Mitter, J. - (1.) The question involved in this appeal is, whether the whole proceedings of the Inquiry Committee constituted to inquire into the charges of mis-appropriation and handling cash belonging to Government without authority were vitiated by the violation of the principles of natural justice with the result that the order of dismissal passed subsequently on the respondent could not be sustained.
(2.) The facts necessary for the disposal of the appeal are as follows. The respondent used to serve as treasure guard in the Eastern Railway. A charge-sheet was issued by the Chief Cashier of the Railway on August 3, 1959 wherein allegations of misappropriation of cash belonging to Government were levelled against him. An Inquiry Committee consisting of three persons, namely, A. K. Roy Choudhury, Divisional Accounts Officer, Mani Chakraborty, Divisional Personnel Officer and R. N. Chatterjee, Divisional Engineer, was constituted to inquire into the charges. The charge-sheet had been issued after a fact finding committee of the very same persons had looked into the matter. After the proceedings of the Inquiry Committee had gone on for some time and some witnesses were examined A. K. Roy Choudhury was transferred to some other place and the vacancy in the committee was filled up by R. N. Vakil, his successor in office. It is common ground that the proceedings were not started afresh but were continued from the stage at which A. K. Roy Choudhury had dropped out. The committee submitted a report finding the respondent guilty of all the three charges framed against him. On 1st February, 1961, the Chief Accounts Officer, eastern Railway issued the second show cause notice and by an order dated March 20, 1961 he was dismissed from service. The respondent's appeal to the General Manager of the Railway was unsuccessful. He thereupon moved the High Court and a learned Single Judge quashed the order of dismissal. A Division Bench of the High Court dismissed the appeal of the Union of India. Hence the present appeal by special leave.
(3.) The Division Bench of the High Court took the view that where the persons who decided the matter finally were not the identical persons who had heard the witnesses at least in respect of a part of the evidence, the departmental proceedings were vitiated by the violation of the principles of natural justice. Reliance was placed mainly on the decision of this Court in Gullapalli Nageswararao vs. Andhra Pradesh State Road Transport Corporation, (1959) 1 Suppl. SCR 319 . According to the High Court: "If the enquiring authority has a duty to come to a conclusion as to the guilt of the delinquent upon an evaluation or assessment of the evidence then it is absolutely necessary that he who should decide the case should hear the evidence. It was impossible to evaluate the evidence of a witness taken on proxy, because one of the salient features of such proceedings is to observe the demeanor of the witness." The High Court turned down the contention that according to the Discipline and Appeal Rules for railway servants the Disciplinary Authority had to look into the record itself in which case any defect in the Inquiry Committee would not be fatal. The High Court held that if the report of the Inquiry Committee was tainted with illegality then the entire departmental enquiry was vitiated.;