Valsalakumari T.M v State of Kerala & Ors.

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** # **PRESENT THE HONOURABLE MR. JUSTICE ALEXANDER THOMAS** **&** **THE HONOURABLE MR. JUSTICE T.R.RAVI** **TUESDAY, THE 23RD DAY OF FEBRUARY 2021 / 4TH PHALGUNA, 1942** ## **OP(KAT).No.22 OF 2021** **AGAINST THE ORDER/JUDGMENT IN OA(EKM) 2151/2018 DATED 28-11-2018 OF KERALA ADMINISTRATIVE TRIBUNAL, THIRUVANANTHAPURAM** ## **PETITIONER/APPLICANT:** **SMT.VALSALAKUMARI.T.M AGED 60 YEARS D/O LATE KUMARAN, RETD. 2ND GRADE OVERSEER, LSGD SECTION, PANDALAYINI BLOCK PANCHAYT, KOZHIKODE673 036, RESIDING AT VAISHNAVAM, KATTAYIPARAMBU, ELATHOOR P.O., KOZHIKODE-673 303.** **BY ADV. SRI.JAMES ABRAHAM (VILAYAKATTU)** ## **RESPONDENTS/RESPONDENTS IN O.A.:** - **1 STATE OF KERALA REPRESENTED BY ITS PRINCIPAL SECRETARY TO GOVERNMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM-695 033.** - **2 LOCAL SELF GOVERNMENT DEPARTMENT REPRESENTED BY ITS SECRETARY, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM-695 003.** **3 THE CHIEF ENGINEER, LOCAL SELF GOVERNMENT DEPARTMENT, UNIVERSITY OF KERALA, SENATE HOUSE CAMPUS, PALAYAM, THIRUVANANTHAPURAM-695 033.** **OP(KAT).No.22 OF 2021** **2** **4 THE ACCOUNTANT GENERAL, THIRUVANANTHAPURAM-695 003.** ## **SRI.B.VINOD, SR.GOVT.PLEADER** **THIS OP KERALA ADMINISTRATIVE TRIBUNAL HAVING BEEN FINALLY HEARD ON 16-02-2021, THE COURT ON 23-02-2021 DELIVERED THE FOLLOWING:** **OP(KAT).No.22 OF 2021** **3** # **ALEXANDER THOMAS & T.R.RAVI, JJ.** **=============================** # **O.P. (KAT) No.22 of 2021** _[Arising out of order dated 28.11.2018 in O.A.(EKM) No.2151 of 2018 of KAT, Ekm. Bench]_ **=============================** Dated this the 23[rd] day of February, 2021 ## **JUDGMENT** ## **ALEXANDER THOMAS, J.** The prayers in the aforecaptioned Original Petition (KAT) filed under Articles 226 and 227 of the Constitution of India are as follows;(See page No.6 of the paper book of this OP) - _“(i) Call for the records leading to the issuance of Exhibit p2 by issuance of writ of certiorari and quash the same._ - _(ii) Issue a writ of mandamus or appropriate order or direction directing the respondents to disburse Death Cum Retirement Gratuity with 8% interest from the date of retirement, ie.1.6.2015, to the petitioner._ - _(iii) Grant such other orders as this Hon'ble Court may deem fit and proper considering the facts and circumstances of the case and_ - _(iv) Grant the costs of this writ petition.”_ ## 2. Heard Sri.James Abraham (Vilayakattu), learned counsel appearing for the petitioner in the O.P./sole applicant in the O.A. before the Tribunal and Sri B.Vinod, learned Senior Government Pleader appearing for the respondents in the O.P./respondents in the O.A. 3. The prayers in Ext.P1 original application, O.A. (Ekm)No.2151/2018 filed by the petitioner herein before the Kerala Administrative Tribunal, Ernakulam Bench read as follows; (See page **OP(KAT).No.22 OF 2021** **4** No.18 of paper book of this O.P.) “ _(a) To direct the respondents to disburse Death Cum Retirement Gratuity and all other terminal benefits to the applicant without delay. (b) Grant such other reliefs as this Hon'ble Tribunal deems fit and proper in the circumstances of the case including the costs of the Original Application.”_ 4. After hearing both sides, the Tribunal has passed impugned Ext.P2 final order dated 28.11.2018 in O.A.(Ekm)No.2151/2018, whereby the main pleas of the petitioner herein have been declined on the premise that the judicial proceedings envisaged in terms of the operative portion of Rule 3 Part III KSR was not then finalised and that after finalisation of the proceedings under Rule 3, it is for the respondents in the O.A. to ensure that final orders in terms of the provisions under Rule 3 Part III KSR are duly passed, so as to ensure that the admissible DCRG and other terminal benefits are disbursed to the petitioner without much delay. It is this final order at Ext.P2 rendered by the Tribunal, that is under challenge in this original petition. 5. It appears that the petitioner was serving in the Local Self Government Department of the State Government. While the petitioner was in service, she was arrested by the Vigilance and Anti Corruption Bureau (VACB), Kozhikode on 23.01.2014 in a trap case and crime was registered as vigilance case, V.C.No.01/2014/KKD of VACB, Kozhikode, for offences punishable under the Prevention of Corruption Act, 1988. The gist **OP(KAT).No.22 OF 2021** **5** of the allegation is that the petitioner had demanded and accepted an amount of Rs.1,000/- as illegal gratification from the defacto complainant, for issuing occupancy certificate for a newly constructed house and the petitioner was arrested and remanded to judicial custody and she was suspended from service on 24.01.2014 as per order dated 29.1.2014 issued by the Secretary of the Kozhikode Municipal Corporation and later she was reinstated in service on 26.11.2014 as per order dated 17.11.2014 issued by the Chief Engineer of Local Self Government Department. These factual aspects of the matter are discernible from a reading of para No.1 of Annexure A7 G.O.(Rt)No.1067/2017/LSGD dated 03.04.2017 (see page Nos. 36 and 37 of paper book of this O.P.). During the pendency of the abovesaid vigilance crime investigation, the petitioner had thereafter retired from service on 31.5.2015. Later, it appears that the Vigilance Police authorities had duly completed the investigation and have filed the final report/charge sheet/police report in terms of Section 173 (2) of Cr.P.C. before the Court of the Enquiry Commissioner and Special Judge, Kozhikode in the above said Vigilance Case, V.C.No.1/2014/KKD and the said criminal court has taken cognizance of the offence alleged against the petitioner, which led to the institution of Calendar Case, C.C.No.1/2017 on 15.3.2017. Thus, it can be seen that filing of the final report/charge sheet **OP(KAT).No.22 OF 2021** **6** by the Vigilance Police on 15.3.2017 on which cognizance was taken by the criminal court and which led to the institution of the Calendar Case, C.C.No.1/2017 on the file of the said criminal court, the judicial proceedings within the meaning of operative portion of Rule 3 Part III KSR has been instituted. 6. In view of the filing of the final report/charge sheet by the Vigilance Police in the above criminal case on 15.03.2017, pursuant to which cognizance was also taken by the competent criminal court on the same day, it is only to be held that judicial proceedings within the meaning as understood in Clause (b) to the explanation appended to Rule 3 of Part III KSR is said to have been instituted on and with effect from 15.03.2017. Hence the rigor of the proceedings in terms of the operative portion of Rule 3 Part III KSR can be said to have been in force on and with effect from 15.03.2017. Rule 3 Part III KSR and its 3 Notes thereunder read as follows: > _“Rule 3. The Government reserve to themselves the right of withholding or withdrawing a pension or any part of it, whether permanently or for a specified period, and the right of ordering the recovery from a pension of the whole or part of any pecuniary loss caused to Government, if in a departmental or judicial proceeding, the pensioner is found guilty of grave misconduct or negligence during the period of his service, including service rendered upon re-employment after retirement: Provided that-_ _(a) such departmental proceeding, if instituted while the employee was in service, whether before his retirement or during his re-employment, shall after the final retirement of the employee, be deemed to be a proceeding under this rule and shall be continued and concluded by the authority by which it was commenced in the same manner as if the_ **OP(KAT).No.22 OF 2021** **7** _employee had continued in service;_ _(b) such departmental proceeding, if not instituted while the employee was in service, whether before his retirement or during his reemployment,-_ - _(i) shall not be instituted save with the sanction of the Government;_ - _(ii) shall not be in respect of any event which took place more than four years before such institution; and_ - _(iii) shall be conducted by such authority and in such place as the Government may direct and in accordance with the procedure applicable to departmental proceedings in which_ _an order of dismissal from service could be made in relation to the employee during his service;_ _[(c) no such judicial proceedings, if not instituted while the employee was in service whether before his retirement or during his re-employment, shall be instituted, save with the sanction of the Government, in respect of cause of action which arose or an event which took place more than four years before such institution; and_ _(d) the Public Service Commission shall be consulted before final orders are passed._ **==> picture [96 x 20] intentionally omitted <==** - _**Note 1** .- As soon as proceedings of the nature referred to in this rule are instituted the authority which institutes such proceedings should without delay intimate the fact to the Audit Officer. The amount of pension withheld under this rule should not ordinarily exceed one-third of the pension originally sanctioned. In fixing the amount of pension to be so withheld, regard should be had to the consideration whether the amount of the pension left to the pensioner in any case would be adequate for his maintenance._ - _**Note 2** .- The word 'pension' used in this rule does not include death-cumretirement gratuity. Liabilities fixed against an employee [or pensioner] can be recovered from the death-cum-retirement gratuity payable to him without the departmental/judicial proceedings referred to in this rule, but after giving the employee [or pensioner] concerned a reasonable opportunity to explain_ - _**Note 3** .- The liabilities of an employee should be quantified either before or after retirement and intimated to him before retirement if possible or after retirement within a period of three years on becoming pensioner. The liabilities of a pensioner should be quantified and intimated to him.”_ (The provisions contained in Ruling No. 1, Ruling No.2 and Ruling No.3 appended under Rule 3 Part III KSR are not very relevant for the present case and therefore are not reproduced hereunder). 7. In the instant case, what was pending as on the date of **OP(KAT).No.22 OF 2021** **8** retirement of the petitioner on 31.05.2015, was only FIR registered by the Vigilance Police as V.C.1/2014/KKD of Vigilance and Anti Corruption Bureau, Kozhikode for offences under the Prevention of Corruption Act. The investigation in the above crime has not yet been completed. Clause (b) of the explanation appended to Rule 3 Part III KSR would stipulate that a judicial proceeding shall be deemed to be instituted in a criminal proceeding on the date on which the complaint or report of the Police Officer on which the Magistrate takes congnizance, is made. Further, Clause (c) of the proviso appended to Rule 3 would also stipulate that no such judicial proceedings, as envisaged in the operative portion of Rule 3 Part III KSR, if not instituted while the employee was in service whether before his retirement or during his re-employment, shall be instituted, save with the sanction of the Government, in respect of a cause of action which arose or an event which took place more than four years before such institution, etc. In the instant case, reading of Annexure A1 would make it clear that the incident which resulted in the aforesaid criminal proceedings is a solitary incident of alleged acceptance of illegal gratification, which has happened on 23.01.2014. The petitioner has retired from service on 31.05.2015. The final report/charge sheet/Police report has been filed on 15.03.2017 on which cognizance was also taken on the same day. Hence **OP(KAT).No.22 OF 2021** **9** the alleged incident which has happened on 23.01.2014 is within the four year period reckoned from 15.03.2017. Since that is the position, no sanction from the Government is required for setting in motion proceedings in terms of Rule 3 Part III KSR, even though the final report/charge sheet on which congnizance has been taken and filed only much after the retirement of the petitioner. Explanation (b)(i) appended to Rule 3 Part III KSR would make it clear that a judicial proceeding shall be deemed to be instituted in case of a criminal proceeding on the date on which the complaint or report of the Police Officer on which Magistrate takes cognizance, is made. Hence by a cumulative and combined reading of various provisions contained in Rule 3 Part III KSR, more particularly, Clause (c) to the proviso as well as Clause (b)(i) to the explanation appended to Rule 3, would make clear that judicial proceedings within the meaning of Rule 3 is appearing in tune with the petitioner's case on and with effect from 15.03.2017. It is common ground that the trial in this case has not been over and the case is pending consideration of the competent criminal court concerned. Further, it appears from the report given by the Court in the Office of the Enquiry Commissioner and Special Judge, Kozhikode that in this case after taking cognizance on 15.03.2017, the charges have not been framed so far by the criminal court and that the case **OP(KAT).No.22 OF 2021** **10** is posted for hearing under Section 239 Cr.P.C. and that the said court is according top priority for disposing of 5 plus year old cases, etc. 8. It appears that later in view of the pendency of the abovesaid judicial proceedings, the competent authority has sanctioned provisional pension to the petitioner in terms of Rule 3A Part III KSR and they have withheld the payment of the full gratuity amount due to the petitioner on account of the provisions contained in the second limb of Rule 3A Part III KSR. The Tribunal by impugned Ext.P2 final order rendered on 28.11.2018, has denied the prayers made by the petitioner for release of the DCRG, etc. due to the petitioner on the ground that the judicial proceedings within the meaning of Rule 3 Part III KSR, is still pending and that in view of the mandatory provisions contained in the second limb of Rule 3A Part III KSR, the DCRG has been withheld by the competent authority and therefore directions cannot be issued by the said Tribunal to release the DCRG due to the petitioner, pending finalisation of the judicial proceedings and the consequential finalization of Rule 3 proceedings thereafter based on the outcome of the judicial proceedings. It is this order at Ext.P2, that is under challenge in this O.P. 9. A Full Bench of this Court in the case in **Chandran K. & Ors. V. Secretary, Local Self Government Department & Ors.** [2020 (5) **OP(KAT).No.22 OF 2021** **11** KLT 669 (F.B.) = 2020 (5) KHC 273 (F.B.)] has categorically held that the provisions contained in the second limb of Rule 3A Part III KSR, authorising withholding even of the DCRG due to the petitioner (apart from the full pensionary benefits) being withheld on account of the first limb of Rule 3 Part III, are _ultra vires_ and illegal and are against the main provision contained in Rule 3 Part III KSR. In this connection, it is also relevant to note that Rule 3A Part III KSR only provides for an interim arrangement pending finalization of the main proceedings as envisaged in the operative portion of Rule 3 Part III KSR. Rule making authority has defined the word 'pension' as occurring in the operative portion of the Rule 3 Part III KSR by incorporating Note 2 thereunder and making it clear like the day light that the word 'pension' occurring in the operative portion of Rule 3 Part III KSR will not be inclusive of DCRG. In other words, what is the subject matter of withholding as per the operative portion of Rule 3 Part III KSR, is only the pension and not the DCRG. The above said provision made in Rule 3 Part III KSR appears to be in contradistinction to the provision contained in Rule 9 of CCS (Pension) Rules wherein explicit provisions are made for withholding not only pension but also DCRG, if the disciplinary proceedings/departmental proceedings within the operative portion of that Rule are pending against retired employees. Hence, the Full **OP(KAT).No.22 OF 2021** **12** Bench held categorically that the provision contained in second limb of Rule 3A authorising even withholding of DCRG, is an oppressive and capricious provision, which has no objective nexus with the objective sought to be achieved as per the main provision contained in Rule 3 Part III KSR and after exhaustively referring to various judicial precedents on the point and also various Apex Court rulings, it was conclusively and categorically held that the second limb of Rule 3A Part III KSR is _ultra vires_ and has struck down the said provision. In other words, the Full Bench has held that once Rule 3 Part III KSR proceedings are pending on account of pendency of departmental proceedings/judicial proceedings as envisaged therein, what can be temporarily withheld from the pensioner pending finalisation of the proceedings is only the pension and not the DCRG. 10. The learned Government Pleader has urged that the State has filed an SLP proceeding before the Apex Court to challenge the above said Full Bench judgment in **Chandran's case** supra [2020 (5) KLT 669 (F.B.)] and that the State has secured interim stay order dated 14.12.2020 in SLP (Civil) No.14881-14882/2020 wherein it has been ordered that in the meantime, the operation of the impugned order passed by the High Court shall remain stayed. The issue is as to whether the abovesaid stay **OP(KAT).No.22 OF 2021** **13** order would amount to stay of only the enforcement of the directions in the judgment of the Full Bench or it would also amount to stay of the _ratio decidendi_ laid down by the Full Bench in **Chandran's case** supra has been considered in detail by this Court in a recent judgment rendered on 17.02.2021 in W.A.No.1407/2019 in the case of a retired employee of the Travancore Devaswom Board, wherein Rule 3 & Rule 3A Part III KSR have been adopted for regulating the retiral state of affairs of the employees of the said Board. 11. This Court after referring to the various decisions of the Division Bench of this Court as well as that of the Apex Court, has held as follows in paragraph Nos.20 to 27 of the judgment dated 17.02.2021 in W.A.No.1407/2019 arising out of W.P.(C). 42482/2018 which read as follows: _“20. That apart, a copy of the interim order dated 14-12-2020 rendered by the Apex Court in SLP(C) Nos.14881-14882 of 2020 filed by the state authorities so as to impugn the abovesaid Full Bench Decision in_ _**Chandran's** case supra [2020 (5) KLT 669 (F.B.)] has been made available to us for perusal along with a memo dated 03-02-2021 filed by the learned Standing Counsel for the appellant Devaswom board and reading of the same would indicate that the order is as follows:_ _“Issue notice._ _In the meantime, the operation of the impugned order passed by the High Court shall remain stayed.”_ _21. So it can be seen that the stay order granted by the Apex Court in the above case confined to the limited extent as against the enforcement and implementation of the directions and orders passed by the Full Bench of this Court in the said judgment in_ _**Chandran's** case supra. It is by now well established by series of rulings including that rendered by the Division Bench of this Court in_ _**Abdu Rahiman v. District Collector, Malappuram** [(2009) 4 KLT 485] that_ **OP(KAT).No.22 OF 2021** **14** _wherein it has been held in para No.5 & 8 thereof that the learned Single Judge of the High Court should not have ignored the two decisions rendered by the Division Bench of the High Court on the ground that appeal has been filed against one of the said decisions of the Division Bench before the Apex Court and there was a stay against him and that even when a decision of Division Bench of the High Court is stayed by the Apex Court, the learned Single Judge is bound to follow the decision of the Division Bench, as it continues to be a binding precedent for them. The interim order of stay only relieves the parties concerned from the liability to obey and comply the directions in the judgment under appeal. It has also been further held therein that when the court declares a law, many people will be regulating their affairs according to it and unless there is a compelling ground, a precedent should not be upset so lightly and in hierarchical system of courts as held by the Apex Court, there should be someone who should say the last word and when the last word is said, the same should be followed by everyone in the lower tiers and that in view of the abovesaid position the learned Single Judge in that case should have followed the decisions of the Division Bench cited therein, etc._ _22. It may be pertinent to refer to para Nos.5 & 8 of the decision of the Division Bench of this Court in_ _**Abdu Rahiman's** case supra [2009 (4) KLT 485] pp.489, 494-495, which read as follows:_ _“5. The learned Attorney General submitted that a Constitution Bench judgment of this Court was binding on smaller Benches and a judgment of three learned Judges was binding on Benches of two learned Judges - a proposition that learned counsel for the appellant did not dispute. The learned Attorney General drew our attention to the judgment of a Constitution Bench in Sub-Committee of Judicial Accountability v. Union of India ((1992) 4 SCC 97) where it has been said that 'no coordinate Bench of this Court can even comment upon, let alone sit in judgment over, the discretion exercised or judgment rendered in a cause or matter before another coordinate Bench' (SCC p.98, para 5). The learned Attorney General submitted that the appropriate course for the Bench of two learned Judges to have adopted, if it felt so strongly that the judgment in Nityananda Kar (1991 Supp (2) SCC 576), was incorrect, was to make a reference to a Bench of three learned Judges. That Bench of three learned Judges, if it also took the same view of Nityananda Kar, could have referred the case to a Bench of five learned Judges._ _8. In the light of the above authoritative pronouncements, the decision of the learned Single Judge in Ahamed Kutty (supra) rendered ignoring the decisions of the Division Bench in Abdul Samad (supra) and Moosakoya (supra) cannot be treated as a valid precedent. An intelligent lawyer can perceive some flaw in any decision and may canvass for reconsideration of it. But, the law has to be clear, specific and consistent. When this Court declares a law, many people will be regulating their affairs according to it. Unless there are compelling grounds, a precedent should not be upset so lightly. In the hierarchical system of Courts, as held by the Apex Court, there should be someone who should say the last word and when the last word is said, the same should be_ **OP(KAT).No.22 OF 2021** **15** _followed by everyone in the lower tiers. In view of the above position, the learned Single Judge should have followed the decisions of the Division Bench in Abdul Samad (supra) and Moosakoya (supra). We agree with the unsatisfactory position of law prevailing because of the lacunae in the Statute which was designed to protect the environment. But, this Court can interpret only what is before it. We are fully aware of the fact that various loopholes can be picked up in the decisions of the Division Bench, because of the loopholes in the enactment. In this context, we notice the submission of the learned Advocate General that the State is conscious of the loopholes in the law and are taking expeditious steps to remedy the same. But, till the law is amended, we are of the view that the Division Bench has taken, in the aforementioned two decisions, a plausible view on the power of the District Collector to order confiscation and lack of power on the Judicial Magistrates to entertain applications for interim custody. The said declaration of law should prevail until it is unsettled by a Full Bench of this Court or by the Apex Court or by legislative intervention. The learned Single Judges are, therefore, bound to follow the decisions in Abdul Samad (supra) and Moosakoya (supra). We feel, it is not necessary to refer the matter to the Full Bench, as we agree with the legal position adumbrated in Abdul Samad (supra) and Moosakoya (supra).”_ _23. That apart it is also to be noted that in certain cases the appellate court concerned, particularly the Apex Court may pass interim orders saying that the dictum laid down in the appeal may not be followed in other cases or the cases now be kept pending till the orders are passed by the Apex Court in the pending SLP Civil appeal concerned. In the instant case, no such directions have been given and what is ordered in the interim order dated 14-12-2020 is that the operation & enforcement of the impugned order/judgment passed by the High court in_ _**Chandran's** case supra shall remain stayed._ _24. Moreover, it has also been held by the Apex Court in decisions as in_ _**Sree Chamundi Mopeds Ltd v. Church of South India Trust Association** [(1992) 3 SCC 1 para No.10] that inter alia, while considering the effect of the interim order staying the operation of the order under challenge, a distinction has to be made between quashing of an order and interim stay of operation of an order and quashment of the order results in the restoration of the position as it stood on the date of the passing of the order which has been quashed and the stay of the operation of an order does not, however, lead to such a result and it only means that the order which has been stayed would not be operative from the date of date of the passing of the stay order and it does not mean that the said order has been wiped out from existence. It has also been further held therein that the effect of quashment of an order will not be available in the case of an order staying the operation of the order of the Appellate Authority because in spite of the said order, the order of the Appellate Authority continues to exist in law and so long as it exists, it cannot be said that the appeal which has been disposed of by the said order has not been disposed of and is still pending, etc. It may be pertinent to refer to the relevant portion of para No.10 of the decision rendered by the Three Judge Bench of the Apex Court in_ _**Sree Chamundi Mopeds Ltd's** case supra [1992 (3) SCC 1] p.9-10, which_ **OP(KAT).No.22 OF 2021** **16** ## _reads as follows:_ _“While considering the effect of an interim order staying the operation of the order under challenge, a distinction has to be made between quashing of an order and stay of operation of an order Quashing of an order results in the restoration of the position as it stood on the date of the passing of the order which has been quashed. The stay of operation of an order does not, however, lead to such a result. It only means that the order which has been stayed would not be operative from the date of the passing of the stay order and it does not mean that the said order has been wiped out from existence. This means that if an order passed by the Appellate Authority is quashed and the matter is remanded, the result would be that the appeal which had been disposed of by the said order of the Appellate Authority would be restored and it can be said to be pending before the Appellate Authority after the quashing of the order of the Appellate Authority. The same cannot be said with regard to an order staying the operation of the order of the Appellate Authority because in spite of the said order, the order of the Appellate Authority continues to exist in law so long as it exists, it cannot be said that the appeal which has been disposed of by the said order has not been disposed of and is still pending. We are, therefore, of the opinion that the passing of the interim order dated February 21, 1991 by the Delhi High Court staying the operation of the order of the Appellate Authority dated January 7, 1991 does not have the effect of reviving the appeal which had been dismissed by the Appellate Authority by its order dated January 7, 1991 and it cannot be said that after February 21, 1991, the said appeal stood revived and was pending before the Appellate Authority. In that view of the matter, it cannot be said that any proceedings under the Act were pending before the Board or the Appellate Authority on the date of the passing of the order dated August 14, 1991 by the learned Single Judge of the Karnataka High Court for winding up of the company or on November 6, 1991 when the Division Bench passed the order dismissing O.S.A. No. 16 of 1991 filed by the appellant-company against the order of the learned Single Judge dated August 14, 1991. Section 22(1) of the Act could not, therefore, be invoked and there was no impediment in the High Court dealing with the winding up petition filed by the respondents. This is the only question that has been canvassed in Civil Appeal No. 126 to 1992, directed against the order for winding up of the appellant-company. The said appeal, therefore, fails and is liable to be dismissed.”_ _25. In view of the abovesaid position, going by the doctrine of precedents, we, sitting as a Division Bench are bound to follow the dictum and ratio decidendi laid down by the Full Bench of this Court in_ _**Chandran's** case supra [2020 5 KLT 669 (F.B)]. Hence it is only to be held that even if the appellant Board had consequently passed an order withholding the DCRG by taking recourse to the power conferred under second limb of Rule 3A Part III KSR and the same would_ **OP(KAT).No.22 OF 2021** **17** _have been ultra vires, in view of the ratio decidendi laid down by the Full Bench of this Court in_ _**Chandran's** case supra._ _26. The next issue is to be considered as to whether the petitioner is entitled for full pensionary benefits including computation of pension as paid by him. As discussed hereinabove indisputably judicial proceedings within the meaning of Rule 3 Part III KSR has been instituted by the petitioner even prior to his retirement on account of the submission of the police report in the year 2011 pursuant to which, cognizance has been taken by the criminal court which led to the institution of the abovesaid Calendar Case in the year 2011. This has happened even prior to the retirement of the petitioner on 30-06-2015. Now with the pronouncement of the final judgment by the criminal court as per Ext.P6 on 24-10-2017, it is only to be held that the said judicial proceedings has now stand terminated as regards the adverse scenario faced by the petitioner on account of the withholding of full pensionary benefits._ _27. True that, the appellant has preferred a criminal appeal as against his conviction and sentence as evident from Ext.P7 and the said criminal appeal is pending. The State has not filed any criminal appeal to challenge Ext.P6 judgment to the extent the petitioner has been acquitted of some of the offences therein. In view of the pronouncement of Ext.P6 judgment by the criminal court it is only to be held that the judicial proceedings as understood in the operative portion of Rule 3 Part III KSR, which has been instituted since the year 2011 now stand terminated on and with effect from the pronouncement of Ext.P6 judgment dated 24-10-2017. Therefore now the appellant Board cannot sit quite any longer on the plea citing the judicial proceedings as the same stands terminated. Now the appellant Board, immediately after Ext.P6 judgment of conviction rendered on 24-10-2017 should have applied their mind and determined whether any adverse order for withholding pension of the petitioner in terms of the power contained in the operative portion of Rule 3 Part III KSR is to be finalised and if so, then the appellant Board should afford opportunity of being heard to the petitioner and should apply their mind as to whether a case of grave misconduct or negligence has been found against the petitioner on the basis of Ext.P6 judgment of conviction and then should have pass final orders finalising proceedings under Rule 3, one way or the other. It has also to be borne in mind in that context that even in appropriate cases the maximum extent of withholding of pension should not exceed 1/3[rd] of the pension originally sanctioned going by the mandate contained in Note 1 of Rule 3 Part III KSR.”_ 12. In view of the abovesaid legal position already settled by this Court, we are of the firm view that the stay order granted by the Apex Court would only affect as against the enforcement of the directions in favour of the successful party in the writ proceedings which led to the Full Bench decision in **Chandran's case** supra and it will not have the effect of **OP(KAT).No.22 OF 2021** **18** staying the _ratio decidendi_ or dictum laid down by the Full Bench in other appropriate cases and that this Court is bound by the doctrine of precedence to ensure that the said dictum and _ratio decidendi_ laid down by the Full Bench would apply to the facts of this case in accordance with law. 13. In the light of these aspects, this Court is constrained to take the view that the respondents cannot justify the withholding of the DCRG due to the petitioner, merely on the basis of the second limb of Rule 3A Part III KSR. As mentioned hereinabove, the main subject matter of Rule 3 proceedings is in the matter of withholding of pension and the word 'pension' has been defined therein is not inclusive of DCRG, as can be seen from Note 2 of Rule 3 Part III KSR. Consequently, it is ordered that the orders of the respondents withholding the DCRG due to the petitioner on account of the judicial proceedings pending as conceived in Rule 3 Part III KSR, after her retirement is not justifiable and the same is illegal and _ultra vires._ 14. The respondents could have identified and ascertained whether liabilities as envisaged in Note 2 and Note 3 of Rule 3 Part III KSR, which could have been determined without resort to the departmental proceedings/judicial proceedings as understood in the operative portion of Rule 3, could have been done in this case. However, the statutory outer **OP(KAT).No.22 OF 2021** **19** time limit for completing that exercise for quantifying such liabilities and also duly intimating such liabilities to the pensioner is only up to a period of three years from the date of retirement of the pensioner. In the instant case, the petitioner has retired on 31.05.2015 and the mandatory outer time limit of three years as envisaged in Note 3 of Rule 3 Part III KSR has expired on 31.05.2018. The respondents do not have any case that any liabilities as understood in Note 2 & Note 3 appended under Rule 3 Part III KSR have been identified with due prior notice to the petitioner and after following the fair procedure of giving show cause notice to the affected person, then quantifying and intimating such liabilities within an outer time limit of 3 years from the date of retirement of the petitioner. Hence it is ordered that the respondent will immediately disburse full DCRG due to the petitioner without any further delay, at any rate, within an outer time limit of two months from the date of receipt of a certified copy of this judgment. Since the very temporary withholding of the DCRG due to the petitioner is illegal and _ultra vires_ , the petitioner is also entitled to get interest since it is well established that terminal benefit is a property right of the pensioner, which right is protected in terms of Article 300A of the Constitution of India, which stipulates that said property right can be deprived only in accordance with the procedure established by law, which **OP(KAT).No.22 OF 2021** **20** is just, fair and reasonable. Since the abovesaid action in depriving the petitioner to get her DCRG has been found to be illegal and _ultra vires_ , the petitioner has to be compensated for the delayed payment. True that the petitioner had not made any prayer in the O.A. for grant of interest. In the O.A. filed by her, the prayer was for directions to ensure forthwith release of the DCRG due to her, that was not done. Hence, the petitioner has prayed for grant of interest in this Original Petition. 15. It may be noted that even at the time of retirement of the petitioner on 31.05.2015, the judicial proceedings within the meaning of Rule 3 Part III KSR was not then instituted. Even now the charges have not been framed by the criminal court. Hence, it is ordered that the respondents will pay interest to the petitioner on the said DCRG amount for the period from 01.09.2015 (3 months after the retirement of the petitioner) upto the date of actual payment, interest at the rate of 6% per annum and the said interest shall also be given to the petitioner within the outer time limit of two months from the date of receipt of a certified copy of this judgment. However it is made clear that in case either the DCRG or the interest thereon is not paid to the petitioner within the said outer time limit of two months as aforestated, then the interest shall be paid to the DCRG amount at the rate of 9% per annum for the period from 01.09.2015 **OP(KAT).No.22 OF 2021** **21** up to the date of actual payment of the DCRG. Accordingly, it is ordered that the impugned Ext.P2 final order dated 28.11.2018 rendered by the Kerala Administrative Tribunal, Ernakulam Bench in O.A.(Ekm) No.2151/2018 will stand set aside. With these observations and directions, the above O.P.(KAT) will stand finally disposed of. Sd/- ## **ALEXANDER THOMAS, JUDGE** Sd/- ## **T.R.RAVI, JUDGE** Pn **OP(KAT).No.22 OF 2021** **22** ## **APPENDIX** ## **PETITIONER'S/S EXHIBITS:** **EXHIBIT P1 PHOTOCOPY OF THE ORIGINAL APPLICATION ALONG WITH ANNEXURES** **ANNEXURE A1 TRUE COPY OF THE ORDER NO C6/11550/14 DATED 29.1.2014 ISSUED BY THE SECRETARY, CORPORATION OF KOZHIKODE** **ANNEXURE A2 TRUE COPY OF THE ORDER NO. E5/4600/13/CE/LSGD DATED 17.11.2014 ISSUED BY THE 2ND RESPONDENT** **ANNEXURE A3 TRUE COPY OF THE ORDER NO.E101072/14/CE/LSGD DATED 22.4.2015 ISSUED BY THE 2ND RESPONDENT ANNEXURE A4 TRUE COPY OF THE ORDER IN O.A (EKM) NO 389/2015 DATED 17.7.2015 ANNEXURE A5 TRUE COPY OF THE GO(RT) NO 1295/2016/LSGD DATED 19.3.2016 ANNEXURE A6 TRUE COPY OF THE ORDER IN O.A NO 827/2016 DATED 15.7.2016 ANNEXURE A7 TRUE COPY OF THE GO(RT) NO 1067/2017/LSGD DATED 3.4.2017 ANNEXURE A8 TRUE COPY OF THE ORDER IN OA (EKM) NO 122/2014 DATED 14.1.2015 ANNEXURE A9 TRUE COPY OF THE DISCHARGE SUMMARY DATED 5.5.2011** - **EXHIBIT P2 TRUE COPY OF THE FINAL ORDER DATED 28.11.2018 IN OA (EKM) NO 2151/2018 OF THE KERALA ADMINISTRATIVE TRIBUNAL** **EXHIBIT P3 A TRUE COPY OF THE ORDER IN PETITION FOR SPECIAL LEAVE TO APPEAL (C) NOS.1488114882/2020 DATED 14.12.2020.**