Holding

A civilian employee in defence services drawing his salary from the Defence Estimates cannot claim the protection of Article 311(2) and the CCS (CCA) Rules, 1965 do not apply to him, but the disciplinary enquiry is not void and the dismissal stands.

Summary

P.N. Malhotra, a civilian employee in the defence services whose salary was drawn from the Defence Estimates, was dismissed after a disciplinary enquiry conducted under the CCS (CCA) Rules, 1965. He challenged the dismissal before the Central Administrative Tribunal, which held that the 1965 Rules did not apply to him and declared his dismissal void. On appeal, the Supreme Court held that such a civilian employee cannot claim the protection of Article 311(2) of the Constitution and that the CCS (CCA) Rules, 1965, are inapplicable to him. However, the Court observed that the enquiry, though conducted under those rules, merely codified the principles of natural justice and was not void; no prejudice was shown. Consequently, the dismissal was upheld and the Tribunal’s order set aside. The appeal was allowed, restoring the dismissal order.

Issues considered

Whether Article 311(2) of the Constitution applies to a civilian employee in defence services drawing salary from the Defence Estimates.
Whether the CCS (CCA) Rules, 1965 are applicable to disciplinary proceedings against such an employee.
Whether a disciplinary enquiry held under the 1965 Rules is void for non‑application of the Rules.
Whether the dismissal can be set aside on the ground of non‑compliance with Article 311(2) or the Rules.

Legislation cited

CCS (CCA) Rules, 1965
Constitution of Indias. 309, s. 310, s. 311(2)

Subjects

Civilian employeeDefence servicesArticle 311Disciplinary enquiryCCS (CCA) Rules 1965Natural justiceDismissalPleasure doctrine

Judgment

I

~

·'t> •.

A DIRECTOR, GENERAL OF ORDNANCE SERVICES AND ORS.
v.
P.N. MALHOTRA

JANUARY' 30, 1995

B (B.P. JEEVAN REDDY AND MRS. SUJATA V. MANOHAR, JJ.]

SelVice Law-Constitution of India-A1ticle 311(2)-CCS (CCA) Rules
1965-Applicability-Civilian employee in defence se1vices drawing his salary
from Defence Estimates-Wliether can claim protection of Art. 311(2)--Held,
C Na-1965 Rules not applicable to such an employee.
/

The respondent, a civilian employee in the defence. seniices was
dismissed from seniice on the basis of disciplinary enquiry held against
him. An appeal preferred by him was dismissed by appellate authority. The
D . respondent challenged the order before. the Central Administrative
Tribunal on the ground that the CCS (CCA) Rules, 1965, wherender the
disciplinary enquiry had been held, had no application to the respondent
-
and, therefore, the entire enquiry was void. Allowing the application the
tribunal declared that the order dismissing him from seniice was void. It
was further declared that the respondent should be deemed to have been
E continuing in service. Hence this appeal.
The appellant submitted that the respondent could not be said to
· have suffered any prejudice by following the procedure p_rj!_scribed by 1965
Rules. He submitted that they were more specific, more elaborate and more
beneficial to the em~loyee than the broad principles of natural justice.
F
Allowing the appeal, this Court

HELD : A civilian employee in military service who ·is drawing his
salary from the Defence Estimates can not claim the protection of Article
G 311 (2) of the Constitution of India. The CCA Rules of 1965 also have no
application to such an employee. The dismissal of such an employee cannot
be faulted on the ground of non complying with the requirements of Article
311(2). [678-F-G, 679-A]

At the same time, it is wrong to hold that a disciplinary enquiry held
H against such an employee in accordance with the CCA Rules is void or I

676
'

"" DIRECTOR GEN. OF ORDNANCE v. P.N. MALHOTRA [JEEVAN REJ?D.Y, J.] 677

invalid. As rightly contended by the appellant, these _rules merely incor- A
porate in a more specific and elaborate form the principles of natural
justice. Following the said rules is indeed more beneficial to the delinquent
employee. In the absence of proof of any prejudice, the enquiry or the
orders of punishment can not be set aside on the said ground.
[678-B, 680-G]
B
Union of India and Anr. v. K.S. Subramanian, [1989) Supp. 1 331;
Lekh Raj Klmrana v. Union of India, [1971) 3 SCR 908; Union of India Anr.
v. K.S. Subramanian, [1977) 1 SCR 87 and Union of India v. Indrajit Batra,
Civil Appeal No. 93 of 1993, decided on 6-9-1994 (SC), relied on;
..
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1110 of c
1995.

From the Judgment and Order datea 21.5.93 of the Central Ad-
... ministrative Tribunal, New Delhi in 0.A. No. 593 of 1991.

K. Lahiri, Ms. Binu Tamta, Mrs. Anil Katiyar and Ms .. A Subhashini D
~ "' for the Appellants.

N.K. Aggarwal for the Respondent.

The Judgment of the Court was delivered by
E
B.P. JEEVAN REDDY, J. Delay condoned.

Leave granted. Heard counsel for both the parties.

This appeal is preferred against the judgment of the Central Ad-
-ti
ministratrive Tribunal, New Delhi allowing the Original Application fileµ F
by the respondent and declaring that the order dismissing him from service
is void and declaring further that he should be deemed to have continued
in service.

The respondent is a civilian employee in the defence services. A
disciplnary enquiry was held against him in respect of certain charges. On G
the basis of the said enquiry, he was dismissed from service by the com-
petent authority on 22.8.1990. An appeal preferred by him was dismissed
by the appellate authority, against which he approached the Central Ad-
ministrative Tribunal. Number of grounds were urged by him in the
Original Application filed by him, all of which were refuted and denied by H
678 SUPREME COURT REPORTS (1995] 1 S.C.R.

A the appellants. (respondents in the Original Application) in their counter-
affidavit.

· At the time of hearing of original application, the counsel for the
respondent raised the submission that the CCS (CCA) Rules, 1965,
whereunder the dis'ciplinary enquiry has been held, have no application to
B the respondent and, therefore, the entire enquiry was void. Reliance was
placed upon the decision of the Supreme Court in Union of India & Anr.
v/K..S. Subramanian, [1989] Suppl. 1 381). The Tribunal upheld the said
plea and granted the declaration aforementioned. The Tribunal, however,
declined to award back wages while directing at the same time that the
C subsistence allowance paid to the respondent shall not be recovered. The
Tribunal also observed that its order does not prevent the appellants
(respondents in the original application) to take appropriate legal proceed-
ings against the respondent in accordance with law and in the light of the
decision in K..S. Subramanian. With respect to its jurisdiction to entertain
an .original application from a civilian employee working in defence ser-
tD
vices, the Tribunal held, following the decision of Calcutta Bench of the
Tribunal, that it has the jurisdiction.

When this SLP came up for admission before us, it was represented
by the learned counsel for the appellants that in an identical matter, viz.,
E SLP (C) No. 19202 of 1991, this Court had granted notice and stay.
Accordingly, we entertained the SLP and stayed the operation of the order
under appeal.

In K..S. Subramanian case, it was held by a 3-Judge. Bench, following
p an earlier decision of this court, that a civilian employee in military service
"who was drawing his salary from the Defence Estimates could not claim
the protection of Article 311(2) of the Constitution". The Court added :
"That being the position, the exclusionary effect of Article 311(2) deprives
him of the protection which he is otherwise entitled to. In other 'words,
there is no fetter on the exercise of the pleasure of the President or the
.G Governor." It was further held that the CCA Rules of 1965 also have no
. application to such an employee. It was observed that "when Article 311(2)
itself stands excluded and the protection thereunder is withdrawn there is
little that one could do under the 1.965 Rules in favour of the respondent.
The said Rules cannot independently play any part since the rule-making
:H power tinder· Article 309. is subject to Article 31.1. This would be 'the legal
I

~.

DIRECTOR GEN. OF ORDNANCE v. P.N. MALHOTRA [JEEVAN REDDY, J.] 679

and logical conclusion." Accordingly, it was held that the dismis.sal of such A
an employee cannot be faulted on th.e ground of not complying-with the
requirements of Article 311(2). We may mention that as far back as 1971,
a Constitution Bench of this Court held in Lekh Ra} Khurana v. Union of
India, [1971] 3 SCR 908 that a civilian employee in Defence Services,
drawing his salary from defence estimates is not entitled to the protection B
of Article 311. We may also mention in this behalf that in another decision
of the three-Judge Bench in Union of India and Another v. KS. Sub-
ramanian, [1977] 1 SCR 87 there are certain observations to the effect that
"the 1965 Rules are applicable when disciplinary proceedings are taken",
but these observations were made after fitst recording a finding that the
Respondent in that case being a temporary employee, the 1965 Rules had C
no application to his case. Though this case was not referred to in the later
decision in Union of India and Another v. KS. Subramanian, [1989} Supp.
1 sec 331, yet it cannot be said that there is any inconsistency between
the two cases (which incidentally bear the same cause title). As stated
,. above, in the first KS. Subramanian case, the employee was only a tern- D
f-.. porary employee and this Court found that the 1965 Rules did not contain
any rule which provided for the termination of an employee like the one
concerned therein. Even if we read the said decision as holding that the
1965 Rules do apply to such employees, particularly in view of Rule 3(1),
even then the order of the Tribunal cannot be sustained.

We are also unable to see now the decision in K.S. Subramanian
[1989) Supp. 1 SCC 331 could have been understood by the Tribunal as
enabling it to declare that the dismissal of the respondent is void and to
further declare that he should be deemed to have been continuing in
service. The said decision in fact militates aginst the respondent, since F
according to it, the respondent does not enjoy the protection of Article
311(2) or the 1965 Rules. It is relevant to notice that in the last para of the
Judgment, this Court states: "In the result, the appellants (Union of India),
succeed on the question of law, but the respondent retains the decree in
his favour purely on compassionate grounds". The compassionate grounds
are stated in the preceding paragraph. G

We may now refer to the recent decision of this Court dated Sep-
tember 6, 1994 in Civil Appeal Nos. 5898-93 of 1993, Union of India v.
Indrajit Datta....Jt was also a case where a civilian employee whose salary
was paid out of the estimates of Ministry of Defence challenged his removal H
680 SUPREME COURT REPORTS [1995] 1 S.C.R.

A on the ground that the aforesaid 1965 Rules, whereunder th~ disciplinary
enquiry was held have no application to him. In that case too, the Tribunal
had set aside the removal order on the same ground as in this case. After
noting the reasoning of the Tribunal, this Court (a Ban ch of two learned
Judges) observed : "We see no ground to interfer~ with the reasoning and
the conclusions reached by the Tribunal". The Court at the same time,
B referred to the submission of the learned counsel for the Union and dealt
with it in the following words :

"Mr. V.C. Mahajan, learned counsel appearing for the appellant~
has, however, contended that by following the procedure
c prescribed under the rules no prejudice was caused to the respon-
dent, rather he was benefitted as the rules of natural justice were
complied with before passing the order of removal. According to
him, his .services could have been terminated on the basis of
pleasure doctrine under Article 310 of the Constitution of India
and simply because he was given an opportunity to defend the
D charges he cannot have any grievance as no· prejudice was caused
to him. We find some plausibility in the contention but keeping in
view the facts and circumstances of this case, we are not inclined to
go into tlte same. It is not disputed that in the year 1984 respondent
submitted resignation to join a shipping company. The resignation
E was not accepted and instead he was subjected to the disciplinary
proceeding under the Rules. We are not inclined. to interfere with
the impugned judgment of ti.,, Tribunal. The appeals are disc
missed. No costs."

F (emphasis added)

The learned counsel for the appellants submits that the respondent
cannot be said to have suffered any prejudice by following the procedure
prescribed by 1965 Rules. He submits that the said Rqles are nothing but
a codification of the principles of natural justice. Indeed, it is submitted,
G they are more specific, more elaborate and more beneficial to the employee
than the broad principles of natural justice. If we assume for the sake of
argument that the respondent was entitled to insist upon an enquiry before
he could be dismissed, we must agree with the submission of the learned
counsel for the appellants. We must also say that this court cannot be said
H to have approved the view taken by the Tribunal in that case (which is the
DIRECTOR GEN. OF ORDNANCE v. P.N. MALHOTRA (JEEVAN REDDY'., J.) 681

same as in this case). In view of the peculier circumstances of that case, A
this Court held, "we are not inclined to interfere with the impugned
judgment of the Tribunal." The earlier sentence in the judgment to the
effect that "we see no ground to interfere with the reasoning and the
conclusions reached by the Tribunal" must be read alongwith the sub-
sequent opinion aforesaid and in the light of all the observations made.
B
We must also mention that neither the Tribunal has stated - nor the
respondent has suggested - that there are any other Rules applicable to
disciplinary enquiries against such civilian employees which have not been
followed - much less has it been stated that any such Rules are qualitatively
different of more beneficial to the respondent. C
The order under appeal shows that though several grounds were
raised in the original application filed by the respondent, the only point
urged by his counsel at the time of arguments before the Tribunal was the
one relating to inapplicability of the 1965 Rules. No other contention
appears to have been urged. D
l
In the circumstances, the appeal is allowed and the order of the
Tribunal is set aside. The order dismissing the respondent as confirmed by
the appellate order is restored. No. costs.

A.G. Appeal allowed. E