Doctrine Of Estoppel Can Be Viewed As Substantive Rule Of Law Since It Helps Create Or Deny Rights Which Would Not Exist Without It: J&K High Court

A bench of Justice MA Chowdhary observed,

“Estoppel though a branch of the law of evidence is also capable of being viewed as a substantive rule of law in so far as it helps to create or defeat rights, which would not exist or be taken away but for that doctrine. Of course, an estoppel cannot have the effect of conferring upon a person a legal status expressly denied to him by a statute. But where such is not the case a right may be claimed as having come into existence on the basis of estoppel and it is capable of being enforced or defended as against the person precluded from denying it.”

Background:

The case involved a conductor with the J&K State Road Transport Corporation (JKSRTC) who was included in a list of employees eligible for the 'Golden Handshake Scheme', a voluntary retirement program introduced by the government. He submitted his consent to the scheme, but the Corporation later terminated his services citing unauthorized absence since 2005.

The conductor challenged the termination, arguing that the Corporation was estopped from taking disciplinary action after including him in the retirement scheme. He claimed that accepting his consent amounted to an acknowledgment of his eligibility and a waiver of any prior misconduct.

The JKSRTC countered that the conductor's inclusion in the list was inadvertent due to a pending disciplinary inquiry. They argued that his unauthorized absence disqualified him from the scheme and justified his termination.

Court's Observations:

Justice Chowdhary delved into the concept of estoppel and explained that estoppel, which forms part of the law of evidence is also capable of being viewed as a substantive rule of law in so far as it helps to create or defeat rights, which would not exist or be taken away but for that doctrine.

The bench said that once the Corporation accepted the conductor's consent, they could not deny him the benefits of the scheme based on pre-existing charges.

Observing that the respondent Corporation had taken a conscious decision that the petitioner was entitled to voluntary retirement/Golden Handshake Scheme the court stated,

“The respondent Corporation cannot be allowed by the application of the principle of estoppel to say that the services of the petitioner after acceptance of his retirement in terms of the Scheme could be terminated on some enquiry to which the petitioner had not been associated”.

Highlighting that the disciplinary proceedings against the petitioner had been left pending for two years without any progress, Justice Chowdhary raised doubts about the Corporation's bona fides and said that it was attempting to defeat his claim of receiving retiral benefits based on the Scheme.

In light of these observations, the court quashed the termination order and directed the JKSRTC to grant the conductor all retirement benefits under the Golden Handshake Scheme.

Case Title: Jaswant Singh Vs J&K State Road Transport Corporation,

Citation: 2024 LiveLaw (JKL) 24

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