A tribunal cannot reduce punishment for serious financial misconduct solely on an honesty certificate.

Respondent No. 2, a Head Cashier at the Bank’s Berhampore Branch, reported a cash shortage of ₹8.30 lakh on 10 March 2009.

The Bank made good the shortage through its Suspense Account, suspended him, and initiated disciplinary proceedings.

Respondent No. 2 later deposited the amount.

Following an enquiry, the Bank imposed compulsory retirement, which the Appellate Authority upheld.

The CGIT set aside the punishment and directed reinstatement with stoppage of three increments, relying on a certificate describing the employee as honest; it denied back wages.

The Bank challenged the award.

While the writ petition was pending, it paid wages under Section 17B of the Industrial Disputes Act, 1947.

The High Court found that payments continued after the employee’s superannuation and that ₹15,59,981.48 had been paid for the period from September 2021 to February 2026.

Whether the CGIT was justified in setting aside compulsory retirement and substituting a lesser penalty on the basis of the employee’s character certificate, despite the proved cash-shortage charge

Whether the Bank could recover wages paid under Section 17B after the employee’s superannuation

Section 11A of the Industrial Disputes Act, 1947, empowers an industrial tribunal to interfere with a dismissal or discharge and impose a lesser punishment;

the respondent relied on The Workmen of M/s Firestone Tyre and Rubber Co. of India (P) Ltd. v. The Management, (1973) 1 SCC 813, and Nand Kumar Verma v. State of Jharkhand, (2012) 3 SCC 580

Section 17B provides for payment of last-drawn wages during the pendency of proceedings challenging an award of reinstatement, as reflected in the interim directions in this case.

The Court’s stated principle was that a character certificate could not prevail over valid disciplinary proceedings concerning a serious financial charge.

The Court found that the Tribunal’s decision rested solely on a certificate describing the employee as honest, whereas the disciplinary proceedings established the cash shortage and the employee had admitted it and later reimbursed the amount.

In the Court’s view, the certificate did not justify displacing the Bank’s disciplinary decision or reducing the penalty for a serious charge involving financial irregularity; the award was therefore perverse and not in accordance with law.

Separately, the Court accepted that Section 17B payments continued after the employee’s superannuation and permitted recovery of the excess amount through due process.

It permitted the Bank to recover ₹15,59,981.48, paid after the employee’s superannuation, through due process, including adjustment against any arrears payable to him.