STATE OF ORISSA AND ORS.versusKALICHARAN MOHAPATRA AND ANR.

                                                                                 ,,.._
A                     STATE OF ORISSA AND ORS.
                                 v.
                  KALICHARAN MOHAPATRA AND ANR.

                             SEPTEMBER 20, 1995
B
            [B.P. JEEVAN REDDY AND M.K. MUKHERJEE, JJ.]

          Se1vice Law:

          :All India Se1vices (Death-cum-Retirement Benefits) Rules, 1958-Rule
c   6-Pendency of Climinal case against pensione1~Withholding of gratuity
    amount and not sanctioning pension finally-Justification of-"Miscon-
    duct''-Meaning of

          Words & phrases : "Misconduct''-Meaning of-Jn the contei:t of All
D   India Services (Death-cum-Retirement Benefits) Rules, 1958-To be under-
    stood in the manner defined in the Prevention of Conuption Act.

        Respondent was a member of the Indian Police Service and had
  retired on December 31, 1990. A raid was conducted on his residential
  premises about six months prior to his retirement. On the basis of the
E material recovered, a prosecution was launched against him under S.13(2)
  read with S.13(1) of the Prevention of Corruption Act for being in posses-
  sion of assets disproportionate to his known sources of income. Due to
  pendency of the criminal case, the appellants withheld the gratuity amount
  and did not sanction the pension finally though provisional pension was
F sanctioned. Respondent approached the Central Administrative Tribunal.            ;
  The appellants relied on Rule 6 of the All India Services (Death-cum-
  Retirement Benefits) Rules, 1958, in support of their action. The Tribunal
  held that there was no justification in withholding the gratuity amount as
  also in not sanctioning the pension finally. It also held that as the charge
  against the resprmdent was not one of causing pecuniary loss to the
G Central or State Government by misconduct or negligence within the
  meaning of Rule 6(1), the appellants cannot avail of it. Hence this appeal
  by State of Orissa.
                                                                                         .
          Allowing the appeal and setting aside the judgment of the Tribunal,
H   this Court
                                       836
            STATEv. KMOHAPATRA(B.P.JEEVANREDDY,J.]                   837

       tlELD : 1. Where a judicial proceeding is pending against a pen- A
sioner for grave misconduct, the government is entitled to withhold
gratuity amount and/or death-cum-gratuity amount and is also entitled to
sanction provisional pension for the period of pendency of the said
proceedings. It is not necessary that a judicial proceeding should relate to
the charge of causing pecuniary loss to the Central or State Government B
by misconduct or negligence during his service. Sub-rule (1) of Rule 6 of
the All India Services (Death-cum-Retirement Benefits) Rules, 1958
specifies two grounds upon which action thereunder can be taken. One is
where the pensioner is found guilty of grave misconduct and the other is
where he is found to have caused pecuniary loss to the Central or State
Government by misconduct and negligence during his service. Sub-rule(2) C
provides for orders to be made during the pendency of such proceedings.
Neither the All India Service (Death-cum-Retirement) Rules nor the Pen-
sions Act, General Clauses Act or the Leave Rules define the expression
"misconduct". It would, therefore, be reasonable and permissible to under-
stand the said expression in Rule 6 aforesaid in the manner defined in the D
Prevention of Corruption Act. [841-A-D]

      2. The Tribunal was, in error in holding that unless the charge
expressly charges the pensioner with causing pecuniary loss to Central or
State Government by his negligence or misconduct during his service,
action under sub-rule (2) of Rule 6 cannot be taken. (841-E]                E
        CIVIL APPELLATE JURISDICTION : Civil Appeal No. 8400 of
1995.

      From the Judgment and Order dated 23.6.94 of the Central Ad-
ministrative Tribunal, Cuttack Bench, Orissa in O.A. No. 439 of 1992.       F.
        Jayant Das and Raj Kumar Mehta for the Appellants.

        Vinoo Bhagat for the Respondents.

        The Judgment of the Court was delivered by                          G
        B.P. JEEVAN REDDY, J. Leave granted.

      This appeal is preferred against the judgment of the Central Ad-
ministrative Tribunal (Cuttack Bench) allowing the Original Application
filed by the respondent and directing the appellants (respondents in the    H
    838                   SUPREME COURT REPORTS [1995] SUPP. 3 S.C.R.

A   Original Application) to release final pension and gratuity to the respon-
    dent within ninety days of the judgment.

          The respondent was a member of the Indian Police Service. He             .-
    retired on December 31, 1990. About six months prior to his retirement, a
    raid was conducted on his residential premises. On the basis of the mat~rial
B   recovered, a prosecution has been launched against him in the Special
    Court, Cuttack under Section 13(2) read With Section 13(1) of the Preven-
    tion of Corruption Act for being in possession of assets disproportionate
    to his known sources of income. [According to Section 13(1) of the said
    Act, misconduct includes being in possession of assets disproportionate to
C   his known sources of income.] The case is still pending. In view of the
    pendency of ·the said criminal case, the appellants withheld the gratuity
    amount and did not also sanction the pension finally. A provisional pension
    equal to ninety percent of his entitlement was, however, sanctioned. Ag-
    grieved by the refusal to release the gratuity amount and the refusal to
D   sanction his pension finally, the respondent approached the Tribunal.

           The appellants relied upon Rule 6 of the All India Services (Death-
    cum-Retirement Benefits) Rules, 1958 in support of their action. The
    appellants' case was that in view of the pendency of the said criminal case,
    they were justified in withholding the gratuity amount and also in not
E sanctioning the pension finally. The Tribunal has ·held that the said rule
  · does not avail the appellants inasmuch as the charge against the respondent
    is not one of causing pecuniary loss to the Central or State Government by
    misconduct or negligence within the meaning of Rule 6(1). We are of the
    opinion that the reading of the rule by the Tribunal is unsustainable and
F incorrect. The rule reads thus :
             "6. Recove1y from pension :- 6( 1) The Central Government reserves
             to itself the right of withholding or withdrawing a pension or any
             part of it, whether permanently or for a specified period, and the
             right of ordering the recovery from pension of the whole or part
G            of any pecuniary loss caused to the Central or a State Government,
             if the pensioner is found in a departmental or judicial proceedings
             to have been guilty of grave misconduct or to have caused
             pecuniary loss to the Central or a State Government by misconduct
             or negligence, during his service, including service rendered or
H            re-employment after retirement.
      STATE v. K. MOHAPATRA (B.P. JEEVAN REDDY, J.]                 839

       Provided that no such order shall be passed without consulting      A
    the Union Public Service Commission : -

-      Provided further that -

    (a) such departmental proceeding, if instituted while the pensioner
    was in service, whether before his retirement or during his re-        B
    employment, shall, after the final retirement of the pensioner, be
    deemed to be a proceeding under this sub-rule and shall be
    continued and concluded by the authority by which it was com-
    menced in the same manner as if the pensioner had continued in
    service;                                                               C
    (b) [Omitted as unnecessary]

    (c) [Omitted as unnecessary]

    Explanation.- For the purpose of this rule : -                         D
    (a) a departmental proceeding shall be deemed to be instituted
    which the charges framed against the pensioner are issued to him
    or, if he has been placed under suspension from an earlier date,
    on such date and
                                                                           E
    (b) a judicial proceeding shall be deemed to be instituted -

         (i) in the case of criminal proceedings, on the date on which
         a complaint is made or a charge-sheet is submitted, to the
         criminal court; and
                                                                           F
         (ii) in the case of civil proceedings, on the date on which the
         plaint is presented or, as the case may be, an application is
         made, to a civil court.

    (2) Where any departmental or judicial proceeding is instituted G
    under sub-rule (1), or where a departmental proceeding is con-
    tinued under clause (a) of the proviso thereto against an officer
    who has retired on attaining the age of compulsory retirement or
    otherwise, he shall be sanctioned by the Govemment which instituted
    such proceedings, during the period commencing from the date of
    his retirement to the date on which, upon conclusion of such H
    840                  SUPREME COURT REPORTS [1995) SUPP. 3 S.C.R.

A           proceeding final orders are passed, a provisional pension not
            exceeding the maximum pension which would have been admis-
            sible' on the basis of his qualifying service upto the date of retire-
            ment, or if he was under suspension on the date of retirement,
            upto the date immediately preceding the date on which he was
            placed under suspension; but no gratuity or death-cum-retir~ .nent
                                                                                     -
B           gratuity shall be paid to him until the conclusion of such proceed-
            ings and the issue of final orders thereon.

                Provided that where disciplinary proceeding has been instituted
            against a member of the Service before his retirement service
c           under rule 10 of the All India Service (Discipline and Appeal)
            Rules, 1969, for imposing any of the penalties specified in clause
            (i), (ii) and (iv) of sub-rule 1 of rule 6 of the said rules and
            continuing such proceeding under sub-rule (1) of this rule after
            his retirement from service, the p~yment of gratuity or Death-cum-
            Retirement gratuity shall not be withheld.
                                                                                     -
D
             (3) [Omitted as unnecessary]."

            A reading of sub-rule (1) of Rule 6 discloses the following features
    .: (a) if the pensioner is found in a departmental or judicial proceeding to
E    have been guilty of grave misconduct or (b) where a pensioner is found in
     a departmental or judicial proceeding to have caused pecuniary loss to the
     Central or State Government by his misconduct or negligence during his
     service (including the service rendered on re-employment after retire-
     ment), (c) the Central Government is entitled to withhold or withdraw
F    pension or any part of it whether permanently or for a specified period.
     The Central Government is also entitled to order recovery from pension
    of the whole or part of any pecuniary loss caused to the Central or State
    Government. Sub-rule (2) says that (a) where a departmental or judicial
    proceeding is instituted under sub-section (1) or (b) where a departmental
     proceeding is continued under clause (a) of the proviso to sub- rule (1),
G    (c) such employees shall be sanctioned by the government which instituted
     such proceedings a provisional pension not exceeding the maximum pen-
     sion admissible to him during the period of pendency of such proceeding,
     (d) but no gratuity or death-cum-retirement gratuity shall be paid to him
    until the conclusion of such proceedings and the issuance of final orders
H   thereon.


                                                           •
                STATE v. K. MO HAP ATRA [B.P. JEEVAN REDDY, J.]               841

---          It is thus clear from an analysis of sub-rules (1) and (2) that where A
      a judicial proceeding is pending against a pensioner for grave misconduct,
      the government is entitled to withhold gratuity amount and/or death-cum-
      gratuity amount and is also entitled to sanction provisional pension for the
      period of pendency of the said proceedings. It is not necessary that a
      judicial proceeding should relate to the charge of causing pecuniary loss
                                                                                   B
      to the Central or State Government by misconduct or negligence during
      his service. Sub-rule (1) of Rule 6 specifies two grounds upon which action
      thereunder can be taken. One is where the pension is found guilty of grave
      misconduct and the other is where he is found to have caused pecuniary
      loss to the Central and State Government by misconduct and negligence
                                                              0


      during his service. Sub- rule (2) provides for orders to be made during the   c
      pendency of such proceedings. It may also be mentioned that neither the
      All India Service (Death-cum-Retirement) Rule nor the Pensions Act,
      General Clauses Act or the Leave Rules [referred to in Rule 2(2)] define
      the expression "misconduct". It would, therefore1 be reasonable and per-
      missible to understand the said expression in Rule 6 aforesaid in the D
      manner defined in the Prevention of Corruption Act.

            The Tribunal was, therefore, in error in holding that unless the
      charge expressly charges the pensioner with causing pecuniary loss to
      Central or State Government by his negligence or misconduct during his
      service, the action under sub-rule (2) of Rule 6 cannot be taken.             E
             The appeal is accordingly allowed and the judgment of the Tribunal
      is set aside. No order as to costs.

      G.N.                                                        Appeal allowed.
                                                                                    F