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Wednesday, January 7, 2015

CIVIL APPEAL NO. 3655 OF 2010 Diwan Singh ... Appellant Versus Life Insurance Corporation of India and others ... Respondents


                        IN THE SUPREME COURT OF INDIA

                        CIVIL  APPELLATE JURISDICTION

                       CIVIL APPEAL NO. 3655  OF 2010

Diwan Singh                                  ... Appellant


Life Insurance Corporation of India
and others                                      ... Respondents

                               J U D G M E N T


      This appeal is directed against judgment and  order  dated  27.8.2009,
passed by the High Court of Judicature at Allahabad, in Special  Appeal  No.
1167 of 1999,  whereby  said  Court  has  partly  allowed  the  appeal,  and
substituted  the  punishment  of  removal  awarded  to  the  appellant,   by
compulsory retirement from service.
We have heard learned counsel for the parties  and  perused  the  papers  on
Briefly stated, the facts are that the appellant was  a  cashier  with  Life
Insurance Corporation of  India  (hereinafter  referred  to  as  "LIC")  and
posted at Bilaspur, District  Rampur  in  U.P.   A  policy  holder,  Bhograj
Singh, deposited with the appellant  an  amount  of  Rs.533/-  towards  half
yearly insurance premium on 13.8.1990 but the same was  not  deposited  with
LIC nor credited in the  account  of  the  policy  holder  till  27.11.1990,
though a receipt was issued on 13.8.1990 by the appellant.  It appears  that
when the LIC agent did not get his commission out of the premium  deposited,
and made enquiries in this regard, aforesaid amount of  Rs.533/-  was  shown
deposited by the appellant with late fee of Rs.15.90/-, and entry  was  made
in the cash register on 28.11.1990. Also, a forged entry was made in  ledger
sheet on back date.  In connection with the above misconduct on the part  of
the appellant, a charge-sheet was served on him on 29.4.1991 on two  counts,
namely, temporary embezzlement of  Rs.533/-  for  the  period  13.8.1990  to
27.11.1990, and forging entry of Rs.533/- in the carbon copy of  the  ledger
sheet dated 13.8.1990 between entry Nos. 12 and 13.  On  conclusion  of  the
departmental enquiry, the appellant was found guilty, and served  with  copy
of enquiry report, whereafter he was removed from service vide  order  dated
21.1.1992.  The departmental appeal appears to have been  dismissed  by  the
authority concerned on 22.2.1992.
Challenging the order of removal from service  and  that  of  the  appellate
authority, the appellant filed Civil Miscellaneous Writ Petition  No.  10308
of 1999 before the High Court which was allowed by the learned Single  Judge
on 6.9.1999.  Aggrieved by said order of the learned Single  Judge,  Special
Appeal was filed before Division Bench of the High Court,  by  the  employer
(i.e. - L.I.C.).  The Division Bench, after hearing  the  parties,  came  to
the conclusion that the appellant appears to have committed the  forgery  to
cover his mistake, and partly allowed the appeal by substituting  punishment
of compulsory retirement in place of removal from service.   The  appellant-
employee has challenged the order of the Division Bench of  the  High  Court
by way of Special Leave Petition mainly on the ground  that  the  punishment
of compulsory retirement is disproportionate, unreasonable and harsh.  Leave
was granted by this Court on 19.4.2010.
Mr. Gaurav Agrawal, learned counsel for the appellant,  drew  our  attention
to Rule 23 of  Life  Insurance  Corporation  of  India  (Employees)  Pension
Rules, 1995, which reads as under:-
"23. Forfeiture of  service.  -  Resignation  or  dismissal  or  removal  or
termination or compulsory retirement of an employee from the service of  the
Corporation  shall  entail  forfeiture  of  his  entire  past  service   and
consequently shall not qualify for pensionary benefits."

It is argued by learned counsel for the appellant  that  it  is  a  case  of
temporary embezzlement of a small amount, as such awarding minor  punishment
of stoppage of increment etc. would have met the ends  of  justice.   It  is
also submitted before us that the  amount  could  not  be  credited  by  the
appellant on 13.8.1990 as the cash actually paid by  the  policy  holder  on
that day was short, as such the  act  on  the  part  of  the  appellant  was
We have given thoughtful consideration to the  above  argument  advanced  on
behalf of the appellant.  The explanation put forth does not  appear  to  be
convincing, as the cashier would not have issued a receipt without  counting
the cash at the  counter.   Secondly,  had  the  act  on  the  part  of  the
appellant been bonafide, he would not have made forged entry of Rs.533/-  in
the carbon copy of ledger sheet on 13.8.1990 between entry Nos. 12  and  13.
As such, the finding of the enquiry officer holding  the  appellant  guilty,
in our opinion, cannot be said to be against the evidence on record.
 As far as argument relating to quantum of punishment, as  modified  by  the
High  Court,  which  results  in  consequential   forfeiture  of  pensionary
benefits in view of Rule 23, quoted above, is concerned, we do not find  the
punishment to be harsh or disproportionate to the guilt,   in  view  of  the
nature of the charge of which the appellant is found guilty in  the  present
case. Time and again, this Court has consistently held that in such  matters
no sympathy should be shown by the Courts.
In Divisional Controller, N.E.K.R.T.C v.  M.  Amaresh[1],   this  Court,  in
para 18 of the judgment has expressed the views on this point as under:

" In the instant case, the misappropriation of the funds by  the  delinquent
employee was only Rs 360.95. This Court has considered the  punishment  that
may be awarded to the delinquent employees who misappropriated the funds  of
the Corporation and the factors to be considered. This Court in a catena  of
judgments held that the loss of confidence is the  primary  factor  and  not
the amount of money misappropriated and  that  the  sympathy  or  generosity
cannot be a factor which is impermissible in law. When an employee is  found
guilty of pilferage or of misappropriating the  Corporation's  funds,  there
is nothing wrong in the Corporation losing confidence or faith  in  such  an
employee and awarding punishment of dismissal. In such cases,  there  is  no
place for generosity or misplaced sympathy  on  the  part  of  the  judicial
forums    and    interfering    therefore    with     the     quantum     of

 In Divisional  Controller,  KSRTC  (NWKRTC)  v.  A.T.  Mane[2]   in   which
unaccounted amount was only Rs.93/- this  Court  expressed  its  opinion  in
para 12 as under:

" Coming to the question of quantum of punishment, one should bear  in  mind
the fact that it is not the amount of money misappropriated that  becomes  a
primary factor for awarding punishment; on the contrary, it is the  loss  of
confidence which is the primary factor to be taken  into  consideration.  In
our  opinion,  when  a  person  is  found  guilty  of  misappropriating  the
corporation's funds, there  is  nothing  wrong  in  the  corporation  losing
confidence  or  faith  in  such  a  person  and  awarding  a  punishment  of

 In Niranjan Hemchandra Sashittal and another v.  State  of  Maharashtra[3],
this  Court  has  made  following  observations  in  paragraph  25  of   the
judgment: -
"..... In the present day scenario, corruption has been treated to have  the
potentiality of corroding the marrows  of  the  economy.   There  are  cases
where the amount is small, and in certain cases, it is extremely high.   The
gravity of the offence in such a case, in our considered opinion, is not  to
be adjudged on the bedrock of the quantum of bribe.  An  attitude  to  abuse
the official position to extend  favour  in  lieu  of  benefit  is  a  crime
against the collective and an anathema to the  basic  tenets  of  democracy,
for it erodes the faith  of  the  people  in  the  system.   It  creates  an
incurable concavity in the Rule of Law...."

In Rajasthan  State  Road  Transport  Corporation  and  another  v.  Bajrang
Lal[4], this Court, following the case of Municipal  Committee,  Bahadurgarh
v. Krishnan Behari  and  others[5],  has  opined  that  in  cases  involving
corruption there cannot be any other  punishment  than  dismissal.   It  has
been further held that any sympathy shown in such cases is totally  uncalled
for and opposed to public  interest.   The  amount  misappropriated  may  be
small or large; it is the act of  misappropriation  that  is  relevant.   In
said case (Rajasthan SRTC), the respondent/employee was  awarded  punishment
of removal from service.  In the present case it is  compulsory  retirement.
Learned  counsel  for  respondents  submitted  that  on  earlier   occasion,
appellant was  awarded  minor  punishment,  for  his  misconduct,  regarding
defalcation of stamps.  And now he is found guilty for the second time.
Therefore, in the above circumstances in view of the law laid down  by  this
Court, as above, we are not inclined to interfere with  the  impugned  order
passed by the High Court.  Accordingly, the  appeal  is  dismissed  with  no
order as to costs.

                                                            [Vikramajit Sen]

                                                    [Prafulla C. Pant]
New Delhi;
January  5, 2015.
[1]    (2006) 6 SCC 187
[2]    (2005) 3 SCC 254
[3]    (2013) 4 SCC 642
[4]    (2014) 4 SCC 693
[5]    (1996) 2 SCC 714

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