U.P. STATE MINERAL DEVELOPMENT. CORPORATION AND ANR.versusK.C.P. SINHA

               U.P. STATE MINERAL DEVELOPMENT.                                   A
                     CORPORATION AND ANR.
                                     v.
                              K.C.P. SINHA

                             APRIL 24, 1996
                                                                                 B
             {S.C. AGRAWAL AND G.T. NANAVATI, JJ.]

     Se1vice Law :

      U.P. State Mineral Development Corporation Employees Service Rules,        c
1978 : Rule 27, clause (iv), as amended by Amendment Rules, 1988 :
Compuls01y retirement on attaining age of 50 years-Rule whether arbitrary
and violative of Articles 14 and 16 of the Constitution for not prewibing any
minimum period of service-Held, no-Operation of amended ntle whether
retrospective-Held, Operates prospectively-Adverse remark~ in C.R-Held,
cannot be ignored.                                                               D

       Constitution of India, 1950: Articles 14 & 16 read with Rule 27 (iv) of
U.P. State Mineral Development Corporation Employees Service Rules, 1978
as amended by Amendment Rules 1988 : Rule providing for compulsory
retirement on attaining age of 50 years-Whether arbitrary and ultra vires for:   E
not prescribing any minimum period of service-Held, no.

      Rule 27 of the U.P. State Mineral Development Corporation
Employees Service Rules, 1978 was substituted by the Amendment Rules
of 1988. Clause (i) of the said amended rule prescribes 58 years as the age
of superannuation for its employees, while clause (iv) empowers the ap-          F
pointing authority, at any time in the public interest or in the interest of
Corporation, to retire an employee who has attained the age of 50 years.
The rule was brought into force on May 15, 1988.

      The respondent had joined sen-ice with the appellant Corporation           G
on January 18, 1977 on post of Marketing Officer. One of the terms of his
appointment was that he will be governed by the rules and l'egulations of
the Corporation framed from time to time. He was redesignated as
Marketing Manager on April 16, 1977 and was confirmed on that post by
order dated June 2, 1984 with effect frlim March 14, 1978. He started
officiating as Chief Marketing Manager under order dated March 12,               H
                                     689
    690                   SUPREME COURT REPORTS [1996} SUPP. 1 S.C.R.

A   19M4. In his confidential report for the year 1983-84, the Reviewin;; Officer
    had on .May 15, 1985, among other adverse remarks, rated his performance
    as poor. He was compulsorily retired from service on the recommendation
    of a Screening Committee, by an order dated August 20, 1988 passed in
    exercise of the powers under rule 27(iv).

B          On a writ petition, the High Court struck down rule 27(iv) being
    violative of Articles l4 and 16 of the Constitution inasmuch as it did not
    prescribe any minimum period of service and conferred arbitrary power
    on the authority to pass an order of compulsory retirement of an employee
    after 1, 2, 5, or HI years of service.
c         In the appeal by special leave, apart from submissions on merits of
    the order of compulsory retirement, it was urged for the respondent that
    his services have arbitrarily terminated, that clause (iv) of rule 27 could
    not be given retrospective effect from 1977 and applied to the respondent,
    and that the remarks made by the Reviewing Officer in respondent's
D   confidential report for the year 1983-84 on May 19, 1985 after he had
    ceased to be the Managing Director should be ignored.

          By order dated August 27, 1990 the Court stayed the reinstatement
    of the respondent on condition that the appellant will continue to pay 60%
    of the salary to him and his agreeing that the receipt of the said payment
E
    would be subject to further orders of the Court. The appellant Corporation
    by its order dated January 12, 1995 appointed the respondent as Chief
    Marketing Manager instead of paying him 60% of the salary without
    obtaining his services.

F         Allowing the appeal, the Court

          HELD : 1. The order of compulsory retirement of the respondent
    does not sutTer from any infirmity. [702-C]

          2. It cannot be said that clause (iv) of Rule 27 of the U.P. State
G   Mineral Development Corporation Employees Service Rules, 1978 sutlers
    from the vice of arbitrariness and is violative of the provisions of Articles
    14 and 16 of the Constitution inasmuch as it does not prescribe a minimum
    length of service for the exercise of the power of compulsory retirement. It
    is not obligatory that a provision regarding compulsory retirement must
H   always provide for a minimum period of service. Such a provision may be
          U.P. STATE MINERAL DEV. CORPN. v. K.C.P. SINHA              691

open for question if having lixed a proper age of superannuation it permits A
a permanent servant to be retired at an early stage of his career. The High
Court failed to note that under the said clause the power of compulsory
retirement can be exercised only after an employee attains the age of 50
years. The normal age of superannuation prescribed under Rule 27(i) is
58 years. The fixation of the age of 50 years for the purpose of compulsory B
retirement does not result in compulsory retirement of an employee at an
early stage of his career. [699-F; C;]

      Union of India v. Col. J.N. Sinha, [1971] 1 SCR 791; Shyam Lal v.
Union of india, [1955] 1 SCR 26; Tara Singh Etc. v. State of Rajasthan &
Ors., AIR (1975) SC 1487; State of Bombay v. Saubhagchand M. Doshi,
                                                                             c
[1958} SCR 571; T.G. Shivacharana Singh Etc. Etc. v. State of Mysore, AIR
(1965) SC 280 and Bailamtha Nath & Anr. v. Chief Distlict Medical Officer~
Baripada & Anr., [1992} 2 SCC 299, referred to.

                                                                             D
     Moti Ram Deka Etc. v. General Manage/; N.E.F. Railways Maliguun,
Pandu, Etc., [1964] 5 SCR 683 and Gurdev Singh Sidhu v. State of Punjab
& Am:, [1964] 7 SCR 587, distinguished.


      3. The application of clause (iv) of rule 27 in respondent's case E
cannot be said to suffer from the vice of arbitrariness. Compulsory retire-
ment differs from dismissal or removal from service in the sense that while
the case of dismissal or removal involves loss of benefit already earned,
an officer who is compulsorily retired does not lose any part of the benefit
already-earned and there is no diminution of the accrued benefit. It is not
case of the respondent that he has been denied the benefit which accrued F
to him on the basis of his service in the Corporation. The fact that he
joined service at a late stage when he was about 41 years old and on his
being compulsorily retired his sen·ices stood terminated after putting
about 9 years of service only does not mean that the order of compulsory
retirement ceases to be an order for compulsory retirement and should be G
treated as an order of removal from service. Merely because the respon-
dent ~ould not be able to earn pension since he had not put in the
prescribed period of qualifying service would not invalidate the order of
compulsory retirement if it is otherwise found to have been passed in
accordance with the recJnirements of rule 27(iv). [700-E; G-H; 701-A-B]      H
    692                  SUPREME COURT REPORTS [1996] SUPP.1 S.C.R.

A         Shyam Lal v. Union of India, {1955] 1 SCR 26, referred to.

         Delhi Transpmt Cmporation v. DTC Mazdoor Congress, [1990] Supp.
    1 SCR 142; Central Inland Water Transp01t Cmporation Ltd. & Anr. v. Brojo
    Nath Gangulay & Anr., [1986] 3 SCC 156 and West Bengal State Electlicity
    Board v. D.B. Gupta, [1985] 3 SCC 116, distinguished.
B
          4, The amendment introduced in the Rules by the Amendment Rules
    of 1988 with effect from May 15, 1988 whereby rule 27 was substituted,
    operates prospectively in reS}Ject of all the employees of the Corporation
    who were employed with the Corporation on that date. The said operation
C   cannot be held to be retrospective in nature merely because it applies to
    employees who joined the Corporation prior to the said amendment but
    were in service of the Corporation on the date of coming into nperation of
    the amendment. Moreover, respondent's letter of appointment specifically
    stated that he will be governed by the rules and regulations of the Cor-
D   poration framed from time to time. It cannot be said, that the amendment
    was wrongly applied in his case. [700-B-D]

          5. The remarks made in the confidential report of the respondent
    for the year 1983-84 rating his performance as poor, cannot be ignored
E   only because the relevant file was taken away by the Reviewing Officer
    with him and the file was sent back after two year in 1987. No case of
    malafides has been made out by the respondent against the Reviewing
    Officer. The said remarks contain a reOection on the integrity of the
    respondent in the matter of discharging his duties. Having regard to
    those remarks it cannot be said that the compulsory retirement of the
F
    responde~t by the appointing authority under order dated August 20,
    1988 was not in public interest. [701-F-G; 702-8]

          6. Since the respondent has been reappointed as Chief Marketing
    Manager by order dated January 12, 1995, and he is functioning on that
G   post now, it will be open to the Corporation, in view of upholding of the
    order of compulsory retirement, to consider whether the respondent
    should continue on the post of Chief Marketing Manager. {702-E]

          7. As regards the period for which the respondent has been paid 60%
H of the salary in pursuance of the order dated August 27, 1990 the said
     U.P.STATEMINERALDEV. CORPN. v. K.C.P. SINHA[S.C.AGRAWAL,J.)       693

amount shall be refundable. [702-E-F]                                        A
         CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3491 of
 1990.

     From the Judgment and Order dated 22.2.90 of the Allahabad High
Court in W.P. No. 6677 of 1988.                                              B
         Ms. Rachna Gupta for the Appellants.

     Parag Tripathi, (Rajesh Kumar Singh) for L.P. Aggarwala & Co. for
the Respondent.
                                                                             c
         The Judgment of the Court was delivered by

       S.C. AGRAWAL, J. This appeal, by special leave, raises the question
 regarding validity of Rule 27(iv) of the U.P. State Mineral Development
 Corporation Limited Employees Service Rules, 1978 (hereinafter referred D
 to as 'the Rules'), as amended vide the Amendment Rules of 1988 with
 effect from May 15, 1988 which provides for compulsory retirement of an
 employee of the U.P. State Mineral Development Corporation (hereinafter
 referred to as 'the Corporation').

        The Corporation, a company registered under the Companies Act, E
  1956, is an undertaking of the Government of Utter Pradesh. The respon-
  dent joined the Corporation on January 18, 1977. Initially he was appointed
  on the post of Marketing Officer. He was redesignated as Marketing
  Manager on April 16, 1977. He was confirmed on the post of Marketing
  Manager by order dated June 2, 1984 with .effect from March 14, 1978. He F
  started officiating as Chief Marketing Manager under order dated March
  12, 1984. By order dated August 20, 1988, the respondent was compulsorily
  retired from service from the date of the issuance of the said order. It was
  directed that in lieu of three months notice he would be entitled to the
  payment of a sum equivalent to the amount of salary and allowances, if any,
  at the rate applicable to him just before the retirement. The said order was G
  passed in exercise of the powers conferred by Rule 27(iv) of the Rules.
  The respondent filed a writ petition (W.P. No. 66/88) in the Allahabad
  High Court, Lucknow Bench, challenging the said order of compulsory
. retirement. The said writ petition has been allowed by the High Court by
  the impugned judgment dated February 20, 1990. The High Court has held H
    694                   SUPREME COURT REPORTS [1996] SUPP. 1 S.C.R.

A   that Rule 27(iv) of the Rules is violative of the provisions of Articles L4
    and 16 of the Constitution inasmuch as it does not prescribe any minimum
    period of service and confers arbitrary powt:r on the authority who can
    pass an order for compulsory retirement of an employee after 1, 2, 5, or
    10 years of service. Feeling aggrieved by the said judgment of the High
    Court the appellants have tiled this appeal.
B
          Apart from supporting the judgment of the High Court striking down
    Rule 27(iv) of the Rules, the learned counsel for the respondent has
    addressed us on the merits of the order of compulsory retirement and has
    submitted that even if the rule is held to be valid the said order cannot be
C   sustained. We will first examine the question regarding the validity of Rule
    27(iv) of the Rules.

          Rule 27 of the Rules, which was substituted by the Amendment Rules
    of 1988, which came into force on May 15, 198B, provides as follows :

D           "Retirement : 27

            (i) Except as otherwise provided in this rule an employee shall
            retire from the service on the afternoon of the last day of the month
            he attains the age of 58 years.

E              An employee whose date of birth is the first day of a month
            shall retire from service on the afternoon of the last day of the
            preceding month on attaining the age of 58 years :

                Provided an employee of Class IV who entered into the service
            of the Corporation prior to this amendment shall retire at the age
F           of 60 years.

            (ii) Notwithstanding anything contained in these rules an employee
            may seek Voluntary retirement by giving 3 months notice to the
            appointing authority at any time after attaining the age of 45 years
            or after he has completed the service of 20 years.
G
            (iii) Provided that the appointing authority may waive the period
            of notice fully or partially but the retirement shall be effective only
            after an order has been passed by the appointing authority to this
            effect. In his discretion the appointing authority may reject the
H           offer of voluntary retirement of the employee.
    U.P.STAlEMINERALDEV. CORPN. v. K.C.P.SINHA(S.C.AGRAWAL,J.)          695

        (iv) The appointing authority may at any time retire in the public A
        interest or in the interest of the Corporation an employee at the
        age of 50 years by giving him 3 months notice or pay in lieu thereof
        or pay for the said period which falls short of said period of 3
        months.

        (v) In order to satisfy whether it will be in the public interest or   B
        in the interest of the Corporation to retire an employee of the
        Corporation under sub-rule of Rule 27 the appointing authority
        may take into consideration any material relating to the employee
        and nothing herein contained shall be construed to exclude from
        the consideration i.e.                                                 c
            i. any entry relating to any period before such employe> ~ was
        allowed to cross any efficiency bar or before he was promoted to
        any post in officiating or substantive capacity or any stop gap
        arrangement or any ad hoc post or
                                                                               D
           ii. any entry against which a representation is pending either
        before the Board or any other authority provided that the repre-
        sentation is also taken into consideration along with the entry or

            iii. any report of communication received from the Government
        or any report received from the internal vigilance/security set-up
                                                                               E
        established by the Corporation under the orders of the
        Board/Chairman/Managing Director or any report of the vigilance
        establishment constituted under the U.P. Vigilance Establishment
        Act, 1965 or any report form the CID of the State of U.P,
                                                                               F
           iv. Every such decision taken in sub-rule (iv) shall be deemed
        to have been taken in the public interest or in the interest of the
        Corporation as the case may be."

      Clause (i) of Rule 27 prescribes 58 years as the age of superannua-
tion for all employees except employees of Class IV for whom the age of G
super;;mnuation is fiXed at 60 years. Clauses (ii) and (iii) enable an
employee of the Corporation to seek voluntary retirement by giving three
months notice to the appointing authority at any time after attaining the
age of 45 years or after he has completed the service of 20 years and the
period of notice can be waived fully or partially by the appointing authority. H
    696                   SUPREMECOURTREPORTS [1996] SUPP.1 S.C.R.

A    Clause (iv) empowers the appointing authority at any time in the public
     interest or in the interest of the Corporation to retire an employee who has
     attained the age of 50 years by giving him 3 months notice or pay in lieu
     thereof. The said clause does not prescribe a minimum period of service
     for the exercise of the power of compulsory retirement by the appointing
     authority. Clause (v) prescribes the material that can be taken into con-
B    sideration while exercising the power under clause (iv).

          The question is whether it is obligatory to prescribe minimum length
    of service in a provision relating to compulsory retirement and whether in
    the absence of such a requirement the provision relating to compulsory
C   retirement has to be held to be invalid.

          The object underlying a provision enabling the appointing authority
    to compulsorily retire an employee before he attains the prescribed age of
    superannuation is to energize the administration and make it more efficient
    by chopping of deadwood and to ensure that a key post is held by a person
D   of undoubted ability and integrity. (See; Union of India v. Col. J.N. Sinha,
    [1971] 1 SCR 791 at p. 796). The decisions of this Court show that such
    provisions fall in three categories ;

           I. A provision which enables compulsory retirement of an employee
E   after he has put in a certain period of service. (See : Shyam Lal v. Union
    of India, [1955] 1 SCR 26 and Tara Singh, Etc. v. State of Rajasthan & Ors.,
    AIR (1975) SC 1487. Compulsory retirement permissible on completion of
    25 years of qualifying service).

          II. Provision which enables the compulsory retirement on attaining a
F   particular age. (See : Col. J.N. Sinha (supra) Fundamental Rule 56G) -
    compulsory retirement permissible on attaining the age of 50 years).

        III. Provision which enables compulsory retirement on attaining a
  particular age or on completion of a particular period of qualifying service.
  (See : The State of Bombay v. Saubhagchand M. Doshi, [1958] SCR 571,
G T.G. Shivacharana Singh Etc. Etc. v. State of Mysore, AIR (1965) SC 280,
  Baikuntha Nath & Anr. v. Chief District medical Officer, Bmipada & Anr.,
  [1992] 2 sec 299.

          In Saubhagchand M. Doshi (supra), this Court, while distinguishing
H compulsory retirement from dismissal or removal from service, has pointed
         U.P. STATEMINERALDEV. CORPN. v. KC.P.SINHA!S.C.AGRAWAL,J.]          697

     out that while in the case of retirement misconduct and efficiency merely A
     furnish the background and there is no duty to hold an enquiry, in the case
     of dismissal or removal from service they form the very basis on which the
     order is made and the enquiry thereon must be formal and must satisfy the
     rules of natural justice. This Court has further observed :

             "It should be added that questions of the above character could        B
             arise only when the rules fix both an age of superannuation and
             an age for compulsory retirement and the services of a civil servant
             are terminated between these two points of time. But where there
             is no rule fixing the age of compulsory retirement, or if there is
             one and the servant is retired before the age prescribed therein,      C
             then that can be regarded only as dismissal or removal within Art.
             311(2)." (p. 579)

           In Moti Ram Deka Etc. v. General Manager, N.E.F. Railways,
     Maligaon, Pandtt, Etc., [1964] 5 SCR 683, while examining the validity of
     Rules 148(3} and 149(3) of the Indian Railway Establishment Code               D
     which provided for termination of services of a permanent servant by
     giving a notice by either side, this Court has taken note of the decisions
     of this Court relating to compulsory retirement of Government
     employees including the decision in Saubhagchand M. Doshi (supra) and
     lhe observations referred to above. After quoting the said observations, it    E
     has been observed :

              "It would be noticed that the rule providing for compulsory retire-
              ment was upheld on the ground that such compulsory retire~ent
            . does not amount to removal under Art. 311(2) because it was
              another mode of retirement and it could be enforced only between      F
              the period of age of superannuation prescribed and after the
              minimum period of service indicated in the rule had been put in.
              If, however, no such minimum period is prescribed by thr rule of
              compulsory retirement, that according to the judgment, would
              violate Art. 311(2) and though the termination of a servant's         G
..            services may be described as compulsory retirement, it would
              amount to dismissal or removal within the meaning of Article
              311(2). With respect, we think that this statement correctly repre-
              sents the true position in law." (pp. 715-716)

           These observations regarding prescribing a minimum period of H
    698                   SUPREME COURT REPORTS [1996] SUPP.l S.C.R.

A   service have to be read in the light of the observations in Saubhagchand
    M. Doshi (supra) referred to above which have been approved and which
    refer to fixing of the age of compulsory retirement. The observations in
    Moti Ram Deka (supra) were made in context of the provisions of Rule
    165-A of the Bombay Civil Service Rub, as amended by the Saurashtra
    Government, which was under consideration in Saubhagchand M. Doshi
B   (supra). It provided for compulsory retirement of a Government servant
    after he had completed 25 years of qualifying service or 50 years of age. In
    Saubhagchand M. Doshi (supra) the employee was appointed in 1948 and
    he was compulsorily retired on October 30, 1952, after 4 years service,
    under the said rule since he had attained the age of 50 years. He had not
c   completed the period of 35 ye<:rs of qualifying service. The said order was
    upheld by this Court. The obscrvatlons of this Court in Moti Ram Deka
    (supra) regarding the requirement of a minimum period of service cannot,
    therefore, be read to mean that a provision regarding compulsory retire-
    ment must always provide for a minimum period of service. [n Moti Ram
D   Deka (supra) what has been emphasised by this Court is that the validity
    of a rule providing for compulsory retirement may be open to question if
    having fixed a proper age of superannuation it permits a permanent servant
    to be retired at an early stage of his career.

          This question came to be considered in Gurdev Singh Sidhu v. State
E of Punjab & Anr., (1964] 7 SCR 587, in the context of Article 9.1 of the
    Pepsu Services Regulations which provided that the Government could
    retire any Government servant after he had completed 10 years of qualify-
    ing service. The said rule was held to be invalid as being violative of Article
    311(2) of the Constitution. It has been observed :

F
             "If a permanent public servant is compulsorily retired under the
             rules which prescribed the normal age of superannuation and
             provide for a reasonably long period of qualified service after
             which alone compulsory retirement can be ordered, that again may
             not amount to dismissal or removal under Article 311(2) mainly
G            because that is the dfect of a long series of decisions of this Court.
             But where while reserving the power to the State to compulsorily
                                                                                      r
             retire a permanent public servant, a rule is framed prescribing a
             proper age of superannuation, and another rule is added giving
             the power to the State to compulsorily retire a permanent public
H            servant at the end of 10 years of his service, that cannot, we think,
         U.P.SfATEMINERALDEV. CORPN.v. KC.P.SINHAIS.C.AGRAWAL,J.]            699

             be treated as falling outside Art. 311(2). The termination of the A
             service of a permanent public servant under such a rule though
             called compulsory retirement, is, in substance, removal under Art,
             311(2)." (p.594)

            The High Court, in striking down clause (iv) of Rule 27 of the Rules,
      has placed reliance on the decisions of this Court in Moti Ram Deka           B
      (supra) and Gurdev Singh Sidhu v. State of Punjab & Anr., (supra) to hold
     that it was incumbent to prescribe a minimum period of service. In taking
     the said view the High Court failed to note that under clause (iv) of Rule
     27 of the Rules the power of compulsory retirement can be exercised only
     after an employee attains the age of 50 years. The normal age of superan-      c
     nuation prescribed under Rule 27 is 58 years. The fiXation of the age of 50
     years for the purpose of compulsory retirement does not result in compul-
     sory retirement of an employee at an early stage of his career. As noticed
     earlier, there is a similar provision in Fundamental Rule 56G) which
     provides for compulsory retirement on attaining the age of 50 years or 55      D
     years as mentioned in Col. J.N. Sinha (supra) and the orders passed for
     compulsory retirement under the said provision have been upheld by this
     court. Similarly there are provisions where the power of compulsory retire-
     ment can be exerCised either on attaining a particular age (generally 50
     years) or on completion of the prescribed period of qualifying service and
     orders for compulsory retirement passed on attaining the prescribed age        E
     have been held to be valid as in Saubhagchand M. Doshi (supra) and T.G.
     Shivacharana Singh (supra). In Saubhagchand M. Doshi (supra) the
     employee had been compulsorily retired on completion of about 4 years
     service only. We ate, therefore, unable to agree with the view of the High
     Court that clause (iv) of Rule 27 suffers from the vice of arbitrariness and
                                                                                    F
     is violative of the provisions of Articles 14 and 16 of the Constitution
     inasmuch a's it does not prescribe a minimum length of service for the
     exercise of the power of compulsory retirement.

            Shri Tripathi, the learned counsel appearing for the respondent, has
     urged that even if clause (iv) of Rule 27 is held to be valid the said clause G
     not be applied in the case of the respondent because the respondent joined
..   the service of the Corporation in 1977 and this clause was introduced after
     his joining the service with effect from May 15 1988. It has been urged
\
     that the said provision cannot be given retrospective effect so as to apply .
     to the respondent who had joined service of the Corporation prior to the H
    700                  SUPREME COURT REPORTS 11996] SUPP.1 S.C.R.

A   introduction of the said clause. The submission is that the amendment that
    was introduced in the Rules in 1988 can only operate prospectively and
    does not have retrospective operation. We iind no merit in this contention.
    The amendment that has been introduced in the rules by the Amendment
    Rules of 1988 with effect from May 15, 1988 operates prospectively and
    the said operation cannot be held to be retrospective in nature merely
B   because it applies to employees who joined the Corporation prior to the
    said amendment but were in service of the Corporation on the date of
    coming into operation of the amendment. The rule operates prospectively
    in respect of all the employees of the Corporation who were employed with
    the Corporation on May 15, 1988. Moreover, the letter of appointment
c   dated January 18, 1977 which was given to the respondent contains the
    following terms :

            ''You will be governed by the rules and regulations of the Corpora-
            tion framed from time to time".

D
    The respondent, therefore, cannot make a grievance that the amendment
    that was made in the Rules in 1988 whereby Rule 27 was substituted is not
    applicable to him and was wrongly applied.

          Shri Tripathi has next submitted that even if clause (iv) of Rule 27
E is held to be valid the application of the said rule in the case of the
    respondent suffers from the vice of arbitrariness inasmuch as the services
    of the respondent have been arbitrarily terminated. In support of his
    aforesaid submission, Shri Tripathi has invoked the principles laid down by
    this Court in Delhi Transpon Corporation v. DTC Mazdoor Congress, {1990]
F   Supp. 1 SCR 142, Centra/Inland Water Transp01t Corporation Ltd. & Anr.
    v. Brojo Nath Ganguly & Anr., [1986J 3 SCC 156 and West Bengal State
    Electricity Board V. D.B. Gupta, [1985] 3 sec 116. In our opinion, this
    silbmission is without substance. As pointed out by this Court in Shyum
    La/ (supra) compulsory retirement differs from dismissal or removal from
    service in the same that while in the case of dismissal or removal involves
G   loss of benefit already earned an officer who is compulsorily retired does
    not lose any part of the benefit that he has earned and on compu.lsory
    retirement he would be entitled to the benefit that he has actually earned
    and that there is no diminution of the accrued benefit (p.42). It is not the
    case of the respondent that he has been denied the benefit which accrued
H   to hiin on the basis of his service in the Corporation. The fact that the
    U.P.STATEMINERALDEV. CORPN. v. K.C.P.SINHA[S.C.AGRAWAL, .T.)           701

respondent joined service at a late stage when he was about 41 years old A
and on account of his being compulsorily retired his services stood ter-
minated after putting about 9 years of service only does not mean that the
order of compulsory retirement ceases to be an order for compulsory
retirement and should be treated as an order for removal from service.
Merely because the respondent would not be able to earn pension since
he had not put in the prescribed period of qualifying service would not
                                                                           B
invalidate the order of compul~ory retirement if it is otherwise found to
have been passed in accordance with the requirements of Rule 27(iv).

      The impugned order of c()mpulsory retirement was passed on the
basis of the recommendations of a Screening Committee consisting of the           C
Managing Director and two Directors of the Corporation. In the Confiden-
tial Report of the respondent for the year 1983-84 following remarks have
been made by the Reviewing Officer :

          "I regret that I cannot agree with the Reporting Officer. Shri K.C.P.
       . Sinha evaded responsibility and his general reputation for integrity     D
         .was bad. He got his own brother-in-law appointed as Sales Agent
        . for Silica S<l:nd and other products without disclosing this fact to
          the Management and continued to deal with him throughout
          without disclosing this relationship. His general reputation some-
          how has not been very good. I was not satisfied even with his           E
          administrative· ability. I would assess his performance and leader-
          ship qualities inadequate. He might be able to work successfully
          under dose superVision but is unsuitable for an independent as-
        . signment. His written work is well below average.

        I would rate his performanc~ .as poor."                                   F
        Shri Tripathi has submitted that the said remarks were made by Shri
A.P, Singh on May 19, 1985 after he had ceased to be the Managing
 Director of the Corporation and that he had taken the file with him when
 he left the Corporation and he ·teturned the file only in 1987. It has also
.been urged by Shti Tripathi that ·t he respondent had submitted a repre- G
 sent!ltion against the remarks and the same has not been considered. The
 fact of the respondent having submitted a representation against the said
 remarks was denied by the app~llants before the High Court. The High
 Court felt that this being a disputed question of fact, could not be decided
 in: writ jurisdiction. We are in agreement with the said view of the High H
    702                   SUPREME COURT REPORTS [1996] SUPP. 1 S.C.R.

A Court. Insofar as the remarks are concerned, we are of the view that the
    same cannot be ignored only because the relevant file was taken away by
    Shri A.P. Singh, the Reviewing Officer, with him and the file was sent back
    after two years in 19g7_ No case of mala fides has been made out by the
    respondent against the Reviewing Officer. The said remarks contain a
    reflection on the integrity of the respondent in the matter of discharging
B
    his duties. Having regard to the said remarks it is not possible to hold that
    the compulsory retin:ment of the respondent by the appointing authority
    under order dated August 20, 198g was not in public interest. We are,
    therefore, of the view that the order of compulsory retirement of the
    respondent does not suffer from any infirmity and the High Court was not
C   justified in st:tting aside the said order .

         . By order dated August 27, 1990, this Court had stayed the reinstate-
    ment of the respondent on condition that the appellants will continue to
    pay 60% of the salary to the respondent and the respondent had agreed
    that the receipt of the said payment would be subject to futher orders of
D   this Court. It appears that the respondent was paid 60% of the salary in
    accordance with the said order but subsequently the Corporation, instead
    of paying 60% of the salary without obtaining his services considered it
    essential in the interest of the Corporation to obtain his services and by
    order dated January 12, 1995 he has been appointed as Chief Marketing
E   Manager and he is functioning on that post now. Since we are upholding
    the order of compulsory retirement it will be open to the Corporation to
    consider whether the respondent should continue on the post of Chief
    Marketing Manager. As regards the period for which the respondent had
    been paid 60% if the salary in pursuance of the order dated August 27,
    1990 the said amount shall be refundable by the respondent to the Cor-
F   poration. The said amount shall be refunded by the respondent within a
    period of three months.

          Jn the result the appeal is allowed, the impugned judgment of the
    High Court is set aside and the writ petition filed by the respondent is
G   dismissed. No orders as to costs.

    P.S.S.                                                     Appeal allowed.