Aadrikaa Legal Services (ALS)- Law I Litigation I Arbitration
Date: 10.10.2026
Bombay High Court Sets Aside Removal of National Insurance Employee, Orders Release of Retirement Benefits
This Short Article has been prepared & written by Advocate Madhumita Jha. The views expressed are based on her interpretation of the law. She can be reached at her email id jhamadhumita27@gmail.com .
The Bombay High Court has quashed the removal of former National Insurance Company employee Charanjit Singh Bright, holding that the insurer bypassed mandatory disciplinary safeguards and wrongly treated medically explained absence as abandonment of service.
Background of the dispute
Charanjit Singh Bright, who stated that he had served National Insurance Company Ltd. for about 36 years in roles including Development Officer, Assistant Administrative Officer and Assistant Manager, challenged disciplinary penalties and his eventual removal from service.
Bright said that he experienced serious health problems from 2005 onward, including heart disease, hypertension, obesity, degenerative spinal disease, sleep apnea, kidney-related ailments and orthopaedic complications. During this period, he was transferred from Mumbai to Vapi, then Pune, and shortly thereafter to Pimpri. He maintained that he repeatedly sought a transfer back to Mumbai to access specialist medical care.
The company later initiated disciplinary proceedings. Earlier penalties in 2009 reduced his basic pay, while an order dated April 8, 2013 removed him from service on the basis that he had remained unauthorisedly absent for more than 600 days. His appeal was rejected in June 2017, leading to the writ petition before the High Court.
Central legal issue: removal without a departmental inquiry
The Court confined its decision to the 2013 removal order and the 2017 appellate order. It did not examine the 2009 penalties because the challenge to those orders was raised too late.
The key question was whether National Insurance could impose the major penalty of removal without conducting a regular departmental inquiry.
Under the General Insurance (Conduct, Discipline and Appeal) Rules, 1975, removal from service is a major penalty that ordinarily requires a detailed inquiry. The company relied on Rule 30, which permits departure from that procedure only in exceptional circumstances, including where holding an inquiry is not reasonably practicable or where an employee has abandoned the post.
The Court found that the April 2013 removal order was passed without notice or a hearing and did not state any specific written reasons why a regular inquiry could not be held.
Why the Court found the companyβs action unlawful
The Division Bench held that the power to dispense with an inquiry is an exception, not a routine administrative option. Rule 30(ii) required the competent authority to record objective, specific and cogent reasons in writing showing that an inquiry was not reasonably practicable.
The removal order did not meet that test. The Court observed that merely invoking Rule 30(ii), without recorded reasons supported by objective material, was legally insufficient and violated principles of natural justice.
Relying on Supreme Court precedent, including Union of India v. Tulsiram Patel, the Court reiterated that disciplinary authorities cannot avoid an inquiry arbitrarily or merely because it is administratively convenient. The reasons for dispensing with an inquiry must be capable of judicial review.
Medical absence did not establish abandonment of service
The Court also rejected the companyβs reliance on Rule 30(iv), which concerns abandonment of post. It held that prolonged absence alone does not prove that an employee intended to permanently sever the employment relationship.
In this case, Bright had repeatedly communicated with the employer about his health, submitted medical material, requested medical leave and a Mumbai transfer, asked for an inquiry at Mumbai or evidence to be recorded through a commission, and applied under the Voluntary Separation Scheme. The Court found that these actions showed an intention to remain connected with employment, rather than an intention to abandon it.
The judgment also noted that the company had sent a retired Assistant Commissioner of Police to verify Brightβs condition. According to the Courtβs findings, the officer visited Bright and found him bedridden, but the resulting report was not relied upon or disclosed by the company.
The Court emphasized that abandonment is a question of intention and cannot be presumed from illness-related absence where the employee continues to communicate and assert service rights.
Companyβs objections rejected
National Insurance argued that the matter was a private contractual employment dispute and therefore not suitable for writ jurisdiction. The Court disagreed, holding that the company is βStateβ for the purposes of Article 12 of the Constitution and that the alleged misuse of the disciplinary rules raised a public-law issue.
The company also alleged that Bright had suppressed facts, including details concerning transfers, unauthorised absence and loan defaults. The Court found no suppression that would disentitle him to relief. It further held that alleged defaults on housing and vehicle loans were separate matters for which the company had already pursued recovery proceedings and could not justify refusing relief in the service dispute.
High Courtβs directions
The Bombay High Court:
- Quashed the removal order dated April 8, 2013 and the appellate order dated June 5, 2017.
- Directed the company to pay any back wages due for periods when Bright had actually worked and was not on leave.
- Declined to grant back wages for periods during which he was not working and was on leave.
- Ordered release of all retirement benefits, including pension, with simple interest at 9% per year from the date of superannuation until payment.
- Directed payment of provident fund dues under the companyβs trust rules, also with simple interest at 9% per year from the date of superannuation until payment.
- Made no order as to costs.
Significance of the ruling
The ruling reinforces that employers governed by statutory disciplinary rules must follow prescribed inquiry procedures before imposing major penalties. An employer cannot label long-term absence as βabandonmentβ without evidence of a clear and voluntary intention by the employee to leave service.
It also underscores that serious medical circumstances, ongoing communication with the employer and repeated requests for accommodation may directly contradict an allegation of abandonment. Where an organization seeks to dispense with a departmental inquiry, it must record defensible reasons in writing and demonstrate that an inquiry was genuinely impracticable.
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Source: Bombay High Court
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