Holding

Back wages are not automatically payable upon acquittal, and in the present case the appellant is not entitled to them as he had already received retirement benefits and departmental proceedings were barred by his superannuation.

Summary

Banshidhar, a Patwari, was suspended in 1976 on allegations of accepting illegal gratification and was convicted under Section 5(1)(d) of the Prevention of Corruption Act read with Section 161 of the IPC. He was dismissed in 1987 but later acquitted by the appellate court in 2001. By the time of his acquittal he had already attained the age of superannuation and was granted pension benefits. He filed a writ petition seeking back wages for the period of suspension, which the Rajasthan High Court denied. The Supreme Court held that back wages are not an automatic right even where a dismissal is later found invalid, especially when the employee has already received retirement benefits and departmental proceedings cannot be initiated after superannuation; consequently, the appeal was dismissed.

Issues considered

Whether a workman who was suspended, later acquitted, and has attained superannuation is entitled to back wages.
Whether departmental proceedings can be entertained against an employee who has already superannuated.

Legislation cited

Indian Penal Code, 1860s. 161
Prevention of Corruption Acts. 5(1)(d)

Subjects

back wagessuspensionacquittalsuperannuationdepartmental proceedingsPrevention of Corruption Actpension benefitsservice law

Judgment

A BANSHIDHAR
v.
STATE OF RAJASTHAN AND ANR.

OCTOBER 31, 2006

B (S.B. SINHA AND MARKANDEY KA TJU, JJ.] , I

'

Service Law: •
Backwages-Entitlement of-Workman placed on suspension pursuant
c to allegation of grave criminal misconduct-On conviction by Trial Court,
dismissed-Acquittal by Appellate Court, though hieanwhile workman reached
age of superannuation-Held: Entitlement to back wages not automatic even
when order of dismissal found invalid-On facts, not a fit case for grant of
back wages having regard to the fact that the workman had been paid retiral
D benefits-Prevention of Corruption Act-Section 5(J)(d) Penal Code, 1860-
Section 161.

Appellant was placed under suspension on allegations of grave criminal '
misconduct. His services were subsequently dispensed with as he was convicted
by a Trial Court under Section S(l)(d) of the Prevention of Corruption Act
read with Section 161, IPC. Appellant was h6wever acquitted by the Appellate
Court, though on the date of passing of the judgment of acquith•I, Appellant
had already reached his age of superannuation.

Appellant filed writ petition before the High Court which, though
denying him back wages, permitted him to claim pensionary benefits before
the concerned authority. On application of the Appellant, he was directed to
be paid his entire pensionary benefits by the said authority.

The question which arose for consideration in the present appeal is
whether in a situation of this nature, Appellant is entitled to payment of back
wages.

Dismissing the appeal, the Court

HELD: 1. It is now a trite law that judgment of acquittal itself would not
have exonerated him of the charges levelled against him. He could have been

78
BANSHI DHAR v. ST ATE OF RA.JASTHAN 79
proceeded against in a departmental proceeding. Departmental proceedings, A
however, could not bl! held as on the date of passing of the judgment of acquittal,
he had already reached his age of superannuation. 182-G-H; 83-AI

Manager, Reserve Bank of India, Bangalore v. S. Mani and Ors .. 120051
5 SCC 100 and Commissioner of Police, New Delhi v. Narender Singh, 120061
4 sec 265, relied on. B
2.1. No hard and fast rule can be laid down in regard to grant to back
wages. Each case has to be determined on its own facts. 182-FI

2.2. The High Court refused to exercise its discretionary jurisdiction.
There is no reason for this Court to take a different view. Grant of back wages, C
it is well settled, is not automatic. Even in cases where principles of natural
justice have been held to have not been complied with, while issuing a direction
of reinstatement, this Court had directed placing of the delinquent employee
under suspension. Even in relation to the industrial disputes, this Court, in
many judgments, has held that back wages need not be granted automatically D
although the order of termination passed against the concerned workman was
found to be invalid. The instant case is not a fit case, having regard to the fact
that the appellant has been paid the retiral benefits, where this Court should
interfere. 183-C; 84-E-GI

Managing Director, EC/l, Hyderabad and Ors. v. B. Karunakar and E
Ors., [1993) 4 SCC 727; South Bengal State Transport Corpn. v. Sapan Kumar
Mitra and Ors., [20061 2 SCC 584; UP. State Brassware Corpn. ltd and
Anr. v. Uday Narain Pandey, [2006) 1 SCC 479 and Municipal Council,
Sujanpur v. Surinder Kumar, (2006) 5 SCC 173, relied on.

Ranchhodji Chatz11]i Thakore v. Superintendent Engineer, Gujarat F
Electricity Board, Himmatnagar (Gujarat) and Anr., [1996[ 11SCC603; Union
ofIndia and Ors. v. Jaipal Singh, [2004) 1SCC121 and Baldev Singh v. Union
of India and Ors., [2005[ 8 SCC 767, referred to.

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4400 of2005.
G
From the Judgment and Final Order dated l.8.2003 of the High Court of
Judicature for Rajasthan at Jodhpur in D.B. Civil Special Appeal (Writ) No.
225/2003.

K.S. Bhati for the Appellant.
G

I
80 SUPREME COURT REPORTS [2006] SUPP. 8 S.C.R.
..... -
A Navin Kumar Singh (for Aruneshwar Gupta) for the Respondents.

The Judgment of the Court was delivered by

S.B. SINHA, J. Appellant was a Patwari working at village Minda in the
year 1976. On an allegation that he had sought illegal gratification, on or
B about 13.7.1976, a complaint was lodged in the office of Deputy Superintendent
of Police, Anti-Corruption, Jaipur (Rural) that the appellant had asked for
illegal gratification. A raiding party laid a trap on the said date and he was
found to have accepted illegal gratification. Pursuant thereto he was prosecuted
for alleged .commission of an offence under Section 5( 1)(d) of the Prevention
of Corruption Act read with Section 161 of the Indian Penal Code. He was
C placed under suspension. He was convicted under Section 5(1)(d) of the
Prevention of Corruption Act read with Section 161 of the Indian Penal Code
by reason of a judgment dated 25.02.1985 passed by the Spec!al Judge
(A.C.D.) in criminal case No. 17 of 1979. He was dismissed from service in
terms of the said judgment of conviction by an order dated 3 .10.1987.
D
The appellant preferred an appeal against the said judgment of conviction
and sentence and by reason of a judgment and order dated 16.0 ! .200 I, the
said appeal was allowed. The appellant, thus, stood acquitted.

In the meanwhile, i.e., in the year 1998, the appellant reached his age
E of superannuation. Having been acquitted in the criminal proceeding, he filed
a writ petition before the High Court of Rajasthan which was marked as SB
Civil Writ Petition No. 311 l of2002. By an order dated 19.02.2003, a learned
Single Judge of the High Court directed that in the event the aµpellailt files
a representation before .the competent officer with regard ,o pension, the same
may be considerd within a period of three months therefrom. An appeal
F preferred thereagainst was dismissed by reawn of the impugned order passed
by the Division Bench.

Before we advert to the contentions raised by the appellant questioning
the correctness or otherwise of the judgment of the learned Single Judge as
G also the Divis.ion Bench of the High Court denying him back wages, we may
notice that pursuant to or in furtherance of the said judgment dated 19.02.2003,
he filed a representation before the r.ollector and the said authority by an
order dated 25.11.2004 directed:

"The first appointment of Sh. Vanshidhar was made on 22.10.60 in the
H Office ofTehsildar, Nagore and on 3.10.87, he was dismissed from his
- .J
BANSI-ll DHAR v. ST ATE OF RAJASTI-lAN [S.B. SINHA. J.) 81

service. Accordingly, the service tenure of Sh. Vanshidhar comes to A
26 years, 11 months and 13 days. This service tenure comes within

.. the pe"nsionable service category.

Therefore, while allowing the representation dated 6.8.04 submitted
by Sh. Vanshidhar, Ex. Patwari, I think it proper to allow the pension
benefit to him under the provisions of Rajasthan Pension Rule, 1996. B
Therefore, in the light of aforesaid all facts and circumstances, the
pensionary bt:nefit of Sh. Vanshidhar, Ex. Patwari is hereby allowed
and it is directed that in compliance of the Circular No. F 10/35/Vitta/
Niyam 96/R.S.R. 2/03 dated 04.02.03 of the Finance Department the
case shali be forwarded to the Finance Department for necessary C
action."

Mr. K.S. Bhati, learned counsel appearing on behalf of the appellant,
submitted that it being not a case where he had remained in custody for
alleged commission of an office which prevented him from attending the
duties, he could not have denied back wages. It was urged that the decision D
of this Court in Ranchhodji Chaturji Thakore v. Superintendent Engineer,
Gujarat Electricity Board, Himmatnagar (Gujarat) and Anr., [ 1996] l I SCC
603 was wrongly applied by the High Court as the appellant therein was
convicted for an offence under Section 302 read with Section 34 of the Indian
Penal Code. In Ranchhodji Chaturji Thakore (supra) this Court opined: E
"The reinstatement of the petitioner into the service has already been
ordered by the High Court. The only question is whether he is entitled
to back wages. It was his conduct of involving himself in the crime
that was taken into account for his not being in service of the
respondent. Consequent upon his acquittal, he is entitled to F
reinstatement for the reason that his service was terminated on the
basis of the conviction by operation of proviso to the statutory rules
applicable to the situation. The question of back wages would be
considered only if the respondents have taken action by way of
disciplinary proceedings and the action was found to be unsustainable
in law and he was unlawfully prevented from discharging the duties. G
In that context, his conduct becomes relevant. Each case requires to
be considered in its own backdrop. In this case, since the petitioner
had involved himself in a crime, though he was later acquitted, he had
disabled himself from rendering the service on account of conviction
and incarceration in jail. Under these circumstances, the petitioner is H
82 SUPREME COURT REPORTS [2006] SUPP. 8 S.C.R.

A not entitled to payment of back wages. The learned Single Judge and
the Division Bench have not committed any error of law warranting
interference.''

It was contended that the decision of this Court following the said dicta
in Union of India and Ors. v . .Jaipal Singh, [2004] I SCC 121 and Baldev
B Singh v. Union of India and Ors., [2005] 8 SCC 767 being based on the same
reasonings, must also be held to be not applicable in the instant case.

The appellant had all along remained under suspension for eleven
years. He yndoubtedly received subsistence allowance during the said period.

C It may be true that the reason for long pendency of the trial or the
criminal appeal filed by him may not be attributed to his acts of omission and
commission but the fact remains that the entire period between 13. 7 .1976 and
the date when he reached his age of superannuation he did not work. He was
placed under order of suspension validly from 1976 to 2.10.1987. Legality of
D the order of dismissal on the basis of the judgment of conviction and sentence
dated 25.2.1985 has also not been questioned. It is true that his services were
dispensed with as he had been convicted in a criminal case involving grave

-
misconduct. On his acquittal, he was to be reinstated in ~ervice. He has been
directed to be paid his pen!:;ionary benefits. The entire period during which
he remained under suspension, thus, would be considered for ca1culating his
E pensionary benefits. Continuity of his service has also not been denied to
him. The only question which arises for consideration, as noticed hereiobefore,
is as to whether in a situation of this nature back wages shouldllave been
granted to him.

No hard and fast rule can be la;d down in regard to grant to back wages.
F Each case has to be detennirted on its own facts. A grave charge of criminal
misconduct was alleged against him. He was also found guilty of the charges
levelled against him by the Special Judge. The High Court while delivering
its judgment dated 16.01.2001 in S.B. Criminal Appeal No. 68of1985 inter a/ia
held that the prosecuticm has not been able to prove that any demand had
G been made by him.

It is now a trite law that judgment of acquittal itself would not have
exonerated him of the charges levelled against him. He could have been
proceeded against in a departmental proceeding. [See Manager, Reserve Bank
ofIndia, Bangalore v. S. Mani and Ors., [2005] 5 SCC 100 and Commissioner ··~
H
BANSHI DHAR v. STATE OF RAJASTHAN [S.B. SINHA. J.) 83
of Police, New Delhi v. Narender Singh, [2006] 4 SCC 265] A
Departmental proceedings, however, could not be held as on the date
of passing of the judgment of acquittal, he had already reached his age of
superannuation. The learned counsel may be right that the decisions of this
Court referred to hereinbefore involved the respeetive appellants therein on
charge of murder under Section 302 of the Indian Penal Code, but, as noticed, B
it has also been laid down that each case has to be considered on its own
facts. The High Court refused to exercise its discretionary jurisdiction having
regard to the aforementioned decision of this Court in Ranchhodji Chatwji
Thakore (supra). We do not see any reason to take a different view. Grant
of back wages, it is well settled, is not automatic. Even in cases where C·
principles of natural justice have been held to have not been complied with,
while issuing a direction of reinstatement, this Court had directed placing of
the delinquent employee under suspension.
•
In Managing Director, ECIL, Hyderabad and Ors. v. B. Karunakar and
Ors., [1993] 4 SCC 727: AIR (1974) SC 1074, this Court opined: D
"Hence, in all cases where the enquiry officer's report is not furnished
to the delinquent employee in the disciplinary proceedings, the Courts
and Tribunals should cause the copy of the report to be furnished to
the aggrieved employee if he has not already secured it before coming
to the Court/Tribunal and give the employee an opportunity to show E
how his or her case was prejudiced because of the non-supply of the
report. If after hearing the parties, the Court/Tribunal comes to the
conclusion that the non-supply of the report would have made no
difference to the ultimate findings and the punishment given, the
Court/Tribunal should not interfere with the order of punishment. The F
Court/Tribunal should not mechanically set aside the order of
punishment on the ground that the report was not furnished as is
regrettably being done at present. The courts should avoid resorting
to short cuts. Since it is the Courts/Tribunals which w.ill apply their
judicial mind to the question and give their reasons for setting aside
or not s.etting aside the order of punishment, (and not any internal G
appellate or revisional authority), there would be neither' a breach of
the principles of natural justice nor a denial of ~he reasonable
opportunity. It is only if the Court/Tribunal finds that the ·furnishing
of the report would have made a difference to the result in the case
that it should set aside the order of punishment. Wher~ ~twr following
H
84 SUPREME COURT REPORTS [2006] SUPP. 8 S.C.R.

A the above procedure, the Court/Tribunal sets aside the order of
punishment, the proper relief that should be granted is to direct
reinstatement of the employee with liberty to the authority/management
to proceed with the inquiry, by placing the employee under suspension
and continuing the inquiry from the stage of furnishing him with the
report. The question whether the employee would be entitled to the
B back-wages and other benefits from the date of his dismissal to the
date of his reinstatement if ultimately ordered, should invariably be
left to be decided by the. authority concerned according to law, after
the culmination of the proceedings and depending on the final outcome.
I
If the employee succeeds in the fresh inquiry and is directed to be
c reinstated, the authority should be at liberty to decide according to
law how it will treat the period from the date of dismissal till the
reinstatement and to what benefits, if any and the extent of the
benefits, he will be entitled. The reinstatement made as a result of the
setting asi<U! of the inquiry for failure to furnish the report, should be
treated as a reinstatement for the purpose of holding the fresh inquiry
D from the stage of furnishing the report and no more, where such fresh
inquiry is held. That will also be the correct position in law."

[See also South Bengal State Transport Corpn. v. Sapan Kumar Mitra
and Ors., (2006) 2 SCC 584] .-
E Even in relation to the industrial disputes, this Court, in many judgments,
has held that back wages need not be granted automatically although the
order of termination passed against the concerned workman was found to be
invalid. [UP. State Brassware Corpn. Ltd. and Anr. v. Uday Narain Pandey,
[2006] I SCC 4 79 and Municipal Council, Sujanpur v. Surinder Kumar, [2006]
F 5SCC173]

We, therefore, are of the opinion that it is :not a fit case, having regard
to the fact that the appellant has been paid the retiral benefits, where we
should interfere with the impugned judgment. The appeal is dismissed. No.
costs.
G
B.B.B. Appeal dismissed.