Summary
A Panchayat Assistant in Salem was dismissed for misappropriating panchayat funds. A first dismissal was quashed because no inquiry had been held. After remand an inquiry was held, but he was dismissed again without being given the inquiry report or a chance to comment on it. The Madras High Court quashed that dismissal for breach of natural justice and ordered reinstatement with full back wages. The Supreme Court held that when a penalty falls because the inquiry was vitiated, the court cannot simply reinstate. It must remit the matter to the disciplinary authority to resume from the point of the defect (A. Masilamani, Rajit Singh), especially on a serious charge. Reinstatement was set aside and the inquiry remitted for completion in six months. As the authority had breached natural justice twice, it was ordered to pay Rs. 50,000 in costs.
Issues
- Whether a court that sets aside a dismissal because the inquiry report was not supplied to the delinquent may order reinstatement with back wages, or must remit the matter to the disciplinary authority to proceed from the stage of the defect.
- What consequences should follow where the disciplinary authority had violated natural justice for a second time.
Provisions considered
- Article 136, Constitution of IndiaExercised to correct the High Court's order of reinstatement with back wages and to remit the inquiry, while awarding costs against the authority for repeated lapses. (¶¶ 4.4, 7)
Held
- Once a punishment is set aside because the inquiry was not properly conducted, the court cannot reinstate the employee. It must remit the case to the disciplinary authority to proceed from the point at which the inquiry was vitiated and conclude it (A. Masilamani, Rajit Singh). (¶ 6.1)
- Given the serious charge of misappropriation, the High Court should have remitted the matter for the inquiry to proceed after supplying the inquiry report and inviting the delinquent's comments, rather than ordering reinstatement with full back wages. (¶¶ 6, 6.2)
- The inquiry was to be completed within six months. Since the dismissal had twice been set aside for breach of natural justice, the appellant was ordered to pay the respondent Rs. 50,000 as costs within six weeks. (¶ 7)
Result
Appeal allowed in part. The orders directing reinstatement with back wages were set aside and the matter was remitted to the disciplinary authority to proceed from the stage of the defect within six months. The appellant was to pay the respondent Rs. 50,000 as costs within six weeks.