Supreme Court Upholds Disciplinary Action in Tender Tampering Case: Indian Oil Corporation vs. Ajit Kumar Singh (2023)

Date of the Judgment: May 17, 2023

Citation: Civil Appeal No. 3663 of 2023

Judges: Abhay S. Oka, J., Rajesh Bindal, J.

Can a High Court, in an intra-court appeal, re-evaluate evidence in a disciplinary proceeding that has already been upheld by a Single Judge? The Supreme Court of India addressed this question in a case involving alleged tampering of tender documents by an employee of Indian Oil Corporation. The court held that the Division Bench of the High Court erred in re-appreciating the evidence and set aside its order, thereby restoring the disciplinary action against the employee. The judgment was authored by Justice Rajesh Bindal.

Case Background

The case revolves around a tender process initiated by the Indian Oil Corporation (IOC) for repair work at its Barauni Refinery on June 30, 2001. Three bidders participated. The technical bids were opened on August 24, 2001, but the price bids were not opened and were kept in a locked drawer. The keys to the drawer were with K.C. Patel and Ajit Kumar Singh (Respondent No. 1). The price bids were opened on October 1, 2001. During the preparation of the comparative table on October 3, 2001, K.C. Patel noticed a change in the price bid of M/s. B.S. Jha compared to the original quotation. The original quotation was missing, and the changed quotation had overwriting, making M/s. B.S. Jha the lowest bidder (L-1).

Further investigation revealed that the price bid of another bidder, M/s. Laxmi Singh, was also tampered with. The Central Forensic Institute confirmed that the envelope containing M/s. Laxmi Singh’s bid was opened and resealed. Given that Respondent No. 1 had access to the drawer where the bids were kept, a chargesheet was issued to him. Departmental proceedings were initiated against him and K.C. Patel. The Inquiry Officer concluded that tampering had occurred, and the changed quotation of M/s. Laxmi Singh contained the original signature of Respondent No. 1. The Disciplinary Authority imposed a penalty of withholding five annual increments with cumulative effect on Respondent No. 1. The appeal against this order was dismissed.

Respondent No. 1 then filed a writ petition challenging the disciplinary action, which was dismissed by a Single Judge of the High Court. However, the Division Bench of the High Court reversed the Single Judge’s order and set aside the punishment imposed on Respondent No. 1. This led to the current appeal before the Supreme Court.

Timeline:

Course of Proceedings

The disciplinary proceedings against Respondent No. 1 were initiated after the tampering of tender documents was discovered. The Inquiry Officer found that the tampering had occurred, and the changed form of quotation of M/s. Laxmi Singh contained the original signature of Respondent No. 1. The Disciplinary Authority imposed a penalty, which was upheld by the Appellate Authority. The Single Judge of the High Court also upheld the disciplinary action. However, the Division Bench of the High Court reversed the Single Judge’s order, leading to the appeal before the Supreme Court.

Legal Framework

The Supreme Court referred to its earlier judgment in Deputy General Manager (Appellate Authority) vs. Ajai Kumar Srivastava (2021) 2 SCC 612, which outlines the scope of judicial review in disciplinary proceedings. The court emphasized that judicial review is concerned with the decision-making process and not the merits of the decision itself. The court can interfere if the proceedings are inconsistent with the rules of natural justice, violate statutory rules, or if the disciplinary authority’s conclusion is based on no evidence or is perverse. The court also referred to Ex-Const/Dvr Mukesh Kumar Raigar vs. Union of India and Ors. (2023) SCC Online SC 27, which reiterated the same principles.

The Supreme Court highlighted that the High Court, in its judicial review, should not re-evaluate the evidence as if it were an appellate court in a criminal trial. The role of the High Court is to ensure that the disciplinary proceedings were conducted fairly and in accordance with the law.

Arguments

Arguments by the Appellant (Indian Oil Corporation):

• The appellant argued that the High Court, in its judicial review, should only examine whether due process was followed and a fair opportunity was given to the employee.
• The appellant contended that the Division Bench of the High Court exceeded its jurisdiction by re-appreciating the evidence, which is beyond the scope of judicial review.
• The appellant emphasized that the tampering of the price bid was established by the Central Forensic Institute’s report.
• The appellant pointed out that the original signature of Respondent No. 1 was found on the changed form of quotation of M/s. Laxmi Singh, which clearly indicated his involvement.

Arguments by the Respondent (Ajit Kumar Singh):

• The respondent argued that the Division Bench of the High Court rightly corrected the injustice done to him.
• The respondent claimed that merely having a duplicate key to the drawer where the bid documents were kept does not make him liable for the tampering.
• The respondent contended that he was made a scapegoat by other employees and has been suffering for over two decades.

Issues Framed by the Supreme Court

The primary issue before the Supreme Court was:

1. Whether the Division Bench of the High Court was justified in re-appreciating the evidence and setting aside the disciplinary action against Respondent No. 1 in an intra-court appeal.

Treatment of the Issue by the Court

Authorities

Cases Relied Upon:

• Deputy General Manager (Appellate Authority) vs. Ajai Kumar Srivastava (2021) 2 SCC 612 – Supreme Court of India: This case was cited to emphasize the limited scope of judicial review in disciplinary matters. The court reiterated that the role of judicial review is to examine the fairness of the decision-making process, not the correctness of the decision itself.
• Ex-Const/Dvr Mukesh Kumar Raigar vs. Union of India and Ors. (2023) SCC Online SC 27 – Supreme Court of India: This case was cited to reinforce the principle that the High Court should not interfere with the findings of fact arrived at in departmental inquiry proceedings unless there is mala fides, perversity, or no evidence to support the finding.

Judgment

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the principle that judicial review of disciplinary proceedings is limited to examining the decision-making process, not re-evaluating the evidence. The court emphasized that the Division Bench of the High Court exceeded its jurisdiction by acting as an appellate court and re-appreciating the evidence. The court was particularly swayed by the fact that the changed form of quotation of M/s. Laxmi Singh contained the original signature of Respondent No. 1, which was not addressed by the Division Bench. This fact, coupled with the forensic report confirming tampering, weighed heavily in the court’s decision to restore the disciplinary action against the respondent.

The Supreme Court emphasized the importance of adhering to the established principles of judicial review in disciplinary matters. The court noted that the Division Bench of the High Court had overlooked the crucial evidence of the respondent’s signature on the tampered document. The court stated:

“The judgment passed by the Division Bench of the High Court shows that matter was dealt with in a manner as if it was the first stage of the case, namely, the inquiry was being conducted and inquiry report was being prepared, which is not the scope in judicial review.”

The court further added:

“However, there was no answer to the finding recorded by the Inquiry Officer in the Inquiry Report, namely, that the changed form of quotation of M/s. Laxmi Singh contained original signature of respondent no.1.”

The court concluded:

“When the changed form of quotation also contained signature of respondent no.1, it clearly established his involvement in the tampering of document.”

Key Takeaways

• Judicial review of disciplinary proceedings is limited to examining the decision-making process and ensuring that due process was followed.
• High Courts should not re-appreciate evidence as if they were an appellate court in a criminal trial.
• Findings of fact by the disciplinary authority should not be interfered with unless there is mala fides, perversity, or no evidence to support the finding.
• The presence of an employee’s original signature on a tampered document is strong evidence of their involvement in the tampering.
• The principle of natural justice must be followed in departmental inquiries.

Directions

The Supreme Court set aside the order of the Division Bench of the High Court and restored the order of the Single Judge, thereby upholding the disciplinary action against Respondent No. 1.

Development of Law

The ratio decidendi of this case is that the High Court, in its judicial review of disciplinary proceedings, should not re-appreciate evidence and should only examine whether the decision-making process was fair and in accordance with the law. This judgment reinforces the limited scope of judicial review in disciplinary matters and emphasizes the importance of adhering to the established principles of judicial review. There is no change in the previous position of law, but this case clarifies the application of the principles of judicial review in disciplinary proceedings.

Conclusion

The Supreme Court’s decision in Indian Oil Corporation vs. Ajit Kumar Singh reaffirms the limited scope of judicial review in disciplinary proceedings. The court held that the Division Bench of the High Court erred in re-evaluating the evidence and restored the disciplinary action against the employee. This judgment underscores the importance of adhering to established legal principles and ensuring that disciplinary proceedings are conducted fairly and in accordance with the law.

Category

Parent Category: Service Law

Child Category: Disciplinary Proceedings

Child Category: Judicial Review

Parent Category: Tender Law

Child Category: Tender Tampering

Parent Category: Service Law

Child Category: Departmental Inquiry

Parent Category: Civil Procedure Code

Child Category: Appeals

Parent Category: Constitution of India

Child Category: Article 226, Constitution of India

Child Category: Article 136, Constitution of India

FAQ

Q: What was the main issue in the Indian Oil Corporation vs. Ajit Kumar Singh case?

A: The main issue was whether the High Court, in an intra-court appeal, could re-evaluate the evidence in a disciplinary proceeding that had already been upheld by a Single Judge.

Q: What did the Supreme Court decide?

A: The Supreme Court held that the High Court’s Division Bench erred in re-appreciating the evidence. The court restored the disciplinary action against the employee.

Q: What is the scope of judicial review in disciplinary proceedings?

A: Judicial review is limited to examining the decision-making process and ensuring that due process was followed. It does not involve re-evaluating the evidence.

Q: What does it mean for an employee if their signature is found on a tampered document?

A: It is strong evidence of their involvement in the tampering.

Q: What are the key takeaways from this case for employees facing disciplinary action?

A: Employees should ensure that the disciplinary proceedings are fair and follow due process. They should also be aware that their actions and signatures on documents can be used as evidence against them.