T.S. Dharmarajan Thazhissary House v Life Insurance Corporation of India & Others; T. Sivadasan v Life Insurance Corporation of India & Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MRS. JUSTICE ANU SIVARAMAN** **TUESDAY, THE 22ND DAY OF DECEMBER 2020 / 1ST POUSHA, 1942** ## **WP(C).No.11743 OF 2020(P)** ## **PETITIONER:** **T.S.DHARMARAJAN THAZHISSARY HOUSE, THAMARAYOOR P.O. THRISSUR- 680 505.** **BY ADVS. SRI.P.CHANDRASEKHAR SRI.K.K.MOHAMED RAVUF SMT.K.VIDYA SHRI. ANOOP KRISHNA** ## **RESPONDENTS:** **1 LIFE INSURANCE CORPORATION OF INIDA CENTRAL OFFICE, YOGASHEMA, JEEVAN BHEEMA MARG, MUMBAI-400 021, REPRESENTED BY ITS MANAGING DIRECTOR. 2 THE ZONAL MANAGER, LIFE INSURANCE CORPORATION OF INDIA, SOUTHERN ZONAL OFFICE, LIC BUILDING, ANNASALI, P.B. NO 12450, CHENNAI-600002. 3 THE SENIOR DIVISIONAL MANAGER, LIFE INSURANCE CORPORATION OF INDIA, DIVISIONAL OFFICE, THRISSUR-680001. R1-3 BY ADV. SRI.S.EASWARAN** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 12-112020, ALONG WITH WP(C).18489/2020(I), THE COURT ON 22-12-2020 DELIVERED THE FOLLOWING:** **WP(C).Nos.11743 & 18489 OF 2020** **2** ## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MRS. JUSTICE ANU SIVARAMAN** **TUESDAY, THE 22ND DAY OF DECEMBER 2020 / 1ST POUSHA, 1942** ## **WP(C).No.18489 OF 2020(I)** ## **PETITIONER:** **T.SIVADASAN AGED 60 YEARS RETD. ASSISTANT BRANCH MANAGER (SALES), LIFE INSURANCE CORPORATION OF INDIA, KUNNAMKULAM BRANCH, THRISSUR DISTRICT, NOW RESIDING AT SREE HARI, THAIKKAD P.O, OPP. GOVERNMENT AYURVEDA HOSPITAL, GURUVAYUR, THRISSUR DISTRICT 680 104** **BY ADVS. SRI.K.RAMAKUMAR (SR.) SRI.T.RAMPRASAD UNNI SRI.S.M.PRASANTH SRI.G.RENJITH SMT.R.S.ASWINI SANKAR SRI.T.H.ARAVIND** ## **RESPONDENTS:** **1 THE LIFE INSURANCE CORPORATION OF INDIA CENTRAL OFFICE, YOGASHEMA, JEEVAN BHEEMA MARG, P.B NO. 19953, MUMBAI 400 021, REPRESENTED BY ITS MANAGING DIRECTOR. 2 THE ZONAL MANAGER, (DISCIPLINARY AUTHORITY), LIFE INSURANCE CORPORATION OF INDIA, SOUTHERN ZONAL OFFICE, P.B NO. 2450, LIC BUILDING, 153 ANNA SALAI, CHENNAI 600 002.** **WP(C).Nos.11743 & 18489 OF 2020** **3** **3 THE SENIOR DIVISIONAL MANAGER, LIFE CORPORATION OF INDIA, DIVISIONAL OFFICE, JEEVAN PRAKASH, KOVILAKATHUMPADAM, THIRUVAMBADI P.O, THRISSUR, THRISSUR DISTRICT, PIN 680 022** **SRI.S.EASWARAN,SC,LIFE INSURANCE CORP. OF INDIA** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 1211-2020, ALONG WITH WP(C).11743/2020(P), THE COURT ON 22-12-2020 DELIVERED THE FOLLOWING:** **WP(C).Nos.11743 & 18489 OF 2020** **4** ## **JUDGMENT** 1.The petitioners in these writ petitions were the accused in C.C.No.3/2000 of the Special Court (SPE/CBI)-I, Ernakulam under Section 420,468 and 471 read with Section 120B IPC and Section 13 (1)(d) read with Section 13(2) of the P.C. Act, 1988. They were convicted by the Special Court by judgment dated 23.11.2006. On the basis of conviction, they were removed from service. By common judgment dated 23.7.2019 in Criminal Appeal Nos.2302/2006 and 2336 of 2006, the appeals were allowed, the conviction and sentence stood set aside and the petitioners were acquitted. They approached this Court filing writ petitions and by a common judgment dated 20.12.2019, the petitioners were directed to be reinstated. Thereafter, orders were passed reinstating the petitioners in service. However, the period from effective date of removal to the date of reinstatement was treated as 'Dies Non'. The petitioners submitted objection. While so, they retired from service on attaining the age of superannuation. - 2.The petitioner in W.P.(C).No.11743 of 2020 was paid the **WP(C).Nos.11743 & 18489 OF 2020** **5** retirement benefits. However, later, on the ground that the CBI proposes to file an appeal against the judgment of this Court in the criminal appeals acquitting the petitioners, the LIC directed him to refund the amounts already paid to him. The said orders and the order of reinstatement, to the extent it treats the period spent out of service as Dies Non, are under challenge. This Court while admitting the writ petition stayed recovery of the amounts paid. In W.P.(C).No.18489/2020, it is contended that the gratuity and other terminal benefits have not been released to the petitioner on the ground that the CBI proposes to file an SLP against the judgment in the criminal appeal. 3.The learned Senior Counsel appearing for the petitioner in W.P. (C).No.18489/2020 relied on the decision of the Apex Court reported in **Sukumaran vs. State of Kerala** (2020 (5) KLT 201 (SC)), and of a Full Bench of this Court in **Chandran K and others v. Secretary, Local Self Government Department and others** [2020 (5) KHC 273 (FB)] to contend that no recovery is possible from the gratuity even if there are judicial proceedings pending. It is further submitted that the petitioners had already suffered the penalties imposed in disciplinary proceedings. Removal from service was inflicted on them only **WP(C).Nos.11743 & 18489 OF 2020** **6** on account of the conviction in the criminal case. It is, therefore, contended that the acquittal in appeal would result in the erasement of the orders of removal from service and the employee would be entitled to reinstatement with all consequential benefits, as if the removal had not occurred. A finding to that effect in the judgment reported in **T.Sivadasan vs. LIC Mumbai and Others** (2018 (1) KHC 65) is also relied on. - 4.The learned counsel for the petitioner in W.P.(C) No.11743/2020 submits that the likelihood of the CBI attempting an SLP against the acquittal in appeal cannot be a justification for refusing to grant the benefits. It is further submitted that the treating of the period as 'Dies Non' is completely illegal and unsustainable. 5. A counter affidavit has been placed on record by the respondents. It is admitted that it was on the basis of the conviction in the criminal case that the penalty of removal from service was inflicted on the petitioners. It is submitted that though the removal was challenged, the writ petition was dismissed and was confirmed in approval. The decisions reported in **T.Sivadasan vs. LIC Mumbai and Others** (2018 **WP(C).Nos.11743 & 18489 OF 2020** **7** (1) KHC 65) & **T.Sivadasan vs. LIC Mumbai and Others** (2018 KHC 377) are relied on by the learned counsel for the LIC. It is further stated that after the petitioners were acquitted in appeal, on the strength of judgments of this Court, orders of reinstatement were issued, accepting which the petitioners rejoined in service. It is further stated that the acquittal in appeal was not honourable acquittal and therefore the petitioners are not entitled to pay and allowances for the period they remained out of service. The provisions of Regulation 38 of Life Insurance Corporation of India (Staff) Regulations, 1960 (hereinafter referred to as 'the Regulations') and a decision of a Division Bench of this Court in W.A. No.1466/2009 rendered on 09.07.2009 are relied on. With regard to the claim for retirement benefits, it is contended that the CBI had, by letter dated 25.05.2020 informed the LIC that a proposal for filing SLP against the common judgment in the criminal appeals has been approved by the competent authority and is pending for final approval from the Ministry of Law and Justice and before the Learned Attorney General of India. It is, therefore, contended that the LIC is awaiting the orders in the SLP and that if all terminal benefits are released and the acquittal is reversed in SLP, the consequences will be disastrous to the LIC. **WP(C).Nos.11743 & 18489 OF 2020** **8** 6.I have considered the contentions advanced. It is an admitted fact that the penalty of removal from service was inflicted on the petitioners only on the basis of conviction in the criminal case. This is apparently on the strength of the power conferred under Regulation 39(4) (i) of the Regulations. Regulation 38 of the Regulation, which is relied on by the respondents, is with regard to treatment of the period of suspension. Regulation 38 reads as follows:- ## _**Treatment of the Period of Suspension:**_ _38. When the suspension of an employee is held to be unjustified or not wholly justified; or when an employee who has been dismissed, removed or suspended is reinstated, the disciplinary, appellate, or reviewing authority, as the case may be whose decision shall be final, under these regulations may grant to him for the period of his absence from duty_ _(a) if he is honourably acquitted, the full pay and allowances which he would have been entitled to if he had not been dismissed, removed or suspended, less the subsistence allowance;_ - _(b) if otherwise, such proportion of pay and allowance as the disciplinary, appellate or reviewing authority may prescribe._ _In a case falling under clause (a), the period of absence from duty will be treated as a period spent on duty. In a case falling under clause(b), the period of absence shall not be treated as a period spent on duty, but the disciplinary, appellate or the reviewing authority may, at its discretion, grant leave for the period to the extent admissible to the employee under the rules; any period of absence which has not been treated as period spent on duty or on leave shall not count as service for any purpose under these Regulations but will not constitute break in_ **WP(C).Nos.11743 & 18489 OF 2020** **9** _service._ _No order passed under this regulation shall have the effect of compelling any employee to refund the subsistence allowance payable under regulation 37._ 7. In the instant case, the contention of the respondents is that the acquittal cannot be termed to be honourable and therefore the order of 'Dies Non' was justified. On an anxious consideration of the pleadings and materials on record, I am unable to accept the contention of the respondent for more reasons than one. Firstly, since the removal from service of the petitioners was solely on the basis of the conviction in the criminal case, the logical consequence of the acquittal in appeal is the reinstatement of the petitioners with all service benefits. Secondly, a reading of the judgment in the criminal appeals would make it clear that the acquittal is indeed honourable. The finding in Ext.P4 judgment is specifically as under:- - “ I find that the prosecution has not been able to adduce clear evidence to prove that the accused had derived any undue advantage or illegal benefit by abusing their official position as LIC officials. In such a circumstance, they are entitled for acquittal.” Thirdly, the possibility of an S.L.P being proposed to be filed some time in the future by the CBI cannot be pleaded by the respondents **WP(C).Nos.11743 & 18489 OF 2020** **10** as a reason to withhold the pensionary benefits due to the petitioners. The petitioners having objected to the treating of the period before reinstatement as 'Dies Non' and the writ petitions having been filed when the requests for release of the salary and pensionary benefits were refused to be considered by the respondents, the contention that the challenge is belated or that the petitioners had acquiesced to the denial of emoluments for the period is devoid of merits. The provisions of the payment of Gratuity Act, specifically sub-section 6 of Section 4 does not permit the withholding of gratuity of a retired employee except in the specific instances mentioned therein. I am of the opinion that the legal consequence of the acquittal of the petitioners in appeal is liable to be extended to them. In the result, these writ petitions are allowed. The action of the respondents in withholding the retirement benefits to the petitioners and seeking to recover the amounts already paid is declared to be illegal. The petitioners will be entitled to all the consequences of the acquittal in the criminal cases including reinstatement with full salary and allowances. The entire benefits **WP(C).Nos.11743 & 18489 OF 2020** **11** shall be calculated and disbursed within a period of three months . from the date of receipt of a copy of this judgment **Sd/-** **ANU SIVARAMAN JUDGE** **SJ** **WP(C).Nos.11743 & 18489 OF 2020** **12** ## **APPENDIX OF WP(C) 11743/2020** **PETITIONER'S/S EXHIBITS:** **EXHIBIT P1** **TRUE COPY OF ORDER DATED 28.6.2007 OF THE CHAIRMAN OF THE 1ST RESPONDENT** **EXHIBIT P2 TRUE COPY OF THE ORDER OF 3RD RESPONDENT DATED 19.7.2014 REMOVING THE PETITIONER FROM SERVICE** **EXHIBIT P3 TRUE COPY OF JUDGMENT DATED 15.11.2017 IN WPC NO 18818 OF 2014 OF THIS HONOURABLE COURT** - **EXHIBIT P4 TRUE COPY OF JUDGMENT DATED 23.7.2019 IN CRIMINAL APPEAL NO 2302 OF 2006 OF THIS HONOURABLE COURT** **EXHIBIT P5 TRUE COPY OF THE LETTER DATED 30.7.2019 OF THE PETITIONER TO THE 3RD RESPONDENT** - **EXHIBIT P6 TRUE COPY OF JUDGMENT DATED 20.12.2019 IN W3PC NO 34582 OF 2019 OF THIS HON'BLE COURT** - **EXHIBIT P7 TRUE COPY OF THE LETTER DATED 15.1.2020 OF 3RD RESPONDENT REINSTATING THE PETITIONER IN SERVICE** - **EXHIBIT P8 TRUE COPY OF THE BANK STATEMENT OF CORPORATION BANK SHOWING THAT THE PETITIONER HAS REMITTED AN AMOUNT OF RS 30,24,511/- ON 17.1.2020** - **EXHIBIT P9 TRUE COPY OF ORDER DATED 17.1.2020 OF 3RD RESPONDENT REINSTATING THE PETITIONER AS ASSISTANT AS KUNNAMKULAM BRANCH OFFICE** **EXHIBIT P10 TRUE COPY OF THE LETTER OF PETITIONER DATED 25.2.2020 REQUESTING THE 3RD RESPONDENT TO LIFT THE DIES NON AND RELEASE AND PAY TO HIM SALARY AND OTHER MONETARY BENEFITS** **WP(C).Nos.11743 & 18489 OF 2020** **13** **EXHIBIT P11 TRUE COPY OF LETTER DATED 6.6.2015 ADDRESSED TO THE PETITIONER BY THE MANAGER (P&R) IN THE OFFICE OF THE 3RD RESPONDENT INFORMING THE PETITIONER THAT THE MATTER HAD BEEN REFERRED TO HIGHER AUTHORITIES.** - **EXHIBIT P12 TRUE COPY OF LETTER DATED 20.5.2020 OF THE 1ST RESPONDENT TO CBI** **EXHIBIT P13 TRUE COPY OF LETTER DATED 1.6.2020 ADDRESSED TO THE PETITIONER BY THE 3RD RESPONDENT INFORMING THE PETITIONER THAT ALL THE PENSION PAYMENTS SHALL BE WITH HELD** **EXHIBIT P14 TRUE COPY OF THE LETTER DATED 1.6.2020 OF MANAGER (F & OS) OFFICE OF THE 3RD RESPONDENT TO THE BRANCH MANAGER, CORPORATION BANK, KUNNUMKULAM TO TRANSFER RS 22,79,993/0 FROM THE ACCOUNT OF THE PETITIONER TO THE ACCOUNT OF LIC** **RESPONDENT'S/S EXHIBITS: EXHIBIT R3(a): TRUE COPY OF THE LETTER DATED 25/05/2020 ISSUED BY CENTRAL BUREAU OF INVESTIGATION KOCHI. EXHIBIT R3(b): TRUE COPY OF THE LETTER DATED 07/08/2020 ISSUED BY CENTRAL BUREAU OF INVESTIGATION KOCHI. EXHIBIT R3(c): TRUE COPY OF THE DISCHARGE RECEIPT DATED 04/07/2018.** **WP(C).Nos.11743 & 18489 OF 2020** **14** ## **APPENDIX OF WP(C) 18489/2020** **PETITIONER'S/S EXHIBITS:** **EXHIBIT P1 2020TRUE COPY OF JUDGMENT DT 20-12-2019 IN WP(C) NO. 33256 OF 2019** - **EXHIBIT P2 TRUE COPY OF COMMUNICATION DT 15-11-2020 ISSUED BY THE SENIOR DIVISIONAL MANAGER LIC TO THE PETITIONER ALONG WITH OFFICE ORDER DT 14-1-2020 ISSUED BY THE ZONAL MANAGER LIC** **EXHIBIT P3 TRUE COPY OF REPRESENTATION DT 04-03-2020 SUBMITTED BY THE PETITIONER.** - **EXHIBIT P4 TRUE COPY OF REPRESENTATION DT 06-06-2020 SUBMITTED BY THE PETITIONER.** - **EXHIBIT P5 TRUE COPY OF REMINDER DT 26-06-2020 SENT BY THE PETITIONER THROUGH E.MAIL** **EXHIBIT P6 TRUE COPY OF REMINDER DT 27-07-2020 SENT BY THE PETITIONER THROUGH E.MAIL.** **RESPONDENT'S/S EXHIBITS:** - **EXHIBIT R3(a) TRUE COPY OF THE LETTER DATED 25/5/2020 ISSUED BY CENTRAL BUREAU OF INVESTIGATION KOCHI** **EXHIBIT R3(b) TRUE COPY OF THE LETTER DATED 7/8/2020 ISSUED BY CENTRAL BUREAU OF INVESTIGATION KOCHI.**