Andhra Pradesh High Court: Non-Existence Of Prejudice Cannot Be Sole Ground To Rule Out Violation Of Principle of Natural Justice

The Andhra Pradesh High Court has observed that non-existence of prejudice by itself cannot be a sole ground to rule out the violation of principle of natural justice.

The Court was considering a Writ Petition seeking direction to the Respondent to refund the deducted amount with interest by granting all consequential benefits.

The single bench of Justice Maheswara Rao Kuncheam held, "Another facet of the argument suggests that, in the absence of prejudice, the principles of natural justice may not be applicable. In this context, adjudicatory forums must examine the factual circumstances by applying a test: whether there has been a complete denial of opportunity or a failure to provide reasonable opportunity. A complete denial of opportunity directly constitutes a gross violation of the principles of natural justice. By contrast, where reasonable opportunity is not afforded, the doctrine of prejudice falls within the scope of judicial scrutiny. In essence, the doctrine of prejudice does not supplant the principles of natural justice but operates as an integral part. Therefore, mere projection of argument of prejudice by itself is not a sole ground to brush aside the applicability of principles of natural justice."

The Petitioner was represented by Advocate V.S. Rayudu while the Respondent was represented by Advocate A. Rama Rao.

Facts of the Case

The Petitioners were working as Permanent Employees of the 1st Respondent Corporation and discharging their duties as Drivers and Conductors at Depot. They challenged the office order issued by the 3rd Respondent to them individually, whereby and where under, ordering for recovery of amounts from their respective salaries were assailed. The main case projected by the Petitioners was that, without any prior Notices or without conducting any enquiry in accordance with the Rules in vogue, the orders were issued against them and are in transgression of Andhra Pradesh State Road Transport Corporation Employees (Classification, Control and Appeal), Regulations, 1967 and also gross violation of principles of natural justice.

The Counsel for the Petitioner contended that the impugned orders were emanated basing upon the unilateral report which was not disclosed. The 3rd Respondent without giving any prior notices or conducting any enquiry, also without determining the specific roles and liabilities against the Petitioners, straight away issued the recovery proceedings.

On the other hand, Counsel for the Respondents Corporation stated that, apparently there were large scale financial irregularities and discrepancies found by the Test Audit Party in its inspection. When a detailed enquiry was conducted, it was came to be know that some of the employees misutilised the Musters though they had not worked at the relevant period etc. Thus, the said enquiry quantified the total financial loss to the tune of Rs.5,27,201 which was directed to be recovered in three monthly installments from the monthly salaries of the Petitioners, who were responsible for the said financial discrepancies.

Reasoning By Court

The moot question before the Court was whether the impugned orders preceded by any prior notices or enquiry proceedings against the Petitioners, in accordance with the law and also principles of natural justice complied, before recovering the amounts from the Petitioners' respective salaries or not?

It noted that the 1st Respondent –Corporation has not pleaded in its counter that they followed the due procedure of issuing Notice prescribed in the Regulations, 1967 before deducting amounts from the salaries of the Petitioners. The Court stressed that in the absence of procedural pre-requisites, straight away recovering the amounts from the salaries of the Petitioners is unknown to law.

"A glance of the counter filed on behalf of the respondents goes to show that the 1st respondent Corporation merely stated about the internal correspondence and other departmental proceedings only, but not at all addressed, the key point raised by the petitioners, regarding the violation of the Regulations, 1967 as well as principles of natural justice. Specifically, whether prior notices were issued to the petitioners before issuing the orders under challenge. In the absence of the above vital information, coupled with the fact that, till today no additional counter nor any other document filed by the 1st respondent Corporation to demonstrate that, they have complied the Regulation, 1976 and principles of natural justice before issuing the impugned orders dated 20.12.2016," the Court observed.

The Court was of the view the impugned order is in violation of principle of natural justice.

"It is apt to mention that the 3rd respondent in obedience to his superior Officer orders dated 25.10.2010 has passed the impugned orders dated 20.12.2016 for recovery of amounts from the salaries of the petitioners without causing any enquiry. Thus, the 3rd respondent on his own perception without applying any reasonable methodology, yardstick, fixed the liability of payment of total fiscal loss on the petitioners by fixing the different amounts on his own, which is nothing but, the gross violation of Regulations, 1967 as well as the principles of natural justice," the Court observed.

".......the 1st respondent Corporation authorities without following the procedure enunciated in the Regulations, 1967 coupled with the fact that, non-adhering the principles of natural justice, by straightaway deducting amounts from the salaries of the petitioners is per-se illegal, arbitrary and liable to be set aside," the Court further observed.

The Petition was accordingly allowed.

Cause Title: V.S. Rayudu vs. Andhra Pradesh State Road Transport Corporation Rep By and Others (APHC010191402017)

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