JUDGMENT
K.A. Swami, C.J.
1. This writ appeal is preferred against the order, dated 23.7.1993, passed by the learned single Judge on Review Application No. 24 of 1992 filed for review of the order, dated 4.11.1992, passed in W.P.No. 10398 of 1992. As the review application has been rejected, the appeal is virtually against the order, dated 4.11.1992, dismissing W.P.No. 10398 of 1992.
2. 1n the writ petition the petitioner sought for quashing the order, dated 5.2.1991 passed by the Manager, United Insurance Company Limited, Regional Office, Madras, removing him from service and also the order, dated 9.10.1991 passed by the Assistant General Manager, United India Insurance Company Limited affirming the order of third respondent. The petitioner has also sought for quashing the order, dated 20.7.1992 passed by the first respondent, M/s. United India Insurance Company Limited.
3. On holding a disciplinary proceeding on certain charges, the appellant/petitioner came to be removed from service of the first respondent on 5.2.1991. As already pointed out, the order passed by the Manager, United India Insurance Company Limited had been affirmed by the Assistant General Manager of the Company and also by the company itself by the order, dated 20.7.1992. Before the learned single Judge several contentions were advanced both on facts as well as on legal infirmities. The learned single Judge has not gone into the facts because it was submitted before the learned single Judge that those contentions may be left open to be urged in the appeal. Therefore, only the legal contentions were considered by the learned single Judge. It was held by the learned single Judge that no opportunity was required to be afforded to the appellant/petitioner for reversing the findings recorded by the Enquiring Authority, by the Disciplinary Authority on some of the charges, that no copy of the findings recorded by the Enquiring Authority was required to be furnished to the appellant/petitioner before passing the order of removal as a copy of the same was furnished to the appellant along with the order, removing him from service, as it was open to the appellant to challenge the correctness of the same in the appeal. Further, the learned single Judge also relied upon Rule 26(2) of the General Insurance (Conduct, Discipline and Appeal) Rules, 1975, for holding that no opportunity was required to be given to the appellant/petitioner before reversing the findings recorded by the Enquiring Authority.
4. In the instant case, seven charges were framed against the appellant/petitioner. The enquiring Authority held that charge Nos. l, 3, 6 and 7 were not proved, whereas charge Nos. 2, 4 and 5 were proved. The Disciplinary Authority reversed the finding on charge No. 1 and approved the findings recorded on the other charges, without affording an opportunity to the appellant/petitioner and without furnishing a copy of the findings recorded by the Enquiring Authority. On the basis of the conclusion so arrived at by the Disciplinary Authority removed the petitioner from service. When the writ appeal came up before us for hearing on 8.11.1994, we passed the following order, after hearing both sides.
In this case, it is not in dispute that the Enquiring Authority is different from the Disciplinary Authority. After the report was submitted by the Enquiring Authority, the Disciplinary Authority passed an order of punishment, without furnishing the report of Enquiring Authority and without affording an opportunity to the employee to put forth his say to the findings recorded by the Enquiry Authority. The Disciplinary Authority also did not give opportunity to the employee to explain as to why the findings recorded by the Enquiring Authority on charge Nos. 1, 3, 6 and 7 should not be reversed and the findings recorded on charge Nos. 2, 4 and 5 should not be accepted. On the facts and circumstances of the case, we are of the view that the propositions laid down in paragraph Nos. 30 and 31 of the Judgment of the Supreme Court in Managing Director, E.C.I.L, Hyderabad v. B.Karunakar (1994)1 L.L.J. 162 are attracted. Therefore, before hearing the matter further, we grant two weeks time to the employee to file an affidavit stating as to how his case was prejudiced because of the non-supply of the report of the Enquiring Officer and also to show cause as to how he is prejudiced by the Management reversing the finding on charge No. 1 and accepting the findings on other charges.
Accordingly the appellant has filed the affidavit stating as to how and in what manner the prejudice is caused to him. There is a counter affidavit filed by one M.V. Natesan, the third respondent in the appeal. The said counter affidavit is filed on behalf of all the respondents. On going through the affidavit of the appellant/petitioner, we notice the appellant/petitioner has stated in greater detail as to how and in what manner the finding arrived at by the Disciplinary Authority on charge No. l is not correct. Similarly how and in what manner the findings recorded on charge Nos. 2, 4 and 5 are also not correct. In the counter-affidavit filed by the third respondent, it has not been stated as to in what manner the averments made in the affidavit of the petitioner/appellant are correct and how the findings recorded by the Disciplinary Authority are valid.
5. At this stage, we have to only consider whether any prejudice is caused to the appellant/petitioner by reason of non-furnishing of the finding recorded by the Enquiring Authority before accepting its findings and also reversing its findings on one of the charges as pointed out above. In the light of the judgment of the Supreme Court, in Managing Director, E.C.I.L., Hyderabad v. B. Karunakar (1994)1 L.L.J. 162, which is referred to by us in our earlier order, dated 8.11.1994, extracted above, in paragraph 30 (iv) and (v) and paragraph, 31, the Supreme Court has pointed out as to the procedure to be followed in such cases. The observations contained in those paragraphs are as follows:
… In the view that we have taken, viz., that the right to make representation to the disciplinary authority against the findings recorded in the inquiry report is an integral part of the opportunity of defence against the charges and is a breach of principles of natural justice to deny the said right, it is only appropriate that the law laid down in Union of India v. Mohd. Ramzan Khan (1991)1 L.L.J. 29, should apply to employees in all establishments, whether Government or non-Government, public or private. This will be the case whether there are rules governing the disciplinary proceedings or not and whether they expressly prohibit the furnishing of the copy of the report or are silent on the subject. Whatever the nature of punishment, further whenever the rules require an inquiry to be held, for inflicting the punishment in question, the delinguent employee should have the benefit of the report of the Inquiry Officer before disciplinary authority records its findings on the charges levelled against him. Hence, question (iv) is answered accordingly.
(v) The next question to be answered is what is the effect on the order of punishment when the report of the Inquiry Officer is not furnished to the employee and what relief should be granted to him in such cases. The answer to this question has to be relative to the punishment awarded. When the employee is dismissed or removed from service and the inquiry is set aside because the report is not furnished to him, in some cases the non-furnishing of the report may have prejudiced him gravely while in other cases it may have made no difference to the ultimate punishment awarded to him. Hence to direct reinstatement of the employee with backwages in all cases is to reduce the rules of justice to a mechanical ritual. The theory of reasonable opportunity and the principles of natural justice have been evolved to uphold the rule of law and to assist the individual to vindicate his just rights. They are not incantations to be invoked nor rites to be performed on all and sundry occasions. Whether in fact, prejudice has been causes to the employee or not on account of the denial to him of the report, has to be considered on facts and circumstances of each case. Where, therefore, even after the furnishing of the report, no different consequence would have followed, it would be a perversion of justice to permit the employee to resume duty and to get all the consequential benefits. It amounts to rewading the dishonest and the guilty and thus to stretching the concept of justice to illogical and exasperating limits. It amounts to an unnatural expansion of natural justice, which in itself is antithetical to justice.
(31) Hence, in all cases where the Inquiry Officer’s report is not furnished to the delinquent employee in the disciplinary proceedings, the Courts and Tribunals should cause the copy of the report to be furnished to the aggrieved employee if he has not already secured it before coming to the Courts/Tribunal and give the employee an opportunity to show how his or her case was prejudiced because of the non-supply of the report. If after hearing the parties, the Court/Tribunal comes to the conclusion that the non-supply of the report would have made no difference to the ultimate findings and the punishment given, the Court/Tribunal should not interfere with the order of punishment. The Court/Tribunal should not mechanically set aside the order of punishment on the ground that the report was not furnished as is regrettably being done at present. The Courts should avoid resorting to shortcuts. Since it is the Courts/Tribunals which will apply their judicial mind to the question and give their reasons for setting aside or not setting aside the order of punishment (and not any internal appellate or revisional authority), there would be neither a breach of the principles of natural justice nor a denial of the reasonable opportunity. It is only if the Court/Tribunal finds that the furnishing of the report would have made a difference to the result in the case that it should set aside the order of punishment. Where after following the above procedure, the Court/Tribunal sets aside the order of punishment. The proper relief that should be granted is to direct reinstatement of the employee with liberty to the authority/management to propeed with the inquiry by placing the employee under suspension and continuing the inquiry from the stage of furnishing him with the report. The question whether the employee would be entitled to the backwages and other benefits from the date of his reinstatement if ultimately ordered, should invariably be left to be decided by the authority concerned according to law, after the culmination of the proceedings and depending on the final outcome. If the employee succeeds to be reinstated, the authority should be at liberty to decide according to law how it will treat the period from the date of dismissal till the reinstatement and to what benefits if any and the extent of the benefits, he will be entitled. The reinstatement made as a result of the setting aside of the inquiry for failure to furnish the report, should be treated as a reinstatement for the purpose of holding the fresh enquiry from the stage of furnishing the report and no more, where such fresh inquiry is held. That will also be the correct position in law.
6. It is not possible to hold that no prejudice is caused to the appellant/petitioner by reason of non-furnishing of a report of the Enquiring Authority before accepting the same and imposing the punishment. As pointed out in the aforesaid case, the requirement as to furnishing of the findings recorded by the Enquiring Authority is an integral part of the opportunity that has to be given to the delinquent officer for imposing the punishment on the charges that had been proved, it is also pointed out in the decision that such a procedure is applicable to officers serving under Government or non-Government, private and public institutions. The averment contained in the affidavit filed in the appeal is that no opportunity had been given to him to prove his innocence with reference to the findings recorded with reference to each charge by the Enquiring Authority and before the Disciplinary Authority arrived at the final decision. It is not possible at this stage to say that the decision would not have been different from the one arrived, at by the Disciplinary Authority. At the same time, we make it clear mat this observation of ours shall not be taken as final expression on the explanation offered by the appellant in the affidavit filed in this appeal. This is intended only to ascertain as to whether prejudice is caused to the appellant/petitioner by reason of non-furnishing a copy of the findings recorded by the Enquiring Authority by the Disciplinary Authority, before accepting or reversing these findings. This is sufficient to remit the matter to the Disciplinary Authority. However, it is also necessary to refer to one of the findings recorded by the learned single Judge based upon Rule 26(2), Rule 26(1) to 4) is as follows:
The competent authority, if it is not itself the Inquiring Authority may, for reasons to be recorded by it in writing, remit the case to the Inquiring Authority for fresh or further inquiry and report and the Inquiring Authority shall thereupon proceed to hold the further inquiry according to the provisions of Rule 25 as far as may be.
(2) The competent authority shall, if it disagrees with the findings of the Inquiring Authority on any article of charge, record its reasons for such disagreement and record its own findings on such charge, if the evidence on record is sufficient for the purpose.
(3) If the competent authority having regard to its findings on all or any of the articles of charge is of the opinion that any of the penalties specified in Rule 23 should be imposed on the employee it shall, notwithstanding any thing contained in Rule 27 make an order imposing such penalty.
(4) If the competent authority having regard to its findings on all or any of the article of charge, is of the opinion that no penalty is called for, it may pass on order exonerating the employee concerned.
Sub-rule (1) of Rule 26 empowers the Disciplinary Authority, if it is not the Inquiring Authority to remit the case to the Inquiring Authority and if it is of the opinion that it is necessary to hold further inquiry, the Inquiring Authority shall proceed to hold further inquiry according to the provisions of Rule 26. As per Sub-rule (2) of Rule 26, it is open to the Disciplinary Authority to disagree with the finding recorded by the Inquiring Authority and in that event it shall have to record its reasons for disagreeing with the finding of the Inquiring Authority and also record its finding on such charges if the evidence on record is sufficient for the purpose. Sub-rule (3) of the Rule 26 empowers the Disciplinary Authority to impose the penalty as per the findings recorded on the articles of charges. Sub-rule (4) of Rule 26 empowers the Disciplinary Authority, if it is of the opinion that the findings on articles of charges do not warrant any penalty, to exonerate the employee, we are concerned in this case the scope of Sub-rule (2) of Rule 26. The learned single Judge has taken a view that the said rule excludes the principles of natural justice, therefore, it is not necessary to afford an opportunity to the delinquent officer to show cause as to why the findings recorded by the Inquiring authority should be reversed. In this regard, it is contended by Mr. A.L.S. Somayaji learned Senior Counsel for the respondents that the Inquiring Authority is none other than the delegatee of the Disciplinary Authority, as such he would be performing the functions of the Disciplinary Authority in holding the inquiry and recording evidence and submitting its finding along with the evidence and the same will not be final. The final authority vests in the Disciplinary Authority. Therefore, it is open to the Disciplinary Authority to reverse the findings recorded by the Inquiring Authority without further affording an opportunity to the delinquent officer because the Disciplinary Authority would be acting on the very same materials on which the Inquiring Authority has recorded the finding in respect of which the delinquent officer had already had the full opportunity. It may be pointed out here that no doubt the Inquiring Authority is appointed by the Disciplinary Authority for the purpose of holding an inquiry, recording the evidence and findings and in some cases even to propose the punishment. That being so, the proceedings of the Enquiring Authority become an integral part of the disciplinary proceedings wherein if the finding recorded by the Enquiring Authority on any of the charges is in favour of the delinquent officer, he is entitled to rely upon the same, therefore, if such a finding is to be reversed he is entitled to put forth his say as to why the finding recorded by the Inquiring Authority does not require to be reversed. In Union of India v. Mohd. Ramzan Khan (1991)1 L.L.J. 29, it has been observed thus:
Where, however, the disciplinary authority delegates the inquiry to another, such Inquiry Officer “may furnish a report on the basis of the evidence recorded by him and in some cases the Inquiry Officer even recommends the punishment to be imposed. In cases where the Inquiry Officer merely transmits the records of inquiry proceedings to the disciplinary authority, there is indeed no distinction to be drawn between the inquiry conducted by the disciplinary authority himself or the Inquiry Officer. This is so on account of the fact that there is no further material added to the record at the time of transmission to the disciplinary authority.
Therefore it is only in a case where the Inquiry Officer merely records the evidence and transmits the records to the disciplinary authority, there will not be any distinction between the Inquiring Authority and the Disciplinary Authority because the Inquiring Authority will not be doing anything more than recording the evidence and he will not be expressing his opinion in any manner on the evidence on record. Ultimately the disciplinary Authority has to “record a finding after hearing the delinquent officer. That being so, in a case where the Inquiring Authority is authorised not only to record evidence, but also submit his finding on the articles to charges, such a finding if rendered in favour of the delinquent officer, such a finding before it is reversed, the delinquent officer is required to be afforded an opportunity to put forth his say, before reversing such a finding, because such finding is recorded in accordance with the rules, empowering the Inquiring Authority to record a finding. Even in Union of India v. M.C. Goel , which is referred to by the learned Single Judge, it has been specifically observed thus:
If the report makes finding in favour of the public servant and the Government disagree with the said findings and holds that the charges framed against the public servants are prima facie proved, the Government should decide provisionally what punishment should be imposed on the public servant and proceed to issue a second notice against him in that behalf. It is also further observed that “if the enquiry officer makes findings, some of which are in favour of the public servant and some against him, the Government is entitled to consider the whole matter and if it holds that some or all the charges framed against the public servant are, in its opinion, prima facie established against him, then also the Government has to decide provisionally what punishment should be imposed on the public servant and give him notice accordingly. It would thus be seen that the object of the second notice is to enable the public servant to notify the Government on both the counts, one that he is innocent of the charges framed against him and the other that even if the charges, are held proved against him, the punishment proposed to be inflicted upon him is unduly severe.
Therefore, in Goel’s case, A.I.R. 1964 S.C. 364, the Supreme Court has stated in categorical terms that the findings of the Inquiring Officer can be reversed only after affording an opportunity to the delinquent officer to ‘show cause as to why those findings should not be reversed on the reasons stated in the notice. Hence, we are of the view that Rule 26(2), which does not in specific terms exclude the application of principles of natural justice cannot at all be construed as excluding the application of the principles of natural justice. No person can be condemned without giving him an opportunity to explain. Reversal of the findings recorded in favour of the delinquent officer on the article of charge results in not only condemning him but also makes him liable for punishment. Therefore, the principles of natural justice do step in and the same are to be complied with before reversing the findings recorded by the Inquiring Authority in favour of the delinquent officer, by the Disciplinary Authority.
7. In the light of the finding recorded by us to the prejudice caused to the appellant- petitioner in not affording an opportunity of showing cause against the findings recorded by the Enquiring Authority and also in not affording an opportunity to show cause as to why the findings recorded on charge No. l should not be reversed on the grounds stated in the notice, the matter requires to be remitted to the Disciplinary Authority in terms of the decision of the Supreme Court in Managing Director, E.C.I.L., Hyderabad v. B.Karunakar (1994)1 L.L.J. 162, as stated in paragraph 31 thereon, which has already been extracted above.
8. Accordingly, for the reasons stated above, the writ appeal is allowed. The orders, dated 23.7.1993 passed on Review Application No. 24 of 1992 and 4.11.1992 passed in W.P.No. 10398 of 1992 are set aside. The writ petition is allowed in the following terms:
The impugned orders, dated 5.2.1991, 9.10.1991 and 20.7.1992 passed by respondents 3, 2 and 1 respectively are quashed. The disciplinary proceeding in question is remitted to the Disciplinary Authority, viz., the third respondent, with a direction to furnish a copy of the finding recorded by the Enquiring Authority along with the notice, affording an opportunity to the petitioner/appellant to put forth his say in the matter with regard to the findings recorded by the Enquiring Authority, In case the Disciplinary Authority intends to reverse the finding recorded on any one of the charges in favour of the Deliquent Officer, it shall also state in the said notice the reasons or grounds for reversing the findings and call upon him to show cause as to why those findings should not be reversed and to afford an opportunity to the delinquent officer to put forth his say in that regard also. It is also further made clear that as a result of setting aside the impugned orders, and in the light of paragraph 31 of the judgment of the Supreme Court in Managing Director, E.C.I.L., Hyderabad v. B.Karunakar (1994)1 L.L.J. 162, referred to above, the petitioner/appellant is directed to be reinstated only for the purpose of enquiry and not for anything else with liberty to the Disciplinary Authority/Management to proceed, with the inquiry by placing the delinquent officer under suspension. As the matter is an old one, the Disciplinary Authority is directed to complete the proceedings within a period of six months from today. There will be no order as to costs.