SC: No back wages for suspension period when dismissal reduced to lesser penalty—reinstatement not equivalent to exoneration

Case Name: Om Pal Singh v. Disciplinary Authority & Others
Date of Judgment: JANUARY 14, 2020
Citation: Civil Appeal No. 176 of 2020
Bench: Hon’ble Mr. Justice L. Nageswara Rao and Hon’ble Mr. Justice Hemant Gupta

Held: The Supreme Court ruled that an employee whose dismissal was substituted with a lesser penalty of pay reduction is not entitled to back wages or salary for the suspension period, as reduction in punishment does not amount to exoneration. The principle of “no work, no pay” applies where misconduct is proved.

Summary: The appellant, an officer of Muzaffarnagar Kshetriya Gramin Bank, was charge-sheeted in 2003 for misconduct, suspended, and dismissed from service in 2004. Following prolonged litigation, the penalty of dismissal was later modified by the Board of Directors in 2012 to reduction in pay by 15 stages for 8 years (later revised to 10 stages for 6 years). He retired in December 2012 but claimed full salary for his suspension period (2003–2012), arguing that dismissal having been set aside, he was entitled to back wages. The Supreme Court rejected this contention, holding that reinstatement due to a lesser punishment does not wipe out proven misconduct. Referring to J.K. Synthetics Ltd. v. K.P. Agrawal (2007) 2 SCC 433, the Court stressed that continuity of service and consequential benefits do not automatically follow in such cases.

Decision: Appeal dismissed. Disciplinary Authority’s decision denying salary for suspension period upheld.