Case Note & Summary
The Union of India and another (petitioners) challenged the judgment and order dated 10.11.2005 of the Central Administrative Tribunal (CAT), Mumbai, which allowed O.A. No. 66 of 2004 filed by the respondent, Sayed Naimuddin. The respondent, a railway employee, was transferred from Mumbai to Ujjain with effect from 26.3.2002. He was permitted to retain the Railway quarter upon payment of normal rent up to 25.11.2002. However, he vacated the quarter only on 25.2.2003. The petitioners treated the period from 26.11.2002 to 25.2.2003 as unauthorised occupation and recovered damage rent from his salary without issuing any show cause notice. The CAT quashed the recovery orders dated 9/11-4-2003 and 15.07.2003 and directed refund of the amounts recovered with interest at 18% per annum. The petitioners argued that since the facts were undisputed, non-issuance of a show cause notice caused no prejudice. The respondent contended that the recovery without notice violated principles of natural justice. The High Court dismissed the petition, holding that even if the facts are undisputed, an opportunity of hearing must be given before imposing a financial penalty. The court noted that the respondent had a valid explanation: he was transferred back to Mumbai on 28.1.2003 and had applied for allotment of the same quarter, which was granted from 26.2.2003. Thus, the period of alleged unauthorised occupation was not entirely without justification. The court upheld the CAT's order, finding no error in the direction to refund the recovered amounts with interest.
Headnote
A) Administrative Law - Principles of Natural Justice - Show Cause Notice - Recovery of Damage Rent - Railway Quarters - The petitioners recovered damage rent from the respondent's salary for alleged unauthorised occupation of Railway quarters without issuing any show cause notice. The CAT quashed the recovery orders on the ground of violation of natural justice. The High Court held that even if facts are undisputed, an opportunity of hearing must be afforded before imposing a financial penalty, and non-issuance of notice causes prejudice. (Paras 1-7)
Issue of Consideration
Whether recovery of damage rent from an employee's salary without issuance of a show cause notice is sustainable in law, even when the facts regarding unauthorised occupation are undisputed.
Final Decision
The High Court dismissed the writ petition, upholding the CAT order dated 10.11.2005. The recovery of damage rent without show cause notice was held to be in violation of principles of natural justice. The direction to refund the recovered amounts with interest at 18% per annum was confirmed.
Law Points
- Principles of natural justice
- Show cause notice
- Recovery of damage rent
- Unauthorised occupation of government quarters
- Prejudice
Case Details
2018 LawText (BOM) (08) 114
WRIT PETITION NO. 3327 OF 2006
Mr. Suresh Kumar for the Petitioner, Mr. Burhan V. Bukhari for the Respondent
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Nature of Litigation
Writ petition challenging the order of Central Administrative Tribunal (CAT) which quashed recovery of damage rent from the respondent's salary.
Remedy Sought
The petitioners (Union of India and another) sought to set aside the CAT order dated 10.11.2005 allowing O.A. No. 66 of 2004.
Filing Reason
The petitioners challenged the CAT order on the ground that the respondent had unauthorisedly occupied Railway quarters and damage rent was recovered without show cause notice, but facts were undisputed and no prejudice was caused.
Previous Decisions
The Central Administrative Tribunal (CAT), Mumbai, by judgment dated 10.11.2005, allowed O.A. No. 66 of 2004, quashing the orders dated 9/11-4-2003 and 15.07.2003 for recovery of damage rent, and directed refund with interest at 18% per annum.
Issues
Whether recovery of damage rent from an employee's salary without issuance of a show cause notice is sustainable in law, even when the facts regarding unauthorised occupation are undisputed.
Submissions/Arguments
Mr. Suresh Kumar for petitioners: The respondent was transferred to Ujjain and retained quarter up to 25.11.2002 but vacated only on 25.2.2003. The intervening period was unauthorised. Since facts were undisputed, non-issuance of show cause notice caused no prejudice. The CAT erred in interfering.
Mr. Burhan Bukhari for respondent: The petitioners ought to have issued a show cause notice before concluding unauthorised occupation and recovering damage rent. The respondent was transferred back to Mumbai on 28.1.2003 and had applied for allotment of the same quarter, which was granted from 26.2.2003. Thus, the period was not entirely unauthorised. Recovery without notice violated natural justice.
Ratio Decidendi
Even if the facts regarding unauthorised occupation are undisputed, an opportunity of hearing must be afforded before imposing a financial penalty such as recovery of damage rent. Non-issuance of a show cause notice causes prejudice and violates principles of natural justice.
Judgment Excerpts
The challenge in this petition is to the judgment and order dated 10.11.2005 made by the Central Administrative Tribunal (CAT), Mumbai allowing O.A. No. 66 of 2004 instituted by the respondent.
Mr. Suresh Kumar submits that since there was no dispute on facts, the action of the petitioners ought not to have been set aside on the grounds of any alleged violation of principles of natural justice or fair play.
Mr. Burhan Bukhari, learned counsel for the respondent, points out that the petitioners, before concluding that the respondent was an unauthorised occupant at the quarters between 26.11.2002 and 25.2.2003, ought to have issued a show cause notice to the respondent.
Procedural History
The respondent filed O.A. No. 66 of 2004 before the Central Administrative Tribunal (CAT), Mumbai, challenging the recovery orders dated 9/11-4-2003 and 15.07.2003. The CAT allowed the O.A. on 10.11.2005, quashing the recovery orders and directing refund with interest. The Union of India and another filed Writ Petition No. 3327 of 2006 before the Bombay High Court challenging the CAT order. The High Court dismissed the petition on 30.08.2018.
