Full Judgment Text
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CASE NO.:
Appeal (civil) 2055 of 2003
PETITIONER:
State Bank of India & Ors.
RESPONDENT:
Ramesh Dinkar Punde
DATE OF JUDGMENT: 11/08/2006
BENCH:
H.K. SEMA & A.K. MATHUR
JUDGMENT:
J U D G M E N T
H.K.SEMA,J
The challenge in this appeal is to the order dated 2nd
August, 2002 of the High Court of Judicature at Bombay
whereby the imposition of penalty of removal inflicted upon
the respondent, who is a bank officer, preceded by an inquiry,
is set aside with a direction to the appellant to reinstate the
respondent with all consequential benefits including that of
back wages, to be paid within a period of three months.
Briefly stated, the facts are as follows:
The respondent was working as an officer under the
appellant bank and at the relevant time he was posted as
Manager, Personnel Banking Division, Palghar Branch.
Sometime in June, 1986 the respondent introduced one Shri
Kishor Bidaye and Shri D.B. Angane to the Branch Manager
Jogeshwari (W) Branch. The respondent brought said Shri
Bidaye to the Branch Manager and got a current account
opened in the name of Shri Bidaye. He had also introduced
the said current account by giving his old Andheri address at
Bombay as the address of Bidaye. A cheque was issued in
favour of the State Bank of India, which was to be invested in
the name of the Trust/Board. However, the respondent
insisted that the funds were meant for Bidaye and Angane and
thereby, induced the Branch Manager to accept the Trust
funds as Term Deposits and issue TDRs in the names of
Bidaye and Angane. The respondent also ensured sanctioning
of overdraft facility against the STDRs. so issued. It is also
alleged that the respondent exerted pressure to grant overdraft
on the same day of remittance of funds and emphatically
stated that it would be his responsibility if anything went
wrong. A complaint was made by a Trust regarding Term
Deposit Receipts being issued in the name of Bidaye and
granting overdraft facilities to him on the basis of such TDR.
The appellant’s bank, thereafter, initiated a Departmental
Inquiry. The following charges were framed against the
respondent:
"ARTICLE OF CHARGE TOGETHER WITH THE
GROUNDS ON WHICH IT IS BASED \026 SHRI R.D.
PUNDE (UNDER SUSPENSION) FRAUD AT
JOGESHWARI (W) BR.
CHARGE
CHARGE-1
You, when posted at Palghar Branch as Manager
P.B.D. negotiated with a fraudulent intention to
extend credit facilities against deposits to be
received from Trusts to Sarvashri Kishore Bidaye
and D.B. Angane at Jogeshwari (W) Branch and
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induced the Branch Manager, Jogeshwari (W)
branch to accept Trust Funds in Terms Deposits
and also caused issue of TDRs in the individual
names with the funds received for investment in
their own names (Trusts). You ensured that STDR
were issued in individual names and that overdrafts
were sanctioned there against although you were
well aware that it was in violation of Bank’s
prescribed norms, procedures, instructions on the
subject. You assisted the said persons despite
knowing their fraudulent motives. You thus acted
dishonestly and in a manner unbecoming of a Bank
Official violating Rule No. 32(4) of the State Bank of
India (Supervising Staff) Service Rules.
GROUNDS ON WHICH BASED
(i) You negotiated with the Branch Manager,
Jogeshwari (w) Branch on behalf of Sarvashri
Kishor Bidaye and D.B. Angane about the
credit facilities to be extended to them against
deposits to be received and vouched for
bonafides and creditworthiness of the said
individuals and assured to recover at short
notice loans granted there against.
Accordingly you introduced Shri Kishor
Bidaye and caused his current Account to be
opened in the books of Jogeshwari (w) Branch
knowing fully well that Shri Bidaye is a
defaulter borrower of our Pimpri Branch. You
also gave your residential address as the legal
address of Shri Bidaye.
You visited Jogeshwari (w) Branch on various
dates accompanied by others including the
said persons and caused issue of STDRs in the
name of Shri Bidaye/Shri Angane against
clearing cheques received from the under
noted Boards. You also prevailed upon the
Branch Manager/Manager P.B.D. to sanction
overdraft limit threagainst to the said persons.
Cheque Amt. Date pf STDR Amt. Of OD
Recd. Of Cheq. TDR No. TDR Limi
t
From Favouring Sanc
t
Ione
d
----------------------------------------------------------------------------------
The Railway Rs.2 lacs 26.06.86 236386 Rs. 2 lacs Rs.1.50
Goods Shri. Lacs
Clearing and Bidaye
Forwarding
Establishment
----------------------------------------------------------------------------------
Nathdwere Rs.2 lacs 8.07.86 236199 Rs.2 lacs Rs. 1.50
Temple Board Shri Lacs
Bidaye
----------------------------------------------------------------------------------
Security Rs.5 lacs 12.07.86 586504 Rs.5 lacs Rs. 3.75
Guards Board Shri Lacs
For Greater Angane
Bombay and
Thane Distt.
----------------------------------------------------------------------------------
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Hyderabad Rs.5 lacs 21.07.86 586542 Rs. 5 lacs Rs. 3.75
(Sind) Shri Lacs
National Bidaye
Collegiate
Board.
----------------------------------------------------------------------------------
(ii) You were well aware of the intentions and
motives of Shri Bidaye and Shri Angane to
defraud the Bank. You failed to use the
material information to protect the Bank’s
interest."
On the basis of the aforesaid charges, the Commissioner
for Departmental Inquiries in the Central Vigilance
Commission, Govt. of India was appointed as the Inquiry
Officer. The Inquiry Officer, after making a detailed inquiry,
submitted its report dated 31.1.90 holding that the charges
against the respondent stand proved. Thereafter, by an order
dated 8.12.90 the Disciplinary Authority dismissed the
respondent from the services of the Bank. Aggrieved thereby,
the respondent filed an appeal before the Appellate Authority,
which was rejected by the order dated 29.10.91. Aggrieved
thereby, the respondent preferred Writ Petition No. 2105/92
before the High Court of Judicature at Bombay praying inter-
alia to quash and set aside the order of dismissal dated
8.12.90 passed by the Disciplinary Authority and also the
order dated 29.10.91 passed by the Appellate Authority
rejecting his appeal and to reinstate the respondent with full
back wages, continuity of service and all the consequential
benefits. During the pendency of the Writ Petition before the
High Court, it appears that pursuant to the observations made
by the High Court, the petitioner bank reduced the
punishment of dismissal to removal.
The High Court, on re-appreciation of evidence, reversed
the finding of the Inquiry Officer and set aside the orders of
the Disciplinary Authority and Appellate Authority.
Before we proceed further, we may observe at this stage
that it is unfortunate that the High Court has acted as an
appellate authority despite the consistent view taken by this
Court that the High Court and the Tribunal while exercising
the judicial review do not act as an appellate authority. Its
jurisdiction is circumscribed and confined to correct errors of
law or procedural error, if any, resulting in manifest
miscarriage of justice or violation of principles of natural
justice. Judicial review is not akin to adjudication on merit by
re-appreciating the evidence as an Appellate Authority. (See
Govt. of A.P. and Ors. (appellant) v. Mohd. Nasrullah Khan
(respondent) (2006) 2 SCC 373 at page SCC 379).
Reverting to the facts of the case, it appears that the
respondent was charged with misconduct of having conducted
himself in violation of the Rule 32(4) of the Service Rules. Rule
32(4) reads:
"32(4) Every employee shall, at all times, take all
possible steps to ensure and protect the interest of
the Bank and discharge his duties with utmost
integrity, honesty, devotion and diligence and do
nothing which is unbecoming of a bank official."
After noticing the said provision and re-appreciating the
evidence, the High Court was of the opinion that unless there
is evidence to show that the petitioner had knowledge of the
intention on the part of the persons introduced in the Bank,
the petitioner cannot be said to have committed any
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misconduct as alleged by the Bank. The High Court has also
considered the official evidence recorded by the Inquiry Officer
in course of the inquiry and observed that the statements
recorded by the Inquiry Officer had no where stated that the
petitioner had knowledge of the intention of Bidaye and
Angane to enjoy the overdraft facility by misusing TDRs
belonging to someone else. The High Court also observed that
there is no evidence to show that on all the occasions when
the TDRs were issued the petitioner was present in the
Jogeshwari Branch. Ultimately, the High Court has concluded
its finding in paragraph 9 of the impugned Judgment as
under:
"9. Ample evidence could have been led to prove the
complicity of the petitioner with Bidaye and Angane.
Even in the FIR lodged with the police, there is not
even a suggestion that the petitioner was in anyway
involved in the commission of fraud by Bidaye and
Angane. In these circumstances, we are firmly of
the opinion that this is a case of no evidence of
misconduct as alleged by the bank, which is not
proved at all and therefore order of punishment is
unsustainable. In the result the petition succeeds
and it is allowed."
It is impermissible for the High Court to re-appreciate
the evidence which had been considered by the Inquiry Officer
\026 a Disciplinary Authority and the Appellate Authority. The
finding of the High Court, on facts, runs to the teeth of the
evidence on record.
The clinching evidence found by the Inquiry Officer
against the charged officer is in the form of Hand Writing
Expert, marked as Ex. S-54 (2), which proved that the hand
writing is that of the charged officer. It is also proved that the
charged officer had filled in the account opening form of Sh.
Bidaye, which has not been denied by the charged officer. The
charged officer, in his examination-in-chief has admitted that
he introduced Sh. Bidaye. The charged officer also admitted
that Sh. Nazar requested him to fill in the application form
and pay-in-slip which he did as a part of customer service.
The charged officer was the Manager of the Bank. There was
no occasion for him to fill in the application form or the pay-
in-slip on behalf of Bidaye as a customer service unless he has
personal interest in it. The respondent admitted that the
distance between Palghar Branch (where he was posted) and
the Jogeshwari Branch (where the account was opened) is
about 60 Kms. and Palghar Branch is not connected by local
train as it usually takes about 2 = hours from Andheri Station
to Palghar Branch. It is common knowledge that unless he
had personal interest, he would not have covered such a
distance to favour his so called friend Bidaye. The charged
officer also admitted his presence on 12.6.86 and 26.6.86.
The account opening form of Sh. Bidaye is in the hand-
writing of the charged officer. The address of Sh. Bidaye is
shown as c/o the respondent. The account has been
introduced by the respondent. In the Inquiry Report it is
established that the charged officer did exert pressure on the
Branch officials for issuance of TDRs against the funds
received from the trusts and granting overdrafts against TDRs.
From the facts collected and the report submitted by the
Inquiry Officer, which has been accepted by the Disciplinary
Authority and the Appellate Authority, active connivance of the
respondent is eloquent enough to connect the respondent with
the issue of TDRs and overdrafts in favour of Bidaye.
We are, therefore, clearly of the view that the High Court
was erred both in law and on facts in interfering with the
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findings of the Inquiry Officer, the Disciplinary Authority and
the Appellate Authority by acting as a court of appeal and re-
appreciating the evidence.
We may now notice a few decisions of this Court in
similar circumstances.
In the case of Union of India (appellant) v. Sardar
Bahadur (respondent) (1972) 2 SCR 218 it is held as under:
A disciplinary preceeding is not a criminal trial. The
standard proof required is that of preponderance of
probability and not proof beyond reasonable doubt.
If the inference that lender was a person likely to
have official dealings with the respondent was one
which reasonable person would draw from the
proved facts of the case, the High Court cannot sit
as a court of appeal over a decision based on it. The
Letters Patent Bench had the same power of dealing
with all questions, either of fact or of law arising in
the appeal, as the Single Judge of the High Court.
If the enquiry has been properly held the question of
adequacy or reliability of the evidence cannot be
canvassed before the High Court. A finding cannot
be characterized as perverse or unsupported by any
relevant materials, if it was a reasonable inference
from proved facts."
In Union of India (appellant) v. Parma Nanda
(respondent) (1989) 2 SCC 177 it is held at page SCC 189 as
under:
"27. We must unequivocally state that the
jurisdiction of the Tribunal to interfere with the
disciplinary matters or punishment cannot be
equated with an appellate jurisdiction. The Tribunal
cannot interfere with the findings of the Inquiry
Officer or competent authority where they are not
arbitrary or utterly perverse. It is appropriate to
remember that the power to impose penalty on a
delinquent officer is conferred on the competent
authority either by an Act of legislature or rules
made under the proviso to Article 309 of the
Constitution. If there has been an enquiry
consistent with the rules and in accordance with
principles of natural justice what punishment
would meet the ends of justice is a matter
exclusively within the jurisdiction of the competent
authority. If the penalty can lawfully be imposed
and is imposed on the proved misconduct, the
Tribunal has no power to substitute its own
discretion for that of the authority. The adequacy of
penalty unless it is malafide is certainly not a
matter for the Tribunal to concern itself with. The
Tribunal also cannot interfere with the penalty if the
conclusion of the Inquiry Officer or the competent
authority is based on evidence even if some of it is
found to be irrelevant or extraneous to the matter."
In Union Bank of India (Appellant) v. Vishwa Mohan
(respondent) (1998) 4 SCC 310, this Court held at page SCC
315 Para 12 as under:
"12. After hearing the rival contentions, we are of
the firm view that all the four charge sheets which
were inquired into relate to serious misconduct. The
respondent was unable to demonstrate before us
how prejudice was caused to him due to non-supply
of the enquiry authority’s report/findings in the
present case. It needs to be emphasised that in the
banking business absolute devotion, diligence,
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integrity and honesty needs to be preserved by every
bank employee and in particular the bank officer. If
this is not observed, the confidence of the
public/depositors would be impaired. It is for this
reason, we are of the opinion that the High Court
had committed an error while setting aside the
order of dismissal of the respondent on the ground
of prejudice on account of non-furnishing of the
inquiry report/findings to him."
In Chairman and Managing Director, United
Commercial Bank and Ors. (Appellant) v. P.C. Kakkar \026
(respondent) (2003) 4 SCC 364, this Court held at page SCC
376 para 14 as under:
"14. A Bank officer is required to exercise higher
standards of honesty and integrity. He deals with
money of the depositors and the customers. Every
officer/employee of the Bank is required to take all
possible steps to protect the interests of the Bank
and to discharge his duties with utmost integrity,
honesty, devotion and diligence and to do nothing
which is unbecoming of a Bank officer. Good
conduct and discipline are inseparable from the
functioning of every officer/employee of the Bank.
As was observed by this Court In Disciplinary
Authority-cum-Regional Manager v. Nikunja Bihari
Patnaik (1996) 9 SCC 69, it is no defence available
to say that there was no loss or profit resulted in
case, when the officer/employee acted without
authority. The very discipline of an organization
more particularly a Bank is dependent upon each of
its officers and officers acting and operating within
their allotted sphere. Acting beyond one’s authority
is by itself a breach of discipline and is a
misconduct. The charges against the employee were
not casual in nature and were serious. These
aspects do not appear to have been kept in view by
the High Court."
In Regional Manager, U.P. SRTC, Etawah & Ors.
(appellants) v. Hoti Lal and Anr. (respondents) (2003) 3
SCC 605, it was pointed out as under:
"If the charged employee holds a position of trust
where honesty and integrity are inbuilt
requirements of functioning, it would not be proper
to deal with the matter leniently. Misconduct in
such cases has to be dealt with iron hands. Where
the person deals with public money or is engaged in
financial transactions or acts in a fiduciary
capacity, highest degree of integrity and
trustworthiness is a must and unexceptionable."
In Cholan Roadways Ltd. (appellant) v. G.
Thirugnanasambandam (respondent) (2005) 3 SCC 241
this Court at page SCC 247 held:
"It is now a well-settled principle of law that the
principles of the Evidence Act have no application in
a domestic inquiry."
Confronted with the facts and the position of law, learned
counsel for the respondent submitted that leniency may be
shown to the respondent having regard to long years of service
rendered by the respondent to the Bank. We are unable to
countenance with such submission. As already said, the
respondent being a bank officer holds a position of trust where
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honesty and integrity are inbuilt requirements of functioning
and it would not be proper to deal with the matter leniently.
The respondent was a Manager of the Bank and it needs to be
emphasised that in the banking business absolute devotion,
diligence, integrity and honesty needs to be preserved by every
bank employee and in particular the bank officer so that the
confidence of the public/depositors is not impaired. It is for
this reason that when a bank officer commits misconduct, as
in the present case, for his personal ends and against the
interest of the bank and the depositors, he must be dealt with
iron hands and he does not deserve to be dealt with leniently.
In the case of T.N.C.S. Corpn. Ltd. and Ors. (appellants)
v. K. Meerabai (respondent) (2006) 2 SCC 255 such plea had
been rejected by this Court. It was pointed out at page SCC
267 para 29 as under:
"29. Mr. Francis also submitted that a sum of Rs.
34,436.85 being 5% of the total loss of Rs.
6,88,735/- is sought to be recovered from the
respondent and that the present departmental
proceedings is the only known allegation against the
respondent and there was no such allegation earlier
and, therefore, a lenient view should be taken by
this Court and relief prayed for by both the parties
can be suitably moulded by this Court. We are
unable to agree with the above submission which,
in our opinion, has no force. The scope of judicial
review is very limited. Sympathy or generosity as a
factor is impermissible. In our view, loss of
confidence is the primary factor and not the amount
of money mis-appropriated. In the instant case,
respondent employee is found guilty of mis-
appropriating the Corporation funds. There is
nothing wrong in the Corporation losing confidence
or faith in such an employee and awarding
punishment of dismissal. In such cases, there is no
place for generosity or mis-placed sympathy on the
part of the judicial forums and interfering therefor
with the quantum of punishment awarded by the
disciplinary and Appellate Authority."
In the view that we have taken, this appeal deserves to be
allowed. The impugned judgment and order of the High Court
dated 2.8.2002 is, hereby, set aside. The orders of the
Disciplinary Authority and that of the Appellate Authority are
restored. The Writ Petition filed by the respondent stands
dismissed.
The appeal is allowed. In the facts and circumstances of
this case, the parties are asked to bear their own costs.