B M VADALIA V. COMMISSIONER OF SALES TAX

SCA/1281/2005

AI Insights

The case involves B M Vadalia, a former Junior Clerk at the Sales Tax Office, who was penalized for misconduct involving the unauthorized alteration of government records related to the issuance of statutory 'F' Forms under the Central Sales Tax Act. Initially exonerated by the Inquiry Officer, the Disciplinary Authority later found Vadalia guilty, leading to an appeal at the Gujarat Civil Services Tribunal, which upheld the penalty. The High Court's decision focused on the procedural integrity of the disciplinary process and the substantive evidence of misconduct, rejecting Vadalia's claims of procedural lapses and lack of evidence.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 726144 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 29-01-2021
• Assessment Year: misc
• Other Referred Cases: Union of India V/s. Prakashkumar Tandon, State of Uttar Pradesh V/s. Saroj Kumar Sinha
• Laws Referred To: Article 226 of the Constitution of India, Central Sales Tax Act, Gujarat Civil Services (Conduct) Rules, 1971
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: DHAWAN JAYSWAL
• Assessee Lawyers: ADITI RAOL
• Keywords: Disciplinary Proceedings; Misconduct; Withholding increments; Government record tampering; Statutory 'F' Form
• Section: 3(2); 3(1)(i)(ii)

Judgement Text

"C/SCA/1281/2005 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 1281 of 2005 FOR APPROVAL AND SIGNATURE: HONOURABLE MR. JUSTICE UMESH A. TRIVEDI ========================================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India or any order made thereunder ? ========================================================== B M VADALIA Versus COMMISSIONER OF SALES TAX ========================================================== Appearance: ADITI S RAOL(8128) for the Petitioner(s) No. 1 MR DHAWAN JAYSWAL AGP (1) for the Respondent(s) No. 1 RULE SERVED(64) for the Respondent(s) No. 1 ========================================================== CORAM: HONOURABLE MR. JUSTICE UMESH A. TRIVEDI Date : 28/01/2021 and 29/01/2021 ORAL JUDGMENT 1. By way of present petition under Article 226 of the Constitution of India, the petitioner challenges the Page 1 of 21 C/SCA/1281/2005 JUDGMENT order passed by the Disciplinary Authority dated 20th November, 2000 imposing penalty of withholding 4 increments without future effect and order passed by the Gujarat Civil Services Tribunal, Gandhinagar dated 29th September, 2004 confirming the order passed by the Disciplinary Authority rejecting the appeal preferred by the petitioner. 2. The petitioner was working as Junior Clerk from 10.06.1989 to 30.06.1991 in assessment branch 1 of Sales Tax Office Division-2, Junagadh. Since petitioner found to have committed misconduct, during the aforesaid period, he was issued a charge-sheet dated 19.3.1997. According to the charge levelled against the petitioner, he interpolated Government record by correcting entries made in it without any authorization for the issuance of statutory ‘F’ Form under the Central Sales Tax Act to M/s. Jamnadas Bhimji and Company, Taluka: Badodar, District: Junagadh, who was issued only one book containing 25 leaves, interpolated to have issued two books thereof rendering a potential threat of misuse of statutory forms causing economic loss to the Government. Thus, petitioner is said to have depicted lack of devotion to duty and projected doubtful integrity by such defective proceedings carried out by him issuing Page 2 of 21 C/SCA/1281/2005 JUDGMENT statutory ‘F’ Form to the trader. Thereby, petitioner is alleged to have committed misconduct, as defined under Rule 3(1)(i)(ii) of the Gujarat Civil Services (Conduct) Rules, 1971. Pursuant to the show cause notice, the petitioner submitted his written explanation. However, Inquiry Officer came to be appointed for carrying out the inquiry against the petitioner who by his inquiry report dated 31.3.1999 exonerated the petitioner from the charges leveled against him. 3. However, Commissioner of Sales Tax, Gujarat State, disagreeing with the report of the Inquiry Officer issued a show cause notice to the petitioner assigning reasons why he is disagreeing with it and called upon the petitioner to submit his final statement of defence. Pursuant thereto, the petitioner vide a communication dated 30.12.1999, submitted his written explanation to the Disciplinary Authority. However, Disciplinary Authority after considering the report of Inquiry Officer as also explanation offered by the petitioner, came to conclusion that the petitioner is guilty of misconduct depicting lack of devotion to duty and of doubtful integrity and thereby imposed penalty, as aforesaid. Page 3 of 21 C/SCA/1281/2005 JUDGMENT 4. Being aggrieved by the decision of the Disciplinary Authority, the petitioner preferred the appeal being Appeal No.455 of 2000 before the Gujarat Civil Services Tribunal, Gandhinagar. The Appellate Tribunal, after hearing the learned advocate appearing for the petitioner and taking into consideration the material available with it in the form of report and Inquiry Officer as also the order of the Disciplinary Authority has also considered the documents / record produced by the Department, dismissed the appeal confirming the order of the Disciplinary Authority withholding 4 increments without future effect. Therefore, the present petition is filed challenging the orders passed by the Disciplinary Authority as also confirmed by the Appellate Authority. 5. Ms.Aditi Raol, learned advocate for the petitioner submitted that when the Inquiry Officer exonerated the petitioner it was incumbent upon the Disciplinary Authority to assign sound and cogent reasons for disagreeing with it, however, it is lacking in the present case. Therefore, she has submitted that the procedure adopted by the Disciplinary Authority for issuance of second and final show cause notice is erroneous and based thereon the order impugned could not have been passed by it. She has further submitted that to Page 4 of 21 C/SCA/1281/2005 JUDGMENT prove the charge against the petitioner, no witnesses are examined nor any documentary evidence produced against the petitioner. According to her submission, it is a case of no evidence and therefore, no punishment, as aforesaid, could have been imposed upon the petitioner. 6. It is further submitted that two copies of ‘F’ Form found from M/s. Umiya Industries, Vanthali though relied on and forming part of Inquiry Officer’s report, copies thereof have not been furnished to the petitioner and therefore, there is a violation of principles of natural justice. It is submitted that the Disciplinary Authority must provide all the material documents used against the delinquent. In the present case, according to her submission, it has not been done by the authority and therefore, the order of punishment imposed is required to be quashed and set aside. 7. She has further submitted that without examining any witnesses from M/s.Jamnadas Bhimji and Company or M/s.Umiya Industries, Vanthali, it could not have been concluded that the petitioner has not supplied two books containing 25 leaves each of ‘F’ Form to M/s. Jamnadas Bhimji and Company. If that is so, charge against the petitioner cannot be said to be proved. It is further Page 5 of 21 C/SCA/1281/2005 JUDGMENT submitted that no fair inquiry is conducted against the petitioner and no opportunity, to defend the case, was provided to the petitioner and therefore, the whole disciplinary proceedings initiated against the petitioner is vitiated. 8. It is further submitted that issuance of statutory ‘F’ Form is the duty of Sales Tax Officer and the petitioner has been made scapegoat to save him from the charge. It is further submitted that he has issued two books of ‘F’ Form to M/s. Jamnadas Bhimji and Company on oral say of Sales Tax Officer despite that, no statement of Sales Tax Officer was ever recorded. Not only that, there is no inquiry conducted against him who has issued illegal oral instructions. It is further submitted that if the issue register contains signature of officer concerned and when there is no signature in this disputed entry, it can safely be concluded that he himself might have not deliberately signed it. It is further submitted that the Inquiry Officer has, therefore, observed that the petitioner has no authority to issue ‘F’ Form to any party. It is further submitted that the concerned officer was in habit of issuing oral instructions and therefore, petitioner cannot be held guilty of the charge levelled against him. She has further submitted that since the Page 6 of 21 C/SCA/1281/2005 JUDGMENT Inquiry Officer has exonerated the petitioner, it was the duty of the Disciplinary Authority to examine the witnesses in support of the charge. She has further submitted that burden of examining the witnesses should not be shifted on the delinquent and it is the duty of the Disciplinary Authority initiating disciplinary proceedings against the delinquent to prove the charge. 9. She has further submitted that the Disciplinary Authority has failed to show that how and in what manner, there is a loss caused to the State exchequer as claimed. There is no single material on record where from it can be concluded that such ‘F’ Form has been misused causing monetary loss to the State exchequer. Therefore, it is submitted that the punishment imposed is disproportionate to the misconduct alleged. 29.01.2021 10. As against that, Mr.Dhawan Jayswal, learned AGP submitted that all prescribed procedures for conducting inquiry against the delinquent and taking disciplinary action have been followed and therefore, this Court should not interfere in the finding of guilt recorded by the Disciplinary Authority in a petition under Article 226 of the Constitution of India, more particularly when, Page 7 of 21 C/SCA/1281/2005 JUDGMENT the order of Disciplinary Authority has been confirmed by the Service Tribunal. 11. Mr.Jayswal, learned AGP has further submitted that the Disciplinary Authority, while issuing show cause notice for initiation of proceedings, not agreeing with the report of the Inquiry Officer, has assigned cogent reasons and therefore, it cannot be found fault with. He has further submitted that it is not the case of the petitioner that no corrections / overwriting / erasion have been effected in the record. However, it is the case of the delinquent that whatever is done is done at the instance and the instructions of his superior officer. However, according to the submission of Mr.Jayswal, learned AGP, the Inquiry Officer has failed to consider the fact that there was no such instructions given by the higher officer. At the same time, no employee is supposed to obey the oral instructions of any higher officer. If at all, the case of the petitioner is to be believed, he has not endorsed even those documents that it has been done at the instance of his superior officer. Drawing attention to Rule 3(2) of the Gujarat Civil Services (Conduct) Rules, 1971, he has submitted that no Government servant shall, in the performance of his official duties or in exercise of the powers conferred on Page 8 of 21 C/SCA/1281/2005 JUDGMENT him, act otherwise than in his best judgment except when he is acting under the direction of his superior officer and shall, where he is acting under such direction, obtain the direction in writing wherever practicable and where it is not practicable to obtain the direction in writing, he shall obtain written confirmation of the direction as soon thereafter as possible. In the present case, no such written instruction or written confirmation of superior officer is obtained by the petitioner. Thus, so far as charge against the petitioner – delinquent is concerned, it is admitted by the petitioner but it is his defence that it was done at the instance and instructions of his superior officer who is not proceeded against and therefore, the petition is required to be rejected. 12. Mr.Jayswal, learned AGP has further submitted that since the case is based on documentary evidence, non examination of any witnesses would not be fatal to the disciplinary proceedings concluded against the petitioner. He has further submitted that if at all the petitioner wants to examine any of the officer or the trader to support his defence, he could have asked for examining either any officer or the trader as a witness in his defence. Though, as submitted by Mr.Jayswal, learned AGP, petitioner was heard in person before the Page 9 of 21 C/SCA/1281/2005 JUDGMENT Disciplinary Authority and he has never prayed for examining any witnesses in his support. Therefore, he has submitted that the petitioner cannot make any grievance about non examination of any witnesses. The statements of concerned trader or any person recorded were already supplied to the petitioner and therefore, not only the inquiry conducted against him but the disciplinary proceedings before the Disciplinary authority was also in accordance with law and there cannot be any grievance raised against it. 13. Mr.Jayswal, learned AGP has further submitted that in exercise of power under Articles 226 and 227 of the Constitution of India, this Court cannot venture into re- appreciation of evidence or interfere with conclusion of inquiry proceedings so long as it is conducted in accordance with law or go into reliability / adequacy of evidence. He has further submitted that the High Court can only consider whether inquiry held by competent authority was in accordance with procedure established by law and principles of natural justice or not. 14. Though there may not be any actual monetary loss occurred by the misconduct of the delinquent, for imposing penalty, it would not be determinative factor. Page 10 of 21 C/SCA/1281/2005 JUDGMENT He has further submitted that the very fact that use of Form ‘F’ is for the purpose of transferring goods under the head of branch transfer from one State to other, claiming it to be not a sale, no Central Sales Tax would be levied thereon. He has further submitted that if there would not have been any raid from the Income Tax Department at the premises of Umiya Industry, Vanthali, the seizure of two ‘F’ Forms out of serial number contained in a second ‘F’ Form book containing 25 leaves would not have come to the notice of the authority. According to his submission, for imposing penalty, monetary loss has nothing to do with the same. The very fact that unauthorizedly book of ‘F’ Form claimed to have been issued to M/s.Jamnadas Bhimji and Company was in fact not issued to it but petitioner has misused the same under the guise of trader M/s. Jamnadas Bhimji and Company has asked for two books of ‘F’ Form containing 25 leaves. 15. He has further submitted that since the punishment imposed is not shockingly disproportionate, this Court should not interfere with it in a petition under Article 226 of the Constitution of India. Page 11 of 21 C/SCA/1281/2005 JUDGMENT 16. Having heard learned advocates for the appearing parties for dealing with the contentions raised in this petition, a thorough scrutiny of the material produced on record is required to be scanned. 17. While petitioner was working as Junior Clerk from 10.6.1989 to 30.6.1991 with Sales Tax Office, Unit-2, Junagadh, claimed to have issued two books of statutory F’ Form to the dealer M/s. Jamnadas Bhimji and Company despite the dealer had asked for one book containing 25 leaves therein. The petitioner is said to have tampered with the Government record by overwriting the serial number of forms, number of books issued in the issue register as also the application tendered by the dealer though dealer had asked for only one book containing 25 leaves. The petitioner is shown to have overwritten the application form and the register to make a show that two books have been asked for and issued to it. Though the Inquiry Officer has exonerated the petitioner of the charge levelled against him on the ground that accepting defence of the petitioner that he acted on the oral instructions of the superior officer, which is not corroborated by any contemporaneous record, while issuing show cause notice by the Disciplinary Authority, cogent reasons are assigned by it for disagreeing with the Page 12 of 21 C/SCA/1281/2005 JUDGMENT report of the Inquiry Officer. If at all, the petitioner acted on the oral instructions of his superior officer, which otherwise he is not supposed to do the same, he has not endorsed in any document or any register that he has acted as per the oral instructions issued by his superior officer. Not only that, if it is to be believed as per his defence that dealer had after completion of procedure for issuance of one book of Form ‘F’, asked for two books, on the oral instructions of officer concerned, he issued two books, again cannot be believed because on the application made by the dealer, the copy of receipt issued to have received ‘F’ Forms nor in issue register where ever there is correction made is signed by the dealer himself. The petitioner could have got the application of the dealer corrected and initialed by the dealer himself instead of making it himself. As such, defence of the petitioner appears to be got up one and his action is not in consonance with the contemporaneous record available. Over and above that under Rule 3(2) of ‘the Rules’ he should have obtained such written instructions or written confirmation from superior officer which is missing in this case. Therefore, said defence is not believable at all. Page 13 of 21 C/SCA/1281/2005 JUDGMENT 18. The report of the Inquiry Officer and the order passed by the Disciplinary Authority are self eloquent to reflect that the procedure prescribed under the law is followed and there is no breach or violation of principles of natural justice. The contemporaneous record available disproves the defence raised by the petitioner. As such, the statement recorded of the concerned person from M/s.Jamnadas Bhimji and Company is very clear that he applied for one book of ‘F’ Form and he received only one book. 19. So far as contention with regard to assigning sound and cogent reasons for disagreeing with the report of the Inquiry Officer by the Disciplinary Authority, the show cause notice issued to the petitioner dated 6.10.1999 is self eloquent is concerned, as recorded in the notice itself, before imposing any punishment, the second book of ‘F’ Form is not found out, which is claimed to have been issued by the petitioner. It is claimed by the petitioner that dealer M/s. Jamnadas Bhimji and Company was issued two books of 25 leaves, however, as claimed in the statement recorded of a dealer, only one book of ‘F’ form vide Serial Number 159651 to 159675 came to be issued to him. However, during the course of inquiry by the Income Tax Department, two leaves of ‘F’ Form bearing Page 14 of 21 C/SCA/1281/2005 JUDGMENT No.159685 and 159688, part of another book, claimed to have been issued, was found from Umiya Industry, Vanthali. Therefore, it is clear that the second book of ‘F’ Form has to be accounted for by the petitioner as he himself has admitted having issued two books containing 25 leaves to M/s.Jamnadas Bhimji and Company which is proved to be incorrect. However, on record, only one book containing 25 leaves has been issued to the dealer. The defence of the petitioner is that he issued two books pursuant to oral instructions by the higher officer. However, there is no note found either in the register itself that the so called correction / tampering is done under the instructions of the higher officer for providing two books of ‘F’ Form containing 25 leaves each. The defence of the petitioner is that higher officer has not signed the register after correction and the issue register contained the signature of the officer except this disputed entries. If at all, it is done at the instance of higher officer, no one prevented the petitioner from getting the signature even of the dealer who had applied for one book and subsequently asked for two books, to correct his application, receipt as also his signature should have been obtained after putting such correction. At any rate, petitioner could not have done himself the said correction. At the same time, Page 15 of 21 C/SCA/1281/2005 JUDGMENT petitioner could not have tampered with Central Registration File but he should have endorsed over it that it has been done pursuant to oral instructions of the officer concerned. That apart, petitioner could have obtained signature of the dealer in the issue register as also the receipt of the same for two books. Not only that as per Rule 3(2) of the ‘the Rules’ petitioner should have obtained written instruction or written confirmation thereof. Thus, the defence raised by the petitioner is misleading and appears to have been got up one. If the show cause notice before imposing penalty is seen as also the order of Disciplinary Authority passed after hearing the petitioner, I am satisfied that the Disciplinary Authority has assigned good cogent reasons not agreeing with the report of the Inquiry Officer and therefore, order imposing punishment cannot be challenged on that ground also. 20. The other submission with regard to non examination of witnesses has also no legs to stand since case rests only on documentary evidence. There is no need to examine any witnesses to prove a charge against the delinquent. At the same time, it is the case of the delinquent that he issued two books to the dealer of ‘F’ Form containing 25 leaves but in support thereof he could have examined Page 16 of 21 C/SCA/1281/2005 JUDGMENT that dealer to whom he issued two books in his defence. Neither before the Inquiry officer nor before the Disciplinary Authority, the petitioner has ever applied for examining any witness in support of his defence. Therefore, the decision in the case of Union of India V/s. Prakashkumar Tandon reported in (2009) 2 SCC 541 for the proposition that delinquent has to be provided fair opportunity of examining any witness and his application for the same should be considered by the Inquiry Officer is not applicable to the present case. Since there was no application filed by the petitioner either before the Inquiry officer or even before the Disciplinary Authority to examine any witness by the petitioner, it cannot be said that there is breach of principles of natural justice. 21. The contention that two leaves of ‘F’ Form found from M/s. Umiya Industry, Vanthali, in the raid carried out by the Income Tax Department, to prove that anyone from Umiya Industry should have been examined how they came in possession thereof, is without any basis. As such, there is no dispute that petitioner has issued two books of ‘F’ Form and two leaves thereof out of second book is found from M/s.Uminya Industry, Vanthali. If at all, petitioner wants to know how Umiya Industry, Page 17 of 21 C/SCA/1281/2005 JUDGMENT Vanthali came in possession thereof, it is for him to explain, as he claimed, that he has issued it to M/s.Jamnadas Bhimji and Company. The other contention is that copies of those two ‘F’ Forms found from M/s. Umiya Industry, Vanthali is not supplied is also without any merit. Nothing turns on non supply of the copy thereof. Fact remains that the second book of ‘F’ Form containing 25 leaves claimed to be issued, to M/s.Jamnadas Bhimji and Company but in reality as proved not issued to it, by tampering with the record and therefore, copies of the same even if not supplied to the petitioner is of no help to him. As such, two leaves found and the second book of ‘F’ Form has led to unearth misdeeds of the petitioner as it has, prima-facie, disproved the claim made by the petitioner that he issued second book to M/s.Jamnadas Bhimji and company. 22. In support of her contention, Ms.Raol, learned advocate for the petitioner relied on decision in the case of State of Uttar Pradesh V/s. Saroj Kumar Sinha reported in (2010) 2 SCC 772 more particularly para-39 thereof, for a proposition that, all relevant statements, documents and other materials should be made available to the delinquent so as to enable him to have reasonable opportunity to defend himself in departmental inquiry. Page 18 of 21 C/SCA/1281/2005 JUDGMENT However, there is no quarrel to the proposition laid down therein but in the present case, petitioner himself has not disputed issuance of second book of ‘F’ Form and two leaves thereof found from M/s. Umiya Industry, Vanthali. Thus, nothing turns on those copies of two leaves of ‘F’ form in the defence of the petitioner. On the contrary, the petitioner has to account for the same as it is a part of a second book claimed to have been issued by him to M/s. Jamnadas Bhimji and company and how it has come in possession of M/s.Umimya Industry, Vanthali. Therefore, the precedent relied on is also not applicable to the facts of the present case. 23. Here in the present case, the learned advocate for the petitioner has failed to show how and in what manner principles of natural justice, during the course of Disciplinary proceedings have not been followed. As such, in a petition under Article 226 of the Constitution of India, this Court cannot venture into re-appreciation of evidence or interfere with the conclusion either in the inquiry proceedings or disciplinary proceedings if the same are conducted in accordance with law. Reliability / adequacy of evidence cannot be gone in to by High Court in such cases. The Court cannot go into proportionality of punishment unless it shocks conscience of the Court. I Page 19 of 21 C/SCA/1281/2005 JUDGMENT am fully satisfied that the inquiry held by the Competent Authority / Disciplinary Authority was in accordance with procedure established by law and principles of natural justice. I am further satisfied that there are no any irrelevant or extraneous considerations and/or exclusion of admissible or material evidence or admission of inadmissible evidence have influenced decision rendering it vulnerable. I am unable to hold that this is a case of no evidence as contended by learned advocate for the petitioner. Since High Court cannot act as a second Court of first appeal, any challenge to the disciplinary proceedings, on the contentions raised by the learned advocate for the petitioner are not acceptable and is required to be rejected. 24. For imposing the penalty in a disciplinary proceedings against the Government servant actual monetary loss is not to be considered at all, any potential threat of possible misuse of ‘F’ Forms for evasion of tax is sufficient. It is the factum of misconduct of the delinquent, which is relevant. The manner in which the petitioner acted reflects complete lack of devotion to duty and of doubtful honesty. Therefore, punishment imposed withholding of 4 increments without future effect is not so disproportionate which Page 20 of 21 C/SCA/1281/2005 JUDGMENT may shock conscience of Court and therefore, I see no reason to interfere with the finding recorded by the Disciplinary Authority and confirmed by the Appellate Authority including that of the imposing punishment. 25. Therefore, this petition is rejected. Rule discharged. (UMESH A. TRIVEDI, J) ASHISH M. GADHIYA Page 21 of 21 "