Punishment of dismissal can be imposed even after superannuation: SC

The SC on May 27, 2020 {Chairman­-cum­-Managing Director, Mahanadi Coalfields Limited vs Sri Rabindranath Choubey} held that the appellant – employer has a right to withhold the gratuity during the pendency of the disciplinary proceedings. 

The majority of SC Bench, comprising of Justice Arun Mishra, Justice M.R. Shah & Justice Ajay Rastogi, observed that the disciplinary authority has powers to impose   the   penalty   of   dismissal/major   penalty   upon   the respondent even after his attaining the age of superannuation, as the disciplinary proceedings were initiated while the employee was in service.  However, Justice Ajay Rastogi gave dissenting judgment on this part i.e. on answer to the second question.

In the present case, the questions of law which fell for consideration before the Court were, (i) as to whether is it permissible in law for the appellant (employer) to withhold the payment of gratuity   of   the   respondent   (employee),   even   after   his superannuation from service, because of the pendency of the disciplinary   proceedings   against   him?,   and   (ii)   where   the departmental enquiry had been instituted against an employee while he was in service and continued after he attained the age of superannuation, whether the punishment of dismissal can be imposed   on   being   found   guilty   of   misconduct   in   view   of   the provisions made in Rule 34.2 of the CDA Rules of 1978? Both questions were answered in affirmative, vide majority view, by the SC.

The SC concluded that the   impugned   judgment   and order passed by the High Court cannot be sustained and the same deserves to be quashed and set aside and was accordingly hereby   quashed   and   set   aside and   the   order   passed   by the Controlling   Authority  was  restored.     However,  it was directed by the SC that  the appellant­/employer   to   conclude   the disciplinary proceedings at the earliest and within a period of four   months  and   pass   appropriate   order   in accordance with law and on merits and thereafter necessary consequences as per Section 4 of the Payment of Gratuity Act, 1972,   more   particularly   Sub­section   (6)   of   Section   4   of   the Gratuity Act and Rule 34.3 of the CDA Rules shall follow. The present appeal was accordingly allowed by the SC.