Research › Search › Judgment

Calcutta High Court · body

2001 DIGILAW 47 (CAL)

VENKATARAMA MURLIDHAR SHENOY v. SYNDICATE BANK

2001-02-05

KALYAN JYOTI SENGUPTA

body2001
KALYAN JYOTI SENGUPTA, J. ( 1 ) THE Court : This writ petition is directed against the order of dismissal dated 11th December, 1998 passed by the General Manager of the respondent Bank and also notice dated 9th July, 1998 issued by the Appellate Authority of the Syndicate Bank, Manipal in the State of Karnataka which preceded the aforesaid order of punishment. ( 2 ) THE short history of the case is that at the relevant time the petitioner was sub-Manager at Netaji Subhas Road, Calcutta Branch of the respondent Bank. On or about 25th March, 1977 he was charge-sheeted with the allegation of misconduct for having violated Regulation 3 (1) of the Syndicate Bank Officer Employees' (Conduct) Regulations, 1976 that constitute misconduct under Regulation 24 of the said Regulations. The allegation of misconduct based on the imputation of charges that he had issued four delivery orders of 34 numbers of Aluminium Coils in favour of constituent without receiving corresponding payment for such delivery and further without observing regular procedure. It is also the charge that the petitioner is alleged to have admitted the aforesaid misconduct in writing on 17th October, 1976 and pleaded for mercy. The petitioner was put under suspension on and from 7th January, 1977. The incident took place in or about 9th March, 1976. The petitioner replied to the above charges. The defence taken in the petition, apart from general denial of the charges, is that delivery order was issued by him in his usual bonafide discharging of duty and upon oral instruction of the then Branch Manager, one B. Vasanthan. ( 3 ) IT appears the petitioner challenged the aforesaid charge-sheet and suspension order in this Court previously and the same were set aside by the learned single Judge of this Court. However, subsequently that order of the learned single Judge was set aside by the appeal Court and directed the respondents to conclude the enquiry proceedings within a period of three months from the date of communication of that order. ( 4 ) PURSUANT to the aforesaid order of appeal Court this departmental proceedings was concluded upon hearing the petitioner. The Enquiry Officer found the petitioner guilty of the charges of misconduct. The aforesaid enquiry report was challenged by the writ petitioner in this Court. ( 4 ) PURSUANT to the aforesaid order of appeal Court this departmental proceedings was concluded upon hearing the petitioner. The Enquiry Officer found the petitioner guilty of the charges of misconduct. The aforesaid enquiry report was challenged by the writ petitioner in this Court. The petitioner obtained interim order to the effect that any adverse order if passed would not be given effect without leave of the Court. The writ petition since then was pending for hearing after completion of filing of affidavits. However, the writ petition was once dismissed for default as none appeared when it was called on for hearing. After dismissal as aforesaid the respondent served the order of punishment of dismissal upon the petitioner. However, the writ petition was restored subsequently but by that time order of punishment was given effect. ( 5 ) THE writ petitioner challenged the aforesaid order of punishment and the same was set aside by the learned single Judge of this Court. An appeal was taken against the order of the learned single Judge setting aside the order of dismissal. Meanwhile the petitioner had retired from services. The appeal Court set aside the order of the learned single Judge again but at the same time did not decide legality and validity of the order of punishment passed by the disciplinary authority. By the judgment and order the appeal Court directed the departmental appellate authority to decide the petitioner's case upon hearing representation of the writ petitioner afresh and to pass appropriate order in accordance with law and also directed the petitioner to be treated as suspended employee. The respondent Bank, however, made an application for review of the appellate Court's judgment and order contending that suspension order was not justified as he had retired, but departmental proceeding would continue under relevant rule after retirement of a delinquent employee and this fact of retirement was not drawn to attention of the Court. ( 6 ) THE appellate Court, however, did not reconsider the case, but clarified that the consideration and hearing of the case by departmental appellate authority in terms of earlier order should be taken in the event Rules relating thereto would permit. After the said order the appellate authority heard this matter and purported to have considered all aspects and conferred the order of dismissal passed by the disciplinary authority. This writ petition is against the aforesaid last order. After the said order the appellate authority heard this matter and purported to have considered all aspects and conferred the order of dismissal passed by the disciplinary authority. This writ petition is against the aforesaid last order. ( 7 ) MR. Maharaj Sinha, learned Advocate, appearing for the petitioner contends that appellate authority has no jurisdiction to hear and consider this case to confirm the decision of the disciplinary authority as the Regulation 20 (3) (iii) of the Service Regulation, 1976 does not permit once the employee retires from services, continuation of disciplinary proceedings unless the same is pending during his service period. In this case disciplinary proceedings cannot be said to have been pending as admittedly before his retirement dismissal order has been passed. On cessation of master and servant relationship this disciplinary proceedings cannot be revived. Therefore, he contends, entire exercise of the appellate authority is void and without authority of law. In support of his submission he refers to AIR 1999 SC 1841 , 1988 (1) CLJ 373 and 1986 Lab IC 1166. ( 8 ) HE contends even assuming the appellate authority has jurisdiction, but then on merit the appellate authority has passed order without application of mind. The alleged misconduct has not been proved by legal and proper evidence. The vital witness the then Branch Manager Mr. Vasanthan was not called as witness though cited to rebut the petitioner's case that he acted under the oral instruction of Mr. Vasanthan. Therefore, it is a case of perverse fact finding by the Enquiry Officer without having so to say any evidence. Moreover, it is on record that the alleged suffering of loss which is one of the charges has not been proved rather the Bank concerned has ratified and/or regularised such irregularity by granting subsequent loan to the same constituent. No action was brought against the aforesaid constituent though it has admitted that he had received delivery of 34 numbers of Aluminium Coils which were in custody of the Bank. He contends alleged misconduct in its face value, at the highest suggest improper supervisory action or supervisory lapses it cannot be termed to be misconduct. In support of his submission he relies on the following decisions :- (i) 1986 Lab IC 1166 and (ii) 1998 (2) CLJ 204 . He contends alleged misconduct in its face value, at the highest suggest improper supervisory action or supervisory lapses it cannot be termed to be misconduct. In support of his submission he relies on the following decisions :- (i) 1986 Lab IC 1166 and (ii) 1998 (2) CLJ 204 . ( 9 ) THE learned Advocate appearing for the Bank contends that this appellate authority has jurisdiction in view of the appeal Court's order. He contends that the charge-sheet was issued admittedly during the service tenure of the petitioner and the same did not reach its finality and in fact it has not reached its finality till today. Therefore, retirement of the petitioner during intervening period is of no consequence. ( 10 ) ON merit, he contends, the petitioner is guilty of serious misconduct because of his lapses and negligence for allowing to part with valuable security without following the established procedure and norms. He allowed 34 numbers of Aluminium Coils without receiving corresponding payment and/or consideration in lieu thereof. By his negligent act the Bank was exposed loss to the extent of Rs. 6. 83 lacs. ( 11 ) HE contends the appellate authority in terms of the appeal Court's order has submitted report holding petitioner guilty upon giving hearing and considering material. It is settled law that the writ Court will not scrutinize sufficiency and insufficiency of evidence. It only concerns with departmental proceedings having been held in compliance with the Rules and Regulations and of natural justice. This Court will examine that it has been concluded on foundation of evidence. ( 12 ) HAVING heard respective contention of the learned counsels and having considered the materials in this case while exercising my power of judicial review, I am to examine whether the order of the appellate authority confirming the order of punishment imposed by the disciplinary authority who in his turn purported to have accepted the findings of the Enquiry Officer, on the face of it as being lawful, valid and in consonance with the principles of natural justice. Conceptually principle of natural justice has wider connotation and variations depending upon each and every individual and peculiar facts and circumstances. ( 13 ) BEFORE I do so the point taken by Mr. Sinha that the appellate authority has no jurisdiction needs to be addressed first. This point founded on cessation of master and servant relationship on retirement. Conceptually principle of natural justice has wider connotation and variations depending upon each and every individual and peculiar facts and circumstances. ( 13 ) BEFORE I do so the point taken by Mr. Sinha that the appellate authority has no jurisdiction needs to be addressed first. This point founded on cessation of master and servant relationship on retirement. This contention is also considered by the appellate authority who has rejected and in my view rightly so for the following reasons :- ( 14 ) THE appellate authority acted in accordance with the Regulation 20 (Termination of services) as amended with effect from 30th January, 1993. Regulation 20 (Termination of services) as per amended Clause 3 of sub-Regulation (iii) provides as follows :-"an officer against whom the disciplinary proceedings have been initiated will cease to be in service on the date of superannuation but the disciplinary proceedings will continue as if he was in service until the proceedings are concluded and final order is passed in respect thereto. The concerned officer will not receive any pay and/or allowance after the date of superannuation. He will also not be entitled for the payment of retirement benefits till the proceedings are completed and final order is passed thereon except his own contributions to GPF. " ( 15 ) BY the aforesaid provision it is made clear that even after retirement disciplinary measure can be taken as in this case the disciplinary proceedings was initiated (on or about 25. 3. 1977) long before his retirement and punishment of dismissal order (27. 5. 1996) was passed rightly or wrongly thereafter but shortly before retirement (16h June, 1997 ). But the aforesaid dismissal order was set aside by the learned trial Judge on 11th December, 1997 but this order of the learned trial Judge, however, was set aside by the appellate Court with a direction that appellate authority will decide as to legality and validity of the order of the punishment. So in my view this disciplinary proceeding is deemed to have been pending and liable to be continued even after retirement. If Mr. Sinha's contention as saying that since the master and servant relationship has come to an end, is accepted then this end had taken place with the order of dismissal passed long before retirement irrespective of fact of retirement, logically the petitioner will not have any say in the writ petition. If Mr. Sinha's contention as saying that since the master and servant relationship has come to an end, is accepted then this end had taken place with the order of dismissal passed long before retirement irrespective of fact of retirement, logically the petitioner will not have any say in the writ petition. On top of that the entire disciplinary proceeding in relation to enquiry report was sub-judice since 1995 till 1997 even after retirement. The interpretation given and the contention raised by Mr. Sinha in my view are wholly unrealistic. Therefore, the correct approach would be that the disciplinary proceedings started long before his retirement and continued even after his retirement and so final order can be passed under the aforesaid amended Regulation. ( 16 ) THE authority cited by Mr. Sinha on this point, laid down the principle in the case (Dena Bank v. Amiya Kr. Dey) reported in 1988 (1) CLJ 373 , is wholly distinguishable. In that case in paragraph 6, if it is read as a whole, it will appear that when there is no express provision for continuation of disciplinary proceedings even after retirement the disciplinary proceedings cannot continue nor can be commenced after employees retires. In that case factually long before retirement of the employee concerned a charge was issued preceded by order of suspension but the same did not continue inspite of the specific direction and order given by this Court and in that case there was no provision for continuation of disciplinary proceedings after retirement. So the aforesaid authority does not lend any assistance either to cause of the client of Mr. Sinha nor to me. Similarly, the decision of the Supreme Court cited by Mr. Sinha reported in AIR 1999 SC 1841 is not applicable and it would be clear from paragraph 6 whereby it has been held that in view of the absence of such provision in the aforesaid Regulation, it must be held that the corporation had no legal authority to make any reduction in the retrial benefits of the appellant (the employee concerned therein ). There is also no provision for conducting disciplinary enquiry after retirement of the appellant and nor any provision stating that in case misconduct is established, a deduction could be made from retrial benefits. Needless to mention that the apex Court decision was rendered on different fact. There is also no provision for conducting disciplinary enquiry after retirement of the appellant and nor any provision stating that in case misconduct is established, a deduction could be made from retrial benefits. Needless to mention that the apex Court decision was rendered on different fact. Therefore, the apex Court decision does not hold good here. ( 17 ) NOW, coming to the merit of this case as to whether the appellate authority has lawfully and validly passed the order in affirmation of the order of the disciplinary authority read with report of the enquiry officer. I am not forgetful of my limitation under Article 226 and also parameters laid down by the apex Court and all other High Courts consistently, which can be summarised as follows :- (I)whether the appellate authority has applied his mind or not; (II)whether the charges in its prima facie value, constitute misconduct or not; (III)whether enquiry officer's report is based on evidence or in consonance with the principle of natural justice; (IV)whether order of punishment is based on lawful finding of guilt. ( 18 ) THE allegations of charge and misconduct is that the writ petitioner had issued orders for delivery of thirty four Nos. of aluminium coils from stock held by the Bank to the constituent namely, M/s. National Screw and Wire Product Limited without receiving any corresponding payment or adjustment having received for the credit of the parties account in breach of established procedure and practice for effecting such deliveries and thereby he had exposed the bank to financial risk and loss and such act and omission constitute an act of misconduct under Regulation 3 (i) of the Syndicate Bank Officer Employees' (Conduct and Regulations), 1976. In the charge-sheet, however, it was not quoted Regulation 3 read with Regulation 24. Therefore, it would be appropriate for me to quote the respective provisions of the Regulation in order to understand correctly the charges levelled against the petitioner. Clause (i) : Every officer employee shall at all times take all possible steps to ensure and protect the interests of the Bank and discharge his duties with utmost integrity, honesty, devotion and diligence and do nothing which is unbecoming of a Bank Officer. Clause (i) : Every officer employee shall at all times take all possible steps to ensure and protect the interests of the Bank and discharge his duties with utmost integrity, honesty, devotion and diligence and do nothing which is unbecoming of a Bank Officer. Regulation 24 : Acts of misconduct : A breach of any of the provision of these Regulations shall be deemed to constitute a misconduct punishable under the Syndicate Bank (Discipline and Appeal) Regulations,1976. ( 19 ) THE imputation of charges were given but in the charge-sheet it was not clearly specified the nature of the misconduct he was alleged to have committed under Regulation 3 (1) which contemplates various acts, omissions and lapses in generality. Since the writ petitioner has not complained as to vagueness so he is presumed to have understood all the charges. Therefore, it will not be prudent for me to proceed on the basis of the vagueness; rather it will be proper for me to assume that all the lapses, acts and omissions are charged against the petitioner as contained in Regulation 3 (i ). ( 20 ) IT is also another charge against the petitioner that he is alleged to have admitted in writing having issued delivery order without receiving credit and he pleaded for mercy on 17th October, 1976 (subsequently by a letter after having received reply to the charge as 16th October, 1976 ). ( 21 ) THE petitioner did not deny the factum of issuance of the aforesaid delivery but took a defence that he did so under the oral instruction of the then concerned Branch Manager, Sri B. Vasanthan, under whose supervision he was acting. It appears from the records that respondent bank namely management in order to prove the case had cited four witnesses which includes the aforesaid Branch Manager and another sub-manager namely Mr. Sarangapani and the other witnesses was Sri B. Vittal Pai and Mr. P. S. V. Mallya before the enquiry was started. The delinquent writ petitioner examined himself in support of defence. The management, however, did not bring the witnesses excepting Mr. Sarangapani. ( 22 ) AFTER having considered the materials the enquiry officer held the writ petitioner guilty of committing misconduct having exposed the bank to loss of Rs. 6. 83 lakhs by issuing delivery orders without receiving any corresponding payment and/or having adjustment against the credit of the said constituent. The management, however, did not bring the witnesses excepting Mr. Sarangapani. ( 22 ) AFTER having considered the materials the enquiry officer held the writ petitioner guilty of committing misconduct having exposed the bank to loss of Rs. 6. 83 lakhs by issuing delivery orders without receiving any corresponding payment and/or having adjustment against the credit of the said constituent. ( 23 ) IT appears the disciplinary authority has accepted the findings and the report on the enquiry officer. While doing so the disciplinary authority came to a different findings having held that the writ petitioner committed misconduct issuing delivery notes without receiving corresponding cash amount allowing M/s. National Screw and Wire Product Ltd. to take delivery of this stock worth Rs. 6. 83 lakhs etc. and thereby cause the bank to suffer substantial financial loss as stated in the charge-sheet. ( 24 ) ON the face of it the findings of the disciplinary authority is substantially different from those of the Enquiry Officer who held the writ petitioner had exposed the bank to financial loss not suffering of actual loss. Exposed to suffering of loss is one thing and actual suffering of financial loss is another thing. It is trite position of law that the disciplinary authority has every right to differ from the findings either altogether or substantially or partially and can come to different findings but in that case the disciplinary authority must record it and must give notice to that effect upon the delinquent asking to show cause. ( 25 ) THE appellate authority in the impugned order has observed amongst others as follows :-"i also find that the punishment awarded by the disciplinary authority is in conformity with the gravity of the misconduct committed by the appellant, taking into consideration financial loss of Rs. 6. 83 lakhs caused to the bank on account of acts of misconduct committed by Sri V. M. Shenoy and the said loss is quite substantial and is still to be recovered. (At the bottom of the internal page 10 of the impugned appellate authority's order at 204 of the writ petition ). " ( 26 ) IN order to come to findings as above it appears the appellate authority has relied on some other materials namely his own knowledge that bank have subsequently filed two suits against the constituent. (At the bottom of the internal page 10 of the impugned appellate authority's order at 204 of the writ petition ). " ( 26 ) IN order to come to findings as above it appears the appellate authority has relied on some other materials namely his own knowledge that bank have subsequently filed two suits against the constituent. These materials were not subject matter of the evidence nor on which charges were framed. The appellate authority of his own without any notice or giving any chance to the petitioner to deal with, has relied on the same. It may be from his own source of information, though I do not find in the records, any copy of the plaint was produced before him. So I conclude that both the disciplinary and the appellate authorities have come to findings which are de hors the charges. ( 27 ) AS I have already observed that there are many a facets of breach of principle of natural justice. The aforesaid lapses on part of the disciplinary authority and appellate authority not giving chance of hearing to the petitioner before recording findings different from enquiry officer and even charge-sheet, to put it other words, the petitioner was heard for one allegation of misconduct but he was punished on substantially different charges without being heard and tried. ( 28 ) ONE of the authorities viz. 1986 LIC 1166 cited by Mr. Sinha substantially in this context helps to conclude as above. In paragraph 7 it has been held amongst others, "a finding which is de hors the charge is clearly unsustainable and no penalty can raise upon such a finding. " ( 29 ) IN my view none of the authorities namely, Enquiry Officer, disciplinary authority and appellate authority has come to a finding that the petitioner is guilty of any of the lapses as contemplated in Regulation 3 Clause (i) which mentions various lapses, acts and omissions. The petitioner at least should have been told in particular what were his lapses. ( 30 ) THEREFORE, on the aforesaid ground it is difficult for me to uphold these findings and punishment. ( 31 ) IT appears to me the Enquiry Officer even has come to conclusion quite unlawfully holding the petitioner being guilty of exposing the bank to pecuniary loss. ( 30 ) THEREFORE, on the aforesaid ground it is difficult for me to uphold these findings and punishment. ( 31 ) IT appears to me the Enquiry Officer even has come to conclusion quite unlawfully holding the petitioner being guilty of exposing the bank to pecuniary loss. The reason of my conclusion is that no reasonable prudent man can come to such finding on the given materials. It appears from the perusal of the materials annexed to the writ petitions and the report of the Enquiry Officer that writ petitioner took a plea during emergency period he had followed oral instruction of the then Branch Manager who was cited as a witness. The writ petitioner examined himself before the Enquiry Officer and reiterated in his oral testimony the aforesaid plea of defence. Surprisingly inspite of the aforesaid Branch Manager being cited as a witness was not produced as a witness to rebut the contention of the writ petitioner of having acted pursuant to oral instruction to issue delivery orders of stock without receiving any payment or adjustment. It appears from the evidence also that such an oral instruction could be given from time to time. But in the evidence only witness of the management it is sought to be established that in case of oral instruction of superior authority subsequent ratification was necessary. There were no documents to establish what was the method and procedure which were allegedly followed for taking steps for release of stocks by officer concerned. Oral testimony of the lone witness of management tended to establish that there were some procedures followed at the time of incident. This witness joined duty at that particular branch subsequent to the incident so his oral testimony without any document in support thereof cannot be any evidence at all. So I find that there is a great force in the defence plea. The writ petitioner acted on the oral instruction of the Branch Manager has been proved. The Branch Manager concerned could have come or rather he could have been compelled to come as he was cited witness to rebut the aforesaid plea but it was not done so. It is true that strict provision of the Evidence Act does not apply in departmental proceedings so also the strict proof of beyond reasonable doubt which requires in the case of a trial of a criminal offence. It is true that strict provision of the Evidence Act does not apply in departmental proceedings so also the strict proof of beyond reasonable doubt which requires in the case of a trial of a criminal offence. ( 32 ) PREPONDERANCE of probability is the only guiding principle for standard of proof in a domestic proceedings is the established judicial principle of law so also accepted by the management. In my view preponderance of probability will not only be applicable in case of bringing charges home but in case of a defence alibi as well. Such probability could have been demolished by producing the said Branch Manager when the vital witness has been withheld adverse inference can easily be drawn. ( 33 ) NOTHING has been produced to establish that subsequent ratification in writing was necessary in case of oral instruction given by the superior authority to the subordinate incumbent. The witness who has nothing to do with this transaction nor having any personal knowledge of the incident cannot establish the aforesaid so-called method and procedure of obtaining subsequent ratification in writing. ( 34 ) SO, I hold that the Enquiry Officer's findings has been arrived at without in such a manner that no reasonable prudent man on a given materials could have reached such a conclusion. Therefore, I cannot uphold this report which is foundation to award and inflict the extreme punishment to the petitioner. I set aside the same and I set aside orders of disciplinary authority and Appellate Authority. ( 35 ) SO, the writ petition succeeds and the same is allowed. ( 36 ) I have been told that the petitioner has already retired, therefore, the factual re-instatement is beyond any question. The petitioner was suspended so he must have received subsistence allowance. He is entitled to reinstatement notionally. His retirement shall be recognized treating him to have been in service continuously. So he is to be paid his salary from the date of dismissal till retirement after adjusting subsistence allowance already paid. All his retrial benefit to the extent of the amount being withheld shall be paid. All the payments and/or arrear salary and retrial benefit shall be paid within three months from the date of communication of this order. Costs of this application assessed at 300 gms. to be paid to the petitioner. Petition allowed.