S. R. MEHTA Vs. UNION OF INDIA

JUDGEMENT

(1.) This petition under Article 226 of the Constitution of India by a former Chairman of the Central Board of Direct Taxes challenges the action of the Union in withholding gratuity and in sanctioning only provisional pension.

(2.) The petitioner, who joined as Income-tax Officer Class I, in May 1948, rose to be the Chairman of Central Board of Direct Taxes and Ex-officio Additional Secretary to Government in April, 1974. He was due to retire on attaining the age of 58 years on December 31, 1975, and submitted his application for pension under Rule 55 of the Central Civil Services Pension Rules, 1972, for short, the Rules, for sanction of his pension and death-cum-retirement gratuity, before the date of retirement so that in terms of the time-table laid in that behalf the pension case of the petitioner may be initiated in 1973 itself and the process be completed by February, 1974, so that the pension payment order be made before the date of retirement. The petitioner was granted extension of service from January 1, 1976, to December 31. 1976. He was granted a further extension from January 1, 1977, to December 31, 1977. Meanwhile, he was awarded Padma Bhushan by the President of India and it is the contention of the petitioner that during the period of first extension he was responsible for unearthing about Rs. 1,600/- crores of black money and concealed wealth. It, however, appears that, either because on account of the numerous raids for the unearthing of black money and concealed wealth, with which the petitioner was concerned during the aforesaid period, he acquired considerable notoriety and became controversial or because of suspected misuse of power in the discharge of his official duties, the petitioner was required, on the changeover of the Central Government, to proceed on leave till the date he was due to retire, which the petitioner did. The petitioner eventually retired from service on December 31, 1977, on the expiry of the leave. In its second interim report released on April 26, 1978, the Shah Commission, which had meanwhile been set up by Government to enquire into cases of abuse of authority and misuse of power during the Emergency, made certain adverse comments with regard to the conduct of the petitioner as Chairman of the Central Board of Direct Taxes. The Commission had earlier made adverse Comments on the conduct of D. Sen, former Director, Central Bureau of Investigation. The Commission also made adverse comments on the conduct of Shri Harihar Lal, the then Director of Inspection (Investigation). Both Shri Sen and Shri Harihar Lal had already been retired with full pension and gratuity benefits.

(3.) The petitioner's claim for gratuity and pension made in his letter of June 2, 1978, elicited a communication of June 9, 1978,. from Additional Secretary, Government of India (Annexure III), by which the petitioner was informed that the papers concerning his gratuity and pension were being "processed" and that meanwhile arrangements were being made "to have a provisional pension sanctioned." The petitioner challenged the proposal for a provisional pension and sought to enforce his right to pension and gratuity in accordance with law by the present petition, which was filed on July 3, 1978. On July 13, 1978, the Union was served with notice to show cause why Rule Nisi be not issued. On July 22, 1978, the petitioner was served with a charge sheet of July 21, 1978, based on allegations of misconduct as an apparent follow up action of the interim reports of the Commission. On July 24, 1978, the petitioner received an order dated July 22, 1978, purporting to be under Rule 65 of the Rules granting provisional pension to the petitioner. On the same date, a First Information Report was filed with regard to the commission of certain offences by the petitioner and an affidavit of July 22, 1978, was filed in this Court in reply to the show cause notice. Rule Nisi was issued by this Court on July 31, 1978.