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Union of India and Others vs M. Duraisamy

Civil Appeal · 2022 INSC 436Decided 19 Apr 2022
Civil Appeal No. 2665 of 2022
M.R. Shah · B.V. Nagarathna

Background

The respondent, a Postal Assistant, committed fraud between 2004 and 2007 by fraudulently withdrawing money from 85 Recurring Deposit (RD) accounts and failing to credit deposits in 71 others, defrauding a total of about Rs. 16.59 lakh. Only after the fraud was detected did he deposit the entire defrauded amount along with penal interest. A departmental inquiry found all charges proved (he had admitted the misconduct), and the Disciplinary Authority removed him from service. The Central Administrative Tribunal later reduced this punishment to compulsory retirement on sympathetic grounds, citing his 39 years of otherwise unblemished service and the fact that the money had been fully repaid, and the Madras High Court upheld that reduction, prompting the Union of India to appeal.

Decision Breakdown

The Supreme Court held that once a disciplinary inquiry has been conducted without procedural irregularity and serious misconduct is proved, courts and tribunals have only limited power to interfere with the punishment imposed and cannot do so merely out of sympathy or sentiment. Relying on its own precedents (including B.C. Chaturvedi v. Union of India and Goparaju Sri Prabhakara Hari Babu), the Court held that long unblemished service and voluntary repayment of the defrauded amount after being caught are not valid grounds to reduce a punishment for proven fraud by a public servant holding a position of trust: repayment after detection does not undo the seriousness of the breach of trust or the reputational harm caused to the department. The Tribunal and High Court had exceeded their jurisdiction by second-guessing the Disciplinary Authority's proportionate assessment of the misconduct's gravity. The Supreme Court set aside the orders of both the High Court and the Tribunal and restored the original punishment of removal from service.

Lesson Learnt

Courts will not reduce a disciplinary punishment for proven fraud by a public servant just because the employee later repaid the misappropriated money or had a long clean service record. Once fraud is established through a fair inquiry, the employer's assessment of appropriate punishment is generally not disturbed on sympathy grounds alone.

Official source (sci.gov.in)View Judgment (PDF)

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