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2008 DIGILAW 506 (KAR)

Syndicate Bank v. M. Hannmanthappa

2008-09-15

RAM MOHAN REDDY

body2008
ORDER Ram Mohan Reddy, J The petitioner, having appointed the respondent as a clerk, directed him to work at Srirama Nagar Branch during the period 11-04-1979 and 21-03-1988 and while discharging duties in the Postal Outward Department, in the said branch, from 27-08-1987 to 29-01-1988, allegedly made entries in the Postal Outward Register maintained at the branch and secured reimbursement of the amounts declaring, indicating actual postal expenditure incurred by him on behalf of the Bank inrespect of 279 articles consisting of notices to borrowers pigmy balance confirmatories, etc., out of which entries against 33 items of registered post, were indicated with receipt numbers said to be assigned by the Postal Department. It is the allegation of the petitioner, that the respondent did not actually post the letters, but secured reimbursement of the monies after making entries in the register giving the impression of having dispatched the 279 articles through post. The petitioner having noticed the irregularities, on 29-01-1988, withdrew the respondent from the Postal Outward Department and on 30-01-1988, 263 unstamped Inland letters said to have been dispatched by post were handed over to the Branch Manager. The respondent, by letter dated 3-2-1988 addressed to the Divisional Manager, Divisional Office, Bellary, confessed to have not sent 263 notices issued by the Advances department during the period from August 1987 to January 1988 and the amount drawn as reimbursement of postal expenses, was misutilised by him and sought the imposition of a minor punishment of warning. By another letter dated 15-02-1988, the respondent requested 90 days' time or until the date of disbursement of bonus amount for the year 1987, whichever was earlier to reimburse the amount mis-utilized. 2. The petitioner instituted a Disciplinary proceedings by issuing a charge-sheet dated 16-05-1989 Annexure-"B" charging the respondent of having committing acts of misconduct prejudicial to the interest of the Bank, in accordance with Clause 19.5 (j) of the Bipartite settlement. The petitioner though acknowledged the charge-sheet, did not submit a reply, leading to the appointment of an Enquiry Officer to enquire into the charges, who held an enquiry and submitted a report dated 2-11-1990 Annexure- "C" holding the charges proved. The petitioner though acknowledged the charge-sheet, did not submit a reply, leading to the appointment of an Enquiry Officer to enquire into the charges, who held an enquiry and submitted a report dated 2-11-1990 Annexure- "C" holding the charges proved. The Assistant General Manager, the Disciplinary Authority in respect of the petitioner, concurred with the findings of the Enquiry Officer and held the respondent guilty of the charges of misconduct, which in the opinion of the Disciplinary Authority being grave, and having gone through all the papers placed before him, by order dated 14-01-1991 Annexure-"D", dismissed the respondent from the services of the Bank. The respondent preferred an appeal whence the Appellate Authority, having regard to the material on record, the evidence of the witness for the Management adduced before the Enquiry Officer and the Enquiry report, concluded that the respondent committed acts of misconduct of mis-appropriation of monies and falsification of records and Accounts during the period between 14-09-1987 to 25-01-1988 and derived undue pecuniary benefit, in a manner unbecoming of a Bank employee and having found no extenuating circumstances warranting reconsideration of the decision of the Disciplinary Authority, by order dated 10-04-1991 Annexure-"G", dismissed the appeal. 3. The respondent initiated Conciliation proceedings under the Industrial Disputes Act, 1947, for short Act, by filing a petition dated 4-10-1995 Annexure-"H" which when ended in a failure report, the Central Government, the appropriate authority, in exercise of jurisdiction under Section 10(1)(d) of the Act, referred the industrial dispute for adjudication to the Presiding Officer, Central Government Industrial Tribunal-cum-Labour Court, Bangalore (for short 'Tribunal'). The reference was numbered as C.R.109/1999, whence the respondent filed a claim statement, inter alia, alleging that he admitted the charges at the instance of the Enquiry Officer who had stated that by such admission, nothing untoward would happen to him. In addition, it was contended that two other employees by name Allan Faria and Ravi M. Halli similarly circumstanced, the Management had taken a lenient view by imposing a minor punishment. The petition was resisted by filing Statement of objections dated 3-10-2001 of the petitioner arraigned as the 2nd party in the proceedings, denying the allegations set out in the Claim statement. The petitioner contended that the punishment of dismissal from service was commensurate with the gravity of misconduct proved and in the absence of extenuating or mitigating circumstances, imposition of minor punishment did not arise. 4. The petitioner contended that the punishment of dismissal from service was commensurate with the gravity of misconduct proved and in the absence of extenuating or mitigating circumstances, imposition of minor punishment did not arise. 4. The Tribunal, in the premise of the pleadings of parties, framed an additional issue over the validity of the domestic enquiry and after recording the depositions of the witness for the petitioner as well as that of the respondent and marked documents as exhibits, the Tribunal, by order dated 18-01-2007, answered the additional issue in the affirmative holding the enquiry as fair and proper. 5. Before the Tribunal, the learned counsel for the respondent contended that the dismissal of the services of the respondent was highly discriminatory as two other employees similarly circumstanced having committed similar misconducts, the petitioner had taken a lenient view and that the respondent aged 55 years, at the fag end of his service, a lenient view betaken. The Tribunal, by award dated 21-02-2008 Annexure-"A", held the charges against the respondent proved and guilty of the acts of misconduct, observed that the quantum of punishment imposed on two other employees had no bearing on the punishment of dismissal imposed on the respondent, nevertheless, held that ends of justice would be met by reducing the punishment of dismissal to one of reinstatement, without back-wages from the date of dismissal and withholding of four annual increments with cumulative effect with continuity of service and consequential benefits. Hence, this petition. 6. Learned counsel for the petitioner while assailing the award, contends that the admission of commission of the acts of misconduct, leading to the findings recorded by the Enquiry Officer that the charges were proved as affirmed by the Disciplinary Authority and recording a finding of guilt coupled with the order of the Appellate Authority observing that there were no extenuating or mitigating circumstances to interfere with the order of dismissal, the Tribunal was justified in affirming the said finding. According to the learned counsel, the acts of misconduct held proved were not only mis-appropriation but also falsifying the records so as to make believe that the postal articles had been dispatched and as if the postal authorities had assigned numbers for the registered articles which cumulatively constituted a serious misconduct. According to the learned counsel, the acts of misconduct held proved were not only mis-appropriation but also falsifying the records so as to make believe that the postal articles had been dispatched and as if the postal authorities had assigned numbers for the registered articles which cumulatively constituted a serious misconduct. According to the Learned Counsel, the petitioner having lost confidence in the respondent, the Tribunal fell in error in interfering with the punishment of dismissal. Learned counsel hastens to add that in the light of the gravity of misconduct proved, interference with the punishment of dismissal by the Tribunal smacks of misplaced sympathy and therefore capricious and arbitrary. Learned counsel places reliance upon the reported opinions of the Apex Court in support of the contention that the acts of misconduct held proved deserved serious punishment and that such acts had to be dealt with an iron hand. 7. Per contra, learned Senior counsel Sri. K. Subba Rao contends that even if the finding over the misconduct is unassailable, that by itself and nothing more, did not warrant the imposition of a major punishment of dismissal from service. Learned counsel makes reference to Clause (c) of Section-12 Part-XXX of the Bipartite Settlement to contend that the Disciplinary Authority is under an obligation to take into consideration the gravity of misconduct proved, the previous record of the workman or any aggravating or extenuation circumstances before considering the award of punishment According to the learned Senior counsel, the Disciplinary Authority, having not complied with the provisions of the Bipartite Settlement, the imposition of the punishment of dismissal was justifiably interfered with by the Tribunal, and reducing to that of reinstatement denying back-wages, reduction of four increments with cumulative effect, however with continuity of service and consequential benefits. 8. Having heard the learned counsel for the parties, perused the pleadings and examined the order impugned, indisputably, the material on record discloses that the respondent, a workman engaged as a clerk to discharge duties in the Postal Outward Department, committed the acts of misconduct of falsifying the records to make believe the fact of having dispatched 279 articles through post out of which some were registered post, and secured reimbursement of Rs.1,287.65/- as postal charges, though the respondent had in fact not dispatched the postal articles. Thus, the respondent had not only mis-appropriated Rs.1,287.65/-, in addition, falsified the Accounts, which stood admitted by the respondent in his letters dated 03.02.1988 and 15.02.1988. What is also not in dispute is the fact that the respondent admitted his guilt before the Enquiry Officer and thereafter in the reply to the proposed punishment of dismissal. It is no doubt true that the respondent immediately on being apprehended of the commission of the acts of misconduct, did not pay the amount reimbursed and mis-appropriated, but sought time and eventually did so. Thus, the question that arise for decision-making is, "Whether in the facts and circumstances the punishment of dismissal imposed on the respondent is commensurate with the gravity of the misconduct proved, and if so, whether the Tribunal was justified in exercising its extraordinary discretion under Section 11-A of the Act to interfere with the quantum of punishment?" 9. The Apex Court, in JANATHA BAZAR (SOUTH KANARA CENTRAL COOPERATIVE WHOLESALE STORES LTD.) AND OTHERS vs SECRETARY, SAHAKARI NOUKARARA SANGHA AND OTHERS, dealing with in a case of misappropriation of value of goods amounting to Rs.24,239.97/- and Rs.19,884.06/- by a workman leading to his dismissal from service, held thus: "Once an act of mis-appropriation is proved, may be for a small or large amount, there is no question of showing uncalled-for sympathy and reinstating the employees in service. Law on this point is well settled. (Re: Municipal Committee, Bahadurgarh vs: Krishnan Behari (1996) 2 SCC 714 : 1996 SCC (L&S) 539 : (1996) 33 ATC 238 ). In V.P.S.R.T.C v. Basudeo Chaudhary ( (1997) 11 SCC 370 : 1998 SCC (L&S) 155)), this Court set aside the judgment passed by the High Court in a case where a conductor serving with U.P. State Road Transport Corporation was removed from service on the ground that the alleged misconduct of the conductor was an attempt to cause loss of Rs.65 to the Corporation by issuing tickets to 23 passengers for a sum of Rs.2.35 but recovering@Rs.5.35 per head and also by making entry in the waybill as having received the amount of Rs.2.35, which figure was subsequently altered to Rs.2.85. The Court held that it was not possible to say that the Corporation removing the conductor from service has imposed a punishment which is disproportionate to his misconduct Similarly in Punjab Dairy Development Corpn. The Court held that it was not possible to say that the Corporation removing the conductor from service has imposed a punishment which is disproportionate to his misconduct Similarly in Punjab Dairy Development Corpn. Ltd. v. Kala Singh ( (1997) 6 SCC 159 : 1997 SCC (L&S) 1434)), this Court considered the case of a workman who was working as a Dairy Helper-cum-Cleaner for collecting milk from various centres and was charged for the misconduct that he inflated the quantum of milk supplies in the milk centres and also inflated the quality of fat contents where there were less fat contents. The Court held (at SCC 00. 161-62, para 4) that in view of the proof of misconduct a necessary consequence will be that the management had lost confidence that the workman would truthfully and faithfully carry on his duties and consequently the Labour Court rightly declined to exercise the power under Section 11-A of the ID Act to grant relief with minor penalty." (Emphasis Supplied) 10. In T.N.C.S. CORPN. LTD AND OTHERS vs K. MEERABAI, the Apex Court, following its decision in B.C. CHATURVEDI vs. UNION OF INDIA, as extracted in Paragraph 26 of the judgment, held thus: "35. In the instant case, the charged employee holds a position of trust where honesty and integrity are inbuilt requirements of functioning and, therefore, in our opinion, the matter should be dealt with firmly with firm hands and not leniently. In the instant case, the respondent deals with public money and is engaged in financial transactions or acts in a fiduciary capacity and, therefore, highest degree of integrity and trustworthiness is a must and unexceptionable. Judged in that background, the conclusion of the learned Single Judge as affirmed by the Division Bench of the High Court do not appear to be proper. We have no hesitation to set aside the same and restore the order passed by the disciplinary authorities upholding the order of dismissal." 11. In M.P ELECTRICITY BOARD vs JAGADISH CHANDRA SHARMA. The Apex Court observed that the Tribunal or Labour Court cannot interfere with the quantum of punishment based on irrational or extraneous factors and certainly not on what it considers a compassionate ground. The jurisdiction vested with the Labour Court to interfere with punishment is not to be exercised capriciously and arbitrarily. In M.P ELECTRICITY BOARD vs JAGADISH CHANDRA SHARMA. The Apex Court observed that the Tribunal or Labour Court cannot interfere with the quantum of punishment based on irrational or extraneous factors and certainly not on what it considers a compassionate ground. The jurisdiction vested with the Labour Court to interfere with punishment is not to be exercised capriciously and arbitrarily. It is necessary, in a case were the Labour Court finds the charge proved, for a conclusion to be arrived at that the punishment was shocking disproportionate to the nature of the charges found proved, before it can interfere to reduce the punishment. When charges proved are grave vis-a-vis the establishment, interference with punishment of dismissal cannot be justified. 12. The principles laid down in the aforesaid rulings makes it abundantly clear that when an employee holds a position of trust, honesty and integrity inbuilt, requirements of functioning, calling for highest degree of integrity and trustworthiness, leniency in the matter of misconduct proved, touching upon the honesty and integrity of the employee, would lead to misplaced sympathy. 13. It is no doubt true that Clause (c) of Section 12 Part XXX of the Bipartite settlement stales that while awarding punishment by way of disciplinary action, the authority should take into account the gravity of misconduct, the previous record, if any, of the employee and any other aggravating or extenuating circumstances, that may exist and if there is sufficient extenuating circumstances, misconduct be condoned and if the misconduct is of a "gross" type, he may be merely discharged, with or without notice or on payment of a month's pay and allowances, in lieu of notice. So also, it is stated that such discharge may follow if the evidence is found to be insufficient to sustain the charge and where the Bank does not, for some reason or other, think it expedient to retain the employee in question any longer in service and that such discharge shall not be deemed to amount to disciplinary action. 14. Having regard to the nature of charge against the respondent, more appropriately one of misappropriation and falsification of the records, cannot be said to be too minor so as to take a lenient view. 14. Having regard to the nature of charge against the respondent, more appropriately one of misappropriation and falsification of the records, cannot be said to be too minor so as to take a lenient view. The respondent, a clerk, was entrusted with the work of postage of letters, correspondence, confirmatory notes, bounced cheques, notices, etc, totalling to 279 articles, which if not communicated to the parties concerned within time could adversely affect the reputation of the Bank and also became liable to claims. The respondent instead of discharging the duties assigned to him, falsified the entries in the records to make believe that the postal articles were dispatched through post, and sought reimbursement of the postal charges, during the extended period from 27.08.1987 to 29.1.1988. But for the timely intervention by a checking of the records, perhaps the Bank would have had to suffer legal claims at the hands of borrowers or c1ientel. The action of the respondent cannot but be said to have put the business of the Bank in jeopardy. 15. The Disciplinary Authority, in the order Annexure-"D", is stated to have carefully gone through all the papers placed before him and found that the respondent derived unlawful benefits at the cost of the Bank and committed a serious misconduct. The Appellate Authority, in the order Annexure-"G", makes it abundantly clear that he did not find any extenuating circumstances warranting reconsideration of the decision of the Disciplinary Authority. In terms of the Bipartite Settlement, it cannot be said that neither the Disciplinary Authority nor the Appellate Authority did not consider mitigating circumstance before imposing the punishment of dismissal, more appropriately to the material on record and the satisfactory evidence to prove the charge against the respondent. The nature of charge held proved, in the opinion of the authorities, did not provide sufficient extenuating circumstances so as to condone the misconducts and that the misconducts were not merely gross, but grave in nature warranting the punishment of dismissal. 15. The Tribunal, considering that two other employees were dealt with leniently, recorded a finding that there was discrimination and victimisation in the case of the respondent in the imposition of the punishment of dismissal, very strangely, without assigning cogent reasons or findings, concluded that there was a need to interfere with the quantum of punishment. 15. The Tribunal, considering that two other employees were dealt with leniently, recorded a finding that there was discrimination and victimisation in the case of the respondent in the imposition of the punishment of dismissal, very strangely, without assigning cogent reasons or findings, concluded that there was a need to interfere with the quantum of punishment. I say it is strange because, the Tribunal recorded a positive finding that the amount involved was not meager and more so, in the light of non-dispatching of 279 articles from the Postal Outward Department and falsification of records. In my opinion, the interference with the quantum of punishment is without justification and the exercise of discretion, is capricious and arbitrary. In the circumstances, there was no justification for the Tribunal to interfere with the order of dismissal, more appropriately in the light of the charges proved against the respondent. In my view, the Tribunal failed to follow the principles laid down by the Apex Court in the matter of dealing with firm hands when charges proved touch upon the position of trust, honesty and integrity of the employees, more so in a Banking institution. 16. The writ petition is allowed. The award dated 21-02-2008 Annexure-“A” is quashed in so for as it relates to interference with the punishment of dismissal. The award stands modified answering the points of reference by the State Government in the affirmative, holding the dismissal of the respondent from the service, as justified, while rejecting the reference stands.