Holding

The order of discharge under Section 22 of the Army Act is valid despite the erroneous citation of Section 20, and the court of inquiry’s findings may lawfully support the administrative termination of service.

Summary

Ram Sunder Ram, a Petrol, Oil and Lubricants clerk in the Indian Army, was alleged to have received illegal money for the clandestine sale of gas. A court of inquiry found him guilty of a prejudicial act, after which he was shown cause; his reply was deemed unsatisfactory and he was discharged from service. He challenged the discharge in the High Court, where a single judge set it aside on natural‑justice grounds, but a division bench reinstated the discharge. On appeal, the Supreme Court held that the discharge was correctly made under Section 22 of the Army Act (the reference to Section 20 being a clerical error does not invalidate the power exercised), that the court of inquiry is a fact‑finding body and its evidence may be used for administrative discharge, and that the discharge was a termination of service simpliciter, not a punitive sanction. Consequently, the appeal was dismissed and the division‑bench order affirmed.

Issues considered

The validity of discharging an Army personnel under Section 22 of the Army Act when the order cites Section 20.
Whether a court of inquiry can be used as the basis for administrative discharge without a court‑martial under Section 63.
Whether the appellant was denied principles of natural justice in the discharge process.
Whether the discharge constitutes a punitive punishment requiring a court‑martial.
Whether the mis‑citation of the statutory provision vitiates the order of discharge.

Legislation cited

Army Act, 1950s. 20, s. 22, s. 23, s. 63
Army Rules, 1954s. Rule 12, s. Rule 13, s. Rule 177

Subjects

Army Actdischargecourt of inquirynatural justicemilitary disciplinetermination of servicepunitive dischargeSection 22Section 63Army Rules

Judgment

A RAM SUNDER RAM
v.
UNION OF INDIA & ORS.
- <-.
'

JULY 11, 2007

B [TARUN CHATTERJEE AND LOKESHWAR SINGH PANTA, Jl]

-j-
Army Act, 1950; Ss. 20, 22 and 63/Army Rules, 1954; Rr. 12, 13 and ~
177: Indiscipline-Prejudicial act to good order-Employee serving as Petrol,
Oil and Lubricant Clerk allegedly received money from an outsider for
c selling of gas illegally-Complaint-Court of inquiry-Authority found him
guilty of prejudicial act to good order and military discipline u/s. 63 of the
act and discharged him from service-Challenge to-Dismissed by High
Court-On appeal, Held: Before the Court of inquiry, the delinquent was
given proper and adequate opportunity to cross examine the witnesses,
D which he did not chose to avail-Having found the cause shown by the
delinquent unsatisfactory, the competent authority ordering his discharge r
from service in exercise ofpower conferred on it mentioning wrong provisions ..,..
of law-In fact, order of discharge could be passed u/s. 22 of the Act and not
u/s. 20 of the Act-Merely because a reference was made to a wrong provision
of law, that by itself does not vitiate the exercise of power by the authority
E so long as power does exist and traceable to the source available' in law-
Order ofdischarge in question is an order of termination of service simplicitor
without casting or attaching any stigma to the conduct of the employee,
hence cannot be termed to be punitive in nature/prejudicial to the future
employment.
F
Appellant was working as Clerk in the Army establishment. While 'r -

performing the duties of Petrol, Oil and Lubricants (POL) Clerk, anonymous
complaints were received against him. The competent authority ordered
convening of the court of inquiry. The appellant was detained for interrogation
under custody. During interrogation, he had made confessional statement of
G receiving illegal money of Rs. 12,500/- from the owner of a Pansari Shop for
selling 87 MT Gas illegally in connivance with a driver. Later, he deposited
Rs. 5,200/- out of Rs. 12,500/- allegedly received by him as illegal money.
The Court of Inquiry submitted its report to the competent authority. The )',-+

appellant, having been found guilty of act prejudicial to good order and military -·-'
H 292
RAM SUNDER RAM v. U.0.1. 293
discipline, charged him· under Section 63 of the Army Act and a show cause A
..,_ notice was issued to him. The appellant showed cause which was found
unsatisfactory. The c'ompetent authority discharged him from service.
Aggrieved, the appell~nt challenged the order in the High Court The Single
Judge of the High)Ziurt set aside the order of discharge interalia on the
/
ground 90.l.!*'ltion of the principles of natural justice and directed the B
respefndents to reinstate the appellant with 25% of his arrear of salaries. In
_yr{it appeal filed by the Union of India, the order of the Single Judge was set
~aside by a Division Bench of the High Court. Hence the present appeal.
_J
Appellant contended that the order of removing him from service was
vitiated being contrary to Section 63 of the Army Act, which provides for C
imposing any kind of punishment only after conviction by court-martial; that
the proceedings of the Court oflnquiry have been used as evidence against
him contrary to Rule 12 of the Army Rules, 1954 as no discharge certificate
was prepared and sent to the appellant; that the Court of Inquiry, acting under
· the Army Rules, collects evidence during fact finding proceedings and no one
is charged of any offence in that proceedings; that the· evidence collected during D
inquiry is not admissible against him in terms of Section 63 of the Act; that
the appellant was discharged from service, as a result thereof his entire past
service has been forfeited and he has been deprived of the benefit of pension
as also future employment in any other civil service; and that he was
administratively discharged from service contrary to the provisions of Section E
63 and there is no provision to impose major penalty in the form of termination
of service of the appellan,t by the Authority under the guise of discharge from
service in exercise of power under Section 20 of the Act.

Respondent submitted that the authority has passed the order of
discharge simplicitor under Section 22 of the Act and Section 20 of the Act F
•, ., appears to have been wrongly mentioned by the authority in the order of
discharge.

Dismissing the appeal, the Court

HELD: I.I. The order of discharge of the appellant from the Army G
service has been passed by the competent authority under Section 22 of the
Army Act read with Rule 13 on the grounds covered under Column (2)(v) of
the Table, after affording adequate opportunity to him of showing cause before
the order of discharge came to be passed; that the court of inquiry was formed
under Rule 177 of the Army Rules and the purpose of court of inquiry was to
H
)-
294 SUPREME COURT REPORTS [2007) 8 S.C.R.

A collect the evidence for the information to superior officers to make up their •
mind about the involvement of the appellant and the other army officials in _.,.,.
the racket of clandestine sale of petrol. In the court of inquiry, the appellant
was heard and was given proper and adequate opportunity to cross-examine · .I
the witnesses, which he did not choose to avail. IPara 19..l~~99-B-C)
'- ....
B 1.2. The appellant had shown cause vide reply to the show"t:.:u:s ·
issued to him by respondent No. 5. The competent authority considered t ·e
reply of the appellant in right perspective and found the same not satisfactory.
Therefore, the competent authority passed the order of discharge of the
appellant from the army service with immediate effect in exercise of the power
c under Section 20 of the Army Act. It appears that the competent authority
has wrongly quoted Section 20 in the order of discharge whereas, in fact. the
order of discharge has to be read having been passed under Section 22 of the
Army Act. It is well settled that if an authority has a power under the law
merely because while exercising that power the source of power is not
specifically referred to or a reference is made to a wrong provision of law,
D that by itself does not vitiate t~e exercise of power so long as the power does
exist and can be traced to a source available in law. Thus, quoting of wrong
,...
provision of Section 20 of the Act in the order of discharge of the appellant
by the compet~t authority does not take away the jurisdiction of the authority .....
under Section 22 of the Army Act. Therefore, the order of discharge of the
appellant from the army service cannot be vitiated on this sole ground.
E
[Para 20) [299-E-H; 300-A)

N. Mani v. Sangeetha Theatre & Ors., [2004) 12 SCC 278, relied on.

1.3. A plain reading of the order of discharge shows that it is an order
of termination of service simplicitor without casting or attaching any stigma
F
to the conduct of the appellant, therefore the said order cannot be termed to
,_..,.
be punitive in nature or prejudicial to the future employment of the appellant
in getting employment in civil service. Thus, the contention of the appellant
that the order of discharge is punitive in nature does not merit acceptance.
[Para 2011300-A-B)
G
Ex. Naik Sardar Singh v. Union of India & Ors., AIR (1992) SC 417;
Major Suresh Chand Mehta v. The Defence Secretary (UO.I) & Ors., AIR
(1991) SC 483; Lt. Col. Prithi Pal Singh Bedi v. Union of India & Ors., AIR .
(1982) SC 1413 and S. N. Mukherjee v. Union of India, (1990] 4 SCC 594,
held inapplicable.
)< ...... .
F
H
_/

RAM SUNDER RAM i·. U.0.1. [LOKESHWAR SINGH PANT A. J.] 295
4. There is ample evidence on record in support of the judgment and A
order of the Division Bench of the High Court and there is nothing that would
justify this Court interferring with it. fPara 21 I (300-FJ

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2951 of2007.

From the Judgment & Order dated I0.12.2004 of the High Court at B
Calcutta in M.A.T. No. 2856 of 1997.

K.S. Bhati. Aishwarya Bhati. Sweta Rani and Rekha Rani for the Appellant.

Vikas Singh. ASG .. Indra Sawhney. Rajni Singh. R.C. Kathia. Prabhat
Ranjan and Anil Katiyar for the Respondents. C
The Judgment of the Court was delivered by

LOKESHWAR SINGH PANTA, J. I. Special leave granted.

2. This appeal. by special leave. has been preferred by Ram Sunder Ram D
---i (appellant herein) against the judgment and order dated 10.12.2004 of a Division
~ Bench of the High Court of Calcutta by which M.A.T. No.2856 of 1997 filed
by the Union of India and Others (respondents herein) was allowed and the
judgment and order dated 07.08.1997 of a learned Single Judge, allowing the
Writ Petition (C.0. No.12843 ('\\') No.1991) filed by the appellant was set aside.
E
3. The appellant filed writ petition in the High Court of Calcutta for
setting aside the order of discharge from -the Army Service passed by the
Commander, 33 Corps Artillery Brigade (respondent No.'?,in the present ~ppeaf) ..
who was competent authority under Rule 13 of the Army Rules 1954.

4. The learned Single Judge allowed the writ petition inter aii~-.on the F
ground that the principles of natural justice have not been followed by the
competent authority while passing the order of discharge.

5. The respondents then preferred writ appeal before the Division Bench
of the High Court, which allowed the same by the judgment and order impugned G
by the appellant in this appeal before us.

6. On 26.09.1980, the appellarit was appointed as Cleaner in Class-IV with
. the Indian Armed Forces. On 23.09.1983, he became LDC in the Anny
establishment. On 03 .07 .1988, the appellant was deputed to perform the duties

H
296 SUPREME COURT REPORTS (2007) 8 S.C.R.

A of Petrol, Oil and Lubricants (POL) Clerk. On 09.08.1988, the competent authority >
'
ordered convening of the court of inquiry based upon certain anonymous
complaints, on the following issues:

'·A. Investigating the circumstances, under which quantity 70 KL of \

70 MT Gas issued to 5033 ASC Battalion against IOC installation, New )
B Jalpaiguri, has not been received by the Unit and pinpoints the
responsibility for the loss.

8. To scrutinize the records for the last two years and also to examine
the procedure being followed for receipt. demand. collection and
accounting the issue of POL in the operation of Kerbside Pump.
c
C. To indicate loopholes and suggest remedy and measures.

D. To indicate losses other than those mentioned in the order.'"

7. The court of inquiry deliberations was held by the authority between
D the period commencing from 16.08.1988 and 12.12.1988. On 06.10.1988, the
appellant was detained for interrogation under custody. During interrogation,
the appellant made confessional statement of receiving illegal money of Rs.
l 2,500/- from one Shri Rajendra Singh, owner of Pansari Shop, for sale of 87
MT Gas through BPLs and Kerbside Pump, kept by Dvr. Gde 11 Ramakant
Prasad of 'A' Coy 503 3 ASC Bn (MT). The appellant later on deposited Rs.
5,2001- out of Rs.12,500/-.

8. The court of inquiry was completed and on 24.08.1988 the enquiry
report was submitted to the competent authority.

9. The appellant, having been found guilty of prejudicial act to good
F order and military discipline. was charged under Section 63 of the Army Act.
1950 [for short the Army Act]. On 08.08.1989, Major H. S. Dhillon. Presiding
Officer, Summary of Evidence, sent a letter to the appellant and LDC J.P. Singh
directing them to be present otj. 9th August, 1989 at 1000 Hrs. for recording .
summary evidence. The evidenc·e was collected by the court of inquiry against
G the appellant and some other Army Officials. On 03 .07 .1991, the appellant was
informed by respondent No. 5 that while working with 'A' Coy 5033 ASC Bn
(MT). the appellant received Rs. 12.500/- as illegal money from Shri Rajendra
Singh, owner of Pansari shop and converted the said amount to self use, well
knowing it to be from sale of87 MT Gas through BPLs and Kerbside Pump,
kept by Dvr. Gde l l Ramakant Prasad of· A' Coy 5033 ASC Bn (MT). He was,
H therefore. asked to show cause within 15 days of the receipt of the notice as
-(
RAM SUNDER RAM,.. U.0.1. [LOKESHWAR SINGH PANT A. J.J 297

to why his services should not be tenninated for the lal'se committed by him. A
· After the appellant showed cause on 13.08.1991 which was found unsatisfactory.
the resrondent No.5 discharged him from service on 09.09.1991.

I 0. The appellant challenged the order of discharge from service in the
High Court of Calcutta. The learned Single Judge, as stateq above, set aside
the said order of discharge inter alia on the ground of violation of the B
principles of natural justice and directed the respondents to reinstate the
appellant with 25% of his arrear salaries as per the last pay drawn. further, it
was observed that the Anny Authority was not prevented from taking
appropriate steps against the appellant in accordance with law, if the); so
advised and technicalities alone ought not to stand in the way in that regard. C
In writ appeal. the order of the learned Single Judge came co be set aside by
a Division Bench of the High Court and the Writ Petition filed by the appellant
was accordingly dismissed.

11. Hence, this appeal by the appellant.
D
12. Capt. K. S. Bhati, learned counsel appearing fo1 the appellant, argued
as a question of law that the order of removing the appellant from service was
vitiated being contrary to Section 63 of the Anny Act, which provides for
imposing any kind of punishment only after conviction by court-martial. He
contended that the proceedings of the court of inquiry have been used ,as
evidence against the appellant contra!)' to Rule 12 of the Army Rules, 19$4 E
[hereinafter referred to as the Anny Rules] as no discharge certificate required
to be furnished under the provisions of Section 23 of the Anny Act was
prepared and sent to the appellant.

13. It was argued for the appellant that the court of inquiry, acting und¢r
the Anny Rules, collects evidence during fact finding proceedings and no on,e F
is accused or charged of any offence in that proceedings. It was argued th~t
the evidence collected during court of inquiry is not admissible against the
appellant in view of Section 63 of the Anny Act under which the case shoul~
have been remanded for trial by court-martial as was done in the case of other
anny personnel. who were dealt with by court-martial and they were retained G
in service by imposing minor punishment upon them whereas the appellant
was discharged from service, as a result thereof his entire past' service has
been forfeited and he has been deprived of the benefit of pension as also
future employment in any other civil service., The learned counsel contended
that the appeliant was administratively discharged from service contrary to the
provisions of Section 63 and there is no provision to impose major penalty in H
-\--

298 SUPREME COURT REPORTS (2007) 8 S.C.R.

A the fonn of termination of service of the appellant by the respondent No.5
under the guise of discharge from service in exercise of power under Section
20 of the Anny Act.

14. Mr. Vikas Singh, learned ASG appearing for the respondents, on the
other hand, made submissions to support the judgment of the Division Bench
B of the High Court. He contended that the well reasoned judgment of the
Division Bench does not suffer from any infinnity or perversity, warranting
interference by this Court. He contended that the authority empowered under
Rule 13 of the Anny Rules has passed the order of discharge simpliciter under
Section 22 of the Army Act and Section 20 appears to have been wrongly
C mentioned by the authority in the order of discharge.

15. We have given our thoughtful and anxious consideration to the
respective contentions of the parties and have perused the entire material on
record.

D 16. It is an admitted case of the parties that the appellant is governed
by the provisions of the Army Act and the Anny Rules framedJhereunder.
The scheme of the Anny Act is fairly clear. Chapter IV of the Act dea·ls with
Conditions of Service of persons subject to the Anny Act.
''..,_.

17. Section 20 of the Act deals with dismissal, removal or reduction by
E the Chief of the Anny Staff and by other officers. Section 191 of the Act
empowers the Central Government to make rules for the purpose of carrying
into effect the provisions of the Army Act. In exercise of the said power, the
Central Government has framed the rules called "The Anny Rules, 1954".
Chapter III of the Army Rules 4eals with dismissal, discharge, etc. Chapter
V of the Anny Rules deals with iilvestigation of charges and trial by court-
F martial. Rule 13 tabulates the category of the Army official, causes.'grounds
of discharge, the authorities competent to pass the order of discharge and the
manner of discharge.

18. It is not in dispute that the appellant has been discharged under
G Rule 13 column 2 (v) of the Table below sub-rule (3) on the grounds of·'all
other classes of discharge" by Brigade/Sub-Area C.:>mmander who, admittedly,
was competent authority to authorize discharge of the appellant. Column 4 of
the Table provides manner of discharge, which reads as under: r
"The Brigade or Sub-Area Commander before ordering the discharge
H shall, if the circumstances of the case permit give to the person whose
J
RAM SUNDER RAM i·. U.0.1. [LOKESHWAR Sll\GH PANT A. J.) 299

discharge is contemplated an opporrunity to show cause against the A
contemplated discharge".

19. The order of discharge of the appellant from the Anny service has
been passed by the competent authority under Section 22 of the Army Act
read with Rule 13 on the grounds covered under column (2}(v) of the Table,
after affording adequate opportunity to him of showing cause before the said B
order of discharge came to be passed. We are, however, satisfied on the
material placed before us that the court of inquiry was formed under Rule 177
,)
of the Anny Rules and the purpose of court of inquiry was to collect the
evidence for the information of superior officers to make up their mind about
the involvement of the appellant and the other army officials in the racket qf C
clandestine sale of petrol. In the court of inquiry. the appellant was heard and
was given proper and adequate opportunity to cross-examine the witnesses.
which he did not choose to avail. The respondents. in Para 20 of the counter
affidavit filed in opposition to the writ petition before the High Court havj!
made categorical statement that in the court of inquiry the appellant was given
full opportunity to defend his case and to cross-examine the witnesses who D
appeared and deposed before the Recording Officer, but the appellant was just
sining throughout the proceedings and did not avail the opportunity of cross-,
examining the witnesses. The appellant has not denied this assertion of the,
respondents in the rejoinder affidavit.

20. As noticed above, the appellant had shown cause vide reply dated, E
13:08.1991 (Annexure P6) to the show cause notice dated 03.07.1991 (Annexure
P5) issued to him by respondent No.5. The competent authority considered'
...
the reply of the appellant in right perspective and found the same not '
satisfactory. Therefore. on 09.09 .1991. the competent authority passed the .
order of discharge (Annexure P7) of the appellant from the army service with ,f
immediate effect in exercise ofJhe power under Section 20 of the Army Act.
It appears that the competent authority has wrongly quoted Section 20 in the
order of discharge whereas, in fact, the order of discharge has to be read
having been passed under Section 22 of the Anny Act. It is well settled that
if an authority has a power under the law merely because while exercising that
power the source of power is not specifically referred to or a reference is made G
to a wrong provision of law, that by itself does not vitiate the exercise of power
so long as the power does exist and can be traced to a source available in law
[see N. Mani v. Sangeetha Theatre & Ors., [2004] 12 SCC 278J. Thus, quoting
of wrong provision of Section 20 in the order of discharge of the appellant by
.the competent authority does not take away the jurisdiction of the authority H
\__

. 300 SUPREME COURT REPORTS (2007) 8 S.C.R .

A under Section 22 of the Army Act. Therefore, the order of discharge of the
appellant from the army service cannot be vitiated on this sole ground as
contended by the learned counsel for the appellant. A plain reading of the
order of discharge shows that it is an order of termination of service simpliciter
without casting or attaching any stigma to the conduct of the appellant,
B therefore the said order cannot be termed to be punitive in nature or prejudicial
to the future employment of the appellant in getting employment in civil
service. Thus. the contention of the learned counsel for the appellant that the
order of discharge is punitive in nature does not merit acceptance.

21. The Division Bench of the High Court has noticed the decisions of
C this Court relied upon by the appellant in the cases of Ex. Naik Sardar Singh
v. Union of India & Ors.. AIR (1992) SC 417, Major Suresh Chand Mehta v.
The Defence Secretary (U.0.1.) & Ors.. AIR (1991) SC 483, Lt. Col. Prithi Pal
Singh Bedi v. Union of India & Ors., AIR ( 1982) SC 1413 and S. N. Mukherjee
v. Union of India. [ 1990] 4 SCC 594. In the said decisions, this Court has dealt
with the matter of imposition of punishment on Army officials who were
D subjected to court-martial proceedings. In S. N. Mukherjee 's case (supra), this
Court was dealing with the requirement of recording of reasons by an authority
~·
exercising quasi-judicial function, besides challenge to the court-martial
proceedings. Reliance was placed on Paragraph 13 of the judgment of this
Court in the case of Major Suresh Chand Mehta (supra) In that case, this
E Court held that the court of inquiry, as provided under Rule 177 of the Army
Rules, is merely held for the purpose of collecting evidence and if so required,
to report in regard to any matter which may be referred to the officers and
such an inquiry is for the purpose of a preliminary investigation and cannot .. I
be equated with a trial or court-martial. All the above cited decisions are of
no assistance to the appellant in the peculiar facts of the case on hand. We
F are satisfied that there is ample evidence on record in support of the judgment
and order of the Division Bench of the High Court and there is nothing that
would justify this Court interfering with it. Therefore, the above arguments
of the appellant are unacceptable to us.

12. FC?r the reasons discussed above, the appeal is devoid of merit and
G it is, accordingly, dismissed. The judgment and order of the Division Bench
is affirmed. The parties, however, \are left to bear their own costs.

S.K.S. Appeal dismissed.