SRI VENKATESH vs THE GENERAL MANAGER

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

TH
DATED THIS THE 14 DAY OF OCTOBER, 2026

PRESENT

THE HON'BLE MR. JUSTICE D K SINGH

AND


THE HON'BLE MR. JUSTICE H.SHANTHI BHUSHAN

WRIT PETITION NO. 8503 OF 2021 (L-TER)
C/W
WRIT PETITION NO. 11197 OF 2022 (L-TER)

IN WP No. 8503/2021:

BETWEEN:

THE GENERAL MANAGER
KARNATAKA GRAMIN BANK
(EARLIER CALLED AS PRAGATHI KRISHNA
GRAMEENA BANK) HEAD OFFICE
BELLARY – 583 104.
REP BY GENERAL MANAGER.









…PETITIONER
(BY SRI. K.N.VASUKI, ADVOCATE FOR
SRI. B.C.PRABHAKAR, ADVOCATE)

AND:

SHRI VENKATESH,
HIREVENKALAKUNTE,
TQ. YELBURGA, DIST. KOPPAL – 583 231.
…RESPONDENT
(BY SRI.K.NAGARAJU, ADVOCATE)

THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO I)
CALL FOR RECORDS LEADING TO THE PASSING OF THE
AWARD DATED 16/10/2020 PASSED BY THE CENTRAL
GOVERNMENT INDUSTRIAL TRIBUNAL-CUM-LABOUR COURT,
BENGALURU IN ID NO.2/2016 (ANNEXURE-H) AND II)ISSUE A
WRIT OF CERTIORARI OR ANY OTHER APPROPRIATE WRIT OR
DIRECTION QUASHING THE AWARD 16/10/2020 PASSED BY



Digitally
signed by
MALA K N
Location:
HIGH COURT
OF
KARNATAKA

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THE CENTRAL GOVERNMENT INDUSTRIAL TRIBUNAL-CUM-
LABOUR COURT, BENGALURU, IN ID NO.2/2016 (ANNEXURE-H)
AND ETC.,

IN WP NO. 11197/2022:

BETWEEN:

SRI. VENKATESH,
S/O RAANNA ELIGER,
AGED ABOUT 47 YEARS,
HIREVANKALAKUNTE,
YELABURGA TALUK,
KOPPAL DISTRICT-583 231.
...PETITIONER
(BY SRI.K.NAGARAJU, ADVOCATE)

AND:

THE GENERAL MANAGER
KARNATAKA GRAMIN BANK
EARLIER CALLED AS
PRAGATHI KRISHNA GRAMEENA BANK
HEAD OFFICE BELLARY-583 103.
...RESPONDENT
(BY SRI. K.N.VASUKI, ADVOCATE FOR
SRI. B.C.PRABHAKAR, ADVOCATE)

THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO
QUASH/ SET ASIDE THE AWARD DATED 16.10.2020
PASSED BY THE CENTRAL GOVERNMENT INDUSTRIAL
TRIBUNAL CUM LABOUR COURT BENGALURU IN ID No-
2/2016 TO THE EXTENT OF REINSTATE HIM INTO SERVICE
WITH OUT BACK WAGES VIDE ANNEXURE-A2 AND DIRECT
THE RESPONDENT TO REINSTATE THE PETITIONER IN THE
SERVICE OF THE BANK WITH ALL THE BACK WAGES AND
SUCH OTHER BENEFIT AND ETC.,
THESE PETITIONS HAVING BEEN HEARD AND RESERVED
FOR ORDERS ON 01.09.2026 AND COMING ON FOR
PRONOUNCEMENT THIS DAY, HON'BLE MR. JUSTICE
H.SHANTHI BHUSHAN PRONOUNCED THE FOLLOWING:

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CORAM: HON'BLE MR. JUSTICE D K SINGH
AND
HON'BLE MR. JUSTICE H.SHANTHI BHUSHAN

CAV JUDGMENT

(PER: HON'BLE MR. JUSTICE H.SANTHI BHUSHAN)

A Bank functions not merely through its financial
transactions but on the foundation of trust reposed in it
by its customers and the integrity of its employees.
Employees entrusted with the money and affairs of
depositors, customers and investors are required to
discharge their duties with the highest degree of
integrity, honesty, devotion and diligence. The greater
the trust reposed in an employee, particularly one
dealing with public money, the greater is the
responsibility and accountability attached to the
position, and consequently, the stricter the scrutiny of
his conduct. Any misconduct committed in the discharge
of such responsibility must, therefore, be examined in
the context of the nature of the duties entrusted to the
employee and the degree of trust reposed in him. At the
same time, the scope of judicial review in disciplinary
matters remains limited. Judicial review is directed
primarily against the decision-making process and not
against the decision itself, and the Court does not
ordinarily substitute its own view for that of the
competent disciplinary authority unless the decision-
making process suffers from illegality, arbitrariness,

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perversity or other recognised infirmity warranting
interference.
These Writ Petitions are preferred, challenging the order
dated 16.10.2020 in I.D.No.02/2016 passed by the Central
Government Industrial Tribunal-cum-Labour Court, Bengaluru
( CGIT ), where the CGIT allowed the workman's claim, directing
the Bank to reinstate him into service with continuity of service
for terminal benefits, but without back wages.
2. W.P.No.8503/2021 is preferred by the Karnataka
Gramin Bank whereas W.P.No.11197/2022 is preferred by the

workman.
W.P.No.8503/2021
Facts and pleadings:

3. The Respondent, Sri Venkatesh, joined the service
of the Bank on 27.04.1984. He was an employee of the
erstwhile Pragathi Krishna Gramin Bank, which is presently
known as Karnataka Gramin Bank. During the relevant period,
he was working as Office Assistant at Hiremannapur Branch. He
had worked in the said Branch from 13.08.2008 to 12.05.2012.

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4. The Petitioner-Bank was constituted under the
Regional Rural Banks Act, 1976 and was sponsored by Canara
Bank. It was jointly owned by Canara Bank, the Government of
India and the Government of Karnataka. The Bank came into
existence pursuant to the Government of India notification
dated 12.09.2005 consequent upon amalgamation of Sahyadri
Gramin Bank, Thungabhadra Gramin Bank, Kolar Gramin Bank
and Chitradurga Gramin Bank. Thereafter, by notification dated
23.08.2013 issued by the Ministry of Finance, Government of
India, Pragathi Gramin Bank and Krishna Gramin Bank were
amalgamated and the resultant Bank was known as Pragathi
Krishna Gramin Bank. The service conditions of the employees
were governed by the Pragathi Krishna Gramin Bank (Officers
and Employees) Service Regulations, 2013.

5. While the respondent was working at Hiremannapur
Branch, certain transactions relating to collection of cheques
and credit of the proceeds thereof came under scrutiny. The
Petitioner alleged that between 13.08.2008 and 12.05.2012,
respondent had committed several irregularities in association
with Sri Udaya Ravi, son of Doddappa, a customer of the Bank.

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6. A charge-sheet was issued to the respondent
alleging irregularities in relation to the said transactions, and
the respondent denied the allegations. He contended that he
was not responsible for the transactions and that the Enquiry
Officer had not properly considered his defence. He also
questioned the legality of the disciplinary proceedings on the
ground that the suspension order, charge-sheet and
punishment order had been signed by different authorities.

7. The first charge related to one Banker's cheque
purchased by Menadal Gram Panchayat and four cheques
purchased by Kandakur Gram Panchayat, all in favour of
Pragathi Gramin Bank, Hiremannapur Branch. According to the
Petitioner, the said instruments were collected by the Branch in
favour of Sri Udaya Ravi, who was maintaining SJJND Account
No.76. Respondent was alleged to have lodged the
instruments, prepared the connected slips and entered the
name of Sri Udaya Ravi in the Out Station Collection Register,
though the instruments were in favour of the Bank.

8. The second charge related to two cheques issued by
Gowripura Gram Panchayat and one cheque issued by
Dhanapur Gram Panchayat, also in favour of Pragathi Gramin

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Bank. The case of the Petitioner was that the said instruments
were collected through Gangavati branch in favour of Sri Udaya
Ravi though there was no endorsement in his favour.
Respondent was alleged to have lodged the instruments and
prepared the relevant slips showing Sri Udaya Ravi as the
person for whose account the proceeds were being collected,
thereby facilitating credit of the amounts to Account No. SJJND
76.

9. The third charge related to nine cheques issued by
the Tahsildar, Kushtagi in favour of 11 beneficiaries and drawn
on Pragathi Gramin Bank, Kushtagi Branch. The Petitioner
alleged that Respondent obtained access to the said
instruments, prepared the collection schedule and connected
documents and sent them for collection. The proceeds, instead
of being credited to the beneficiaries, were alleged to have
been credited to Savings Bank Account No.3972 of Sri Veeresh
Hasgal at Hiremannapur Branch, who was not a beneficiary
under the said instruments.

10. It was further alleged that after the proceeds were
remitted by the Kushtagi Branch through IBA, Respondent
altered the relevant particulars and changed the OSC number

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so as to facilitate credit to Savings Bank Account No.3972. It
was also alleged that withdrawal slip dated 09.05.2009 was
used for withdrawing a sum of Rs.8,900/- from the said
account and that the amount was misappropriated.

11. The departmental enquiry was thereafter
conducted. Nine witnesses were examined on behalf of the
Petitioner and 96 documents were marked. Respondent cross-
examined the management witnesses but did not adduce
defence evidence. The witnesses included the Branch officials,
the cashier, the former Panchayat Development Officer of
Kandakur Gram Panchayat, the handwriting and fingerprint
expert and the Investigating Officer.

12. The handwriting expert examined the withdrawal
documents relating to the third charge and stated that the
signatures appearing on the relevant documents were not in
the handwriting of Sri Veeresh Hasgal. The evidence of the
cashier was also considered with regard to the credit slips and
the withdrawal slip dated 09.05.2009.

13. The Enquiry Officer held Charges I and II proved. In
respect of the third charge, the Enquiry Officer considered the
evidence relating to the nine instruments, the credit to Savings

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Bank Account No.3972 and the subsequent withdrawal of
Rs.8,900/- and held Respondent responsible for the
transaction.

14. The Enquiry Officer submitted his report.
Respondent submitted his objections to the report. The
disciplinary authority thereafter issued a show-cause notice
dated 02.02.2015 proposing the punishment of dismissal.
Respondent was given an opportunity of personal hearing and
he also submitted his written submissions. The disciplinary
authority considered the proved charges and his past record
and passed the order dismissing him from service with effect
from 25.02.2015. The appeal preferred by Respondent against
the said order was rejected by the Appellate Authority vide
order dated 25.04.2015.

15. The respondent thereafter raised an industrial
dispute before the Central Government Industrial Tribunal-
cum-Labour Court. His case was that the findings of the
Enquiry Officer were perverse, that the evidence did not
establish his involvement in the alleged fraudulent transactions
and that the disciplinary proceedings had not been properly
conducted. He sought reinstatement with full back wages and

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consequential benefits. He also contended that the Branch
Managers who were in charge during the relevant period had
been dealt with leniently, whereas he alone had been dismissed
from service.
Proceedings before the CGIT:
16. The CGIT first considered the fairness of the
domestic enquiry and framed a preliminary issue in that regard.
The Petitioner produced the enquiry records, which were
marked as Exs.M-1 to M-9. On consideration of the records and
the submissions, the CGIT held that the procedure adopted by
the Enquiry Officer was fair and proper. The other objections
raised by Respondent, including his challenge to the findings
recorded in the Enquiry Report, were left open for consideration
on merits.
17. The CGIT noticed that the Enquiry Report was brief
and mainly contained a compilation of the evidence, the
witnesses examined and the documents marked. The CGIT also
noticed the contention of the respondent that the Enquiry
Officer had submitted the report without waiting for his defence
brief.

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18. The evidence of the Branch Managers was also
considered. MW-4, who had worked as Branch Manager
between 27.06.2011 and 26.05.2012, stated that due to
workload and the confidence reposed in Respondent, he had
not verified all the slips thoroughly and that Respondent used
his ID in carrying out the internal work. MW-5, who had worked
as Branch Manager between 10.09.2008 and 20.07.2011,
stated that he was new to the BANC 724 system and depended
upon Respondent for the internal work of the Branch.
19. The CGIT also considered the investigation report
dated 06.09.2012. The said report referred to the role of Sri S.
Hanumanthappa and Sri H.N. Hosur, who were the Managers
during the relevant period. It was recorded therein that the
Managers had not exercised due caution though they were
aware that the proceeds of account-payee cheques were
required to be credited to the named payee. The report also
stated that the Managers had permitted the illegal credit of the
proceeds and that Respondent was instrumental in crediting the
amounts to the account of Sri Udaya Ravi.
20. The respondent contended before the CGIT that the
Managers had continued in service after being imposed with

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minor punishment, whereas he had been dismissed. He also
stated that after his dismissal with effect from 25.02.2015 he
had not obtained employment elsewhere for gain. The
Petitioner did not effectively dispute the statement regarding
the continuation of the Managers in service.
21. The CGIT considered the material regarding the
alleged transactions with Sri Udaya Ravi. It noticed that the
allegations had originated from an investigation by the
Lokayukta Police under the Prevention of Corruption Act and
that documents seized during the investigation had been
marked before the Enquiry Officer. The CGIT also noticed that
no material had been placed before it regarding the subsequent
fate of the criminal case against Sri Udaya Ravi.
22. The CGIT further recorded that, though the
proceedings referred to a financial risk of Rs.41,42,417/-, there
was no material before it to show that the Petitioner-Bank had
actually suffered the said financial loss or had become liable for
the amount. It also noticed that no criminal complaint against
Respondent had been shown to have been filed before the
jurisdictional police in respect of the allegations.

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23. While considering the punishment, the CGIT took
note of the fact that the Managers who were in charge during
the relevant period had continued in service after imposition of
minor punishment. The CGIT observed that their position as
superior officers could not be equated with that of Respondent,
but their supervisory responsibility and the findings recorded in
the investigation report were relevant while considering the
punishment imposed upon Respondent.
24. On the material before it, the CGIT held that the
punishment of dismissal was not justified in the circumstances.
It particularly noticed the absence of established financial loss
to the Bank and the fact that the Managers who were at the
helm of affairs during the relevant period had continued in
service. The CGIT therefore interfered with the punishment
under Section 11-A of the Industrial Disputes Act.
25. The CGIT accordingly allowed the claim of
Respondent under Section 2A(2) and (3) of the Industrial
Disputes Act. The order of dismissal dated 25.02.2015 was
interfered with and the Petitioner-Bank was directed to
reinstate Respondent in service.

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26. The CGIT did not grant back wages. Continuity of
service was also restricted only for the purpose of calculating
terminal benefits at the time of superannuation. Thus, by the
Award dated 16.10.2020, the Petitioner was directed to
reinstate Respondent without back wages, with continuity of
service only for the aforesaid limited purpose.
27. Aggrieved by the said order of the CGIT, the
petitioner has approached this court on the following grounds
amongst other grounds.
28. The Petitioner challenges the Award dated
16.10.2020 on the ground that the CGIT, after holding the
domestic enquiry to be fair and proper and noticing the findings
of misconduct against Respondent, erred in interfering with the
punishment of dismissal. The CGIT could not have re-
appreciated the evidence as an appellate authority. The
absence of actual financial loss could not by itself justify
interference, when the misconduct involved serious
irregularities in handling Bank instruments and had exposed the
Bank to financial risk.
29. The CGIT further erred in relying upon the fact that
the Branch Managers had continued in service after being dealt

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with separately. The punishment imposed on Respondent had
to be considered on the basis of the proved misconduct and the
circumstances of his case. Having regard to the seriousness of
the misconduct and the findings recorded in the enquiry, the
exercise of power under Section 11-A and the direction to
reinstate Respondent, with continuity of service for terminal
benefits, were not justified.
30. We have heard Sri.K.N.Vasuki, learned counsel on
behalf of the petitioner as well as Sri.K.Nagaraju, learned
counsel for the respondent and perused the pleadings, the
entire material placed on record and the order passed by the
CGIT.
31. The question that arises for consideration in this
appeal is,
Whether the order passed by the CGIT calls for
interference by this Court?
Reasons for allowing W.P.No.8503/2021:
32. The CGIT, having held the domestic enquiry to be
fair and proper, further recorded that the respondent had not
chosen to adduce any defence evidence. No documents were

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produced by him in support of his defence. The enquiry records
were before the CGIT and the management had examined its
witnesses and produced the relevant records. In such
circumstances, there was no material placed by respondent to
dislodge the findings recorded by the Enquiry Officer. The CGIT,
therefore, ought to have considered the findings on the basis of
the material available in the enquiry and, in the absence of any
evidence from Respondent, there was no justification to
interfere with the punishment imposed by the management.

33. The exercise of power under Section 11-A of the
Industrial Disputes Act cannot be made merely because
another view as to the punishment is possible. Such power is to
be exercised only in cases where the punishment imposed is
shockingly disproportionate to the misconduct proved. In the
present case, the CGIT itself did not set aside the findings of
the Enquiry Officer regarding the involvement of Respondent
in the transactions. Having accepted the validity of the enquiry
and having not interfered with the findings of misconduct, the
CGIT was not justified in substituting the punishment on the
limited consideration that the Bank had not ultimately suffered
actual financial loss.

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34. The Enquiry Officer, on consideration of the
management exhibits, the evidence of the nine management
witnesses and the material produced during the enquiry,
recorded a finding that all the three charges were proved. The
Enquiry Officer specifically found that Respondent had
committed fraud, falsified the official records and
misappropriated the Bank's funds and had exposed the Bank to
potential financial risk. The finding was thus not based on any
bare allegation, but was recorded upon consideration of the
evidence and the records produced in the disciplinary
proceedings. The Disciplinary Authority thereafter considered
the Enquiry Report and imposed the punishment of dismissal,
and the Appellate Authority also confirmed the same.

35. The fact that the Bank did not ultimately suffer the
entire financial loss referred to in the proceedings cannot by
itself wipe out the misconduct proved in the enquiry. The
investigation report dated 06.09.2012 had recorded that the
Managers had failed to exercise due caution and that
Respondent was instrumental in crediting the proceeds to the
account of Sri Udaya Ravi. The Enquiry Officer also found that
the acts of Respondent had exposed the Bank to financial risk.
Exposure of the Bank to such financial risk, arising out of the

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proved acts of the employee, was itself a circumstance which
required to be taken seriously while considering the
punishment.

36. Taking a lenient view of such proved misconduct
merely on the ground that the Bank had not ultimately suffered
the entire financial loss would have the effect of treating the
proved conduct lightly. In the facts of the present case, where
the Enquiry Officer had found the charges proved on the basis
of the evidence and records, and where the Disciplinary
Authority and the Appellate Authority had considered the
matter before confirming dismissal, the interference by the
CGIT under Section 11-A was not justified.

37. Normally, the Court, while exercising judicial
review, does not sit in appeal over the punishment imposed by
the competent disciplinary authority or substitute its own view
for that of the authority. The disciplinary authority is ordinarily
the best judge of the nature of misconduct and the punishment
required to maintain discipline in the establishment.
Interference is warranted only where the punishment is so
disproportionate to the proved misconduct that it shocks the
conscience of the Court or is such that no reasonable

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disciplinary authority could have imposed it. Even where the
Court finds the punishment disproportionate, the power to
interfere has to be exercised sparingly and for reasons which
demonstrate that the discretion vested in the disciplinary
authority has been improperly exercised.

38. In the present case, the respondent was working as
an Office Assistant at the Hiremannapur Branch during the
relevant period. The misconduct found proved against him
relates to his role in handling the cheque collection
transactions, preparation of the relevant slips and records, and
facilitating the credit of the proceeds of the instruments to
accounts other than those of the intended beneficiaries. The
Enquiry Officer, upon consideration of the evidence of the
management witnesses and the documents produced in the
disciplinary proceedings, found the charges against the
respondent to have been proved. The fact that the Branch
Managers were also found to have failed to exercise due
caution and were visited with lesser punishment cannot, by
itself, absolve the respondent of the misconduct proved against
him or entitle him to parity in punishment.

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39. The nature and extent of the respondent's
involvement in the transactions have to be considered on the
basis of the findings recorded in the domestic enquiry. The
respondent was entrusted with duties relating to the handling
and processing of banking transactions, and the misconduct
proved against him involved irregular handling of Bank
instruments, alteration of relevant particulars and facilitating
the credit of the proceeds to accounts other than those of the
named beneficiaries. Having regard to the nature of the
misconduct proved, the financial risk to which the Bank was
exposed and the trust reposed in an employee dealing with
banking transactions, the mere fact that the Branch Managers
were imposed lesser punishment cannot be a ground to hold
that the punishment imposed upon the respondent was
disproportionate. Parity in punishment cannot be claimed as a
matter of course, particularly where the role and circumstances
of the employees proceeded against are not identical.

40. Having regard to the nature of the misconduct, the
position held by the respondent and the higher degree of trust
and responsibility attached to his office, the punishment
imposed by the disciplinary authority cannot be said to be
shockingly disproportionate or arbitrary. The interference by

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the High Court, therefore, was not warranted. The order under
challenge, to that extent, calls for interference and the writ
petition filed by the Bank deserves to be allowed.
41. It is apposite to refer to the decision of the Hon’ble
1
Supreme Court in Punjab & Sind Bank v. Raj Kumar ,
wherein the Supreme Court, after considering and relying upon
a catena of decisions, reiterated the well-settled principles
governing judicial interference with the quantum of punishment
imposed in disciplinary proceedings, as under:
“8. We consider it apt to note the relevant passages from
the decision of the Supreme Court

a. Bhagat Ram v. State of Himachal Pradesh (1983) 2 SCC
442
15. …It is equally true that the penalty imposed must
be commensurate with the gravity of the misconduct, and
that any penalty disproportionate to the gravity of the
misconduct would be violative of Article 14 of the
Constitution. . . .

b. Ranjit Thakur v. Union of India: (1987) 4 SCC 611

25. Judicial review generally speaking, is not directed
against a decision, but is directed against the “decision-
making process”. The question of the choice and quantum
of punishment is within the jurisdiction and discretion of the
court-martial. But the sentence has to suit the offence and
the offender. It should not be vindictive or unduly harsh. It
should not be so disproportionate to the offence as to shock

1
2026 SCC OnLine SC 519

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the conscience and amount in itself to conclusive evidence
of bias. The doctrine of proportionality, as part of the
concept of judicial review, would ensure that even on an
aspect which is, otherwise, within the exclusive province of
the court-martial, if the decision of the court even as to
sentence is an outrageous defiance of logic, then the
sentence would not be immune from correction.
Irrationality and perversity are recognised grounds of
judicial review….
(emphasis supplied)

c. B.C. Chaturvedi v. Union of India (three-Judge Bench):
(1995) 6 SCC 749

18. A review of the above legal position would establish that
the disciplinary authority, and on appeal the appellate
authority, being fact-finding authorities have exclusive
power to consider the evidence with a view to maintain
discipline. They are invested with the discretion to impose
appropriate punishment keeping in view the magnitude or
gravity of the misconduct. The High Court/Tribunal, while
exercising the power of judicial review, cannot normally
substitute its own conclusion on penalty and impose some
other penalty. If the punishment imposed by the
disciplinary authority or the appellate authority shocks the
conscience of the High Court/Tribunal, it would
appropriately mould the relief, either directing the
disciplinary/appellate authority to reconsider the penalty
imposed, or to shorten the litigation, it may itself, in
exceptional and rare cases, impose appropriate punishment
with cogent reasons in support thereof.

d. Union of India v. G. Ganayutham (three-Judge Bench):
(1997) 7 SCC 463
Punishment in disciplinary matters: Wednesbury and CCSU
tests

32. Finally, we come to the present case. It is not
contended before us that any fundamental freedom is
affected. We need not therefore go into the question of
“proportionality”. There is no contention that the

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punishment imposed is illegal or vitiated by procedural
impropriety. As to “irrationality”, there is no finding by the
Tribunal that the decision is one which no sensible person
who weighed the pros and cons could have arrived at nor is
there a finding, based on material, that the punishment is
in “outrageous” defiance of logic. Neither Wednesbury nor
CCSU tests are satisfied. We have still to explain “Ranjit
Thakur [(1987) 4 SCC 611 : 1987 SCC (L&S) 1 : (1987) 5
ATC 113]”.

33. In Ranjit Thakur [(1987) 4 SCC 611 : 1987 SCC (L&S)
1 : (1987) 5 ATC 113] this Court interfered with the
punishment only after coming to the conclusion that the
punishment was in outrageous defiance of logic and was
shocking. It was also described as perverse and irrational.
In other words, this Court felt that, on facts, Wednesbury
and CCSU tests were satisfied. In another case, in B.C.
Chaturvedi v. Union of India [(1995) 6 SCC 749 : 1996 SCC
(L&S) 80 : (1996) 32 ATC 44] a three-Judge Bench said the
same thing as follows……….

34. In such a situation, unless the court/tribunal opines in
its secondary role, that the administrator was, on the
material before him, irrational according to Wednesbury
[[1948] 1 K.B. 223 : [1947] 2 All ER 680] or CCSU [[1985]
A.C. 374 : [1984] 3 All ER 935] norms, the punishment
cannot be quashed. Even then, the matter has to be
remitted back to the appropriate authority for
reconsideration. It is only in very rare cases as pointed out
in B.C. Chaturvedi case [AIR 1961 SC 418 : (1961) 2 SCR
343] that the Court might — to shorten litigation — think of
substituting its own view as to the quantum of punishment
in the place of the punishment awarded by the competent
authority. (In B.C. Chaturvedi [AIR 1961 SC 418 : (1961) 2
SCR 343] and other cases referred to therein it has
however been made clear that the power of this Court
under Article 136 is different.) For the reasons given above,
the case cited for the respondent, namely, State of
Maharashtra v. M.H. Mazumdar [(1988) 2 SCC 52: 1988
SCC (L&S) 436 : (1988) 6 ATC 876] cannot be of any help.

35. For the aforesaid reasons, we set aside the order of the
Tribunal which has interfered with the quantum of
punishment and which has also substituted its own view of
the punishment. The punishment awarded by the

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departmental authorities is restored. In the circumstances,
there will be no order as to costs.”

42. In the above said case, the Supreme Court came to
the conclusion that ,
“ 9. What follows from the precedents noted above is
that courts should exercise restraint while interdicting
orders of punishment. Normally, no court in exercise of its
power of judicial review should interfere with an order of
punishment imposed on a delinquent as a measure of
disciplinary action by the competent authority and
substitute its own judgment for that of the former. This is
premised on the reason that the disciplinary authority is the
best judge of the situation, and the requirements of
maintaining discipline within the work force. While it is not
the law that the courts should invariably stay at a distance
when legality and/or propriety of a particular punishment is
questioned, judicial scrutiny of the disciplinary action by
way of punishment could arise only if the circumstances are
such that no reasonable person would impose the
punishment which is questioned and/or such punishment
has the effect of shocking the conscience of the court. To
put in simpler words, interference could be warranted if it
appeals to the court that the disciplinary authority has
‘used a sledgehammer for cracking a nut’. A punishment,
which is strikingly or shockingly disproportionate and is not
commensurate with the gravity of misconduct, proved to
have been committed in course of inquiry or otherwise,
would border on arbitrariness and offend Article 14 of the
Constitution.

10. Where a court, upon due consideration, arrives at
the conclusion that the punishment imposed is
disproportionate, its intervention is circumscribed in nature.
Judicial scrutiny and interference, if at all, has to be based
on reasons in support of the court's ultimate satisfaction
that the disciplinary authority has faltered in the exercise of
his discretion. In such a situation, the court may adopt one

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of two courses: it may remit the matter to the competent
authority for reconsideration of the punishment; or, in the
rarest of cases, it may substitute the punishment while
supporting such a course with cogent reasons.”

The Supreme Court in the above cited case considered the
legality of interference with the punishment imposed on a bank
employee. The respondent, a Senior Manager, was dismissed
from service for his involvement in misconduct concerning
misappropriation of customers’ money and bank records, while
the co-delinquents holding lower positions were awarded lesser
punishments. The High Court reduced his punishment to
compulsory retirement on the ground of parity. The Supreme
Court set aside the High Court’s order and restored the
punishment of dismissal, holding that judicial review of the
quantum of punishment is limited and interference is warranted
only when the punishment is shockingly disproportionate or
irrational. It further held that a higher-ranking bank officer
cannot claim parity with employees having lesser powers and
responsibilities, as higher rank carries greater accountability
and the greater the trust reposed, the stricter the scrutiny .
43. The Award, insofar as it directs reinstatement of
Respondent by substituting the punishment of dismissal,

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therefore, calls for interference. Accordingly,
W.P.No.8503/2021 filed by the Karnataka Gramin Bank is liable
to be allowed.
W.P.No.11197/2022
44. In this writ petition, the respondent/workman has
challenged the order passed by the CGIT, seeking setting aside
of the award insofar as it directs his reinstatement without back
wages. He has further sought a direction to the petitioner-Bank
to reinstate him into service with full back wages and
consequential benefits, apart from quashing the inquiry report
submitted by the Management.
45. Since we have allowed W.P.No.8503/2021 filed by
the petitioner/Bank challenging the order of the CGIT, the
question of considering the writ petition filed by the respondent
does not arise. Accordingly, we pass the following;
ORDER
(i) Writ Petition No.8503/2021 filed by the Karnataka
Gramin Bank is allowed ;

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(ii) T he order dated 16.10.2020 in I.D.No.02/2016
passed by the Central Government Industrial Tribunal-cum-
Labour Court, Bengaluru, is hereby set aside;
(iii) W.P.11197/2022 filed by the respondent/workman
is dismissed .

Sd/-
(D K SINGH)
JUDGE


Sd/-
(H.SHANTHI BHUSHAN)
JUDGE














KNM