Ranganathan, J. - (1.) The respondent, C.S.N. Murthy, was an Assistant Engineer in the Telecommunications Training Centre at Hyderabad. He was normally due to retire from service in 1980. However, the provisions of Rule 560(j) of the Fundamental Rules were invoked in his case. A high powered committee consisting of the Secretary to the Ministry of Finance and the Joint Secretary to the Cabinet Scretariat reviewed the service records of 96 persons belonging to the Department. The committee recommended, on an overall assessment of the confidential records, that there was no justification for continuing the petitioner and two others (with whom we are not here concerned in service. Accepting the recommendations of the committee, the Posts and Telegraphs Board issued a notice on the respondent on 19-10-73 giving him notice of compulsory retirement under Fundamental Rule 560 (J) with effect from the expiry of three months from the date of service of the notice on him ' Consequent thereupon, the respondent's services came to an end, by way of compulsory retirement, in February, 1974.
(2.) The respondent filed a writ petition in the Andhra Pradesh High Court challenging the validity of the order of compulsory retirement but the writ petition was unsuccessful. However, the appeal preferred by him to a Division Bench of the High Court was allowed. The Division Bench, in its judgment and order dated 19-7-76, came to the conclusion that the impugned order of retirement was not founded on any relevant material and was arbitrary and capricious. The impugned order was, therefore, quashed and the petitioner was directed to be reinstated forthwith with all the benefits that could have accrued to him had the order not been implemented against him. The Union of India has preferred the present appeal.
(3.) The modalities for the invocation of Fundamental Rule 560(j) have been examined by a number of decisions of this Court. All these judgments have been reviewed and the legal principles applicable thereto have been summarised by B. P. Jeevan Reddy, J., speaking for the Supreme Court, in Baikuntha Nath Das v. Chief District Medical Officer, Baripada, JT 1992 (2) SC 1 . These principles have been set out in paragraph 32 of the judgment, which can be extracted here for purposes of convenient reference 32. The following principles emerge from the above discussion: (i) An order of compulsory retirement is not a punishment. It implies no stigma nor any suggestion of misbehaviour. (ii) The order has to be passed by the Government on forming the opinion that it is in the public interest to retire a Government servant compulsorily. The order is passed on the subjective satisfaction of the Government. (iii) Principles of natural justice have no place in the context of an order of compulsory retirement. This does not mean that judicial scrutiny is excluded altogether. While the High Court or this Court would not examine the matter as a appellate Court, they may interfere if they are satisfied that the order is passed (a) mala fide or (b) that it is based on no evidence, or (c) that it is arbitrary, in the sense that no reasonable person would form the requisite opinion on the given material; in short, if it is found to be a perverse order. (iv) The Government (or the Review Committee, as the case may be) shall have to consider the entire record of service before taking a decision in the matter - of course attaching more importance to record of and performance during the later years. The record to be so considered would naturally include the entries in the confidential records/ character rolls, both favourable and adverse. If a Government servant is promoted to a higher post notwithstanding the adverse remarks, such remarks lose their sting, more so, if the promotion is based upon merit (selection) and not upon seniority. (v) An order of compulsory retirement is not liable to be quashed by a Court merely on showing that, while passing it uncommunicated adverse remarks were also taken into consideration. That circumstance by itself cannot he a basis for interference. Interference is permissible only on the grounds mentioned in (iii) above. This aspect has been discussed in paras 29 to 31 above.;