“Big fish are not caught, you are after small level employee”: SC grants relief to class-4 officer against dismissal order - Business Guardian
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“Big fish are not caught, you are after small level employee”: SC grants relief to class-4 officer against dismissal order

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SC seeks Centre’s reply on fresh pleas against CAA

While orally remarking that “missing from duty is a major misconduct in paramilitary forces or the Army, but may not be so in a civilian employment”, the Supreme Court on June 30, 2022 in an extremely laudable, learned, landmark and latest judgment titled Union of India & Anr vs RK Sharma in Civil Appeal No. 4059/2015 criticised the Central Government for imposing the penalty of dismissal from service for unauthorized absence from duty on a Grade-IV employee in the Ministry of Steel. The Court orally observed bluntly, boldly and brilliantly that, “Missing from duty is a major misconduct in paramilitary forces or the army. Had it been that kind of duty, we would have immediately agreed. But in a civilian employment, in some mines department, that too a class four employee? It is not that he was handling some sensitive kind of assignments where he compromised with his duties. We are agreeable that he had absented from duty, so retire him compulsorily, throw him out, don’t keep him there, but allow his family to survive.” We also ought to note that the Court stated in its order that, “It is also undeniable that no action was taken against the officers who purportedly granted leave to the respondents despite not being competent to sanction the same.” The Court minced just no words to orally ask ASG Jayant Sud and senior advocate R Balasubramanian for the appellants stating that, “The big fish are not caught and you are after the blood of the small-level employee…Did you take action against the undersecretary or the section officer who granted the leave in excess of their power?”

To start with, this brief, brilliant, bold and balanced judgment authored by a Bench of Apex Court comprising of Justice Surya Kant and Justice JB Pardiwala sets the ball rolling by first and foremost putting forth in para 1 that, “The Union of India through Ministry of Steel and the Director of the said Ministry are aggrieved by the order dated 06.12.2012 passed by the High Court of Delhi whereby the High Court set aside the dismissal order dated 14.07.2000 as well as the order dated 18.02.2002 passed by the Central Administrative Tribunal, (“The Tribunal”, for short), upholding the said dismissal order passed against the respondent.”

Suffice it to say, the Bench then observes in para 2 that, “It is not necessary to give the factual matrix in detail and suffice it is to mention that the respondent was working as a Daftry (appears to be Grade-IV post). After the respondent had served for about seven years or so, he was served with a charge-memo dated 04.12.1998 proposing to hold an inquiry under Rule 14 of the Central Civil Services (Classification, Control and Appeal) Rules, 1965 (“1965 Rules” for short).”

As things stand, the Bench then mentions in para 3 that, “The charge-memo contained the following articles of charge against the respondent:

“Article I: That Shri R.K. Sharma while functioning as Daftry was absent from duty during following periods without prior permission of the competent authority:

From 09.02.1998 to 23.03.1998

From 24.03.1998 to 23.05.1998

Article II: That Shri R.K. Sharma while functioning as Daftry did not receive intentionally the letter No. 11(6)/98-HSM dated 16.04.1998 sent to him by registered post and in this manner he kept the office in dark about his residential address.

Article III: That Shri R.K. Sharma functioning as Daftry/Adhoc LDC was absent continuously from duty without prior sanction and intimation during the period 1993-98.

Article IV: That Shri R.K. Sharma while functioning as adhoc LDC/Daftry was not loyal towards his duties by keeping himself continuously absent from duty without prior sanction of leave.””

Simply put, the Bench then points out in para 4 that, “An inquiry was conducted and after concluding that charge Nos. I, III & IV had been proved, the Disciplinary Authority concurred with the Inquiry Report and imposed the punishment of dismissal from service of the respondent vide order dated 14.07.2000.”

As it turned out, the Bench then observes in para 5 that, “The respondent assailed the dismissal order before the Tribunal but his Original Application was turned down vide order dated 18.02.2002. Still aggrieved, the respondent approached the High Court. The Division Bench of the High Court vide impugned judgment dated 06.12.2012 allowed the Writ Petition and set aside the orders impugned therebefore. As a consequence thereto, the respondent was directed to be reinstated in service but without any back-wages.”

Needless to say, the Bench then states in para 6 that, “The appellants have now laid challenge to the aforesaid order of the High Court through the instant appeal.”

Quite rightly, the Bench then seeks to question in para 8 that, “The short question which falls for consideration is whether the punishment of dismissal from service on account of absence from duty for the period mentioned in Article 1 of the Charge-memo, is proportionate, reasonable and in conformity with Articles 14 and 16 of the Constitution of India?”

As we see, the Bench then observes in para 9 that, “Learned counsel for the appellants have rightly pointed out that besides the absence period, the respondent had on several occasions remained on Casual Leave/Earned Leave or other sanctioned leave also. It is pointed out that such leave was sanctioned by the officers who were not competent to do so. However, the appellants have not proved that the respondent was “willfully” absent from service during those periods. It remains a possibility that respondent merely acted under the faith that the officer in question had the power to approve his requests for leave. It is also undeniable that no action was taken against the officers who purportedly granted leave to the respondent despite not being competent to sanction the same.”

As a corollary, the Bench then observes in para 10 that, “In view of the above, we are of the considered opinion that no misconduct can be attributed to the respondent for the periods he availed one or the other sanctioned leave.”

Most significantly, the Bench then minces no words to mandate in para 11 that, “As regards to the period for which the respondent was absent from duty, we are satisfied that the punishment of dismissal from service is too harsh, disproportionate and not commensurate with the nature of the charge proved against the respondent. We are, therefore, of the view that the ends of justice would have been adequately met by imposing some lesser but major penalty upon the respondent.”

Equally significant is what is then envisaged in para 12 wherein it is postulated that, “The misconduct attributed to the respondent is based on the charge-memo dated 04.12.1998 with respect to which he was dismissed from service in the year 2000. We, therefore, do not deem it necessary to remit the case to the disciplinary authority after such a long spell of 22 years. Instead, we are inclined to invoke our power under Article 142 of the Constitution, keeping in mind the doctrine of proportionality and with a view to do complete justice between the parties. This Court has utilized Article 142 on numerous occasions in the past, such as in Hind Construction & Engineering v. Their Workmen AIR 1965 SC 917 and Management of the Federation of Indian Chambers of Commerce v. Their Workmen to ensure that the punishment meted out to a public sector employee for a violation of the applicable service laws/rules is not disproportionate to the infraction that he/she has committed. The doctrine of proportionality is employed to examine whether the penalty that is imposed upon is congruent with the charges brought against the delinquent employee.”

It is worth noting that the Bench then directs in para 13 that, “We, thus, allow this appeal in part and dispose of the same in the following terms:

(i) The order of the High Court dated 06.12.2012 to the extent of setting aside the dismissal dated 14.07.2000 is upheld.

(ii) The respondent is ordered to be reinstated in service but he shall be deemed to have remained in service till he completed minimum “qualifying service” of 20 years to earn pension and other retiral benefits.

(iii) The respondent shall be deemed to have been `compulsorily retired from service’, with entitlement to pension, gratuity and other retiral benefits on completion of minimum qualifying service.

(iv) No arrears of pay shall be paid to the respondent from the date of dismissal from service i.e. 14.07.2000 till he is deemed to have completed the minimum “qualifying service”.

(v) The respondent, however, shall be entitled to arrears of pension and other retiral benefits, without any interest, provided that such arrears are paid within a period of four months from today. In the event of delay, the respondent shall be entitled to interest @ 6% per annum on delayed payment.

(vi) It is made clear that the above stated order shall not constitute a precedent as the same has been passed by invoking power under Article 142 of the Constitution.”

Finally, the Bench then concludes by holding in para 14 that, “The Civil Appeal is disposed of in the aforesaid terms.”

In sum, we thus see that the Apex Court minces no words to take potshots at the Central Government for imposing a very strict punishment on Class-4 officer in the Ministry of Steel of dismissal from service for unauthorisedly being absent from duty. The Apex Court was very direct in saying to the Central Government that you are after a small level employee and big fish are not being caught. No doubt, what all the Apex Court has stated carries a lot of relevance and Centre must definitely pay heed to what the Apex Court Bench comprising of Justice Surya Kant and Justice JB Pardiwala have ruled in this notable case so elegantly, eloquently and effectively and thus act accordingly! There can be just no denying it!

Most significantly, the Bench then minces no words to mandate in para 11 that, “As regards to the period for which the respondent was absent from duty, we are satisfied that the punishment of dismissal from service is too harsh, disproportionate and not commensurate with the nature of the charge proved against the respondent. We are, therefore, of the view that the ends of justice would have been adequately met by imposing some lesser but major penalty upon the respondent.”

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Policy&Politics

Govt extends date for submission of R&D proposals

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The Government has extended the deadline for submission of proposals related to R&D scheme under the National Green Hydrogen Mission. The R&D scheme seeks to make the production, storage, transportation and utilisation of green hydrogen more affordable. It also aims to improve the efficiency, safety and reliability of the relevant processes and technologies involved in the green hydrogen value chain. Subsequent to the issue of the guidelines, the Ministry of New & Renewable Energy issued a call for proposals on 16 March, 2024.

While the Call for Proposals is receiving encouraging response, some stakeholders have requested more time for submission of R&D proposals. In view of such requests and to allow sufficient time to the institutions for submitting good-quality proposals, the Ministry has extended the deadline for submission of proposals to 27th April, 2024.

The scheme also aims to foster partnerships among industry, academia and government in order to establish an innovation ecosystem for green hydrogen technologies. The scheme will also help the scaling up and commercialisation of green hydrogen technologies by providing the necessary policy and regulatory support.

The R&D scheme will be implemented with a total budgetary outlay of Rs 400 crore till the financial year 2025-26. The support under the R&D programme includes all components of the green hydrogen value chain, namely, production, storage, compression, transportation, and utilisation.

The R&D projects supported under the mission will be goal-oriented, time bound, and suitable to be scaled up. In addition to industrial and institutional research, innovative MSMEs and start-ups working on indigenous technology development will also be encouraged under the Scheme.

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Policy&Politics

India, Brazil, South Africa to press for labour & social issues, sustainability

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The Indian delegation also comprises Rupesh Kumar Thakur, Joint Secretary, and Rakesh Gaur, Deputy Director from the Ministry of Labour & Employment.

India, on Thursday, joined the G20’s two-day 2nd Employment Working Group (EWG) meeting under the Brazilian Presidency which is all set to address labour, employment and social issues for strong, sustainable, balanced and job-rich growth for all. India is co-chairing the 2nd EWG meeting, along with Brazil and South Africa, and is represented by Sumita Dawra, Secretary, Labour & Employment.

The Indian delegation also comprises Rupesh Kumar Thakur, Joint Secretary, and Rakesh Gaur, Deputy Director from the Ministry of Labour & Employment. India has pointed out that the priority areas of the 2nd EWG at Brasilia align with the priority areas and outcomes of previous G20 presidencies including Indian presidency, and commended the continuity in the multi-year agenda to create lasting positive change in the world of work. This not only sustains but also elevates the work initiated by the EWG during the Indian Presidency.

The focus areas for the 2nd EWG meeting are — creating quality employment and promoting decent labour, addressing a just transition amidst digital and energy transformations, leveraging technologies to enhance the quality of life for al and the emphasis on gender equity and promoting diversity in the world of employment for inclusivity, driving innovation and growth. On the first day of the meeting, deliberations were held on the over-arching theme of promotion of gender equality and promoting diversity in the workplace.

The Indian delegation emphasized the need for creating inclusive environments by ensuring equal representation and empowerment for all, irrespective of race, gender, ethnicity, or socio-economic background. To increase female labour force participation, India has enacted occupational safety health and working conditions code, 2020 which entitles women to be employed in all establishments for all types of work with their consent at night time. This provision has already been implemented in underground mines.

In 2017, the Government amended the Maternity Benefit Act of 1961, which increased the ‘maternity leave with pay protection’ from 12 weeks to 26 weeks for all women working in establishments employing 10 or more workers. This is expected to reduce the motherhood pay gap among the working mothers. To aid migrant workers, India’s innovative policy ‘One Nation, One Ration Card’ allows migrants to access their entitled food grains from anywhere in the Public Distribution System network in the country.

A landmark step in fostering inclusion in the workforce is the e-Shram portal, launched to create a national database of unorganized workers, especially migrant and construction workers. This initiative, providing the e-Shram card, enables access to benefits under various social security schemes.

The portal allows an unorganized worker to register himself or herself on the portal on self-declaration basis, under 400 occupations in 30 broad occupation sectors. More than 290 million unorganized workers have been registered on this portal so far.

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Policy&Politics

India to spend USD 3.7 billion to fence Myanmar border

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India plans to spend nearly $3.7 billion to fence its 1,610-km (1,000-mile) porous border with Myanmar within about a decade, said a source with direct knowledge of the matter, to prevent smuggling and other illegal activities. New Delhi said earlier this year it would fence the border and end a decades-old visa-free movement policy with coup-hit Myanmar for border citizens for reasons of national security and to maintain the demographic structure of its northeastern region.

A government committee earlier this month approved the cost for the fencing, which needs to be approved by Prime Minister Narendra Modi’s cabinet, said the source who declined to be named as they were not authorised to talk to the media. The prime minister’s office and the ministries of home, finance, foreign affairs and information and broadcasting did not immediately respond to an email seeking comment.

Myanmar has so far not commented on India’s fencing plans. Since a military coup in Myanmar in 2021, thousands of civilians and hundreds of troops have fled from there to Indian states where people on both sides share ethnic and familial ties. This has worried New Delhi because of risk of communal tensions spreading to India. Some members of the Indian government have also blamed the porous border for abetting the tense situation in the restive north-eastern Indian state of Manipur, abutting Myanmar.

For nearly a year, Manipur has been engulfed by a civil war-like situation between two ethnic groups, one of which shares lineage with Myanmar’s Chin tribe. The committee of senior Indian officials also agreed to build parallel roads along the fence and 1,700 km (1,050 miles) of feeder roads connecting military bases to the border, the source said.

The fence and the adjoining road will cost nearly 125 million rupees per km, more than double that of the 55 million per km cost for the border fence with Bangladesh built in 2020, the source said, because of the difficult hilly terrain and the use of technology to prevent intrusion and corrosion.

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Policy&Politics

ONLY 2-3% RECOVERED FROM $2-3 TN ANNUAL ILLEGAL TRADE THROUGH BANKING: INTERPOL

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However, Stock highlighted the enormity of the challenge, noting that between 40% and 70% of criminal profits are reinvested, perpetuating the cycle of illicit financial activity.

In a press briefing held on Wednesday, Interpol Secretary General Jurgen Stock unveiled alarming statistics regarding the extent of undetected money laundering and illegal trade transactions plaguing the global banking network. Stock revealed that over 96% of the money transacted through this network remains undetected, with only 2-3% of the estimated USD 2-3 trillion from illegal trade being tracked and returned to victims.

Interpol, working in conjunction with law enforcement agencies and private financial sectors across its 196 member countries, is committed to combating the rising tide of fraud perpetrated by illicit traders. These criminal activities encompass a wide spectrum, including drug trafficking, human trafficking, arms dealing, and the illicit movement of financial assets.

Stock emphasized the urgent need to establish mechanisms for monitoring transactions within the global banking network. Currently, efforts are underway to engage banking associations worldwide in setting up such a framework. However, Stock highlighted the enormity of the challenge, noting that between 40% and 70% of criminal profits are reinvested, perpetuating the cycle of illicit financial activity. The lack of real-time information sharing poses a significant obstacle to law enforcement agencies in their efforts to combat money laundering and illegal trade.

Stock underscored the role of Artificial Intelligence (AI) in exacerbating this problem, citing its use in voice cloning and other fraudulent activities. Criminal organizations are leveraging AI technologies to expand their operations and evade detection on a global scale. Stock emphasized the importance of enhanced cooperation between law enforcement agencies and private sector banking groups. Realtime information sharing is crucial in the fight against illegal wealth accumulation.

Drawing inspiration from initiatives such as the “Singapore Anti-Scam Centre,” Stock called for the adoption of similar models in other countries to strengthen the collective response to financial crimes. In conclusion, Stock’s revelations underscore the pressing need for concerted action to combat global financial crimes. Enhanced cooperation between public and private sectors, coupled with innovative strategies for monitoring and combating illicit transactions, is essential to safeguarding the integrity of the global financial system.

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Policy&Politics

FM defends Atal Pension Scheme, highlights guaranteed returns

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Finance Minister Nirmala Sitharaman defended the Atal Pension Yojana (APY) against Congress criticism, asserting its design based on choice architecture and a guaranteed minimum 8% return. She emphasized the scheme’s opt-out feature, facilitating automatic premium continuation unless subscribers choose otherwise, promoting retirement savings. Sitharaman countered Congress allegations of coercion, stating the APY’s guaranteed returns irrespective of market conditions, supplemented by government subsidies.

Responding to Congress’s claim of scheme misuse, Sitharaman highlighted its intended beneficiaries – the lower-income groups. She criticized Congress for its alleged elitist mindset and emphasized the scheme’s success in targeting the needy. Sitharaman accused Congress of exploiting vote bank politics and coercive tactics, contrasting it with the APY’s transparent framework. The exchange underscores the political debate surrounding social welfare schemes, with the government defending its approach while opposition parties raise concerns about implementation and efficacy.

Finance Minister Nirmala Sitharaman’s robust defense of the Atal Pension Yojana (APY) against Congress criticism highlights the ongoing debate over social welfare schemes in India. Sitharaman’s assertion of the APY’s design principles, including its opt-out feature and guaranteed minimum return, underscores the government’s commitment to promoting retirement savings among lower-income groups. The Atal Pension Yojana, named after former Prime Minister Atal Bihari Vajpayee, was launched in 2015 to provide pension benefits to workers in the unorganized sector. It aims to address the significant gap in pension coverage among India’s workforce, particularly those employed in informal and low-income sectors. The scheme offers subscribers fixed pension amounts ranging from Rs. 1,000 to Rs. 5,000 per month, depending on their contribution and age at entry, after attaining the age of 60. Sitharaman’s response comes after Congress criticism alleging the APY’s inefficacy and coercive tactics in enrolment.

Congress General Secretary Jairam Ramesh described the scheme as poorly designed, citing instances of subscribers dropping out due to unauthorized account openings. However, Sitharaman refuted these claims, emphasizing the APY’s transparent and beneficiary-oriented approach. The finance minister’s defense focuses on three key aspects of the APY: Choice Architecture: Sitharaman highlights the opt-out feature of the APY, which automatically continues premium payments unless subscribers choose to discontinue.

This design element aims to encourage long-term participation and ensure consistent retirement savings among subscribers. By simplifying the decision-making process, the scheme seeks to overcome inertia and promote financial discipline among participants. Guaranteed Minimum Return: Sitharaman underscores the APY’s guarantee of a minimum 8% return, irrespective of prevailing interest rates. This assurance provides subscribers with confidence in the scheme’s financial viability and incentivizes long-term savings.

The government’s commitment to subsidizing any shortfall in actual returns further strengthens the attractiveness of the APY as a retirement planning tool. Targeting the Needy: Sitharaman defends the predominance of pension accounts in lower income slabs, arguing that it reflects the scheme’s successful targeting of its intended beneficiaries – the poor and lower-middle class. She criticizes Congress for its alleged elitist mindset and suggests that the party’s opposition to welfare schemes like the APY stems from a disconnect with the needs of marginalized communities. Sitharaman’s rebuttal also addresses broader political narratives surrounding social welfare policies in India.

She accuses Congress of exploiting vote bank politics and coercive tactics, contrasting it with the transparent and inclusive framework of the APY. The exchange underscores the ideological differences between the ruling Bharatiya Janata Party (BJP) and the opposition Congress, with each side advocating for their vision of social welfare and economic development. In addition to defending the APY, Sitharaman’s remarks shed light on the broader challenges and opportunities facing India’s pension sector.

Despite significant progress in expanding pension coverage through schemes like the APY, the country still grapples with issues such as financial literacy, informal employment, and pension portability. Addressing these challenges requires a multifaceted approach involving government intervention, private sector participation, and civil society engagement.

As India strives to achieve its vision of inclusive and sustainable development, initiatives like the APY play a crucial role in promoting economic security and social equity. Sitharaman’s defense of the scheme underscores the government’s commitment to addressing the needs of vulnerable populations and ensuring their financial well-being in the long run.

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Economic

Regulatory steps will make financial sector strong, but raise cost of capital

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India’s financial system regulator, the Reserve Bank of India (RBI), is demonstrating a serious commitment to improving governance and transparency at finance companies and banks, with the RBI’s recent measures aimed at curtailing lenders’ overexuberance, enhancing compliance culture and safeguarding customers.

While the global ratings firm has appreciated the RBI’s “diminishing tolerance for non-compliance, customer complaints, data privacy, governance, know-your-customer (KYC), and anti-money laundering issues”, it has cautioned that increased regulatory risk could impede growth and raise the cost of capital for financial institutions. “Governance and transparency are key weaknesses for the Indian financial sector and weigh on our analysis. The RBI’s new measures are creating a more robust and transparent financial system,” says S&P Global Credit Analyst, Geeta Chugh. “India’s regulator has underscored its commitment to strengthening the financial sector. The drawback will be higher capital costs for institutions,” Chugh cautions.

The RBI measures include restraining IIFL Finance and JM Financial Products from disbursing gold loan and loans against shares respectively and asking Paytm Payments Bank (PPBL) to stop onboarding of new customers. Earlier in December 2020, the RBI suspended HDFC Bank from sourcing new credit card customers after repeated technological outages. These actions are a departure from the historically nominal financial penalties imposed for breaches, S&P Global notes.

Besides, as the global agency points out, the RBI has decided to publicly disclose the key issues that lead to suspensions or other strict actions against concerned entities and become more vocal in calling out conduct that it deems detrimental to the interests of customers and investors. “We believe that increased transparency will create additional pressure on the entire financial sector to enhance compliance and governance practices,” adds Chugh. The global agency has also lauded the RBI’s recent actions demonstrating scant tolerance for any potential window-dressing of accounts.

These actions include the provisioning requirement on alternative investment funds that lend to the same borrower as the bank finance company. Amidst the possibility of some retail loans, such as personal loans, loans against property, and gold loans getting diverted to invest in stock markets and difficulty of ascertaining the end-use of money in these products, S&P Global underlines the faith of market participants that the RBI and market regulator, the Securities and Exchange Board of India, want to protect small investors by scrutinizing these activities more cautiously.

On the flip side, at a time of tight liquidity, the RBI’s new measures are likely to limit credit growth in fiscal 2025 (year ending March 2025). “We expect loan growth to decline to 14 per cent in fiscal 2025 from 16 per cent in fiscal 2024, reflecting the cumulative impact of all these actions,” says Chugh. The other side of the story is that stricter rules may disrupt affected entities and increase caution among fintechs and other regulated entities and the RBI’s decision to raise risk weights on unsecured personal loans and credit cards may constrain growth. Household debt to GDP in India (excluding agriculture and small and midsize enterprises) increased to an estimated 24 per cent in March 2024 from 19 per cent in March 2019. Growth in unsecured loans has also been excessive and now forms close to 10 per cent of total banking sector loans.

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