Dismissal for fraudulent withdrawals is sustainable where charges are proved through a fair departmental enquiry.

The original petitioner, a Head Cashier with the Central Bank of India, was suspended on 18 September 2008 for alleged fraudulent withdrawals from savings accounts of deceased customers. A charge-sheet containing seven charges was issued on 14 January 2009, and a criminal case was also registered concerning the same allegations.

During the departmental enquiry, the petitioner repeatedly sought nine documents, including records concerning the relevant customer accounts and departmental proceedings against other bank employees. The Enquiry Officer and the Bank declined to furnish some documents on the ground that they were irrelevant, although the documents relied upon by the management were made available.

The enquiry proceeded ex parte after the petitioner failed to appear on a scheduled date; management witnesses were examined, but the petitioner did not cross-examine them.

The Enquiry Officer found all seven charges proved, and the Disciplinary Authority dismissed the petitioner from service without notice and denied him the difference between salary and subsistence allowance.

His statutory appeal was rejected on 28 June 2011.

During the writ proceedings, the petitioner died on 9 April 2012, and his legal heirs were substituted in 2023 after condonation of delay.

Whether the departmental enquiry and the consequential orders of dismissal were vitiated by the Bank’s failure to supply the documents sought by the petitioner, thereby violating the principles of natural justice?

Whether the ex parte conduct of the departmental enquiry was procedurally invalid because the petitioner was denied an effective opportunity to defend himself and cross-examine the management witnesses?

Whether the punishment of dismissal from service was disproportionate to the proved misconduct and therefore liable to be interfered with in judicial review?

The Court applied the disciplinary procedure contained in the applicable Bank Rules and Bipartite Settlement, particularly Clauses 19.10 and 19.12, holding that the Bank was not required to furnish every document requested by the delinquent, but only relevant documents necessary for a fair defence.

Relying on State of Tamil Nadu v. Thiru K.V. Perumal, 1996 (5) SCC 474, the Court held that non-supply of documents invalidates an enquiry only where the documents are relevant and their non-supply causes prejudice.

Under Syndicate Bank v. Venkatesh Gururao Kurati, 2006 (3) SCC 150, non-supply of documents not relied upon by the Enquiry Officer does not ordinarily cause prejudice unless the delinquent establishes otherwise.

The Court distinguished State of U.P. v. Saroj Kumar Sinha, 2010 (2) SCC 772, which requires the department to prove charges through evidence even in an ex parte enquiry, because, in the present case, management witnesses were examined and the petitioner was given an opportunity to cross-examine them.

The Court further applied the principle that bank employees are held to a high standard of honesty, integrity and diligence, as stated in State Bank of India v. Bela Bagchi, 2005 (7) SCC 435.

On proportionality, the Court recognised that dismissal may be interfered with only where it shocks the conscience of the Court; however, serious misconduct involving fraudulent withdrawal of customers’ funds and erosion of public confidence justified dismissal.

The Court held that the petitioner was repeatedly afforded opportunities to participate in the enquiry, submit a defence, inspect or receive the management’s relied-upon documents, cross-examine witnesses, respond to the enquiry report and make submissions before the Disciplinary Authority and Appellate Authority.

The documents withheld were not relied upon by the Enquiry Officer and were considered irrelevant; the petitioner failed to demonstrate that their non-supply caused specific prejudice to his defence, as required by K.V. Perumal and Venkatesh Gururao Kurati.

The Court therefore found no violation of natural justice merely because the enquiry proceeded ex parte, particularly since management witnesses had been examined and the petitioner had declined to cross-examine them.

Regarding penalty, the Court treated fraudulent withdrawals from accounts of deceased customers as grave misconduct inconsistent with the trust and discipline required of bank employees. Since all seven charges were found proved on the basis of oral and documentary evidence, the punishment of dismissal was not considered disproportionate.

The Court upheld the dismissal order dated 22 February 2011 and the appellate order dated 28 June 2011, finding that the departmental enquiry was procedurally valid, that non-supply of the requested documents had not been shown to cause prejudice, and that the penalty of dismissal was justified by the seriousness of the proved misconduct.

All pending applications were also disposed of.