Jagdish Prasad Saxena vs State Of Madhya Bharat

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Appeal (civil) 348 of 1958

Decision Date: 28 October 1960

Coram: P.B. Gajendragadkar, A.K. Sarkar, K. SUBBARAO, K.N. Wanchoo, J.R. Mudholkar

In this case the Court recorded that the appeal, designated as Appeal (civil) 348 of 1958, was brought before a bench consisting of P B Gajendragadkar, A K Sarkar, K N Wanchoo, K Subbarao and J R Mudholkar and that the judgment was delivered on 28 October 1960. The parties before the Court were the petitioner, Jagdish Prasad Saxena, and the respondent, the State of Madhya Bharat. The appeal was instituted by special leave after the petitioner had filed a petition in the High Court of Madhya Bharat seeking the issuance of a writ of certiorari, mandamus or any other appropriate writ or direction to set aside an order dated 3 December 1953 which terminated his services as of 2 October 1951, the date on which he had been suspended. The petitioner testified that a chargesheet relating to the proceedings against him had been served on 17 October 1951, but it was acknowledged by both parties that no fresh enquiry had been held after the service of that chargesheet prior to the impugned termination order. The High Court had held that an enquiry had been conducted before the chargesheet was served, during which the petitioner had substantially admitted the material facts upon which the chargesheet was based, and therefore the absence of a formal enquiry after the chargesheet did not prejudice him. Consequently the High Court refused the writ that the petitioner sought and dismissed his petition. By way of the present appeal, the petitioner challenged both the correctness and the propriety of the High Court’s decision. The factual background disclosed that the petitioner was a permanent employee of the Department of Customs and Excise, appointed as a distillery inspector, and at the relevant time he was posted at Barwaha in the district of Khargone. It was admitted that his service was governed by the rules and regulations of the State Civil Service. The Barwaha establishment comprised a distillery and a separate warehouse building located on the same premises. The warehouse clerk, identified as Kethulekar, was in charge of the warehouse, while the distiller was identified as Narona. On 12 July 1951, at approximately five in the evening, when the petitioner was about to leave the distillery, Narona requested the key of the receiver for the purpose of taking a flow reading; the petitioner handed over the key and instructed Kethulekar to supervise the distillation. It was later found that Kethulekar, who was on duty, issued liquor to Nathu, a contractor from Piplia, who possessed a permit authorising him to receive one gallon of Narangi (strength 25 U P), twenty gallons of Rasi (strength 60 U P) and two gallons of Dubara (strength 25 U P). The contractor had deposited Rs 180‑6‑0 in the treasury in respect of that permit. At the time of the alleged illegal issue, the contractor was, in fact, supplied with one gallon of Narangi and thirty‑two gallons of Dubara, thereby providing an excess of thirty gallons of Dubara and causing a loss of Rs 305‑10‑0 to the Government.

The contractor received one gallon of Narangi and thirty‑two gallons of Dubara, although his permit authorized only one gallon of Narangi, twenty gallons of Rasi and two gallons of Dubara. Thus an excess of thirty gallons of Dubara was illegally issued, causing a loss to the Government amounting to Rs. 305‑10‑0. According to the appellant, Kethulekar, in concert with Narona, transferred liquor from the receiver to the warehouse vat to conceal the deficiency created by the illegal issue. An informer reported the matter to the Superintendent of Customs and Excise, who promptly went to the premises and seized the entire stock of liquor from the contractor Nathu. On 13 July 1951 the Superintendent, together with the appellant, conducted a preliminary enquiry in which all three individuals admitted their guilt. The Superintendent subsequently recovered Rs. 305‑6‑0 from Kethulekar as compensation for the loss caused by the illegal delivery of thirty gallons of Dubara, and Kethulekar was suspended effective 17 July 1951. Following the superintendent’s direction, the appellant submitted a detailed report describing the incident. Five days later, the Deputy Commissioner of Customs and Excise held a second enquiry together with the Superintendent. During this enquiry Kethulekar and Narona implicated the appellant, alleging his participation in the illegal transaction. The appellant also gave a statement at this enquiry, although no formal chargesheet had yet been served upon him. The Superintendent filed his report on the same day, 21 July 1951, concluding his findings. The Deputy Commissioner also issued his report on 21 July, exonerating the appellant of any complicity but finding him guilty of negligence in supervision and control. Consequently, the Deputy Commissioner recommended that the appellant be transferred to another posting and that his grade increment be withheld for six months.

Accordingly, the appellant was transferred to Indore on 6 September 1951. On 1 October 1951 the Deputy Commissioner suspended the appellant effective 2 October 1951, acting on instructions from the Secretary, Finance, Department of Excise and Customs. The appellant was also required to appear at Barwaha on 8 October 1951. On 8‑9 October 1951 the Deputy Commissioner reopened an enquiry against the appellant after receiving three complaints lodged by Kethulekar. In this renewed enquiry the appellant filed a written statement on 16 October 1951, although he had not been provided copies of the earlier enquiry reports. The Deputy Commissioner served the appellant with a chargesheet on 17 October 1951, charging him with participation in the illegal issue of liquor. On 21 October 1951 the Deputy Commissioner submitted his report, again finding the appellant not complicit in the offence. More than a year later, on 25 November 1952 the appellant received a show‑cause notice demanding a response within fifteen days as to why he should not be removed from service. The appellant requested on 8 December 1952 permission to inspect the records so that he could prepare an adequate reply, but his application was ignored. He replied to the show‑cause notice on 11 December 1952 and asked for a personal hearing, a request that was rejected. Finally, on 3 December 1953 an order was issued terminating his employment effective from 2 October 1951, the date of his suspension. The appellant challenged the validity of this dismissal, asserting that no proper enquiry had been held and that he had been denied a reasonable opportunity to meet the charge.

On 25 November 1952 the Under Secretary of the respondent issued a notice to the appellant demanding that he show cause why he should not be removed from service as a penalty for the offence of allowing an illegal transfer of liquor to a contractor while he was present. The notice stated that the illegal issue of liquor to contractor Nathu and the manipulation of stock by transferring liquor unlawfully from the distillery had been fully established. The appellant, who was in charge of the distillery, therefore faced a single charge that he had been present at the time of the illegal transfer. On 8 December 1952 the appellant wrote to the Under Secretary requesting permission to inspect the records so that he could prepare a proper and adequate reply to the notice; this request was disregarded. Nevertheless, on 11 December 1952 the appellant filed a reply to the show‑cause notice and also asked for a personal hearing. The request for a hearing was refused. Subsequently, on 3 December 1953 an order was issued terminating the appellant’s services, effective from 2 October 1951, the date on which he had been suspended. The appellant challenged this order, arguing that no formal enquiry had been held and that he had therefore been denied a reasonable opportunity to meet the charge. The High Court rejected this contention. The principal issue that now required determination was whether the High Court was correct in holding that, in substance, the appellant had been given a reasonable opportunity to meet the charge under Article 311(2) of the Constitution.

The chargesheet served on the appellant on 17 October 1951 set out several detailed accusations. First, it alleged that the appellant was present when liquor was illegally handed over to the contractor and that he had conspired with Kethulekar in the illegal act. Second, the chargesheet claimed that after the offence was committed the appellant fraudulently inserted entries in the official note‑books that he was required to keep in the performance of his duties; the nature of these interpolations was described in the chargesheet. Third, it asserted that after liquor had been seized from the contractor, the appellant’s co‑conspirators visited him at 7 a.m. on 13 July 1951 to seek his advice. Although the chargesheet contained additional details, the judgment noted that it was unnecessary to repeat them. Upon receipt of the chargesheet, the appellant was required to submit his explanation on the same day. Consequently, the appellant’s later reply to the show‑cause notice and his request for a hearing were made in the context of these specific allegations, all of which formed the basis for the subsequent order of dismissal.

In the notice issued on 25 November 1952, the respondent asserted that the appellant had been present when liquor was illegally transferred, and therefore, that he had committed a serious offence. The notice therefore charged the appellant solely with being present at the time of the illegal transfer and required him to submit a reply within fifteen days. The appellant wrote to the Under Secretary on 8 December 1952, explaining that the case had become more than a year old and that he could not prepare an adequate reply without first inspecting the file containing all the relevant enquiry papers. The appellant’s request for access to the file was apparently not acted upon, and consequently he relied on his memory and filed a detailed reply on 11 December 1952. After this submission, little appears to have occurred for almost a year. On 25 November 1953, the Finance Minister, to whom the papers had presumably been forwarded for a decision, concluded that the appellant had participated in the offence and ordered his removal from service effective from the date of his suspension. The minister’s order was based on three points: first, that the appellant had handed the key of the distillery to the distiller named Narona; second, that after liquor had been seized from the contractor Kethulekar, the contractor had visited the appellant the next morning to seek his advice; and third, that entries in the relevant books had been tampered with. The minister found the appellant’s written explanation on these matters unsatisfactory.

Following the minister’s decision, the Under Secretary informed the appellant on 3 December 1953 that the respondent had decided to remove him from service from the date of his suspension. The appellant then applied to the respondent for a review of that order, but on 1 December 1954 his application was rejected on the ground that there was no reason to revise, modify or amend the decision taken on 25 November 1953. The record showed that the appellant had expressly admitted, during the earlier enquiry, that illegal liquor had been delivered to the contractor and that he had given the key of the receiver to Narona. The High Court considered these admissions to be substantial, concluding that the appellant had effectively admitted his guilt, and therefore a formal enquiry was not required after the chargesheet was served on him. It is important to note that the earlier enquiry had not been directed against the appellant as an accused; he was not placed in the position of a defendant in that proceeding. Consequently, the High Court’s view was that the appellant’s admissions, while significant, did not by themselves justify his removal without a proper formal enquiry as mandated by the governing rules.

The enquiry concluded that the appellant was cleared of any participation in the offence and that the sole criticism directed at him concerned his lax supervision, which was the reason given for his transfer. Even if the appellant had made statements that could be interpreted as admissions, it remained doubtful whether his removal from service could be justified solely on the basis of those alleged admissions without conducting a formal enquiry as mandated by the applicable rules. Moreover, if the appellant’s statements did not constitute a clear and unambiguous confession of guilt, the failure to hold a formal enquiry would represent a serious defect in the dismissal order. Article 311(2) provided that the appellant was entitled to a reasonable opportunity to meet the charge framed against him, yet, before the show‑cause notice was issued, he had received no such opportunity. After the chargesheet was served, the appellant was not afforded a chance to cross‑examine Kethulekar or any other witnesses, nor was he supplied with a copy of the report prepared by the enquiry officers. Consequently, he could not present his explanation in response to the points raised against him. It appears that an inference drawn from the evidence recorded in the earlier enquiries, which had resulted in Kethulekar’s suspension, was used to justify serving a show‑cause notice on the appellant. In the Court’s view, the appellant was right to contend that, under the circumstances, he had been denied any opportunity to show cause, thereby breaching the requirement of Article 311(2).

The two facts that the appellant admitted did not inevitably lead to a finding of his guilt for the offence with which he was charged; when his statements are examined as a whole, they do not amount to an admission of guilt. The principal allegation against him was that he was present when liquor was transferred to the contractor, yet his presence could not be reasonably inferred from the facts he had admitted. Regarding the delivery of the key to Narona, no rule was produced that expressly prohibited such delivery even in an emergency. The superintendent’s report dated 13 July 1951 indicated that a prudent officer would have refrained from giving the key to Narona. The appellant was subsequently instructed that, in the future, the key should be handed only to reliable persons when needed. This admonishment demonstrated that, in cases of necessity, the appellant was permitted to give the key to a trustworthy individual, and therefore no rule absolutely barred the delivery of the key.

There was no rule that prohibited handing the key to any person even when an emergency arose. Consequently, the appellant’s admission that he gave the key to Narona could not be taken as proof that he was collaborating with either Narona or Kethulekar. The order issued by the Minister revealed that the Minister had considered two matters: the alleged interpolations in the books maintained by the appellant and the observation that Kethulekar and the contractor had seen the appellant the following morning. Regarding these two matters, it became clear that the appellant had not been afforded any chance to cross‑examine Kethulekar and the contractor or to demonstrate that their testimony was false, nor had he been allowed to support his explanation concerning the supposed interpolations in the books. The Minister might have concluded that these facts suggested the appellant’s presence at the warehouse at the time of the offence, but the Court emphasized that when disciplinary action is contemplated against a public servant, a proper departmental enquiry must be conducted after the servant receives a chargesheet, and the servant must be given a reasonable opportunity to meet the allegations contained therein. In the present case, only preliminary, general‑type enquiries had been held, and they culminated in findings Kethulekar. Those reports did not establish the appellant’s guilt of the offence that led to his dismissal. Moreover, the delay in furnishing the appellant with the chargesheet and in communicating the final dismissal order indicated that the authorities did not regard speed as essential, and therefore there was no justification for failing to hold a formal and proper enquiry after the chargesheet dated 17 October 1951 was served. The Court held that the High Court erred in concluding that no prejudice was caused to the appellant by the respondent’s failure to hold such an enquiry after the chargesheet had been supplied. A departmental enquiry is not a mere formality; it is a serious proceeding intended to give the officer a chance to confront the charge and prove innocence. In the absence of such an enquiry, it would be unfair to strain facts against the appellant or to assume that his admissions rendered an enquiry unnecessary, a speculation that is wholly inappropriate in cases involving termination of public service. Accordingly, the appeal was allowed, the decision of the High Court was set aside, and the order dismissing the appellant was quashed. The appellant was awarded costs of this proceeding.