Fertilizers and Chemicals Travancore Limited v. A.B. Vishwanathan

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR. JUSTICE ANIL K.NARENDRAN WEDNESDAY, THE 31ST DAY OF MAY 2017/10TH JYAISHTA, 1939 RP.No.1066 of 2015 (I) IN WP(C).8283/2015 ------------------------------------------AGAINST THE JUDGMENT IN WP(C) 8283/2015 of HIGH COURT OF KERALA DATED 28-07-2015 REVIEW PETITIONERS/RESPONDENTS IN WPC: --------------------------------------------------------------------- 1. THE FERTILIZERS AND CHEMICALS TRAVANCORE LIMITED REPRESENTED BY ITS CHAIRMAN AND MANAGING DIRECTOR, CORPORATE OFFICE, UDYOGAMANDAL, PIN-683501. 2. THE GENERAL MANAGER, (HR & BD) AND DISCIPLINARY AUTHORITY, FACT CORPORATE OFFICE, UDYOGAMANDAL,PIN-683501. BY ADVS.SRI.M.GOPIKRISHNAN NAMBIAR SRI.P.GOPINATH SRI.P.BENNY THOMAS SRI.K.JOHN MATHAI SRI.JOSON MANAVALAN SRI.KURYAN THOMAS RESPONDENT/PETITIONER IN WP: -------------------------------------------------- A.B. VISHWANATHAN (RTD. SENIOR REGIONAL MANAGER) FACT LTD., UDYOGAMANDAL,ERNAKULAM DISTRICT), HILL VIEW, KALLEKULANGARA,PALAKKAD,PIN-678009. BY ADV. SRI.S.P.ARAVINDAKSHAN PILLAY ADV. SMT.N.SANTHA ADV. SRI.K.A.BALAN ADV. SRI.PETER JOSE CHRISTO ADV. SRI.S.A.ANAND THIS REVIEW PETITION HAVING BEEN FINALLY HEARD ON 31-05-2017, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: ## **APPENDIX IN R.P.No.1066/2015** ## **REVIEW PETITIONER'S ANNEXURES:** ANNEX-I: COPY OF ORDER DT.11.7.01 ISSUED BY GOVT. OF INDIA APPROVING THE PAY REVISION. ANNEX-II: COPY OF ORDER DT.28.8.01 ISSUED BY THE REVIEW PETITIONER, IMPLEMENTING THE WAGE REVISION. ANNEX-III-: COPY OF PAY REVISION ORDER DT.3.8.2010 OF GOVERNMENT OF INDIA. ANNEX-IV: COPY OF ORDER DT.14.8.2010 IMPLEMENTING THE PAY REVISION ISSUED BY THE REVIEW PETITIONER. ANNEX.V: COPY OF CIRCULAR CPRM/IC/408/78 DT.27.5.1978 ISSUED BY THE 1ST REVIEW PETITIONER. RESPONDENTS' ANNEXURES: NIL TRUE COPY P.S. TO JUDGE dsn ## **ANIL K. NARENDRAN, J** **--------------------------------------------Review Petition No.1066 of 2015 in W.P.(C)No.8283 of 2015 -------------------------------------------------DATED THIS THE 31[st] DAY OF MAY, 2017** ## **ORDER** This review petition arises out of the judgment of this Court dated 28.7.2015 in W.P.(C)No.8283/2105. The petitioners herein are the respondents in that writ petition filed by the respondent herein, who retired from the service of Fertilizers and Chemicals Travancore Limited (FACT) on 31.08.2014. 2. W.P.(C)No.8283/2105 was filed seeking a writ of certiorari to quash Ext.P1 memorandum dated 25.08.2014 issued by the 2[nd] petitioner herein; a declaration that no disciplinary action is liable to be taken against the respondent herein on the basis of Ext.P1, which was served on him only on 24.09.2014, after he retired from service on 31.08.2014; a writ of mandamus commanding the petitioners herein to drop the disciplinary action contemplated against the respondent herein as per Ext.P1; and a writ of mandamus commanding the petitioners herein to disburse all retirement benefits due to the respondent herein with interest at the rate of 9% per annum, with effect from 01.09.2014 to the date of actual payment. 3. After considering the rival contentions, this Court by the R.P.No.1066/15 in WP(C)No.8283/15 -2- judgment dated 28.7.2015 rejected the challenge made against the disciplinary proceedings initiated against the respondent herein based on Ext.P1 memorandum and also the challenge made against the action of the petitioners herein in withholding the gratuity payable to him. However, this Court held that, though clause (ii) of Rule 32 of the FACT Employees (Conduct, Discipline and Appeal) Rules, 1977 (for brevity, 'CDA Rules') empower the management to withhold payment of gratuity of the delinquent employee, in accordance with sub-section (6) of Section 4 of the Payment of Gratuity Act, 1972 during the pendency of the disciplinary proceedings initiated while the employee was in service, the said provision does not empower the management to withhold the leave encashment or terminal benefits other than gratuity payable to the employee. Accordingly, the writ petition was disposed of directing the petitioners herein to consider the request made by the respondent herein in Exts.P3 and P4 representations and disburse the leave encashment and terminal benefits other than gratuity payable to him, within a period of one month from the date of receipt of a certified copy of the judgment. 4. Now the petitioners herein have filed this review petition seeking review of the judgment dated 28.7.2015 to the extent they are directed to consider the request made in Exts.P3 and P4 R.P.No.1066/15 in WP(C)No.8283/15 -3- representations and disburse the leave encashment and terminal benefits other than gratuity payable to him within the time limit prescribed therein, contending that there is error apparent on the face of the record, warranting review of the said judgment to the extent indicated as above. 5. Heard learned counsel for the review petitioners/ respondents and also learned counsel for the respondent/writ petitioner. 6. The learned counsel for the review petitioners would contend that, as per the leave rules applicable to the writ petitioner, leave encashment is not allowed in the normal course if cessation of service is due to dismissal for misconduct. In the case of the writ petitioner, disciplinary proceedings initiated against him are still in progress and in view of Annexures I to V circulars/orders in force, till the conclusion of such disciplinary proceedings, the writ petitioner is not legally entitled to the benefits of the leave encashment or any other terminal benefits. However, the said fact could not be brought to the notice of this Court at the time of final hearing of the writ petition. 7. Per contra, the learned counsel for the respondent/writ petitioner would contend that, Annexures I to V circulars/orders which are in the nature of pay revision orders, which incidentally deal with R.P.No.1066/15 in WP(C)No.8283/15 -4- the grant of leave encashment, were well within the knowledge of the review petitioners and they could have produced the same before this Court during the pendency of the writ petition. Since the review petitioners failed to produce those documents before final disposal of the writ petition, they have to suffer the consequences of nonproduction of such documents. Therefore, the present review petition filed under Order XLVII Rule 1 of the Code of Civil Procedure, 1908 mainly relying on Annexures I to V circulars/orders is not legally maintainable. 8. In **Parsion Devi v. Sumitri Devi [(1997) 8 SCC 715]** the Apex Court, in the context of the power of review under Order XLVII Rule 1 of the Code of Civil Procedure, 1908 reiterated that, a judgment may be open to review inter alia if there is a mistake or an error apparent on the face of the record. An error which is not self evident and has to be detected by a process of reasoning, can hardly be said to be an error apparent on the face of the record justifying the court to exercise its power review under Order XLVII Rule 1 of the Code. In exercise of the jurisdiction under Order XLVII Rule 1 of the Code, it is not permissible for an erroneous decision to be 'reheard and corrected'. A review petition has a limited purpose and cannot be allowed to be 'an appeal in disguise'. R.P.No.1066/15 in WP(C)No.8283/15 -5- 9. In **Usha Bharti v. State of U.P. [(2014) 7 SCC 663]** the Apex Court reiterated that, in exercise of the power of review, the Apex Court or High Court can reopen the case and rehear the entire matter. But, whilst exercising such power, the Court cannot be oblivious of the provisions contained in Order XLVII Rule 1 of the Code as well as the rules framed by the High Courts and the Apex Court and that the limits within which the Courts can exercise the powers of review have been well settled in a catena of judgments. 10. In the judgment sought to be reviewed, after referring to the provisions under the CDA Rules, this Court came to the conclusion that clause (ii) of Rule 32, which enables the disciplinary authority to withhold payment of gratuity of an employee, during the pendency of disciplinary proceedings, in accordance with sub-section (6) of Section 4 of the Payment of Gratuity Act, is in no way in conflict with the provisions of Section 4 of the Payment of Gratuity Act. This Court, in the absence of any materials placed on record as to the entitlement of an employee for leave encashment during the pendency of such disciplinary proceedings, concluded that clause (ii) of Rule 32 of the CDA Rules does not empower the management to withhold the leave encashment or terminal benefits other than gratuity payable to the delinquent employee, during the pendency of the disciplinary R.P.No.1066/15 in WP(C)No.8283/15 -6- proceedings initiated while he was in service. Based on such a finding, the writ petition was disposed of by the judgment dated 28.7.2015, by which the revision petitioners were directed to consider the request made by the writ petitioner in Exts.P3 and P4 representations and disburse the leave encashment and terminal benefits other than gratuity payable to him without further delay. Paragraphs 48, 49 and also the last paragraph of the said judgment read thus; “48. As I have already noticed, a conjoint reading of subsection (1) and sub-section (6) of Section 4 of the Payment of Gratuity Act make it explicitly clear that, the said provisions by itself provide for forfeiture of gratuity, in cases falling under clause (a) and clause (b) of sub-section (6) of Section 4 of the Act. Further, clause (i) of Rule 32 of the CDA Rules makes it explicitly clear that, the retirement of the employee does not affect the maintainability of the disciplinary proceedings initiated against him while he was in service and clause (ii) of Rule 32 empower the disciplinary authority to withhold payment of gratuity in accordance with sub-section (6) of Section 4 of the Payment of Gratuity Act, during the pendency of such disciplinary proceedings. If the enquiry initiated against the petitioner can be continued, in terms of clause (i) of Rule 32 of the CDA Rules, it would necessarily carry with it, the power to pass a consequential order of punishment. Similarly, the power to forfeit the amount of gratuity, to the extent permissible under sub-section (6) of Section 4 of the Act, would be incapable of a meaningful exercise, unless the same is understood to carry with it the power to withhold the payment of such amount R.P.No.1066/15 in WP(C)No.8283/15 -7- pending finalisation of the the disciplinary proceedings initiated while the employee was in service. Therefore, clause (ii) of Rule 32, which enables the disciplinary authority to withhold payment of gratuity of such an employee, during the pendency of such disciplinary proceedings, in accordance with sub-section (6) of Section 4 of the Payment of Gratuity Act, is in no way in conflict with the provisions of Section 4 of the Payment of Gratuity Act. 49. Though, clause (ii) of Rule 32 of the CDA Rules empower the management to withhold payment of gratuity of the delinquent employee, in accordance with sub-section (6) of Section 4 of the Payment of Gratuity Act, during the pendency of the disciplinary proceedings initiated while the employee was in service, but the said provision does not empower the management to withhold the leave encashment or terminal benefits other than gratuity payable to the employee. In such circumstances, the respondents shall consider the request made by the petitioner in Exts.P3 and P4 representations and disburse the leave encashment and terminal benefits other than gratuity payable to him, without further delay. In the result, the challenge made in this writ petition against the disciplinary proceedings initiated against the petitioner based on Ext.P1 memorandum and also the challenge against the action of the respondents in withholding the gratuity payable to him are rejected. The writ petition is disposed of directing the respondents to consider the request made by the petitioner in Exts.P3 and P4 representations and disburse the leave encashment and terminal benefits other than gratuity payable to him, within a period of one month from the date of receipt of a certified copy of this judgment.” 11. Now, the documents placed on record as Annexures I to V R.P.No.1066/15 in WP(C)No.8283/15 -8- along with this review petition would show that, as per the leave rules applicable to the writ petitioner, leave encashment is not allowed in the normal course if cessation of service is due to dismissal for misconduct. Annexure V circular dated 27.5.1978 makes it explicitly clear that, earned leave which accrues to an employee in the managerial cadre and stands to his credit would be paid for in cash on cessation of his employment due to any reason whatsoever other than dismissing for misconduct. Para.5.1 of Annexure V circular, which deals with encashment of leave reads thus: “5.1. Encashment of leave. (a) Earned leave which accrues to an employee in the managerial cadre and stands to his credit would be paid for in cash on cessation of his employment due to any reason whatsoever other than dismissal for misconduct. If the cessation is during the course of the leave year the manager shall be entitled to be credited to his leave account with the proportionate earned leave due for the year. (b) In the case of an employee dismissed from service for misconduct, such earned leave shall not normally be paid for in cash. However, the Board of Directors may, at their discretion, permit encashment of leave in exceptional cases.” 12. In the case of the writ petitioner, the disciplinary proceedings initiated against him while he was in service are still in progress. In such circumstances, in view of the circulars/orders referred to hereinbefore, the writ petitioner is not legally entitled for R.P.No.1066/15 in WP(C)No.8283/15 -9- disbursement of leave encashment till the conclusion of the said disciplinary proceedings. 13. The fact that the entitlement of the writ petitioner for leave encashment is governed by Annexures I to V circulars/orders is not seriously disputed by the learned counsel for the respondent herein/ writ petitioner. The writ petitioner has also not produced any circulars/orders to the contra in support of his claim for disbursement of leave encashment during the pendency of the disciplinary proceedings initiated while he was in service. The contention of the writ petitioner that, having failed to produce Annexures I to V circulars/orders before final disposal of the writ petition, the review petitioners have to suffer the consequences of non-production of such documents can only be repelled as devoid of merit. 14. For the reasons stated hereinbefore, the review petitioners have made out a case warranting review of the judgment of this Court dated 28.7.2015 in W.P.(C)No.8283/2015 to the extent they are directed to consider the request made by the writ petitioner for disbursement of leave encashment, during the pendency of the disciplinary proceedings initiated against him while he was in service. In the result, this Review Petition is allowed and the judgment of this Court dated 28.7.2015 in W.P.(C)No.8283/2015 is reviewed to the R.P.No.1066/15 in WP(C)No.8283/15 -10- extent indicated as above. However, it is made clear that the review petitioners shall consider the claim made by the writ petitioner for leave encashment, in terms of Annexures I to V circulars/orders, after the culmination of the disciplinary proceedings initiated while he was in service. Sd/- **ANIL K.NARENDRAN, JUDGE** dsn True copy P.S. to Judge