Ch Ramakoti Lingeswara Rao Vs the State of Andhra Pradesh

The present Writ Petition is filed questioning the action of the Respondents in not releasing the gratuity and earned leave contrary to the A.P. Revised Pension Rules, 1980,as illegal and arbitrary.

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The facts leading to the filing of the writ petition are as follows:

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The Petitioner had retired from service as Chief Engineer from the Respondent No. 3 Corporation on attaining the age of superannuation on 28.02.2022. While in service, a criminal case was registered against the Petitioner for the offense punishable under Section 13 (2) r/w Section 13 (1) (e) of the Prevention of Corruption Act on the allegation of having assets disproportionate to the known source of income. After investigation, a charge sheet has been filed, which was taken cognizance of by the concerned Court and numbered as C.C.No.35 of 2023, and the said case is pending for trial. While so, the present Writ Petition is filed for grant of gratuity and earned leave.

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Learned counsel for the Petitioner while relying on the Rule 9 of the A.P. Revised Pension Rules, 1980, which provides for withholding of pensionary benefits and gratuity only in the event of any loss caused to the Respondent Corporation, contends that in the present case as there is no loss caused to the Respondent Corporation, the Petitioner would be entitled to gratuity and pension.

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Learned Standing Counsel for the respondent Corporation would submit that the proviso to Rule 9 of the A.P. Revised Pension Rules, 1980, empowers the competent authority to withhold or withdraw pension or gratuity, either in whole or in part, where an employee is found guilty or upon conviction in a court of law regarding the offenses of grave charges of misappropriation, bribery, bigamy, corruption, etc. He would further submit that once gratuity is disbursed, the power of withholding gratuity as contemplated under the proviso to Rule 9 cannot be exercised, and such a situation is not the intent or understanding of the said proviso.

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Heard the respective counsel.

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6. The provision to Rule 9 of the AP Revised Pension Rules,

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1980, reads as under:

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“9. Right of Government to withhold or withdraw pension :-

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(1) The Government reserves to themselves the right of withholding a pension or gratuity, or both, either in full or in part, or withdrawing a pension in full or in part, whether permanently or for a specific period and of ordering recovery from a pension or gratuity of the whole or part of any pecuniary loss caused, to the Government and to the local authority if, in any departmental or judicial proceedings the pensioner is found guilty of grave misconduct or negligence during the period of his service, including service rendered upon re-employment after retirement:

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Provided that the Andhra Pradesh Public Service Commission shall be consulted before any final orders are passed. 1 [“However, consultation with Andhra Pradesh Public Service Commission is not necessary, when the pensioner is found guilty in any judicial proceedings”.

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Provided further that a part of pension is withheld or withdrawn, the amount of such pension shall not be reduced below the limit specified in sub-rule (5) of Rule 45.

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“Provided also that the penalty of withholding of entire pension or gratuity or both may be imposed against the retired Government servant upon being found guilty or upon conviction in a court of law for the offences of grave charges namely proved cases of misappropriation, bribery, bigamy, corruption, moral turpitude, forgery, outraging the modesty of women and misconduct.”

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The above extracted proviso provides for a right to the employer to withhold the gratuity and earned leave in entirety

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when an employee is found guilty or convicted by a Court of law with regard to grave offenses of misconduct or corruption, etc.

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In the present case, the Petitioner is facing grave allegations of having assets disproportionate to the known source of income, and in the event of his conviction, the Respondent Corporation would have a right as provided under the above extracted proviso to withhold the gratuity and pension in their entirety as contended by the learned Counsel for the Respondents. In the event the gratuity and pension are disbursed to the Petitioner, there is no scope for the Respondent Corporation to withhold the gratuity, and that is not the purpose of the intent of the proviso.

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However, as regards the leave encashment, the Division Bench of this Court in W.A. No. 196 of 2022, dated 16.02.2022, while considering a case of an individual with regard to the criminal case and for the grant of gratuity and leave encashment benefits, interpreted the Rule 52(c) of the Rules, 1980 held that the petitioner therein is not entitled to gratuity but would be entitled to leave encashment. In the light of the decision of the Division Bench of this Court, the Petitioner is not entitled to

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gratuity for the present; however, he would be entitled to the leave encashment benefits as held by the Division Bench of this Court in W.A. No. 196 of 2022. The relevant part of the said judgment reads as under:

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“ For the foregoing discussion, the said part of the impugned Order passed by the learned Judge allowing payment of 80% of the retirement gratuity to the Writ Petition is set aside. However, we observe that the Writ Petition is entitled to leave encashment”.

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9. Accordingly, the Writ Petition is disposed of with the following directions:

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i) The Petitioner is not entitled to a grant of gratuity for the present, and the said issue can be agitated subject to the outcome of the criminal case against the Petitioner.

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ii) The Respondent Authorities are directed to release the leave encashment to the Petitioner within a period of four weeks from the date of receipt of a copy of this Order.

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iii) There shall be no order as to costs.

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As a sequel, pending applications, if any, shall stand closed.

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__________________ NYAPATHY VIJAY, J

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Date: 18.12.2025 eha

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THE HONOURABLE SRI JUSTICE NYAPATHY VIJAY