Durga Charan Rout 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]. - thereafter, he applied to the planning and co-ordination department on 24.8.1969 for re-employment and on the said application his name was recommended to the district judge, puri for appointment to a suitable post, the petitioner was then temporarily appointed as l. 11-26/67 p dated 5-2-1968. 3. from the facts narrated above it is manifest that after his service in the office of the sub-registrar, athagarh was terminated, the petitioner was issued a certificate to that effect by the authorities concerned and thereafter, his name was recommended by the planning and co-ordination department as a retrenched personnel to the district judge, puri, for appointment in his office. since the petitioner had been appointed in the office of the district judge, puri on being recommended by the planning & co-ordination department and having been found suitable for the post in question and he was continuing in the said post, if any defect in the appointment was found subsequently on the basis of which it was proposed to alter the position then prevailing, the minimum that the principles of natural justice and fairness required was that the allegation proposed to be utilised against him should have been brought to his notice and he should have been given an opportunity to submit his explanation, if any.d.p. mohapatra, j.1. the petitioner has filed this writ petition praying to quash the order dated 26. 4. 1979 by the district judge, puri terminating his services with effect from 1, 6. 1979 (annexure:3 to the writ petition) and to declare him to be continuing in service.the gist of the petitioner's case is that he was appointed as a temporary extra clerk in the office of the sub-registrar, athagarh in july, 1969 and continued in the said post till august, 1969. when the employment was terminated due to want of copying the documents petitioner was issued a certificate to that effect. thereafter, he applied to the planning and co-ordination department on 24.8.1969 for re-employment and on the said application his name was recommended to the district judge, puri for appointment to a suitable post, the petitioner was then temporarily appointed as l.d.c., clerk in the office of the district judge, puri by order no. 188/1969 dated 18.11.1969 (annexure-1 to the writ petition), it is the further case of the petitioner that all of a sudden, without any enquiry to his knowledge, the impugned order of termination was passed on 26th of april, 1979, terminating his services with effect from 1. 6. 1979. the petitioner asserts that a number of persons, about 56 in all, (vide annexure-2 to the writ petition) who were appointed in the office subsequently still continue in service though his services were dispensed with without disclosing any reason.2. the stand taken by opposite parties 1 and 2 in their counter is that since the petitioner held a temporary appointment he had no right to the post; the impugned order is one of termination simplicitor and does not visit the petitioner with any stigma. the opposite parties further state that after the petitioner was appointed in the office of the district judge, puri on the basis of the recommendation received from the planning and' co-ordination department, on enquiry it was revealed that he had obtained a false retrenchment certificate in as much as he had served in the office of the sub-registrar, athagarh for 17 days only and he was not a retrenched personnel as contemplated in the planning and co-ordination circular no. 683-estt. 11-26/67 p dated 5-2-1968.3. from the facts narrated above it is manifest that after his service in the office of the sub-registrar, athagarh was terminated, the petitioner was issued a certificate to that effect by the authorities concerned and thereafter, his name was recommended by the planning and co-ordination department as a retrenched personnel to the district judge, puri, for appointment in his office. no material is forthcoming to show that the petitioner had any other involvement in obtaining the certificate or the recommendation from the sub-registrar, athagarh or the planning & co-ordination department excepting submitting applications for the purpose. admittedly, no enquiry has been held and no opportunity has been afforded to the petitioner by the appointing authority before passing the order of termination. nothing is also indicated for what reason the certificate obtained by the petitioner from the sub-registrar, athagarh, was held to be a false one. since the petitioner had been appointed in the office of the district judge, puri on being recommended by the planning & co-ordination department and having been found suitable for the post in question and he was continuing in the said post, if any defect in the appointment was found subsequently on the basis of which it was proposed to alter the position then prevailing, the minimum that the principles of natural justice and fairness required was that the allegation proposed to be utilised against him should have been brought to his notice and he should have been given an opportunity to submit his explanation, if any. this having not been done, the order is vitiated as being an arbitrary and capricious one.4. in view of the discussion aforesaid the writ petition succeeds, the impugned order terminating the petitioner's service is quashed and the petitioner is deemed to be continuing in service. in the circumstances of the case there shall be no order for costs.