules, 1992, the State Government reserves the right to order recovery of any pecuniary loss caused to the Government.

It was further contended that if a departmental proceeding is instituted while the government servant was in service, then after retirement it is deemed to be a proceeding under the Pension Rules. The employee further argued that as per Rule 7(2)(a) of the Pension Rules, when the departmental proceeding is initiated by an authority subordinate to the Government, that authority must submit a report recording its findings to the Government.

On the other hand, it was argued by the respondents that the penalty order passed by the District Education Officer was an appealable order, and the appellate authority was competent to examine all issues including jurisdiction and the applicability of the Pension Rules.

Findings of the Court

It was noted by the Court that the departmental proceeding was initiated against the employee when he was in service. It was observed that after his retirement, the proceeding continued and the enquiry report was submitted.

It was observed that Rule 7(2)(a) of the Orissa Civil Services (Pension) Rules, 1992 states that when departmental proceedings are instituted by an authority subordinate to the Government, that authority shall submit a report recording its findings to the Government, and the Government is the final authority to pass the order of penalty.

It was held by the Division Bench that the penalty order was contrary to the mandate of Rule 7(2)(a) of the Pension Rules. It was noted that the Single Judge had erred in holding that employee should avail the appellate remedy under the disciplinary rules. It was further observed by the Court that the District Education Officer was a subordinate authority. Therefore, he had no jurisdiction to pass the final penalty order after the employee's retirement.

It was held that after superannuation, only the Government is authorised under the rules to pass the order of penalty in a departmental proceeding even initiated prior to the retirement. Consequently, the single judge's order was set aside by the Division Bench.

Further, the respondents were directed to place the enquiry report before the State Government for appropriate action in accordance with the Pension Rules. Further, the penalty order being illegal was set aside by the Division Bench.

With the aforesaid observations, the writ appeal filed by the employee was allowed by the Division Bench.

Case Name: Somanath Rout (dead) v. State of Orissa & Others

Case No. : W.A. No.652 of 2021

Counsel for the Appellants : Laxmikanta Mohanty, Advocate

Counsel for the Respondents : Jayanta Kumar Bal, Additional Government Advocate