Unless otherwise allowed for by the Service Rules, Departmental Proceedings cannot be resumed after an employee retires: Orissa High Court

The Orissa high court has recently allowed the petition (22 May 2023) and filed by a Seed Production Officer and marketing manager (‘petitioner’) working at Odisha State Seed Corporation Limited to quash the Show Cause Notice issued against him and direct the Corporation to release all the consequential terminal dues and service benefits. The Single Judge Bench of Sanjay Kumar Mishra directed the authorities concerned to release the retirement dues of the petitioner along with payment of 10 percent interest on the amount of gratuity, in the case of Tapan Narayan Mohanty v. Odisha State Seed Corporation Limited (W.P.(C) No.3314 of 2017)

Facts of the Case

According to the Orissa State Seeds Corporation Service (Classification Control and Appeal) Rules, 1994, also known as “the Rules, 1994,” the petitioner was placed under suspension while serving in the capacity of a Seed Production Officer with an additional responsibility as Marketing Manager. The reason given was that the petitioner had not performed the duties related to the purchase of groundnut seeds, their proper distribution throughout the State’s various districts during Rabi 2013–14, and the improper management of inventory. Additionally, it was claimed that he had conspired with private vendors to deprive the Corporation of money. 

As a result, on June 28, 2014, a charge sheet, statement of imputations, and articles of charge were released. Later, with effect from July 31, 2014, the petitioner was superannuated from service after reaching the age of 58. An investigation was then carried out, and on June 24, 2016, a communication was sent to the petitioner informing him that he was accountable for the mistakes made in the seeds transaction and was therefore deserving of the proposed punishment. The suspension period was treated as such, and the increment was withheld with cumulative effect.


A review of the Rules from 1994 revealed, according to the Court, that there is no provision for the continuation of the departmental proceeding even after an employee retires, despite the fact that the departmental proceeding had already been started against the offending employee prior to his retirement. The Court further stated that it is well established law that a Departmental Proceeding cannot be continued after an employee or delinquent retires, even if it was started prior to the employee’s retirement. This is true until and unless there is a specific provision in the Service Rules for such a continuation. The Disciplinary Authority had violated Rules, 1994, according to the Court, when it issued the Show Cause Notice dated 24-06-2016. The Disciplinary Authority had brought two additional charges against the petitioner before the petitioner could offer an explanation for the said additional charges, and before the petitioner could do so, the Disciplinary Authority concurrently proposed the punishment to be imposed on him. This was done in lieu of the petitioner providing justifications for disagreeing with the Enquiry Officer’s findings. The Court further noted that the whole investigation procedure, from the appointment of the inquiry officer to the date of the show cause notice, took place after the petitioner was declared superannuated on July 31, 2014. Therefore, the Court considered that the contested Show Cause Notice was unlawful, unreasonable, and unsupportable in the eyes of the law since it went beyond the guidelines set forth in the Rules of 1994 and contained certain additional counts that were not listed in the Memorandum of counts. 

The Court ruled that because the petitioner had superannuated as of July 31, 2014, there was no legal obstacle to the distribution of his retirement benefits, including his gratuity. The Court ordered that the petitioner be paid his differential salary, or the salary to which he would have been entitled had he not been placed on suspension, within a six-week period from the date of his suspension until the date of his retirement, which is July 31, 2014, less any suspension allowances already paid to him.

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