Absence Of Prejudice Not Sole Ground To Brush Aside Principles Of Natural Justice: Andhra Pradesh High Court

The Andhra Pradesh High Court has quashed orders passed by the concerned Depot Manager deducting amounts from the salaries of the drivers and conductors working in the concerned depot of the Andhra Pradesh State Road Transport Corporation, on the ground of non-compliance of principles of natural justice. 

In doing so the court observed that the corporation had not followed the procedure prescribed under Andhra Pradesh State Road Transport Corporation Employees (Classification, Control and Appeal), Regulations, 1967. It further underscored that the doctrine of prejudice does not replace of principles of natural justice but operates as an integral part of the same and the projection of an argument of prejudice would not by itself be a sole ground to brush aside the applicability of principles of natural justice.

Justice Maheswara Rao Kuncheam in his order said:

"Admittedly, the petitioners are employees working in the respondents' Corporation. The employees in the respondents' Corporation service conditions are under the Regulations, 1967...A plain reading of the Regulations, 1967 clearly stipulates that the 1st respondent Corporation is duty bound to issue prior notice and to give an opportunity to the concerned and then only, empowered to impose the penalties against the employees. Whereas, in the instant case, apparently, the 1st respondent – Corporation has not pleaded in its counter that they followed the above stated procedures prescribed in the Regulations, 1967 before deducting amounts from the salaries of the petitioners. In the absence of procedural pre-requisites, straight away recovering the amounts from the salaries of the petitioners is unknown to law". 

The court further perused the corporation's counter and observed that it merely stated about the internal correspondence and other departmental proceedings, but did not address the key point regarding the violation of the 1967 Regulations as well as principles of natural justice. 

With respect to the argument that in the absence of prejudice, the principles of natural justice may not be applicable, the court said:

"In this context, adjudicatory forums must examine the factual circumstances by applying a test: whether there has been a complete denial of opportunity or a failure to provide reasonable opportunity. A complete denial of opportunity directly constitutes a gross violation of the principles of natural justice. By contrast, where reasonable opportunity is not afforded, the doctrine of prejudice falls within the scope of judicial scrutiny. In essence, the doctrine of prejudice does not supplant the principles of natural justice but operates as an integral part. Therefore, mere projection of argument of prejudice by itself is not a sole ground to brush aside the applicability of principles of natural justice”.

Background

The court was hearing a plea moved by permanent employees of the Andhra Pradesh State Road Transport Corporation who were discharging duties as Drivers and Conductors in a Depot (Respondent 3).

The petitioners, had challenged an office order of December 2016 issued by Respondent 3-Depot Manager, whereby, the amounts of recovery were ordered to be made from the respective salaries of the petitioners without any prior notice or without conducting any enquiry in accordance with 1967 Regulations. 

The respondents argued that due to the large scale financial irregularities and discrepancies highlighted by the Test Audit Party in its inspection, the Personnel Officer, Kadapa and members of Corporation, after conducting a detailed inquiry, concluded in their report that some of the employees misutilised the Muster due to which Corporation sustained a loss of Rs. 5,27,201.71. Consequently, the Regional Manager, Andhra Pradesh State Road Transport (Respondent 2) directed the Depot Manager to recover the amount in three monthly instalments from the monthly salaries of the petitioners.

Findings

The court observed that the report highlighting the financial irregularities were not disclosed to the petitioners. Thus, the Court held the Depot on its own perception, without application of any reasonable methodology or yardstick, fixed the liability of payment of total fiscal loss upon the petitioners by fixing the different amounts on its own, which not only contravened the 1967 Regulations, but also violated the principles of natural justice.

The court reiterated that principles of natural justice have been followed since ancient times, “right from gross root level (village Panchayats) to Emperor's Assembly”. After relying on multiple judgements of the Supreme Court, including A.K Kraipak v. Union of India (1969) and Maneka Gandhi Vs Union of India (1978) the Court held that the facet of Audi Alteram Partem, which means that no person can be condemned or punished by the Court without having a fair opportunity of being heard, was not followed, thereby, leading to a violation of the principles of natural justice.

In this regard, the Court held,

“…the 1st respondent Corporation authorities without following the procedure enunciated in the Regulations, 1967 coupled with the fact that, non-adhering the principles of natural justice, by straightaway deducting amounts from the salaries of the petitioners is per-se illegal, arbitrary and liable to be set aside. Before parting with the instant case, this court in view of phenomenal importance attached to the principles of natural justice, in adjudicating the cases day-in and day-out, by the judicial, quasi-Judicial administrative authorities in vivid foras, should be complied with the principles of natural justice in its true letter and spirit then only, it is paving the way to reach the objects and intendment of our Indian Constitution.”

The court allowed the plea and the respondents were directed to return the amounts recovered from the salaries of the petitioners within three months.

Case Details:

Case Number: WRIT PETITION NO: 2873/2017

Case Name: V.S. Rayudu, S/o. Gopal, Occ: Driver and Others v. Andhra Pradesh State Road Transport Corporation

Date: 28.03.2025

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