Sudhir Ch. Das Vs. State of Orissa and ors. - Court Judgment

Excerpt:
- state financial corporations act, 1951 [63/1951]. section 29; [p.k. tripathy, a.k. parichha & n.prusty, jj] discharge of loan orissa forest act (14 of 1972), section 56 confiscation of vehicle - held, the authorities under section 56 of the orissa forest act, 1972 are not obliged to release the vehicle from the confiscation proceeding or to pay the sale proceeds of the vehicle after the order of confiscation in favour of orissa state financial corporation when such vehicles were purchased on being financed by the orissa state financial corporation and the loan had not been liquidated by the date of the seizure/confiscation of the vehicle. concept of first charge or second charge has no applicability when the vehicle is not otherwise disposed of to determine the liabilities of the loanee. on the other hand the vehicle having been found indulged in forest offences was made subject matter of a confiscation proceedings, and therefore, the procedure followed for confiscation of the vehicle and for its sale is punitive in nature and not with a view to give benefit to anybody including the department which initiated the confiscation proceeding. apart from that, the claim of the orissa state financial corporation as against its loanee (who had taken the vehicle on hire- purchase agreement) brings the loanee and the sureties within the default clause under the state financial corporation act, 1951 or the heirs and successors of such persons. procedure is provided in the act, 1951 and the rules thereof about the manner in which such loan is to be recovered, and in that context only the vehicle under the hire-purchase agreement is placed as the first charge. if such property is not available for any reason, then the loan is not automatically waived or the loanee and his sureties are not automatically redeemed of the liabilities to repay. the financial corporation is concerned with repayment of loan either from the property or persons offered as surety. thus, a vehicle, which is subject matter of confiscation proceeding under the act, 1872, being not available to the orissa state financial corporation for adjustment of the unpaid loan, that does not at all bring out an anomalous situation so as to defeat the right of the orissa state financial corporation. agreement between the orissa state financial corporation and the loanee is a pure and simple contract governed by the provisions of the contract act, 1872 read with the provisions in the act, 1951 and its rules. on the other hand, a confiscation proceeding under the act, 1972 is punitive in nature for commission of a forest offence. thus, by virtue of the provision in section 56 read with section 64 (2) of the act, 1972, the action taken for confiscation of the vehicle cannot be extended to grant protection of the loan advanced by orissa state financial corporation. by doing that it amounts to grant premium to the pick-pockets in as much as, by making payment of the confiscation amount in favour of the orissa state financial corporation the loan burden of the accused of the forest offence is reduced to the extent of the sale proceeds of the vehicle. in other words, on payment of the sale proceeds of the confiscation proceeding to the orissa state financial corporation towards discharge of the loan account of the accused of a forest offence, it would lead to a system to reward him by repayment of his loan. then it does not become a penalty nor the action become punitive, but it remains as a reward to the accused of forest offence. such a concept is totally not conceivable from any provision in the act, 1972 or the act, 1951. [air 2002 orissa 130 overruled]. -- state financial corporations act, 1951. section 29; discharge of loan orissa forest act (14 of 1972), section 56 confiscation of vehicle - held, the authorities under section 56 of the orissa forest act, 1972 are not obliged to release the vehicle from the confiscation proceeding or to pay the sale proceeds of the vehicle after the order of confiscation in favour of orissa state financial corporation when such vehicles were purchased on being financed by the orissa state financial corporation and the loan had not been liquidated by the date of the seizure/confiscation of the vehicle. concept of first charge or second charge has no applicability when the vehicle is not otherwise disposed of to determine the liabilities of the loanee. on the other hand the vehicle having been found indulged in forest offences was made subject matter of a confiscation proceedings, and therefore, the procedure followed for confiscation of the vehicle and for its sale is punitive in nature and not with a view to give benefit to anybody including the department which initiated the confiscation proceeding. apart from that, the claim of the orissa state financial corporation as against its loanee (who had taken the vehicle on hire- purchase agreement) brings the loanee and the sureties within the default clause under the state financial corporation act, 1951 or the heirs and successors of such persons. procedure is provided in the act, 1951 and the rules thereof about the manner in which such loan is to be recovered, and in that context only the vehicle under the hire-purchase agreement is placed as the first charge. if such property is not available for any reason, then the loan is not automatically waived or the loanee and his sureties are not automatically redeemed of the liabilities to repay. the financial corporation is concerned with repayment of loan either from the property or persons offered as surety. thus, a vehicle, which is subject matter of confiscation proceeding under the act, 1872, being not available to the orissa state financial corporation for adjustment of the unpaid loan, that does not at all bring out an anomalous situation so as to defeat the right of the orissa state financial corporation. agreement between the orissa state financial corporation and the loanee is a pure and simple contract governed by the provisions of the contract act, 1872 read with the provisions in the act, 1951 and its rules. on the other hand, a confiscation proceeding under the act, 1972 is punitive in nature for commission of a forest offence. thus, by virtue of the provision in section 56 read with section 64 (2) of the act, 1972, the action taken for confiscation of the vehicle cannot be extended to grant protection of the loan advanced by orissa state financial corporation. by doing that it amounts to grant premium to the pick-pockets in as much as, by making payment of the confiscation amount in favour of the orissa state financial corporation the loan burden of the accused of the forest offence is reduced to the extent of the sale proceeds of the vehicle. in other words, on payment of the sale proceeds of the confiscation proceeding to the orissa state financial corporation towards discharge of the loan account of the accused of a forest offence, it would lead to a system to reward him by repayment of his loan. then it does not become a penalty nor the action become punitive, but it remains as a reward to the accused of forest offence. such a concept is totally not conceivable from any provision in the act, 1972 or the act, 1951. [air 2002 orissa 130 overruled]. - panda on behalf of the petitioner that the correspondence between the chief engineer and the superintending engineer ultimately culminating in the discharge of the petitioner by the order of the assistant engineer as per annexure-1 clearly shows that the foundation of the order was the factum of arrest of the petitioner in the criminal case. 3. the law on the point is well settled and is no longer in doubt. it may at best be a motive. 5. on the aforesaid analysis, we are clearly of opinion that the discharge order is not by way of punishment. we are satisfied from the facts and circumstances of this case that the real discharge order was passed by the chief engineer himself or at any rate by the executive engineer.g.k. misra, c.j.1. the petitioner was appointed as a work-sarkar under work-charged establishment of the public health sub-division in baripada. the appointment was purely temporary and was liable to be terminated at any time without prior notice and without assigning any reason. his services were terminated on 15-10-69 by the following order:sri sudhir chandra das, work-sarkar is discharged from service from 15-10-69 forenoon.it is this order which is assailed in this writ application under article 226 of the constitution as being contrary to law, inasmuch as, though ex facie it appears to be innocuous, it was given by way of punishment. the facts referred to in the petition to make out a case of punishment are that the superintending engineer, bhubaneswar circle wrote a letter to the chief engineer on 9-10-69 to the following effect:i have to inform you that sri sudhir chandra das, work-sarkar under work-charged establishment of baripada p.h. divn. has been arrested by the police in p.s. no. 122/69 and has been released on bail.as per article 93a of the o.s. code, a government servant against whom a criminal charge or a proceeding for arrest may be placed under suspension by the issue of specific orders. but there is no such rule or any government circular in which the work-charged staff involved in criminal charges will be suspended. hence i would therefore request that the necessary decision may kindly be issued on the matter to take further action against the person concerned and for strict guidance. to this letter, the chief engineer replied by saying in annexure-3 on 9-10-69 that the petitioner should be discharged from service from the date he has been arrested. thereafter, the petitioner was discharged by the order at annexure 1 on 15-10-69.2. it is contended by mr. panda on behalf of the petitioner that the correspondence between the chief engineer and the superintending engineer ultimately culminating in the discharge of the petitioner by the order of the assistant engineer as per annexure-1 clearly shows that the foundation of the order was the factum of arrest of the petitioner in the criminal case. this contention requires careful examination.3. the law on the point is well settled and is no longer in doubt.even if an order is innocuous on the face of it and appears to be an order of discharge simpliciter, it is open to the court to lift the veil and find out the real nature and character of that order. if it was inflicted by way of punishment, then even in the case of a temporary servant who has no right to the post, a proceeding under article 311 of the constitution is essential. there again, a distinction is to be made between the conduct of the petitioner which constitutes the motive for taking action against him and the same constituting the foundation of such an order. if the latter is the basis of such an order, then the discharge is one by way of punishment. if, on the other hand, that circumstance constitutes the motive for the discharge order, the order itself is a discharge simpliciter. the ultimate conclusion in each case would depend on the facts and circumstances of that case. no rule of thumb can be prescribed: vide the state of bihar v. shiva bhikshuk mishra (1970) ii s.c.w.r. 606.4. in this particular case, from the facts narrated, it appears that the chief engineer did not want that a further enquiry was necessary as no punishment was intended to be imposed. the petitioner was a temporary servant and when it came to his knowledge that petitioner was arrested in a criminal case, he considered that it was not necessary to retain him further in service. the factum of arrest, therefore, did not constitute the foundation of the ultimate conclusion for discharging the petitioner. it may at best be a motive.5. on the aforesaid analysis, we are clearly of opinion that the discharge order is not by way of punishment.6. mr. panda further advanced a contention that the petitioner has been discharged from service by an officer lower in rank than the appointing authority. it is not disputed in this case that the executive engineer was the appointing authority. the foundation of this argument is that in his letter the chief engineer suggested that the petitioner should be discharged. in the counter-affidavit, it has been stated that on receipt of the letter from the chief engineer, the executive engineer passed an order to discharge the petitioner and that order was merely carried out by the assistant engineer. we are satisfied from the facts and circumstances of this case that the real discharge order was passed by the chief engineer himself or at any rate by the executive engineer. the mere use of the word 'should' cannot be construed to mean that the order was not passed by the chief engineer.7. we find no merit in this application which is accordingly dismissed, but in the circumstances without costs.a. misra, j.8. i agree.