STATE OF U.P. AND ANRversusSHRI KRISHNA PANDEY

                              STATE OF U.P. AND ANR                                A
                                            v.
                              SHRI KRISHNA PANDEY

                                    MARCH 1, 1'196

                  [K. RAMASWAMY AND G.B. PATTANAIK, JJ.]                           B

             Civil Services Regulations: Regulation 351-A.

'I        Service Law-Pension-Forfeiture order-Validity of-Direction by
     High Court for release of pension.                                 C
            Departmental enquiry-Period of limitation for-Employee-£mbezzle-
     menl-l'ecuniary loss to exchequer-Employees superannuated on 31st March
     1987-Departmental proceedings initiated on April 21, 1991 i.e. after four years
     of retirement-Stoppage of pension-Held institution of inquiry was not com,
     petent-Cause for institution of enquiry must not have taken place more than D
     four years before date of institution of proceedings.

             CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4502 of
     1996.

          From the judgment and Order dated 2.12.93 of the Allahabad High          E
     Court C. Misc. W.P. No. 29951 of 1993.

             Ms. Rachna Gupta and R.B.Misra for the Appellants.

             Ms. Rachna Joshi Issar for the Respondent.
                                                                                   F
             The following order of the Court was delivered :

             Leave granted.

           We have heard learned counsel on both sides. This appeal by special
     leave arises from the order of the High Court of Allahabad, made on           G
     December 2, 1993 in Civil Misc. Writ Petition No. 29951 of 1993. The
     admitted position is that before departmental enquiry was initiated against
     the respondent for embezzlement of Rs. 2,47,779, on his attaining the age
     of superannuation on March 31,1987, he was allowed to retire from service.
     The departmental proceedings thereafter were initiated against him. F.l.R.
     was lodged and investigation is stated to be in progress. No such rule to     H
                                         183
    184                    SUPREME COURT REPORTS                 [1996] 3 S.C.R.

A   continue the proceedings after retirement as is in vogue in some State or
    Central Service Pension Rules, is in operation. So the action of departmen-
    tal proceedings cannot be continued. There would be no impediment to
    have the investigation into the offences continued. However, when pension
    was not paid to him it came to be challenged in the High Court in the
    above writ petition which the High Court has allowed it and has directed
B   to pay the pension. Thus this appeal by special leave.

          The only provision brought to our notice is Regulation 351-A of the
    Civil Services Regulations which reads as under :-
                                                                                    I
            "The Governor reserves to himself the right of withholding or
c           withdrawing a pension or any part of it, whether permanently or
            for a specified period and the right of ordering the recovery from
            a pension of the whole part of any pecuniary loss caused to
            Government, if the pensioner is found in departmental or judicial
            proceedings to have been guilty of grave mis-conduct, or to have
            caused pecuniary loss to Government by misconduct or negligence,
D           during his service, including service rendered on re-employment
            after retirement:

            Provided that
                                                      I
            (a) Such departmental proceedings, if not instituted while the
E           officer was on duty either before retirement or during re-employ-
            ment -

                  (i)     shall not be instituted save with the sanction of the
                          Governor.
                                                                                    r
F                 (ii)    shall be in respect of an event which took place n.:it
                          more than four years before the institution of such
                          proceedings, and

                  (iii)   shall be conducted by such authority and in such place
                          or places as the Governor may direct and in accordance
G
                          with the procedure applicable to proceedings on which
                          an order of dismissal from service may be made.

             (b) judicial proceedings, if not instituted while the officer was on
             duty either before retirement or during re-employment, shall have
H            been instituted in accordance with sub-clause (ii) of clause (a) and
                          STATEv. KPANDEY                             185

        (c) the Public Service Commission, U.P., shall be consulted before A
        final orders are passed.

        Explanation - For the purpose of this article-

        (a) departmental proceedings shall be deemed to have been in-
        stituted when the charges framed against the pensioner are issued    B
        to him, or if the officer has been placed under suspension from an
        earlier date, on such date; and

             (i)    in the case of criminal proceedings, on the date on
                    which a complaint is made, or a charge sheet is sub-
                    mitted, to criminal court; and                           c
             (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.

        Note:- As soon as proceedings of the nature referred to in this D
        article are instituted the authority which institutes such proceed-
        ings shall without delay intimate the fact to the Audit Officer
        concerned."

       A reading thereof clearly indicates that the Governor reserves to
himself the power and right to withhold or withdraw pension or a part E
thereof, whether permanently or for a specified period. Equally; he has
right to order recovery from pe:'sion of the whole or part of any pecuniary
loss caused to Government when it is found in a departmental or judicial
proceedings that the delinquent was guilty of grave misconduct or has
caused pecuniary loss to the Government by his misconduct or negligence
while he was continuing in service including the period of his re- employ- F
ment after retirement. But the conditions precedent are that the
departmental proceedings should be initiated only either before retirement
or during re-employment and the same shall not be instituted without the
sanction of the Governor. It should be in respect of an event which may
have taken place not more than 4 years before the institution of such G
proceedings.

     Explanation to the rule purports to give the meaning to the words
'commencement of departmental proceedings'. It says that departmental
proceedings shall be deemed to have been instituted when the charges
framed against the pensioner are issued to him, or if the officer has been H
    186                   SUPREME COURT REPORTS                    [1996] 3 S.C.R.

A placed under suspension from an earlier date, from such dat~ the date of
    suspension and the proceedings shall be deemed to have been instituted in
    the case of criminal proceedings, on the date on which complaint is made
    or a charge-sheet submitted to a criminal court; and 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 the Civil Court. As soon as the proceed·
B   ings of the nature referred in the articles are instituted, the authority which
    institutes such proceedings shall without delay intimate the fact to the audit
    officer of the concerned.

           It would thus be seen that proceedings are required to be instituted
    against a delinquent officer before retirement. There is no specific
C   provision allowing the officer to continue in service nor any order passed
    to allow him to continue on re-employment till the enquiry is completed,
    without allowing him to retire from service. Equally, there is no provision
    that the proceedings be initiated as disciplinary measure and the action
    initiated earlier would remain unabated after retirement. If Rule 351-A is
D   to be operative in respect of pending proceedings, by necessary implica·
    tion, prior sanction of the Governor to continue the proceedings against
    him is required. On the other hand, the rule also would indicate that if the
    officer caused pecuniary loss or committed embezzlement etc. due to
    misconduct or negligence or dereliction of duty; then proceedings should
    also be instituted after retirement against the officer as expeditiously as
E   possible. But the events of misconduct etc. which may have resulted in the
    loss to the Government or embezzlement, i.e., the cause for the institution
    of proceedings, should not have taken place more than four years before
    the date of institution of proceedings. In other words, the departmental
    proceedings must be instituted before lapse of four years from the date on
    which the event or misconduct etc. had taken place. Admittedly, in this
F   case the officer had retired on March 31, 1987 and the proceedings were
    initiated on April 21, 1991. Obviously, the event of embezzlement which
    caused pecuniary loss to the State took place prior to four years from the
    date of his retirement. Under these circumstances, the State had disabled
    itself by their deliberate omissions to take appropriate action against the
G   respondent and allowed the officer to escape from the provision of rule
    351-A of the rules. This order does not preclude proceeding with the
    investigation into the offence and taking action thereon.

          The appeal is accordingly dismissed. No costs.

HT.NA.                                                         Appeal dismissed.