FACTS OF THE CASE

Anil Kumar Sarkar, the respondent herein, joined the Northern Railways as a
Junior Clerk on 04.11.1977. He was promoted to various posts and while he was
working as senior AFA/T-1 in the office of the Financial Adviser and Chief Accounts
Officer of Northeast Frontier (N.F.) Railway at Maligaon, a Departmental Promotion
Committee (DPC) was convened by the Union Public Service Commission (UPSC)
on 26.02.2002 and 27.02.2002 to consider eligible Group ‘B’ officers of the Accounts
Department for their substantive promotion to Group ‘A’ (Jr. Scale) of Indian
Railways Accounts Service (IRAS) against the vacancies for various Zonal
Railways/Production Units. In the said DPC, the respondent’s name was also
considered against the vacancies in N.F. Railway for the year 2001-2002 and
accordingly, his name was placed in the extended select panel.

It was alleged by the appellants herein that during the year 1994-95, while the
respondent was working as Assistant Accounts Officer in the Central Stores
Accounts (Bills) in the office of the Financial Adviser and Chief Accounts Officer
(Open Line), N.F. Railway, Maligaon, he committed gross misconduct in the matter
of checking and passing the bills of various firms involved in manufacturing and
supplying of cast iron sleeper plates to N.F. Railways. For the said acts, four
memorandum of charges were issued to the respondent, out of which two were
issued on 13.08.2003 and others on 01.09.2003 and 05.11.2003. On the basis of the
said memorandums, four departmental proceedings were initiated against the
respondent at three different places, i.e., Delhi, Kolkata and Gauhati, enquiries were
completed and show cause notices were served.

Based on the similar charges, in the year 2004, the CBI lodged 11 FIRs against the
respondent herein on different dates under Section 120B/420 of the Indian Penal
Code, 1860 and Section 13(1)(d)read with Section 13(2) of the Prevention of
Corruption Act, 1988 and accordingly, cases were registered against him.
Subsequently, 11 cases were amalgamated into 3 cases being numbered as Special
Case Nos. 59/04, 60/04 and 62/04. According to the appellants, on the basis of
these charges, the respondent was not promoted to Group ‘A’ (Jr. Scale).
By office order dated 21.04.2003, the batch mates of the respondent were promoted.
Being aggrieved, the respondent herein filed several representations to the
Department for consideration of his case for promotion which were duly rejected.
Challenging the non-consideration of his case for promotion, the respondent filed
O.A. No. 251 of 2007 before the Central Administrative Tribunal, Gauhati Bench for a
direction to the appellants herein to promote him to Group ‘A’ (Jr. Scale) of IRAS
w.e.f. 05.03.2002 in terms of the recommendations of the DPC held on 26.02.2002
and 27.02.2002 wherein his name was figured in the extended panel list. Vide order
dated 21.08.2009, the Tribunal dismissed his application.

Challenging the order of the Tribunal, the respondent herein filed a petition being
W.P.(C) No. 744 of 2010 before the Gauhati High Court. The High Court, by
impugned order dated 27.04.2010, allowed the petition and set aside the order
passed by the Tribunal and directed the appellants herein to issue appropriate order
in favour of the respondent herein for promotion with all consequential benefits.
Challenging the said order, the Union of India has filed this appeal by way of special
leave.

ISSUES
1.Whether the special leave petition is sustainable ?

2.What is the date from which it can be said that disciplinary/criminal proceedings
are pending against an employee?

3.What is the course to be adopted when the employee is held guilty in such
proceedings if the guilt merits punishment other than that of dismissal?

4.To what benefits an employee who is completely or partially exonerated is entitled

to and from which date?

PROVISION OF LAW
Section 120B in The Indian Penal Code

Punishment of criminal conspiracy.—

(1) Whoever is a party to a criminal conspiracy to commit an offence punishable with

death, 2[imprisonment for life] or rigorous imprisonment for a term of two years or
upwards, shall, where no express provision is made in this Code for the punishment
of such a conspiracy, be punished in the same manner as if he had abetted such
offence.

(2) Whoever is a party to a criminal conspiracy other than a criminal conspiracy to

commit an offence punishable as aforesaid shall be punished with imprisonment of
either description for a term not exceeding six months, or with fine or with both.]

Section 420 in The Indian Penal Code

Cheating and dishonestly inducing delivery of property.—Whoever cheats and

thereby dishonestly induces the person deceived to deliver any property to any
person, or to make, alter or destroy the whole or any part of a valuable security, or
anything which is signed or sealed, and which is capable of being converted into a
valuable security, shall be punished with imprisonment of either description for a
term which may extend to seven years, and shall also be liable to fine.

Section 13(2) in The Prevention of Corruption Act, 1988

Any public servant who commits criminal misconduct shall be punishable with
imprisonment for a term which shall be not less than one year but which may extend
to seven years and shall also be liable to fine.

Article 136 in The Constitution Of India 1949

Special leave to appeal by the Supreme Court
(1) Notwithstanding anything in this Chapter, the Supreme Court may, in its
discretion, grant special leave to appeal from any judgment, decree, determination,
sentence or order in any cause or matter passed or made by any court or tribunal in
the territory of India

(2) Nothing in clause ( 1 ) shall apply to any judgment, determination, sentence or

order passed or made by any court or tribunal constituted by or under any law
relating to the Armed Forces

ARGUMENT BY PETITIONER

In this case the arguments made by the petitioner are that , It is not in dispute that
the respondent had joined the Northern Railways as a Junior Clerk on 04.11.1977,
and got promoted time and again. While he was working as a Group ‘B’ Officer, his
case was taken up for promotion to Group ‘A’ (Junior Scale) of the Indian Railways
Accounts Service (IRAS). It is also not in dispute that in the meetings of the DPC
conducted on 26.02.2002 and 27.02.2002, the respondent’s name was considered
and he was placed in the extended select panel. It is further seen that up to
21.04.2003, the date on which the respondent’s batch mates were promoted to
IRAS, neither any criminal proceedings was initiated against him nor any
departmental enquiry was initiated, nor any charge sheet was served upon him and
nor he was placed under suspension.

Aggrieved by the non-consideration of his representations for promotion, the

respondent filed O.A. before the Central Administrative Tribunal. Learned counsel for
the Railways, by placing reliance on the Office Memorandum dated 14.09.1992,
contended before the Tribunal that a Government servant who is recommended for
promotion by the DPC and in whose case the circumstances mentioned in paragraph
2 are in existence, he shall not be promoted. Accepting the above stand of the
Railways, the Tribunal rejected the petition filed by the respondent herein.

Aggrieved by the said decision of the Tribunal, the respondent herein filed a petition
before the High Court, wherein, the said memorandum, particularly paragraph 2, was
pressed into service. The High Court, taking note of the conditions prescribed in
paragraph 2 and in the absence of any such condition as on the relevant date, i.e.,
21.04.2003, set aside the order of the Tribunal and directed the Railways to consider
the case of the respondent for promotion.

Mr. Rakesh Kumar Singh, learned counsel for the respondent submitted that as on
the date i.e. 21.04.2003, when his juniors were promoted, neither the respondent
was under suspension nor any charge sheet was served upon him and he was not
facing any criminal prosecution, hence, there was no impediment in promoting him.

ARGUMENT BY RESPONDENT

Mr. Mohan Jain, learned Additional Solicitor General for the Union of India Mr.
Mohan Jain, learned ASG, after taking us through the Office Memorandum dated
14.09.1992 issued by the Ministry of Personnel, Public Grievances and Pensions,
Department of Personnel and Training, submitted that paragraph 2 of the said
memorandum has to be considered along with paragraph 7 of the same. According
to him, the High Court is not justified in considering paragraph 2 of the memorandum
alone. He further submitted that at the relevant time, 4 charge sheets were issued to
the respondent and enquiries were completed and notices to show cause had
already been served upon the respondent.

Learned ASG, by drawing our attention to the decision of this Court in Union of India
and Another vs. R.S. Sharma, (2000) 4 SCC 394 submitted that in spite of decision
of this Court in Jankiraman’s case (supra) in view of para 7 of the office
memorandum and in the light of the fact that proceedings were initiated both criminal
and departmentally, the High Court committed an error by overlooking para 7 of
sealed cover process and contended that the direction issued by it cannot be
sustained. Court must carefully gone through the factual position and the ultimate
ratio laid down by this Court in R.S. Sharma’s case (surpa). Even though in the said
decision, this Court has distinguished the decision in Jankiraman’s case (supra) and
held that the same is not applicable to its case, in the light of the conditions
mentioned in para 2 as well as para 7 of the office memorandum dated 14.09.1992
and of the categorical finding that none of the conditions mentioned therein has been
fulfilled.
The pendency of preliminary investigation prior to that stage will not be sufficient to
enable the authorities to adopt the sealed cover procedure. We are in agreement
with the Tribunal on this point. The contention advanced by the learned counsel for
the appellant- authorities that when there are serious allegations and it takes time to
collect necessary evidence to prepare and issue charge-memo/charge- sheet, it
would not be in the interest of the purity of administration to reward the employee
with a promotion, increment etc. does not impress us. The acceptance of this
contention would result in injustice to the employees in many cases.

As has been the experience so far, the preliminary investigations take an inordinately
long time and particularly when they are initiated at the instance of the interested
persons, they are kept pending deliberately. Many times they never result in the
issue of any charge-memo/charge-sheet. If the allegations are serious and the
authorities are keen in investigating them, ordinarily it should not take much time to
collect the relevant evidence and finalise the charges

DECISION OF COURT[JUDGEMENT]

The court hold that the ratio laid down in Jankiraman’s case (supra) are fully
applicable to the case on hand, court are in agreement with the ultimate decision of
the High Court. Consequently, the appeal filed by the Union of India fails and the
same is dismissed. And there will be no order as to costs.

REASON FOR THE DECISION

It is not in dispute that an identical issue was considered by this Court in Union of
India and Others vs. K.V.Jankiraman and Others, (1991) 4 SCC 109. The common
questions involved in all those matters were: (1) What is the date from which it can
be said that disciplinary/criminal proceedings are pending against an employee? (2)
What is the course to be adopted when the employee is held guilty in such
proceedings if the guilt merits punishment other than that of dismissal? and (3) To
what benefits an employee who is completely or partially exonerated is entitled to
and from which date?.
Among the three questions, we are concerned about question No.1. As per the rules
applicable, the “sealed cover procedure” is adopted when an employee is due for
promotion, increment etc. but disciplinary/criminal proceedings are pending against
him at the relevant time and hence, the findings of his entitlement to the benefit are
kept in a sealed cover to be opened after the proceedings in question are over.
Inasmuch as we are concerned about the first question, the dictum laid down by this
Court relating to the said issue is as follows:-

On the first question, viz., as to when for the purposes of the sealed cover procedure
the disciplinary/criminal proceedings can be said to have commenced, the Full
Bench of the Tribunal has held that it is only when a charge-memo in a disciplinary
proceedings or a charge-sheet in a criminal prosecution is issued to the employee
that it can be said that the departmental proceedings/criminal prosecution is initiated
against the employee.

The sealed cover procedure is to be resorted to only after the charge-memo/charge-

sheet is issued. The pendency of preliminary investigation prior to that stage will not
be sufficient to enable the authorities to adopt the sealed cover procedure. We are in
agreement with the Tribunal on this point. The contention advanced by the learned
counsel for the appellant- authorities that when there are serious allegations and it
takes time to collect necessary evidence to prepare and issue charge-memo/charge-
sheet, it would not be in the interest of the purity of administration to reward the
employee with a promotion, increment etc. does not impress us.

The acceptance of this contention would result in injustice to the employees in many
cases. As has been the experience so far, the preliminary investigations take an
inordinately long time and particularly when they are initiated at the instance of the
interested persons, they are kept pending deliberately. Many times they never result
in the issue of any charge-memo/charge-sheet. If the allegations are serious and the
authorities are keen in investigating them, ordinarily it should not take much time to
collect the relevant evidence and finalise the charges. What is further, if the charges
are that serious, the authorities have the power to suspend the employee under the
relevant rules, and the suspension by itself permits a resort to the sealed cover
procedure. The authorities thus are not without a remedy.

The promotion etc. cannot be withheld merely because some disciplinary/criminal

proceedings are pending against the employee. To deny the said benefit, they must
be at the relevant time pending at the stage when charge-memo/charge-sheet has
already been issued to the employee

After finding so, in the light of the fact that no charge sheet was served on the
respondent-employee when the DPC met to consider his promotion, yet the sealed
cover procedure was adopted. In such circumstances, this Court held that “the
Tribunal has rightly directed the authorities to open the sealed cover and if the
respondent was found fit for promotion by the DPC, to give him the promotion from
the date of his immediate junior Shri M. Raja Rao was promoted pursuant to the
order dated April 30, 1986

The Tribunal has also directed the authorities to grant to the respondent all the
consequential benefits…..We see no reason to interfere with this order. The appeal,
therefore, stands dismissed.The principles laid down with reference to similar office
memorandum are applicable to the case on hand and the contrary argument raised
by the appellant-Union of India is liable to be rejected.

PART 2
 CRITICAL COMMENT

The case Union of India v. Anil Kumar Sarkar, (2013) 4 SCC 161 is about the
Service Law Promotion Parity in treatment with similarly situated persons where
Sealed cover procedure been put in test over that when applicable. Government of
India through Office Memorandum dt. 14-9-1992 No. 22011/4/91-Estt(A), Paras 2
and 7 denied promotion to the petitioner in this case over the lodging of FIRs by CBI.
Aggrevied by the said actions the petitioner contested in court over Relative scope
of said order as On date on which respondent's batch mates were promoted,
neither was any criminal nor any departmental enquiry pending against him, nor was
any charge-sheet served upon him and nor was he placed under suspension

Hence held, impugned judgment directing appellant State to consider respondent's

case for promotion, in terms of Para 2 of OM dt. 14-9-1992 calls for no interference
Further held, sealed cover procedure" as envisaged in Para 7 is adopted when an
employee is due for promotion, increment, etc. but disciplinary/criminal proceedings
are pending against him at relevant time and hence, findings of his entitlement to
benefit of promotion are kept in sealed cover to be opened after proceedings in
question are over, which was not the case herein,

A Service Law Departmental Enquiry Held, departmental proceedings commence

only when charge-sheet is issued to delinquent employee Learned counsel for
petitioner submitted that since charges are not framed, there is no impediment in
considering him for promotion and an employee can be ignored only when charges
are drawn. Further contention of the learned counsel for petitioner is, as per the
policy of the Government as notified in disciplinary proceedings have to be
concluded within the maximum period of six months, whereas in the instant case, for
more than two years, even charges are not drawn. Learned counsel, therefore,
submitted that petitioner is entitled to be considered for promotion on ad hoc basis
without regard to intention of the Government to initiate disciplinary proceedings.

Departmental Inquiry shall Conclude within 6 Months As said in case , Case name:
Prem Nath Bali v. Registrar High Court of Delhi In this case, the disciplinary
proceedings, which commenced in the year 1990, continued for more than nine
years. Pending disciplinary proceedings, the appellant sought revocation of
suspension order but such representation made by the appellant was not
considered. The Supreme Court in the case took a strong note of the undue delay
caused in disciplinary proceedings. The Court stated that due to such unreasonable
delay, the appellant naturally suffered a lot as he had to survive only on suspension
allowance for a long period of 9 years. Other key observations made by the Court in
the case are:

That it is the duty of the employer to ensure that the departmental inquiry initiated
against the delinquent employee is concluded within the shortest possible time by
taking priority measures. That in cases where the delinquent is placed under
suspension during the pendency of such inquiry then it becomes all the more
imperative for the employer to ensure that the inquiry is concluded in the shortest
possible time to avoid any prejudice to the rights of the delinquent employee. That
every employer (whether State or private) must make sincere endeavor to conclude
the departmental inquiry proceedings once initiated against the delinquent employee
within a reasonable time by giving priority to such proceedings and as far as possible
it should be concluded within six months as an outer limit. Where it is not possible for
the employer to conclude due to certain unavoidable causes arising in the
proceedings within the time frame then efforts should be made to conclude within
reasonably extended period depending upon the cause and the nature of inquiry but
not more than a year.

Departmental Enquiry on Vague Charges shall be Vitiated Case name- Shri Anant R.
Kulkarni v. Y.P. Education Society & Ors. In this case, the Supreme Court made
some key observations pertaining to disciplinary proceedings which enumerated
below: That once court sets aside an order of punishment on the ground that enquiry
was not properly conducted, Court should not preclude employer from holding the
enquiry in accordance with law. It must remit the case to disciplinary authority, to
conduct enquiry from the point it stood vitiated, and to conclude the same in
accordance with law. However, resorting to such a course depends upon gravity of
delinquency involved. Court/tribunal should not generally set aside departmental
enquiry, and quash charges on the ground of delay in initiation of disciplinary
proceedings, as such a power is de hors the limitation of judicial review. While
setting aside a departmental enquiry, the Court must take into consideration all
relevant facts, and balance and weigh the same, so as to determine, if it is in fact in
the interest of clean and honest administration that proceedings are allowed to be
terminated, only on the ground of a delay in their conclusion.

Departmental Enquiry on vague and unspecified charges – In this context, the

Supreme Court held that a delinquent shall not be served a charge sheet, without
providing him, a clear, specific and definite description of charge against him.
Departmental Enquiry against retired employee– In this case, the Court also
enumerated the circumstances when departmental enquiry could be conducted
against retired employee. The Court held that relevant rules governing the service
conditions of an employee are determining factors as to whether and in what manner
domestic enquiry can be held against an employee who stood retired after reaching
the age of superannuation. Generally, if the enquiry has been initiated while the
delinquent employee was in service, it would continue even after his retirement, but
nature of punishment would change. The punishment of dismissal/removal from
service would not be imposed.

Promotion available during Claimant’s period of extension of service can’t be granted

to the Claimant Case name: H.M. Singh v. Union of India, (2014) 3 SCC 670 This
case dealt with service Law Promotion Entitlement to promotion during period of
extension of service. In the case, the appellant’s claim for promotion to post of Lt.
General was rejected on ground that he was on extension of service. In view of the
aforesaid, the Supreme Court held that in situations wherein an officer attains the
age of retirement without there being a vacancy for his consideration to a higher
rank, even though he is eligible for the same, such an officer who is granted
extension in service, cannot claim consideration for promotion, against a vacancy
which has become available during the period of his extension in service.

In Absence of Disciplinary Authority, Charge Sheet becomes Non est Case name:
Union of India v. B.V. Gopinath, (2014) 1 SCC 351 In this case, the Supreme Court
in view of the facts and circumstances of the case, clearly stated that in absence of
approval of disciplinary authority, charge memo/charge-sheet becomes non est and
hence is liable to be quashed. It was further held that all decisions regarding
approval, modification/amendment, dropping of charge memo have to be taken by
disciplinary authority for initiation of disciplinary proceedings. Hence, disciplinary
authority alone is required to exercise that power, otherwise, it would go against
established maxim delegatus non potest delegare.

SC’s Guidelines for Employer in case of Suppression of Information by Employee

Case name: Avtar Singh v. Union of India In this case the Court considered the
cleavage of opinion in various decisions on the question of suppression of
information or submitting false information in the verification form as to the question
of having been criminally prosecuted, arrested or as to pendency of a criminal case.
The Apex Court in the case laid down the following guidelines for the employer and
stated that any of the following recourse appropriate to the case may be adopted: –
In a case trivial in nature in which conviction had been recorded, such as shouting
slogans at young age or for a petty offence which if disclosed would not have
rendered an incumbent unfit for post in question, the employer may, in its discretion,
ignore such suppression of fact or false information by condoning the lapse.
Where conviction has been recorded in case which is not trivial in nature, employer
may cancel candidature or terminate services of the employee.

If acquittal had already been recorded in a case involving moral turpitude or offence
of heinous/serious nature, on technical ground and it is not a case of clean acquittal,
or benefit of reasonable doubt has been given, the employer may consider all
relevant facts available as to antecedents, and may take appropriate decision as to
the continuance of the employee. In a case where the employee has made
declaration truthfully of a concluded criminal case, the employer still has the right to
consider antecedents, and cannot be compelled to appoint the candidate. In case
when fact has been truthfully declared in character verification form regarding
pendency of a criminal case of trivial nature, employer, in facts and circumstances of
the case, in its discretion may appoint the candidate subject to decision of such
case.

In a case of deliberate suppression of fact with respect to multiple pending cases

such false information by itself will assume significance and an employer may pass
appropriate order cancelling candidature or terminating services as appointment of a
person against whom multiple criminal cases were pending may not be proper.
If criminal case was pending but not known to the candidate at the time of filling the
form, still it may have adverse impact and the appointing authority would take
decision after considering the seriousness of the crime. In case the employee is
confirmed in service, holding Departmental enquiry would be necessary before
passing order of termination/removal or dismissal on the ground of suppression or
submitting false information in verification form.

For determining suppression or false information attestation/verification form has to

be specific, not vague. Only such information which was required to be specifically
mentioned has to be disclosed. If information not asked for but is relevant comes to
knowledge of the employer the same can be considered in an objective manner
while addressing the question of fitness. However, in such cases action cannot be
taken on basis of suppression or submitting false information as to a fact which was
not even asked for. Before a person is held guilty of suppressio veri or suggestio
falsi, knowledge of the fact must be attributable to him.

Departmental Inquiry is no Ground to Deny Pension or Subsistence Allowance to

Employee Case name: UCO Bank & Ors. v. Rajendra Shankar Shukla In the case,
the Supreme Court made a scathing attack on the Appellant Bank in view of
illegalities in departmental inquiry against the Respondent Employee including the
fact that the Respondent employee was denied even the subsistence allowance
during the pendency of the inquiry against him.In the case, the Bench considered the
question of law on access to justice in a departmental inquiry. The Court opined that
the Respondent was not given a fair opportunity to defend himself by denying him
financial resources.

The Apex Court in the case held that an employee is entitled to subsistence
allowance during an inquiry pending against him or her but if that employee is
starved of finances by zero payment, it would be unreasonable to expect the
employee to meaningfully participate in a departmental inquiry. Access to justice is a
valuable right available to every person, even to a criminal, and indeed free legal
representation is provided even to a criminal. In the case of a departmental
inquiry, the delinquent is at best guilty of a misconduct but that is no ground to deny
access to pension or subsistence allowance.