High Court of KeralaSingle Judge2023-02-28Writ petitions allowed; recovery notice quashed...

K. Krishnankutty v. Kerala State Electricity Board; Vincent B.F v. State of Kerala and Others

Case / Petition Number:WP(C) No. 5652 of 2012; WP(C) No. 28016 of 2011

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: Amit Rawal
Judgment Date: 2023-02-28
Court Decision / Holding: WP(P) No. 5652 of 2012 and WP(C) No. 28016 of 2011 disposed; the recovery notice dated 4.10.2011 against the petitioners recovering the amounts in the 80:20 ratio is quashed. Writ petitions allowed; the steps for recovery are barred by the proviso to Rule 3; the matter regarding Article 112 of the Limitation Act is not adjudicated here.
Final Disposition: Writ petitions allowed; recovery notice quashed; no further orders stated in the excerpt.

Parties to the Case

Appellants / Petitioners

K. Krishnankutty (Retired Technical Member, Kerala State Electricity Board, Thiruvananthapuram)
Vincent B.F (residing at KP VII/362A, Kairali Nagar, Kudappanakunnu, Thiruvananthapuram-695043)

Respondents

Kerala State Electricity Board represented by its Secretary, Vydyuthi Bhavanam, Pattom, Thiruvananthapuram, PIN-695004
The Chairman, Kerala State Electricity Board, Vydyuthi Bhavanam, Pattom, Thiruvananthapuram, PIN-695004
State of Kerala represented by the Secretary to Government, Power Department, Secretariat, Thiruvananthapuram, PIN-695001

Legal Representation & Advocates

Counsels for Petitioners

• S.P. Aravindakshan Pillay; S.A. Anand; K.A. Balan; P. Jose Christo; N. Santha (N. SANTHA) for K. Krishnankutty
• Elvin Peter P.J.; K.R. Ganesh; T.G. Sunil Pranavam for Vincent B.F.

Counsels for Respondents

• K.S. Anil, SC, KSEB; Antony Mukkath; Regi Mathew; Joy V. Joseph; G.P. Jimmy George; Antony Mukkath (SC)
• K.S. Anil, SC, KSEB; Regi Mathew; Joy V. Joseph; Jimmy George GP

Case Synopsis & Summary

This judgment disposes of two connected writ petitions challenging the Kerala State Electricity Board’s recovery of amounts allegedly lost due to lapses in procurement of four Overhead Line Fault Locators (OLFLs). Both petitioners, long-serving engineers who retired in 2000–2002, were found by a 2007 enquiry to be responsible, under Board-approved apportionment, for losses from idle OLFLs. The Board passed a recovery order in 2011 demanding Rs. 34,73,955 (80%) from K. Krishnankutty and Rs. 8,68,491 (20%) from Vincent B.F. The petitions argued that the recovery steps were time-barred by Rule 3 (proviso) and Rule 116(6) of Part III of the Kerala Service Rules (KSR), and that initiation of recovery could not substitute a civil suit; the show-cause process had not included due process. The learned Judge examined the sequence: 2004 committee findings, 2007 enquiry, and 2009 show-cause notices culminating in the 2011 recovery order. He held that the four-year limitation contained in the proviso to Rule 3 had elapsed for both cases and that recovery cannot be treated as an action under Rule 116(6); civil suits were not established as viable. Consequently, the recovery order was quashed and the writ petitions allowed. The judge did not adjudicate on Article 112 of the Limitation Act in this context, but reserved the right to take appropriate action if necessary.

Provisions of Law Cited

Rule 3B of Part III KSRRule 3 of Part III KSRRule 116(6) of Part III KSRProviso to Rule 3 of Part III KSRArticle 112 of the Limitation Act

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioners argued that the recovery action is illegal, arbitrary, and barred by the four-year limit under the proviso to Rule 3 of Part III KSR. They contended that initiation of recovery cannot be equated to a civil suit under Rule 116(6), and that the delay in initiating proceedings cannot be cured by later notices; the processes deprived them of due process and failed to follow the proper procedures for recovery under the KSR. They urged that limitation bars recovery and that the impugned 2011 order is unsustainable.

Contentions of Respondents

The Board contended that the proviso to Rule 3 permits recovery steps within four years and that civil suit is still a possibility under Article 112, but recovery cannot be treated as a civil suit in this context. They argued that the enquiry and notices were proper in pursuing a recovery based on the 2004/2007 findings of fault in procurement and that the imposition of liability (80:20) was justified after due consideration of responsibility of the officers.

Cited Precedents (1)

Case Name	Citation	Treatment	Explanation
W.P.(C) Nos. 32275, 32396 of 2007 & 26127 of 2008	W.P.(C) Nos. 32275/2007; 32396/2007; 26127/2008	Mentioned Only	Judgment cited as an exhibit (Ext. P14) in the present case; no explicit treatment or reliance discussed in the text.

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Extracted Judgment Text

Exact text extracted from official judgment records.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE AMIT RAWAL TUESDAY, THE 28[TH] DAY OF FEBRUARY 2023 / 9TH PHALGUNA, 1944 WP(C) NO. 5652 OF 2012** ## **PETITIONER/S:** K. KRISHNANKUTTY (RETIRED TECHNICAL MEMBER, KERALA STATE ELECTRICITY BOARD, THIRUVANANTHAPURAM), RESIDING AT 27-NCC NAGAR (AISWARYA), PEROORKADA, THIRUVANANTHAPURAM, PIN-695005. BY ADVS. SRI.S.P.ARAVINDAKSHAN PILLAY SRI.S.A.ANAND SRI.K.A.BALAN SRI.PETER JOSE CHRISTO SMT.N.SANTHA ## **RESPONDENT/S:** 1 KERALA STATE ELECTRICITY BOARD REPRESENTED BY ITS SECRETARY, VYDYUTHI BHAVANAM, PATTOM, THIRUVANANTHAPURAM, PIN-695004. 2 THE CHAIRMAN KERALA STATE ELECTRICITY BOARD VYDYUTHI BHAVANAM, PATTOM, THIRUVANANTHAPURAM, PIN695004. 3 STATE OF KERALA REPRESENTED BY THE SECRETARY TO GOVERNMENT, POWER DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM, PIN695001. BY ADVS. SRI.K.S.ANIL, SC, KSEB ANTONY MUKKATH REGI MATHEW(K/1132/2020) JOY V. JOSEPH(K/1910/1999) SRI. G.P JIMMY GEORGE SRI. ANTONY MUKKATH, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28.02.2023, ALONG WITH WP(C).28016/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: **WP(C) NO. 5652 OF 2012 and conctd. Case** **2** ## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR. JUSTICE AMIT RAWAL** **TUESDAY, THE 28[TH] DAY OF FEBRUARY 2023 / 9TH PHALGUNA, 1944** **WP(C) NO. 28016 OF 2011** ## **PETITIONER/S:** VINCENT B.F HOUSE NO.KP VII/362A, KAIRALI NAGAR,, KUDAPPANAKUNNU, THIRUVANANTHAPURAM-695 043. BY ADVS. SRI.ELVIN PETER P.J. SRI.K.R.GANESH SRI.T.G.SUNIL PRANAVAM ## **RESPONDENT/S:** 1 STATE OF KERALA REPRESENTED BY SECRETARY TO GOVERNMENT,, POWER DEPARTMENT, SECRETARIAT,, THIRUVANANTHAPURAM.-695 001. 2 KERALA STATE ELECTRICITY BOARD REPRESENTED BY ITS CHAIRMAN, BOARD SECRETARIAT,, VYDHUTHI BHAVAN, THIRUVANANTHAPURAM. 3 THE SECRETARY KERALA STATE ELECTRICITY BOARD,, VYDHUTHI BHAVAN, THIRUVANANTHAPURAM. BY ADVS. ANTONY MUKKATH SRI.K.S.ANIL, SC, KSEB REGI MATHEW(K/1132/2020) JOY V. JOSEPH(K/1910/1999) SRI. JIMMY GEORGE GP THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28.02.2023, ALONG WITH WP(C).5652/2012, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: **WP(C) NO. 5652 OF 2012 and conctd. Case** **3** ## **JUDGMENT** This order of mine shall dispose of two writ petitions ie., W.P. (C) No.5652 of 2012 titled as K.Krishanankutty v. Kerala State Electricity Board (hereinafter referred to as first writ petition) and W.P.(C) No.28016 of 2011 titled as Vincent B.F v. State of Kerala and Others (hereinafter referred to as second writ petition) whereby action of the respondent for recovery of the amount on account of the alleged lapses by the petitioners while working as the members of the Kerala State Electricity Board was sought to be recovered on the basis of an enquiry conducted in 2007 and show cause notices in 2009 and finally recovery in 4.10.2011, as the common question of fact and law involved. 2. Both the petitioners had entered into Kerala State Electricity Board in 1969 and thereafter after rendering the long period of service were promoted as member of the Kerala State Electricity Board and then retired on 31.3.2002 and 30.11.2000 respectively. On the basis of the sanction accorded by the Board, Chief Engineer, World Bank Project, Thiruvananthapuram issued a purchase order dated 18.2.1997 for purchase of four nos. of Overhead Line Fault Locators from the CSD Instruments (India) Pvt. Ltd., Jaipur on certain terms and conditions including the condition of the guarantee. The aforementioned locators were commissioned ## **WP(C) NO. 5652 OF 2012 and conctd. Case** ## **4** in 1998, 2000, February and March 2003. Petitioners at the time of purchase order were discharging the duties as Chief Engineer. Audit department of the Board while analyzing the Projects of the four Overhead Line Fault Locators, opined that the Board had purchased the same without assessing the actual requirements and without ensuring its performance which resulted in an idle investment to the extent of 65.19 lakh plus loss by way of interest to the loan from January 1998 onwards and suspected some foul play in the purchase of the Fault Locating equipment as entire units had not commissioned even after the expiry of the guaranteed period. A committee was constituted which conducted an enquiry without affording an opportunity to the petitioners or any of the other concerned officers and filed an enquiry report dated 19.2.2007. A show cause notice dated 8.5.2009 were served upon the petitioners on 8.5.2009 which was duly replied and ultimately vide impugned order dated 4.10. 2011 ordered for recovery of the amount. 3. Learned counsel for the petitioners submitted that the action taken by the respondent is wholly aberrative, illegal and arbitrary and against the provisions of Rule 3B of Part III KSR, which are applicable to the petitioners. The action is purportedly beyond the period of limitation. Even the respondents cannot take the benefit of the provisions of sub Rule 6 of Rule 116 of Part III, for, **WP(C) NO. 5652 OF 2012 and conctd. Case** **5** the impugned notices were at stage of adjudication but had not gone through the procedure prescribed therein ie., by institution of the civil suit. Even the civil suit would not have been maintainable as the limitation for the same had already expired. 4. On the other hand, learned counsel appearing on behalf of the KSEB submitted that no doubt, the proviso to Rule 3 provide initiation of recovery steps not beyond the period of four (4) years but it does not prevent institution of the civil suit as per the provisions of Article 112 of the limitation Act. 5. I have heard the learned counsel for the parties and appraised the paperbook. Both the petitioners retired in 2000 and 2002. The finding of the Committee is of February 2007 as evident from the copy of the show cause notices dated 8.5.2009. The said notices resulted into an adjudication vide impugned communication dated 4.10.2011. It would be relevant to reproduce the operative part of the same. The Chairman has examined the reply submitted by the concerned Deputy Chief Engineers in detail along with the relevant documents of the case and observed that their contentions deserves some merit since the basic issue was the improper planning in the procurement of the accessories like computer with correct operating system which was indispensable for the commissioning of Overhead Line Fault Locators and the performance of the Overhead Line Fault Locators could not be assessed in time, prior to expiry of guarantee period. It is also observed that there was no substantial evidence for giving advance instruction to the field officers for the **WP(C) NO. 5652 OF 2012 and conctd. Case** **6** procurement of appropriate computer system. Hence the Chairman is convinced that the Chief Engineer's who were in charge of WBP. Thiruvananthapuram who failed to purchase the computer system along with the Overhead Line Fault Locators are responsible for the loss sustained to the Board in connection with the idling of Overhead Line Fault Locators. The Chairman is convinced that the S/s K.Krishnankutty. Member (Rtd) and B.F. Vincent, Member (Rtd) former Chief Engineers are responsible for the loss sustained to the Board in connection with the idling of Overhead Line Fault Locators as they were the purchasing authority/implementing authority and they did not purchase the computer system indispensable for the operation of the Overhead Line Fault Locators Especially Sri K. Krishnankutty. Member(Rtd.) had waived the inspection/testing of 4 Overhead Line Fault Locators and directed the Supplier to forward the Test Certificate and he had approved the same Sri K Krishnankutty. Member(Rtd) has the prime responsibility for the loss sustained to the Board in idling of 4 Overhead Line Fault Locators and hence it was decided to apportion the responsibility in the ratio of 80:20 between Sri.K.Krishnankutty and Sri. B.F Vincent. Revised Notices vide reference 6 above were issued to Sri K Krishnankutty, Member(Rtd) and to Sri. BF Vincent, Member(Rtd), required to show why an amount of Rs.34,73,965/- and Rs.8,68,491/- being the 80% and 20% of the total loss respectively, sustained by the Board should not be recovered from them. After examining the reply to the notice submitted by both the delinquent officers and the contentions raised by Sr. K Krishnankutty in the personal hearing, the Chairman came to the conclusion that no valid contentions with facts have been raised by the delinquent officers to prove that they were not responsible for the loss caused to KSEB, and hence it is just and proper to recover an amount of Rs. 34,73,955/- being the 80% of the total loss of Rs. 43,42,456/- sustained by the Board from Sri. K Krishnankutty and Rs. 8,68,491/- being the 20% of the total loss of Rs. 43,42,456/- from Sri. BF Vincent. 6. On perusal of the aforementioned findings, it is evident that it is not a show cause notice giving an indication to initiate the ## **WP(C) NO. 5652 OF 2012 and conctd. Case** ## **7** steps by way of recovery but an order to recover the amount in the ratio of 80:20, i.e., against the amount of Rs. 34,73,955/- being the 80% of the total loss of Rs. 43,42,456/- sustained by the Board from petitioner in first writ petition and an amount of Rs. 8,68,491/being the 20% of the total loss of Rs. 43,42,456/- from petitioner in second writ petition. Constitution of the Committee dated 16.11.2004 reveals that the enquiry conducted in 2007 was unilateral which means the petitioners was never associated. It would be also expedient to refer the Rule 3 as well as sub Rule 6 of Rule 116 of KSR, Part III. 7. 'Now' the question which arises is whether the respondents would initiate the enquiry in 2007, though the steps were taken in 2004 ie., beyond 4 years in case of petitioner in W.P. (C) No.28016 of 2011 and within two years in the case of petitioner in W.P.(C) No.5652 of 2012. But the show cause notices were only issued in 2009 ie., when the report came in 2007. The period spend for holding the enquiry could not have been excluded for the purpose of counting the limitation as provided in the proviso to Rule 3. Thus the action taken by the respondent for initiating the steps for recovery of the amount as per the impugned communication is wholly barred as per the proviso to Rule 3 of the KSR. Question posed is answered accordingly. **WP(C) NO. 5652 OF 2012 and conctd. Case** ## **8** 8. The recovery steps taken vide impugned communication cannot be considered to be an action as provided under sub Rule 6 of Rule 116 as recovery has to be done in a manner as prescribed by instituting a civil suit. The next question which arises is whether the suit could be filed as suggested by the counsel for the respondent under Article 112 of the Limitation Act. I would be refraining from delving upon the same as it would give the right of the parties to take appropriate measures as and when steps for filing the suit excluding the period of stay in the pending proceedings against the recovery notices dated 4.10.2011 are initiated. Accordingly, the recovery notice dated 4.10.2011 against the petitioners recovering the amount to the ratio of 80:20 is quashed. Writ petitions are allowed. **Sd/-** sab **AMIT RAWAL** **JUDGE** ## **WP(C) NO. 5652 OF 2012 and conctd. Case** ## **9** ## PETITIONER'S EXHIBITS IN WPC NO.5652 OF 2012 Exhibit P1: True copy of the order No.57/96-97 dated 18.02.1997 of the Board. Exhibit P2: True copy of the order No.CE/TRA/E4/PUC/OLFL/1937 dated16.11.2004 of the Chief Engineer, Transmission (North), Kozhikode. Exhibit P3: True copy of the notice No.VIG/BIV/ 4854/08/1055 dated 8.5.2009/15.5.2009 of the 2nd respondent. ExhibitP4:True copy of the reply submitted by the petitioner to Ext.P3. ExhibitP5: True copy of the revised notice No.VIG/BIV/4854/08/1090 dated 18.5.2011 of the 2nd respondent. Exhibit P6: True copy of the reply dated 11.7.2011 submitted by the petitioner to Ext.P5. ExhibitP7:True copy of the BO(CM) No.2359/ 2011(VIG/BIV/4854/08) dated 4.10.2011of the Board. Exhibit P8: True copy of the petition dated 28.10.2011 submitted by the petitioner to the Chairman, KSEB. Exhibit P9: True copy of the letter No.VIG/BIV/ 4854/08/2194 dated 2.11.2011 of the Chief Vigilance Officer, KSEB. Exhibit P10: True copy of the judgment dated 3. 5.8.2011 in W.P.(C) No.32275/2008 and connected cases of this Hon'ble Court. **WP(C) NO. 5652 OF 2012 and conctd. Case** **10** PETITIONER'S EXHIBITS IN WPC No. **28016 OF 2011** Ext.P1: true copy of Purchase Order No.57/96-97 dated 18.2.1997 Issued by Chief Engineer, World Bank Project Office, Thiruvananthapuam Ext.P2: True copy of Order B.O.No.1274/99(TC1/ SI/1044/98) Dated 7.6.99. Ext.P3 True copy of the Enquiry report Dated 16.11.2004 of the Chief Engineer, Transmission, Kozhikode. Ext.P4 True copy of the show cause notice Dated 8.5.2009 issued by the 2nd respondent to the petitioner Ext.P5: true copy of the reply dated 9.7.2009 submitted by the petitioner to the 2[nd] respondent. Ext.P6:True copy of the show cause notice Dated 17.5.2010 issued by the 2nd respondent. Ext.P7: true copy of the show cause notice Dated 17.5.2010 issued by the 2nd respondent. Ext. P8: True copy of the show cause notice Dated 17.5.2010 issued by the 2nd respondent. Ext. P9: True copy of the show cause notice Dated 17.5.2010 issued by the 2nd respondent. **WP(C) NO. 5652 OF 2012 and conctd. Case** **11** Ext. P10: True copy of the show cause notice Dated 17.5.2010 issued by the 2nd respondent. Ext. P11: True copy of the revised notice Dated 18.5.2011 issued to the petitioner by the 2[nd] respondent. Ext.P12: True copy of the reply dated 3.6.11 Submitted by the petitioner to the 2nd respondent. Ext.P13: True copy of the Order No.B.O. (CM)No.2359/11 (VIG)/BIV/4854/08) dated 4.10.2011 issued by the 3[rd] respondent. Ext.P14: True copy of the Judgment in W.P.(C) Nos. 32275, 32396 of 2007 & 26127 of 2008 of this Honourable Court. Dated 5.8.2009.