CASE TITLE : SANGRAM KESHARI SWAIN Vs. UNION OF INDIA & ORS.
CASE NO : W.P.(C) NO. 26063 of 2022
DATE OF JUDGMENT : October 09, 2024
CORAM : Justice D. Dash, Justice V. Narasingh

Currency of punishment ends on the date when the order of penalty is passed and it cannot be deemed to last till a future date when authority actually executes order at its whims.

This case emanates from the writ petition filed by the petitioner who was an Officer belonging to the Odisha Administrative Service (OAS). He, being aggrieved by non-selection to the cadre of Indian Administrative Service (IAS), had filed an application before the Central Administrative Tribunal, Cuttack, which was rejected. Being aggrieved, he knocked the portals of this Court.

The petitioner, though had the required seniority for getting promoted to the cadre of IAS, was not recommended by the Selection Committee and declared ‘unfit’ for such promotion merely because a minor penalty was imposed upon him in the nature of ‘censure’ and ‘recovery’ way back in 2012.

Censure had no bearing upon consideration of the candidature of the petitioner by the Selection Committee, but the petitioner was penalized with an amount of Rs.39,675.95 which was ordered to be recovered in twenty installments. Though the currency of the penalty was due to expire by January, 2024, the amount could not be recovered till 2018.

Since the last portion of the penalty amount was recovered only in 2018, the petitioner was deemed unfit for promotion as his performance from 2014-15 till 2018-19 was assessed for the said purpose. As the last amount was recovered in 2018, it was deemed by the authority that the currency of the penalty lasted till 2018, rendering the petitioner ineligible for promotion.

However, the petitioner challenged such stance taken by the Selection Committee and submitted that it was the responsibility of the competent authority to deduct the recovery amount from his salary and thus, any failure on the part of the authority to recover the penalty amount/installment amount, without any fault of his own, would not render him ineligible.

The Court countenanced this contention of the petitioner that it was the authority who was at fault in not recovering the amount and held as follows:

“This Court is of the firm view that the word “Recovery” itself puts a responsibility on the competent authority to recover the amount and no discretion is neither left nor can be exercised by the delinquent to deposit the same.”

Furthermore, it held that the currency of the punishment is on the date when the order was passed and under no circumstances it can be till a future date depending upon the execution of the order as per discretion and whims of the authority in recovering the last pie. Thus, it observed, currency of the both punishments ought to be construed to be co-terminus on the date on which it is imposed.

As a result, since the currency of the punishment was held to have ended in the year 2012 itself, it was held that the same cannot affect the performance assessment of the petitioner which was done for a later period, i.e. 2014-15 to 2018-19.

Accordingly, the opposite parties were directed to convene a Review Selection Board for considering the candidature of the petitioner for promotion to the cadre of IAS on the basis of aforesaid assessment matrix and in case, he is found eligible, he was directed to be promoted retrospectively i.e. from the date on which the private opposite parties were promoted.

CASE TITLE : M/S. MAGNUM POLYMERS PRIVATE LIMITED V. INDUSTRIAL PROMOTION AND INVESTMENT CORPORATION OF ODISHA LIMITED & ORS.
CASE NO : W.P.(C) NO. 513 of 2017
DATE OF JUDGMENT : October 08, 2024

Borrower/guarantor has no vested right to claim One Time Settlement (OTS); Financial institutions cannot be directed by Court to grant benefit of OTS to borrowers.

The petitioner company had taken loan from the respondent-IPICOL, by mortgaging and hypothecating all its assets, to set up a PP Rope and HOPE twine manufacturing unit. The company had made an agreement to repay the loan along with interest as per schedule but for some compelling reasons, it could not clear the debt.

Subsequently, a One Time Settlement (OTS) scheme was floated by the respondent to give relief to the loss-making industrial units. The petitioner, being an eligible loss-making unit, accepted the promise/offer of IPICOL for settlement of the outstanding loans as per the MDF-OTS-07 Scheme.

However, before the finalization of settlement, the respondent-IPICOL introduced a new scheme under the name of OTS Scheme, 2016. The petitioner filed this writ petition assailing such stance taken by the respondent and pleaded that when its application was pending as per the 2007 scheme, the respondent could not have introduced a new scheme for settlement of dues.

Thus, the legal question which cropped up for consideration is that whether the petitioner has a vested right to claim for OTS and whether a direction can be passed by the Court to the opposite party to implement MDS-OTS 2007 when admittedly the said scheme is not in vogue being superseded by OTS-2016.

After discussing the law laid down by the Hon’ble Apex Court in The Bijnor Urban Cooperative Bank Limited, Bijnor v. Meena Agarwal & Ors., (2023) 2 SCC 805, the Court held that a borrower/guarantor has no vested right to claim OTS and financial institutions/banks should not be directed to positively grant benefit of OTS to a borrower nor can extension of time granted in terms of an OTS be directed to be afforded, as it would tantamount to rewriting/modification of contract.

Accordingly, the Court dismissed the writ petition by rejecting the prayer of the petitioner to get benefit of OTS under the 2007 scheme and held as follows:

“By applying the aforesaid principle of law, the petitioner’s prayer seeking a direction to consider its application under the One Time Settlement Scheme-2007, which has been admittedly suspended in the year 2011 and superseded by OTS-2016, cannot be entertained.”