Research › Search › Judgment

Karnataka High Court · body

2008 DIGILAW 316 (KAR)

E. N. Veeranna v. Indian Overseas Bank

2008-06-23

AJIT J.GUNJAL

body2008
Judgment :- Mr. M.N. Prasanna, learned counsel appearing for the petitioner has raised only two contentions i.e., non-compliance of the Mandatory Regulations 6(15) and 6(17) of the Indian Overseas Bank Officer Employees’ Conduct and Discipline & Appeal Regulations, 1976 (for short ‘Regulations’). The main thrust of his argument is that there is a clear violation of the Regulations inasmuch as Regulation 6(17) has not been scrupulously followed. 2. Smt. K. Subha Ananthi, learned counsel appearing for the Bank submits that there is no violation of Regulation 6(17) of the Regulations inasmuch as an opportunity was given to the petitioner and he has filed his written brief, which would be a sufficient compliance of Regulation 6(17) of the Regulations, which would deal with the major penalties. 3. Whether indeed Regulation 6(17) of the Regulations has been scrupulously followed or not as contended by the learned counsel appearing for the petitioner, few facts are required to be noticed: The petitioner joined the services of the respondent – Bank as a probationary officer on 01.02.1978. The case of the petitioner is that his integrity, honesty and intelligence were recognized and he was termed as an Excellent performer. He was promoted as an Officer in the Middle Management Grade Scale –II in the year 1985 and he was further promoted as an Officer in the Middle Management Grade Scale –III in the year 1993. Recognizing his services, he was given a foreign posting for a period of three years from 1990. But however, at the relevant point of time, he was working as a Branch Manager of the Kumara Park Branch of the Bank at Bangalore. Suffice it to say that the respondent-Bank pursuant to an order dated 24th February 1995 kept the petitioner under suspension contemplating an enquiry. A show cause notice was issued to the petitioner pointing out certain irregularities committed by him when he was at Kumara Park Bench. Copy of the said show cause notice is at Annexure ‘A’. A reply to the said notice was sent by the petitioner at Annexure ‘B’. The reply to the said show cause notice was not accepted by the respondent-Bank. After keeping the petitioner under suspension for some time, a charge sheet was issued, a copy of which is produced at Annexure ‘C’. Reply to the charge sheet was given, a copy of which is produced at Annexure ‘D’. The reply to the said show cause notice was not accepted by the respondent-Bank. After keeping the petitioner under suspension for some time, a charge sheet was issued, a copy of which is produced at Annexure ‘C’. Reply to the charge sheet was given, a copy of which is produced at Annexure ‘D’. The enquiry commenced on 12.03.1997 and a report was submitted on 29.06.1998 holding that the charges leveled against the petitioner are proved. Annexure ‘F’ is the report of the Enquiry Officer. Annexure ‘H’ is the reply given by the petitioner to the said report. The Disciplinary Authority, having regard to the report of the Enquiry Officer as well as the findings recorded on the charges and imputations found that the petitioner should be terminated from the service. Questioning the order passed by the Disciplinary authority, the petitioner preferred an appeal. In the appeal indeed he has raised several grounds and the Appellate Authority having regard to the nature of the misconduct committed by the petitioner, confirmed the order of the Disciplinary Authority. Hence, this writ petition. 4. Indeed to appreciate whether there is violation of Regulation 6(17) of the Regulations, it is necessary to look into the said provision. Before referring to Regulation 6(17), it is necessary to look into Regulation 6(15) of the Regulation. Regulation 6(15) would read as under: “When the case in support of the charges is closed, the officer employee may be required to state his defence orally or in writing, as he may prefer. If the defence is made orally, it shall be recorded and the officer employee shall be required to sign the record. In either case, a copy of the statement of defence shall be given to the Presenting Officer, if any, appointed. Regulation 6(17) of the Regulations would read as under: The Inquiring Authority may, after the officer employee closes his evidence, and shall, if the officer employee has not got himself examined, generally question him on the circumstances appearing against him in the evidence for the purpose of enabling the officer employee to explain any circumstances appearing in the evidence against him. 5. Regulation 6(15) of the Regulations would come into play at the fag end of the enquiry i.e., after the evidence is concluded. The employee is required to state his defence orally or in writing, as he may prefer. 5. Regulation 6(15) of the Regulations would come into play at the fag end of the enquiry i.e., after the evidence is concluded. The employee is required to state his defence orally or in writing, as he may prefer. If the defence is made orally, it ought to be recorded and the employee is required to sign the said statement of the defence is given to the Presenting Officer i.e., representative of the Bank. 6. The main thrust of argument of Mr. M.N. Prasanna, learned counsel for the petitioner is that after the enquiry is concluded inasmuch as after the evidence of the management is over and the employee closes his evidence, if the employee has not stepped into box inasmuch as he has not examined himself, the Enquiry Officer would generally question him on the circumstances and the evidence, which is adduced against him for the purpose of enabling him to explain any circumstances against him in the evidence, which is let-in. Indeed this would be in the nature of statement of the accused under Section 313 of the Code of Criminal Procedure. 7. Indeed any violation of this salutary principle would certainly result in prejudice to the employee and the enquiry to that extent is liable to be set at naught. 8. Mr. M.N. Prasanna, learned counsel appearing for the petitioner submitted that there is a clear violation of the salutary principle. Hence, the entire procedure commencing from the report of the Enquiry Officer is liable to be set-aside. 9. But however, Smt. K. Subha Ananthi, learned counsel appearing for the respondent submits that the fact that the petitioner has filed his written brief, itself would amount to examining himself and the fact that the Enquiry Officer has not put any specific questions will not prejudice the enquiry. The Enquiry proceedings conducted before the Enquiry Officer is made available, copy of which is produced in the form of a paper book filed by respondent – Bank. The Enquiry Officer has posed questions as under: IA: P.O. may introduce his next witness if any. PO: No more witness and no more documents to introduce. IA: DR do you have any document/witness to introduce? DR: We have no other document/witness to introduce. IA: Since both sides have closed their presentation of the case, Mr. Veeranna, Do you wish to say anything? CSO: It will form part of Defence brief. PO: No more witness and no more documents to introduce. IA: DR do you have any document/witness to introduce? DR: We have no other document/witness to introduce. IA: Since both sides have closed their presentation of the case, Mr. Veeranna, Do you wish to say anything? CSO: It will form part of Defence brief. IA: Since both sides have closed their presentation of the case, I am treating the enquiry as concluded. 10. The moot question is whether these questions and answers shall be construed as compliance of Regulation 6(17) of the Regulations. In this regard, it is necessary to refer to the reply or the written brief submitted by the petitioner, a copy of which is made available at Annexure ‘E’. 11. The answer of the petitioner in the written brief to imputation (2) is as follows: “ Regarding the correct transfer entries in the S.B. Account of the CSO MW 4 during cross-examination deposed that there was no complaint from any of the staff members regarding amount transferred to the CSO’s account. Hence, this is more or less liking (like) taking ‘hand loan’ which was subsequently repaid by the CSO or otherwise the staff members would have made complaints in this regard”. This is answer to imputation No.3: “ME 3 and ME31 will reveal that cheque No.766013 dated 18.09.1994 for Rs.2,400/- is not returned but paid. So also cheque No.766018 dated 09.11.1994 for Rs.40,000/-does not find a place in ME 31- There are repetition of entries in ME 31 and the number of cheque are not so many as in the annexure. I also draw the kind attention of the DA that none of the payees complained about the return of the cheques, which shows that the CSO should have settled the amount to the payees”. This is answer to imputation No.4: MW 2 during the cross-examination by defence deposed on perusing the ME 56 that the cash (loan proceeds of DL 117/94) was received by Sri. Shivananda Rao – Hence, it is clear that the proceeds of the loan was received and enjoyed by the borrower and the contents of the alleged imputation that the cash was received by CSO is absurd. The cheque No.766018 dated 9.11.1994 for Rs.40,000/- is unconnected with the loan as the loan amount is Rs.43,000/-. 12. Shivananda Rao – Hence, it is clear that the proceeds of the loan was received and enjoyed by the borrower and the contents of the alleged imputation that the cash was received by CSO is absurd. The cheque No.766018 dated 9.11.1994 for Rs.40,000/- is unconnected with the loan as the loan amount is Rs.43,000/-. 12. In fact on imputation No.4, the reply given by the petitioner would also deal with the further evidence of MW 2. On Imputations No.6 & 7, the evidence both oral and documentary let in by the management has been referred to and suitable answer has been given. So also for imputation No.11. 13. The main object of examining the employee and putting him across the evidence, which is let in by the Management is to elicit answers in the nature of admission or denial. Indeed Regulation 6(17) is a salutary principle, which is required to be scrupulously followed by any Enquiry Officer. To my mind, the petitioner has not stepped into the witness box and no specific questions were put to him by the Enquiry Officer regarding evidence, which is let in against him. The written brief, which is filed by him would certainly answer the evidence, which has been let in against him. 14. Indeed a perusal of Sub-Registration (17) of Regulation 6 would indicate that if the employee has not got himself examined, the inquiring authority may, generally question him on the circumstances appearing against him in the evidence for the purpose of enabling the officer to explain the circumstances. The circumstances, which are against the employee were made to known to the petitioner, to which he has filed his reply. Indeed the questions and answers which are referred to above would clearly indicate that the Enquiry Officer had posed a specific question whether the petitioner has anything to say. The petitioner has replied saying that it would form a part of the defence brief. If this answer is read in tandem with Sub-Regulation 17 of Regulation 6, it is abundantly clear that the evidence of the Management has been put across and a written brief is filed by the petitioner replying to the said evidence. Hence, I am of the view that there is a proper compliance of the Sub-Regulation (17) of Regulation 6. This provision is akin to Section 313 of the Criminal Procedure Code. Hence, I am of the view that there is a proper compliance of the Sub-Regulation (17) of Regulation 6. This provision is akin to Section 313 of the Criminal Procedure Code. It is now well settled that an enquiry is not vitiated unless the petitioner is able to establish prejudice. The petitioner has cross-examined the witnesses and has submitted his defence in writing in great detail. The petitioner was fully alive to the allegations against him and dealt with all aspects of the charges in his written brief. I am of the view that petitioner is not least prejudiced. 15. Indeed the Apex Court in the case of Ministry Of Finance and another V/s. S.B. Ramesh reported in AIR 1998 SC 853 has ruled that it is incumbent upon the Enquiry Authority to question the Officer facing the charge, broadly on the evidence appearing against him in a case where the Officer does not offer himself for examination as a witness. 16. Indeed in the case on hand, it is to be noticed that the petitioner certainly did not step into the witness box but however, he has filed his reply to the evidence, which is let in by the management against him in which case I am of the view that this would amount to a sufficient compliance of Sub-Regulation (17) of Regulation 6 and no prejudice is caused to the petitioner. 17. This takes us to the next question regarding the imposition of penalty. In this regard Smt. K.Subha Ananthi, learned counsel appearing for the respondent vehemently submits that since all the charges leveled against the petitioner have been proved, the question of showing leniency in the circumstances would not arise. She submits that the petitioner was an Officer of the Bank and his action is unbecoming of an Officer of the Bank. 18. Mr. M.N. Prasanna, learned counsel appearing for the petitioner submits that in view of the fact that the livelihood of the petitioner is being taken away, instead of straight dismissal or termination of the service, the petitioner could be compulsorily retired or any other suitable penalty other than termination could be imposed. 19. It is to be noticed that the petitioner is in Banking Service. The Regulations of the Bank would require an Officer to take all possible steps to protect the interest of the Bank. 19. It is to be noticed that the petitioner is in Banking Service. The Regulations of the Bank would require an Officer to take all possible steps to protect the interest of the Bank. He is expected to discharge the duties of the Bank with utmost care. Even if any one falls short of any of the duties case on him, it will certainly amount to mis-conduct. Indeed a Banker is required to maintain good conduct and discipline and his performance should be such that his judgments in respect of financial matters are done in the interest of the Bank. 20. Indeed in the case on hand, the petitioner is charged with acting beyond his authority in allowing certain overdrafts towards crossing cheques, making unauthorized and irregular advances inasmuch as the undue pecuniary benefit is conferred on persons known to him. It is also to be noticed that he had advances amounts to two persons against the Salary Certificate, which was not authenticated. The Apex Court in the case of Disciplinary Authority cum-Regional manager and others V/S. Nikunja Bihari Patnaik reported in Vol.89 F.J.R. 49 has observed thus: “ In the case of a bank – for that matter, in the case of any other organisaton – every officer/employee is supposed to act within the limits of his authority. If each officer/employee is allowed to act beyond his authority, the discipline of the bank/organization will disapper, the functioning of the bank cannot be allowed to carve out his own little empire wherein he dispenses favours and largesse. No organization, more particularly, a bank, can function properly and effectively if its officers and employees do not observe the prescribed norms and discipline. Such indiscipline cannot be candoned on the spacious ground that it was not actuated by ulterior motives or by extraneous considerations. The very act of acting beyond authority – that too, a course of conduct spread over a sufficiently long period and involving innumerable instances- is by itself a misconduct. Such acts, if permitted, may bring in profit in some cases but they may also lead to huge losses. Such adventures are not given to the employees of banks which deal with public funds”. 21. Having regard to these facts and the law declared by Apex Court, I am of the view that the extreme penalty of dismissal cannot be faulted. 22. Mr. Such adventures are not given to the employees of banks which deal with public funds”. 21. Having regard to these facts and the law declared by Apex Court, I am of the view that the extreme penalty of dismissal cannot be faulted. 22. Mr. M.N. Prasanna, learned counsel appearing for the petitioner has also relied on a ruling of this Court in the case of V.V. Kamath V/S. The Assistant General Manager, Bank of Baroda, Bangalore and others reported in 2006(6) Kar.L.J. 696 where in this Court has held that if the mandatory provisions are violated, it would result in the enquiry being vitiated. 23. I have perused the said judgment. Apparently, that was a case where there was certainly violation of the Rules and Regulations. Thus, this Court was of the opinion that the entire Enquiry resulting in the dismissal is vitiated. But however, that is not the case here. 24. The Apex Court in the case State Bank of Patiala and others V/S. S.K.Sharma reported in (1996) 3 SCC 364 has held thus: “In the case of violation of a procedural provision, which is of a mandatory character, it has to be ascertained whether the provision is conceived in the interest of the persons proceeded against of in public interest. If it is found to be the former, then it must be seen whether the delinquent officer has waived the said requirement, either expressly or by his conduct. If he is found to have waived it, then the order of punishment cannot be set-aside on the ground of the said violation. If on the other hand, it is found that the delinquent officer, employee has not waived it or that the provision could not be waived by him, then the Court or Tribunal should made appropriate directions(include the setting aside of the order of punishment) keeping in mind the approach adopted by the Constitution Bench in case of Managing Director, ECIL V/s. B. Karunakar [ (1993) 4 SCC 727 ]. The ultimate test is always the same, viz, test of prejudice or the test of fair hearing, as it may be called.” 25. Having regard to the findings recorded by me in the earlier paragraphs, there is no merit in this petition inasmuch as no prejudice is caused to the petitioner and a fair hearing is given. Petition stands rejected. Rule discharged.