TMI Blog2023 (12) TMI 426X X X X Extracts X X X X X X X X Extracts X X X X ..... fter considering UNION OF INDIA AND OTHERS VERSUS KK. DHAWAN [ 1993 (1) TMI 255 - SUPREME COURT] and various other judgments, the Supreme Court was of the view that merely because the penalty imposable was not imposed, it cannot be said that by not levying penalty, the appellant has favoured the assessee or shown undue favour to him. It was also held that if every error of law were to constitute a charge of misconduct, it would impinge upon the independent functioning of quasi-judicial officer like the appellant therein. It further held that to maintain a charge-sheet against a quasi-judicial authority, something more has to be alleged than a mere mistake of law, e.g., in the nature of some extraneous consideration influencing the quasi judicial order. Since nothing of that sort was alleged against the appellant therein, the impugned chargesheet was rendered illegal / quashed. The Supreme Court in the case of Zunjarrao Bhikaji Nagarkar has held that the negligence in case of quasi-judicial adjudication is not perceived as carelessness, inadvertence or omission, but as culpable negligence. In other words, if the view of the competent authority, is that the impugned order passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in paragraphs 17, 18, 19 and 20, as under:- 17. The present O.A. primarily challenges the Charge Memorandum. This aspect is also well settled by the Hon ble Supreme Court in Civil Appeal No. 2333 of 2007 titled The Secretary, Ministry of Defence vs. Prabhas Chandra Mirdha, dated 29.05.2012, wherein it is held as under: 11. Ordinarily a writ application does not lie against a chargesheet or show cause notice for the reason that it does not give rise to any cause of action. It does not amount to an adverse order which affects the right of any party unless the same has been issued by a person having no jurisdiction/competence to do so. A writ lies when some right of a party is infringed. In fact, chargesheet does not infringe the right of a party. It is only when a final order imposing the punishment or otherwise adversely affecting a party is passed, it may have a grievance and cause of action. Thus, a chargesheet or show cause notice in disciplinary proceedings should not ordinarily be quashed by the Court. ( Vide : State of U.P. v. Brahm Datt Sharma, AIR 1987 SC 943; Executive Engineer, Bihar State Housing Board v. Ramesh Kumar Singh Ors., (1996) 1 SCC 327; Ulagappa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 26.07.2019 passed by the respondents. 20. The O.A. being devoid of merit, is accordingly dismissed. There shall be no order as to costs. 2. The facts as noted from the petition are:- that the petitioner was posted as Commissioner of Income Tax (Appeals)-1, Jodhpur. While working so, she was issued a letter dated April 06, 2016, by the respondents, calling upon her to submit her version in connection with disposal of the appeal decided by her on February 13, 2015, in the case of M/s Mahaveer Infra Engineering Private Limited for Assessment Year 2011-12. 3. The petitioner submitted her reply on May 12, 2016 explaining the order passed in the said appeal. It was also her stand that the order passed by her, has been subsequently upheld by the Income Tax Appellate Tribunal (ITAT), vide its order dated January 11, 2017. 4. Thereafter, Charge Memorandum dated September 26, 2017, was issued to her by the respondents, proposing to hold an inquiry under Rule 14 of the Central Civil Services (Classification, Control and Appeal) Rules, 1965 ( Rules of 1965 , for short), wherein, three Articles of Charge were framed against the petitioner. She submitted her reply to the Charge M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (m) Union of India vs. Shri S. Rajguru in WP(C) No. 5113/2014 decided on August 13, 2014. 7. Whereas, primarily, the case of the respondents in their counter reply filed before the Tribunal was that the O.A. is premature as the disciplinary proceedings under challenge before the Tribunal, have not yet been finalized and no penalty has yet been imposed on the petitioner. It was their case that all reasonable opportunities have been provided to the petitioner at all stages in the disciplinary proceedings, which were duly conducted in consultation with CVC and UPSC. 8. It was also their case that the Charge Memorandum has been issued by the disciplinary authority after considering all the facts and circumstances of the case. They justified the issuance of Charge Memorandum in the facts of the present case. 9. Whereas, the respondents had relied upon the following judgments in support of their case:- (a) Union of India Ors. vs. Swathi S. Patil, Civil Appeal No. 3881 of 2007 (arising out of SLP (C) No. 17417 of 2006) decided on August 22, 2007; (b) Union of India Ors. vs. K.K. Dhawan, 1993 AIR 1478; (c) Union of India vs. Benoy Gupta, 2002 (3) ATJ 7; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner:- 12.3.1. to show wanton breach of governing principles of law or procedure by the petitioner; 12.3.2. to show pattern manifesting that the petitioner has extraneously considered certain materials to pass her orders; 12.3.3. to show that case was of misconduct or dishonest exercise of judicial power; 12.3.4. to appreciate that case in hand was of misconduct not just erroneous decision; 12.3.5. to satisfy itself that the statutory requirement u/r 14(4)(b) of the Rules of 1965, of affording at least 15 days time to the petitioner to submit her written statement of defense, before going ahead with the disciplinary inquiry, has been complied with (whereas, in this case, only 10 days were given to the petitioner). 12.4 As per Dr. Kothari, the aforesaid instructions have not been complied with, by the respondents, before going ahead with the disciplinary inquiry and thereby very jurisdiction of the disciplinary authority was challenged by the petitioner before the Tribunal. He submitted that the following jurisdictional issues were pleaded by the petitioner before the Tribunal: 12.4.1. Mistake of law or wrong interpretation of law done by a q ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rson discharging quasi judicial functions, could be amenable to any disciplinary action. 16. As per Dr. Kothari, the Tribunal has misapplied the CVC circular and the following Supreme Court judgments while dismissing the OA filed by the petitioner herein: (a) K.K. Dhawan (supra), (b) Govinda Memon v. Union of India, AIR 1967 SC 1274; (c) Parma Nanda (supra) (d) N. Gangaraj (supra) (e) Dalbir Singh (supra) (f) Prabhas Chandra Mirdha (supra) 17. It has further been submitted by Dr. Kothari that the Tribunal failed to appreciate that the petitioner was not seeking adjudication or review in the context of correctness or otherwise of the allegations levelled in the Charge Memorandum, before it, but she only wanted the Tribunal to examine whether in the facts and circumstances of the petitioner s case, the disciplinary authority had the jurisdiction to initiate the disciplinary proceedings. He submitted that the Tribunal clearly erred in equating the fundamental ground in the OA qua absolute lack of jurisdiction with review of correctness or otherwise of the allegations , as made out in the Charge Memorandum. 18. He also submitted tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f ₹14.25 Crores, on share capital premium. Whereas, Article III alleges that the petitioner allowed the interest expense of ₹36,88,347/- attributable to the interest-free advances given by the assessee. He submitted that the aforesaid charges reveal allegations not against the conduct of the petitioner but only against the wrong order passed by her. He has also submitted that the Tribunal has failed to appreciate that there cannot be a Charge Memorandum just because the order passed by the petitioner has been viewed to be wrong and more so, when this view has subsequently been discarded by the ITAT vide order dated January 11, 2017, when it upheld the order passed by the petitioner herein in an appeal filed by the respondents herein. 22. He has also relied upon the judgment of the Supreme Court in the case of Abhay Jain (supra) to state that the Supreme Court in this Judgment has held that mere suspicion cannot be construed as misconduct. He submitted that the inquiry officer in his report has specifically held that there is no allegation of corruption against the petitioner and on this basis only, the Charge Memorandum deserves to be quashed. He submitted that if Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sciplinary authority by the time it decided to issue Charge Memorandum on September 26, 2017. He submitted that the grounds of inquiry had already been adjudicated by the ITAT and the Tribunal ignored the vital factor that non-consideration of such clinching evidence, the Charge Memorandum, as a matter of fact got vitiated. 26. It has also been his submission that the Charge Memorandum also needs to be quashed for having been issued in violation of legal proposition as laid down by the Supreme Court in the case of Roop Singh Negi v. Punjab National Bank, 2009 2 SCC 570 . He submitted that along with the Charge Memorandum, the respondents have also relied upon the copy of the statement recorded in the fact finding inquiry. As per Annexure-III of the Charge Memorandum, the respondents have relied upon the statement of one Kishore Jain and Pawan Agarwal, recorded during the preliminary inquiry to prove the charges. He submitted that neither Pawan Agarwal nor Kishore Jain were named as witnesses in the Charge Memorandum and in their absence, their statements cannot be taken into consideration. It is his submission that by mere production of documents, the charges cannot be proved ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Coal India Ltd. and Ors. v. Ananta Saha and Ors., MANU/SC/0364/2011, has held that it is a settled law that if initial action is not in consonance with law, subsequent proceedings would not sanctify the same by relying upon the legal maxim sublato fundamento cadit opus , meaning thereby, in case a foundation is removed, the superstructure also falls. Similarly, he has also taken the aid of the judgment of the co-ordinate bench of this Court in the case of Than Singh v. Union of India (UOI) and Ors., MANU/DE/1660/2002 , to contend that even the charge sheet can be questioned if it is not in conformity with law; if it discloses bias or pre-judgment of the guilt of the charged employee; there is nonapplication of mind in issuing the charge sheet; if it does not disclose any misconduct; it is vague; it is based on stale allegations or when it is issued mala fide. 28. On the basis of the aforesaid submissions, Dr. Kothari prays that the present petition needs to be allowed, the Charge Memorandum dated September 26, 2017 and the impugned order passed by the Tribunal need to be quashed and set aside, respectively. SUBMISSIONS ON BEHALF OF RESPONDENTS 29. On the other h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etitioner was given the opportunity to put forward her case before the disciplinary authority. Therefore, there was no requirement to interfere with the disciplinary proceedings; 29.9 He submitted, the main plea of the petitioner is that the order passed by the petitioner was subsequently upheld by the ITAT vide order dated January 11, 2017. However, the petitioner has failed to bring into the notice of this Court that the said order passed by the ITAT has been challenged and vide order October 12, 2018 in D.B. Income Tax Appeal No. 126/2018, the High Court of Judicature for Rajasthan at Jodhpur has admitted the said appeal impugning the order of the ITAT; 29.10 He also submitted that the judgment relied upon by Mr. Kothari in the case of Abhay Jain (supra) is altogether distinguishable from the facts of the present case; 29.11 It was his submission that the judgment in the case of Arindam Lahiri v. Union of India Ors., W.P.(C) 13640/2006 decided on March 20, 2009 of the coordinate Bench of this Court is also distinguishable inasmuch as in that case, this Court was considering a case wherein inquiry proceedings were already concluded and moreover the punishment w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... summed up as under:- (i) The allegations levelled against the petitioner cannot be construed as misconduct as the same are in the context of the order passed by her in discharge of her functions as quasi-judicial body [CIT (Appeals)]; (ii) The order passed by the petitioner has been upheld in appeal by ITAT; (iii) While issuing a Charge Memorandum against a quasi-judicial officer, the disciplinary authority is under an obligation to show satisfaction in the context of CVC circular that the order passed by such an officer is in breach of governing principles of law or procedure; (iv) It has to be shown from the imputations, at least prima facie, that the petitioner has extraneously considered certain material(s) to pass the impugned order against which the Charge Memorandum has been issued or the petitioner has exercised her quasi-judicial powers dishonestly or the case in hand was of misconduct and not just erroneous decision of law or fact. 32. It was the case of the petitioner before the Tribunal that the mistake of law or wrong interpretation of law committed by a quasi-judicial officer while exercising lawful jurisdiction cannot be made the basis for init ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duty and had ordered confiscation of the goods. In that case, the Supreme Court has also referred to its judgment in the case of K.K. Dhawan (supra), wherein the Supreme Court had highlighted the grounds on which the disciplinary proceedings can be initiated against a person discharging quasi-judicial functions. After considering K.K. Dhawan (supra) and various other judgments, the Supreme Court was of the view that merely because the penalty imposable was not imposed, it cannot be said that by not levying penalty, the appellant has favoured the assessee or shown undue favour to him. It was also held that if every error of law were to constitute a charge of misconduct, it would impinge upon the independent functioning of quasi-judicial officer like the appellant therein. It further held that to maintain a charge-sheet against a quasi-judicial authority, something more has to be alleged than a mere mistake of law, e.g., in the nature of some extraneous consideration influencing the quasi judicial order. Since nothing of that sort was alleged against the appellant therein, the impugned chargesheet was rendered illegal / quashed. 37. We may also highlight the following lines in pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... und to indict a judicial officer for taking one view and that too for alleged misconduct for that reason alone. It was further held that the Inquiry Officer has not found any other material which would reflect on the reputation or integrity or good-faith or devotion to duty of the appellant or that her decision is actuated by any corrupt motive. It was observed that, at best, the inquiry officer might have said, that view taken by the appellant was not proper or correct but could not have attributed any motive to the appellant, that is, for extraneous consideration, the appellant had acted in that manner. So, on that basis, the order made by the High Court was set aside and the appellant was directed to be reinstated in service. 41. Whereas, in Ramesh Chander Singh (supra), the Supreme Court was concerned with the punishment imposed upon the appellant whereby the appellant was reduced to the rank of Civil Judge (Sr. Division) which was subsequently affirmed by the Division Bench of the High Court of Allahabad. The Supreme Court, in appeal, held that if the High Court were to initiate disciplinary proceedings based on judicial order, there should have been strong grounds to suspe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was challenged by the appellant before the Supreme Court. In essence, the appellant was charge-sheeted, inter alia, with the following charges:- Charge No. 1 - That you on 10.02.2003 while posted as IInd Additional District Judge Ghaziabad decided Land Acquisition Reference No. 193/1996 Lile Singh v. State of U.P. and 35 others illegally and against all judicial norms and propriety awarding to the claimants solatium, additional amount and interest over and above the rate at which two other claimants had entered into compromise which was inclusive of such other benefits at an enhanced rate of Rs. 265/- per sq. yard as against Rs. 74.40 determined by the S.L.A.O. for land area 276 Bighas 12 Biswas and 15 Biswansi, unduly awarded an additional amount of Rs. 47,73,39,903.86 which leads to an inference that you were actuated by extraneous considerations and you thereby failed to maintain absolute integrity and complete devotion to duty and you thus committed misconduct within the meaning of Rule 3 of UP Govt. Servants Conduct Rules 1956. Charge No. 2 - That you on 7.11.2003 posted as Additional District Judge, Court No. 1, Ghaziabad, while deciding Land Acquisition R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommend the appellant for confirmation and recommended discharge of the appellant despite pendency of the inquiry proceedings. It was in this background, the order of discharge of appellant became the subject matter of the proceedings before the High Court which dismissed the petition. In appeal, the Supreme Court held that the appellant may have been guilty of negligence in the sense that he did not carefully go through the case file and did not take notice of the order of the High Court which was on his file, it held that this negligence on the part of the appellant, could not have been treated as a misconduct. The Supreme Court whilst relying upon the Judgment in the case of Sadhna Chaudhary (supra), wherein it is held that mere suspicion cannot constitute misconduct, observed that any probability of misconduct needs to be supported with oral or documentary material and this requirement has not been fulfilled in the present case. Accordingly, it allowed the appeal and set aside the impugned order of the High Court. 46. In the case of Union of India Others v. Dolly Saxena, 2001 SCC OnLine Del 756 , the facts are that the respondent was working as Collector of Customs and C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order passed by the Single Judge of Karnataka High Court; and (ii) the respondent did not correctly appreciate the documentary evidence produced by the department and AEL and REL. With regard to Charge No. 1, the Court held that in the teeth of the facts (as noted by the Court), by no stretch of imagination it can be said that the respondent acted in a haste manner in proceeding with the matter in question and not awaited the outcome of the appeal filed by the Department. Therefore, it was held that department was wholly unjustified in issuing a charge sheet against the respondent with respect to Charge-1. With regard to Charge No. 2, the Court held that grounds as raised in Charge No. 2, were already raised by the department before the appellate authority, i.e., CESTAT. CESTAT, after adjudicating the order rendered by the respondent, did not find any merit in the said grounds and held that respondent had correctly appreciated the documentary evidence. Thereby, the Court also held that the department was unjustified in issuing a charge sheet in respect of Charge-2. Consequently, this Court held that, if the charge sheet is read meaningfully, it only sought to inculp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was held, though it has been alleged that certain decisions rendered by the respondent while he was acting as CIT (Appeals), indicate lack of devotion to duty, but bare perusal of the charges along with statement of imputations reveal that gravamen of the charges levelled against the respondent are not based on his conduct, however, it was only that the respondent had rendered decisions which, according to the revenue, were erroneous. Thus, it was held by this Court that the same cannot be the basis on which the proceedings for misconduct can be commenced against an officer, who is charged with a quasi-judicial function. 50. In the case of Akshay Bipin v. Union of India, MANU/DE/3609/2018 , wherein the learned Single Judge of this Court has reiterated the principles as enunciated by the Supreme Court in the case of K.K. Dhawan (supra), by holding that in the absence of any element of corrupt motives or ulterior motives, the disciplinary action against quasi-judicial/ judicial officers cannot be sustained and has set aside the charge sheet. The appeal preferred by the government against this judgment was rejected by the Coordinate Bench of this Court in the case of Union o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and inapplicable case laws the facts of which were clearly distinguishable, and without appreciating that mere payment is not the basis of allowing an expenditure as business deduction u/s. 36 and u/s 37 but the onus is on the party claiming such payment as expenditure to prove that the payment is real and that it had been incurred wholly and exclusively for the purposes of its business By her aforesaid acts, Smt. Alka Rajvanshi Jain has failed to maintain absolute integrity, devotion to duty and exhibited conduct unbecoming of a Government servant and thereby contravened the provisions of Rules 3(1)(i), 3(1)(ii) and 3(1)(iii) of the CCS (Conduct) Rules, 1964 ARTICLE-II That, Smt. Alka Rajvanshi Jain (Civil List No. 89048) while functioning as CIT(A)-2, Jodhpur, Rajasthan from 19.12.2014 to 22.06.2016, decided the income tax appeal of the assessee company, M/s Mahaveer Infra Engineering Private Limited for A.Y. 2011-12 vide order dated 13.02.2015, granting relief on share capital premium of Rs. 14.25cr without examining the real nature of the credits in spite of clear admission from the assessee company itself that the transaction is a mere book entry for the purposes o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Articles of Charge are supported by the statement of imputation and therefore should be read and perused together. The imputation with regard to Article-I, specifically imputation 1.79, which we reproduce below, do indicate that the allegation is, that the order passed by the petitioner is not a mere error in passing the judgment/order or carelessness or negligence simplicitor, in performance of her duty, but that of a culpable negligence and failure to maintain devotion as per Rule 3(1)(ii) of the Conduct Rules, 1964. ARTICLE 1.79 The failure of Smt. Alka Rajvanshi Jain, the then CIT (A)-2, Jodhpur to take into cognizance the established facts and findings of search and survey action in the case of the principal party, PACL India Ltd. and its alleged sub-contractors including the assessee the irrefutable findings from the independent enquiries conducted by the AO and the repeated failure of the assessee to substantiate its claim on the issues under appeal is inexplicable. The hurried manner in which relief was granted by Smt. Alka Rajvanshi Jain, the then CIT(A)-2, Jodhpur on the issue of sub-contract expenses of Rs. 98.05 crore on the basis of unsigned contract ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cr without examining the real nature of the credits in spite of clear admission from the assessee company itself that the transaction is not genuine and that parties were not even aware of cash credits being made in their name in assessee s books prima facie points to lack of due diligence and lack of devotion to duty on her part. 2.11 By her aforesaid acts, Smt. Alka Rajvanshi Jain has failed to maintain absolute integrity, devotion to duty and exhibited conduct unbecoming of a Government servant and thereby contravened the provisions of Rules 3(1)(i), 3(1)(ii) and 3(1)(iii) of the CCS (Conduct) Rules, 1964. ARTICLE-III 3.29 From the facts on record, it clearly emerges that prima facie there was no due diligence shown by Smt Alka Rajvanshi Jain, the then CIT(A)-2, Jodhpur in verifying the correctness of the assessee s claim and the veracity of facts while granting relief in respect of interest expense of Rs. 36,88,347/- attributable to the interest free advances given by the assessee. 3.30 By her aforesaid acts, Smt Alka Rajvanshi Jain has failed to maintain absolute integrity, devotion to duty and exhibited conduct unbecoming of a Government servant and ther ..... X X X X Extracts X X X X X X X X Extracts X X X X
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