M. Gopala Krishna Naidu Vs. State of
Madhya Pradesh  INSC 189 (24 August 1967)
24/08/1967 SHELAT, J.M.
CITATION: 1968 AIR 240 1968 SCR (1) 355
CITATOR INFO :
F 1972 SC2472 (13,15,16) APR 1985 SC1416
(5,107) RF 1986 SC 555 (6) R 1987 SC2257 (16,17,19)
Government Service--Fundamental Rule r
54--Emoluments payable on re--instatement after suspension--Opportunity to
show, cause whether necessary before passing orders under Rule and deciding
which clause of the rule is applicable to the case--Natural Justice.
The appellant was an Overseer in the Public
Works Department of the Central Provinces and Berar Government. In 1947 he was
suspended from service and prosecuted under s. 161 I.P.C. Ultimately, on orders
from the High Court, the prosecution was dropped. In a departmental enquiry
also the appellant was exonerated, By an order dated December 1960, the
Government held that the suspension of the appellant and the' departmental
enquiry against him "were not wholly unjustified". The order then
directed that the appellant should be reinstated in service with effect from
the date of the order and retired from the date, he, having already attained
superannuation age on September 5, 1952 and that the entire period of absence
from duty should be treated as period spent on duty under F.R. 54(5) for
purposes of pension only, but that he should not be allowed any pay beyond what
he had actually received or what was allowed to him, by way of subsistence allowance
during the period of his suspension. The appellant filed a petition under Art.
226 of the Constitution contending that F.
Rule 54(2) governed his case and not F. Rule 54(5). The High Court decided
against him but granted him certificate to appeal to this Court. It was
contended on behalf of the appellant that before deciding which rule applied to
his case the Government should have given him an opportunity to be heard.
The respondent urged that in passing a
consequential order a hearing is not necessary.
Held: An order passed under F R. 54 is not
always a consequential order nor is such order necessarily a continuation of
the departmental proceeding taken against the employee. [359E-F] Consideration
under F.R. 54 depending as it does on facts and circumstances in their
entirety, passing an order on the basis of factual finding arrived at from such
facts and circumstances and such an order resulting in pecuniary loss to the
Government servant must be held to be an objective rather than a subjective function.
The very nature of the function implies the duty to act judicially. In such a
case if an opportunity to show cause against the action proposed is not
afforded, as admittedly it was not done in the present case, the order is
liable to be struck down as invalid on the ground that it was one in breach of
the principles of natural justice.
State of Orissa v. Dr. (Miss) Binapani Devi
and Ors.  2 S.C.R. 625, relied on. [359H; 360A-B] V. R. Gokhale v. State
of Maharashtra, I.L.R.  Bom.
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 2376 of 1966.
355 356 Appeal from the judgment and order
dated January 18, 1963 of the Madhya Pradesh High Court in Miscellaneous
267 of 1962.
R.V.S. Mani, E.C. Agarwala and P.C. Agarwala,.for
B. Sen, M.N. Shroff for I.N. Shroff for the
The Judgment of the Court was delivered by.
Shelat, J. Prior to December 17, 1947 the
appellant was serving as an Overseer in the Public Works Department of the
Central Provinces and Berar Government. On December 17, 1947 he was suspended
from service and prosecuted under section .161 of the Penal Code. The trial
resulted in his conviction but that was set aside in appeal on the ground that
no proper sanction for prosecution was obtained. He was again prosecuted on the
same charge but the Special Judge trying him quashed the chargesheet on the
ground that the investigation had not been carried out by the proper
authorities. In revision the High Court of Nagpur held that the Special Judge
was in error in so holding but recommended that the prosecution should not be
proceeded with as nearly 10 years had gone by since it was launched against the
appellant. Following the recommendation the prosecution was dropped but a
departmental inquiry was held on the same charges. The Inquiry Officer found
the appellant not guilty but the Government disagreed with that finding and
served a notice to show cause why he should not be dismissed. By an order dated
December 5, 1960 the Government held that the charges against the appellant
were not proved beyond reasonable doubt. It also held that the suspension and
the departmental inquiry "were not wholly unjustified". The order
then directed that the appellant should be reinstated in service with effect
from the date of the order and retired from that, date, he having already
attained superannuation age on September 5, 1952 and that the entire period of
absence from duty should be treated as period spent on duty under F.R. 54(5)
for purposes of pension only, but that he should not be allowed any pay beyond
what he had actually received or what was allowed to him by way of subsistence
allowance during the period of his suspension.
On a representation made by him against the
said order having been rejected the appellant filed a petition under Art.
226 of the Constitution in the High Court of
Madhya Pradesh for quashing the said order and for an order directing the
Government to treat the period of absence from duty as period spent on duty
under cl. 2 of the said Fundamental Rule and to revise the pension payable to
him under that clause. The High Court dismissed the petition but granted
certificate to file this appeal and that is how this appeal has come up before
357 Fundamental Rule 54 on the interpretation
of which this appeal depends is as follows: "(1) When a Government servant
who has been dismissed, removed or suspended is reinstated;
the authority competent to order the
reinstatement shall consider and make a specific order-, (a) Regarding the pay
and allowance to be paid to the Government servant for the period of his
absence from duty; and (b) whether or not the said period shall be treated as a
period spent on duty-, (2) Where the authority 'Mentioned in sub-rule (1) is of
opinion that the Government servant has been fully exonerated or in the case of
suspension, that it was wholly unjustified, the Government servant shall be
given the full pay and allowances to which he would have been entitled, had he
not been dismissed, removed or suspended as the case may be.
(3)In other cases, the Government servant
shall be given such proportion of such pay and allowances as such competent
authority may prescribe Provided that the payment of allowances under clause
(2)or clause (3) shall be, subject to all other conditions under which such
allowances are admissible. Provided other that such proportion of such pay and
allowances '-all not be less than the subsistence and other allowances
admissible under Rule 53.
(4) In a case falling under clause (2), the
period of absence from by shall be treated as a period spent on duty for all
(5) In a case falling under clause (3) the
period of absence from duty shall not be treated as a period spent on duty unless
such competent authority specifically directs that it shall be so treated for
any specified purpose.
Provided that if the Government servant so
desired, such authority may direct that the period of absence from duty shall
be converted into leave of any kind due and admissible to the, Government
servant." On behalf of the appellant two points were urged before the High
Court; (1) that before passing the impugned order the appellant ought to have
been given a reasonable opportunity to show cause against the action proposed
and (2) that it was clause 2 and not clause 5 which applied to his case. The
High Court rejected both the contentions and, as aforesaid, dismissed the
358 Counsel for the appellant canvassed the
same contentions before us. Mr. Sen on behalf of the State. however, argued
that F.R. 54 does not in express terms lay down a duty on the part of the
authority to give an opportunity to show cause to the government employee and
therefore the question would be whether the Rule imposed such a duty by
necessary implication. He urged that the Rule cannot be said to lay down such
duty by implications inasmuch as the impugned order is only a consequential
order. That it was passed following a departmental inquiry held against the
appellant during the course of which opportunity to show cause was already
afforded. He contended that the only duty laid down by FR. 54 was that the
Government should, consider whether the appellant was fully exonerated and in
case of suspension whether such suspension was wholly unjustified and that once
the authority formed the opinion that it was not so cls. 3 and 5 would apply.
The Government having formed the opinion that the suspension was not wholly
unjustified clans 5 applied and the impugned order was not liable to be
The first question which requires
consideration is whether there was a duty on the competent authority to afford
an opportunity to the appellant to show cause before that authority formed the
opinion as to whether he was fully exonerated and whether his suspension was
wholly unjustified. Under F.R. 54 where a Government servant is reinstated, the
authority has to consider and make a specific order (i) regarding pay and
allowances payable to him for the period of his absence from duty and (ii)
whether such period of absence should be treated as one spent on duty. The
consideration of these questions depends on whether on the facts and
circumstances of the case the Government servant had been fully exonerated and
in case of pension whether it was wholly unjustified. If the authority forms
such an opinion the Government servant is entitled to full pay and allowances
which he would have been entitled to had the order of dismissal, removal or
suspension, as the case may be, not been passed. Where the authority cannot
form such an opinion the Government servant may be given such proportion of pay
an allowances as the authority may prescribe. In the former case the period of
absence from duty has to be treated as period spent on duty for all purposes
and in the latter case such period is not to be treated as period spent on
duty. But the authority has the power in suitable cases to direct that such
period of absence shall be treated as period spent on duty in which case the
government servant would be entitled to full pay and allowances.
It is true that the order under FR. 54 in a
sense a consequential order in that it would be passed aft an order of
reinstatement is made. But the fact that it is a consequential order does not
determine the question whether the government servant has to be given an
opportunity to show cause or not. It is also true 359 that in. a case where
reinstatement is ordered after a departmental inquiry the government servant
would Ordinarily have had an opportunity, to show: cause. In such a case, the authority
no doubt ,would have before him the entire record including the explanation
given by the government servant from which all the facts and circumstances of
the case would be before the authority and from which he can form the opinion
as to whether he has been fully exonerated or not and in case of suspension
whether such suspension was wholly unjustified or not. In such a case the order
passed under a rule such as the present Fundamental Rule might be said to be a
consquential order following a departmental inquiry. But there are, three
classes of cases as laid down by the proviso in Art. 311 where a departmental
inquiry would not be held, viz., (a) where a person is dismissed, removed or
reduced in rank on the ground of conduct which has led to his conviction on a
criminal charge, (b) where the authority empowered. to dismiss or remove person
or to reduce him in rank is satisfied for reasons to be record in writing that
it is not reasonably practicable to hold such an inquiry; and (c) where the
President or the Governor as the case may be is satisfied, that in the interest
of security of the State it is not expedient to hold such inquiry. Since there
would be no inquiry in these classes of cases the authority would not have
before him any explanation by the' government servant. The authority in such
cages would have to consider and pass the' order merely on such facts which
might be placed before him by the department concerned. The order in such a
case Would be exparte without the authority having the other side of the
picture. In such cases the order that such authority would pass would not be a
consequential order as where a departmental inquiry has been held. Therefore,
aft order passed under Fundamental Rule 45 is not always a consequential order
nor is such order a continuation of the departmental proceeding taken against
It is true as Mr. Sen pointed out that F.R.
54 does not in express terms lay down that the authority shall give to the
employee concerned the opportunity to show cause before he passes the order.
Even so, the question is whether the rule casts such a duty on the authority by
implication. The order as to whether a given case falls under cl. 2 or cl. 5 of
the Fundamental Rule must depend on the examination by the authority of all the
facts and circumstances of the case and. his forming the opinion there from of
two factual findings; whether the employee was fully exonerated and in case of
suspension whether it was wholly unjustified.
Besides, an order passed under this rule
would obviously affect the government servant adversely if it is one made under
cls. 3 and 5. Consideration under this rule depending as it does on facts and
circumstances in their entirety, passing an order on the basis of factual
finding arrived at from such facts and circumstances and such an order
resulting in pecuniary loss to the government servant must be held to be an
objective rather than a subjective function.
360 The very nature of the function implies
the duty to act judicially. In such a case if an opportunity to show cause
against the action, proposed is not afforded, as admittedly it was not done in
the present case, the order is liable to be struck down as invalid on the
ground that it is one in breach of the principles of natural justice.
In the State of Orissa v. Dr. (Miss) Binapani
Devi and others(1) this Court held that an order fixing the date of birth of
the government servant concerned there and declaring that she should be deemed
to have retired on a particular date on the basis of the date so determined
without giving an opportunity to show cause against the action proposed was
invalid on the ground that the determination was in violation of the principles
of natural justice. It was there observed: "The State was undoubtedly not
precluded, merely because of the acceptance of the date of birth of the first
respondent in the service register, from holding an inquiry if there existed
sufficient grounds for holding such enquiry and for refixing her date of birth.
But the decision of the State could be based upon the result of an enquiry in a
manner consonant with the basic concept of justice. An order by the State to
the prejudice of a person in derogation of his vested rights may be made only
in accordance with the basic rules of justice and fairplay.
The deciding authority, it is true, is not in
the position of a Judge called upon to decide an action between contesting
parties, and strict compliance with the forms of judicial procedure may not be
insisted upon. He is however under a duty to give the person against whom an
enquiry is held an opportunity to set up his version or defence and an
opportunity to correct or to controvert any evidence in the possession of the
authority which is sought to be relied upon to his prejudice." We find
that the High Court of Maharashtra has also taken in V. R. Gokhale v. State of
Maharashtra(2) the same view which we are inclined to take of the nature of
function under R.
152 of the Bombay Civil Service Rules, 1959,
a rule in terms identical to those of F.R. 54 before us.
In our view, F.R. 54 contemplates a duty to
act in accordance with the basic concept of justice and fairplay. The authority
therefore had to afford a reasonable opportunity to the appellant to show cause
why cls. 3 and 5 should not be applied and that having not been done the order
must be held to be invalid.
(1)  2 S.C.R. 625.
(2) I.L.R.  Bom, 537.
361 The appeal is allowed and the High
Court's order is set aside. The competent authority is directed to consider the
question de novo after giving to the appellant a reasonable opportunity to show
cause against the action proposed against him. The respondent will pay to the
appellant costs of this appeal as also the costs of the petition in the
petition in the High Court.
G.C Appeal allowed.