High Court Reinstatement Of Postmaster Quashed; Removal Penalty Upheld By Supreme Court

A bench of Justices Rajesh Bindal and Manmohan heard an appeal by the Union of India challenging the Rajasthan High Court’s order of 2 September 2024 which had set aside a disciplinary removal imposed on a Gramin Dak Sevak/Branch Postmaster and directed his reinstatement. The appeal arose from allegations of misappropriation of public funds discovered during an annual inspection and the ensuing departmental inquiry, appellate proceedings and tribunal adjudication.

The Court allowed the appeal, set aside the High Court judgment and upheld the punishment of removal imposed by the disciplinary authority. The bench held that the High Court had “travelled beyond its jurisdiction” by re-examining the merits of the misconduct—whereas judicial review was confined to the legality of the inquiry process—and that contemporaneous documents and admissions supported the finding of misappropriation. The Court, in its reasoning, observed: "Still aggrieved, the respondent challenged the order passed in the Original Application before the High Court. Vide impugned order, the High Court had misdirected itself while extending the scope of jurisdiction which could be exercised in matter of judicial review. The merits of controversy were gone into. Even the admission made by the respondent and voluntary deposit of the amount misappropriated by him were dealt with and finally the punishment imposed on the respondent was set aside. He was directed to be reinstated back in service. The High Court opined that mere suspicion is not enough to punish him, not realizing the fact that it was not a case of mere suspicion. The documents clearly established the factum of embezzlement. The passbooks of the account holders were stamped with the receipt of the amount with no corresponding entries in the books of accounts maintained in the post office. It is a matter of chance that the embezzlement made by the respondent came to the notice of the authorities that action could be taken against him while restoring the amount to the post office. However, the fact remains that mere deposit of the embezzled amount will not absolve an employee of the misconduct. Relationship of a customer with a banker is of mutual trust. Any account holder will be satisfied once an entry is made in his passbook regarding deposit of any amount by him in the post office where he had maintained the account. An account holder may not be privy to the manner in which the accounts are maintained by the post office and also whether the corresponding entries were made or not in the books of accounts maintained there. The respondent tried to explain the embezzlement by stating that on account of ignorance of the Rules, the passbooks of the account holders were stamped. Such an explanation cannot be accepted being farfetched. He had been in service for about 12 years. Ignorance of rules of the procedure with so much experience cannot be accepted. There was no defect or error pointed out in the course of inquiry. The High Court had travelled beyond its jurisdiction in trying to explain the admission of the respondent which was nothing else but an afterthought."

Background The respondent was appointed on 12 January 1998 as Gramin Dak Sevak/Branch Postmaster and, during an annual inspection on 16 June 2011, inspectors detected irregularities suggesting misappropriation of recurring deposit and postal life insurance premiums. Two departmental articles of charge alleged that the respondent accepted amounts from depositors and policyholders, stamped passbooks or receipt books, but did not record corresponding entries in the office accounts and kept the money for personal use. A chargesheet issued on 17 December 2013 led to a formal inquiry. The respondent was provided opportunity of hearing, defence assistance, and cross-examined departmental witnesses; he did not lead evidence in defence and in his statement dated 28 April 2012 admitted that the "money received by him from the account holders was spent by him for his household purposes." The inquiry report found the charges proved; the disciplinary authority removed the respondent by order dated 8 December 2014 and the statutory appeal was dismissed on 31 July 2015. The Central Administrative Tribunal dismissed the Original Application on 23 February 2023. The High Court, however, allowed the writ petition, examined the merits and set aside the penalty, directing reinstatement. The Supreme Court found no infirmity in the inquiry process and held that the High Court had exceeded the scope of judicial review by reopening facts already accepted by the disciplinary authorities and the Tribunal. The Supreme Court therefore allowed the appeal, set aside the High Court order and upheld the removal; no interim directions were recorded and no precedent was expressly overruled.

Case No.: CIVIL APPEAL NO.13183 OF 2025 (Arising out of S.L.P.(C) No.31515 of 2025; Diary No.28631 of 2025) Case Title: Union of India and Ors. v. Indraj Appearances: For the Petitioner(s): Not indicated in the judgment For the Respondent(s): Not indicated in the judgment