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2014 DIGILAW 572 (ORI)

Khirod Kumar Sahu v. Odisha Gramya Bank

2014-09-05

BISWANATH RATH

body2014
JUDGMENT Biswanath Rath, J.: By filing this writ petition, the petitioner has prayed for the following relief(s) “(a) The writ application may be allowed (b) A writ in the nature of certiorari may be issued quashing Annexures-12 and 14. (c) A writ in the nature of mandamus may be issued directing the opposite parties to allow the petitioner to function as usual without any degradation and to consider the case of the petitioner for promotion and to consider the case of the petitioner for promotion as and when the petitioner will be found to be eligible for the same And such other order(s)/direction(s)/writ(s) may be issued in giving complete relief to the petitioner” 2. The petitioner’s case as appearing through the writ petition is that the petitioner entered into the service of opposite party no.1 previously known as Cuttack Gramya Bank as Manager in the year 1980. He claims to have been rendering duty to the best satisfaction of all concerned and never acted in a manner, which will go against the departmental interest of the Bank. While continue as Branch Manager of Rudhia Branch in the year 1995, one Cash Credit proposal for sanction of loan worth Rs.1,10,000/-(rupees one lakh ten thousand) was received by him. As per the conditions for grant of Cash Credit facility one needs to deposit certain amount and to provide equitable mortgage of landed property worth Rs.70,000/-(rupees seventy thousand). Loanee deposited an amount of Rs.80,205/-(rupees eighty thousand two hundred five), which was the renewal proceed of old MSYC of Rs.70,000/-(rupees seventy thousand). At this stage coming to know that only a sum of Rs,1,00,000/-(rupees one lakh) has been sanctioned in his favour, the loanee expressed his unwillingness to give equitable mortgage of Rs.70,000/-(rupees seventy thousand), since difference between the loan amount and deposit was less than Rs.20,000/-(rupees twenty thousand), consequently the loanee requested to sanction the aforesaid loan against his deposit of Rs.80,205/-(rupees eighty thousand) two hundred five) and further requested not to insist on the submission of equitable mortgage. Failing such exemption, he threatened to pursue his sister to take back her deposit. The particular Branch being a small Branch, apprehending loosing business in the Bank, the petitioner contacted the senior Manager Credit Administration Department over telephone and sought for his advice. Failing such exemption, he threatened to pursue his sister to take back her deposit. The particular Branch being a small Branch, apprehending loosing business in the Bank, the petitioner contacted the senior Manager Credit Administration Department over telephone and sought for his advice. The petitioner further submitted that the Credit Administration Department advised him over telephone not to insist on submission of equitable mortgage and directed the petitioner to release the loan and advised the petitioner to send a letter to the Head Office for confirmation of the transaction with realization. Accordingly, after sanctioning the loan, the petitioner issued a letter to the Head Officer on 29.12.1995 disclosing the entire development and specifically mentioning his discussion over phone with the Credit Administration Department and the advice regarding the disbursement of loan without realization of equitable mortgage. 3. In the year 1999, the petitioner was transferred to Rudhia Branch while the matter stood thus vide letter no.CAD/HO/476/01-02 dated 07.08.2001, the opposite party no.2required to petitioner to submit the reply as to why accountability will not be fixed apart from initiating the disciplinary proceeding against the petitioner for his alleged violation of the sanctioning norms for disbursement of loan deliberately. In response to which the petitioner filed a detailed reply on 25.08.2001 clearly indicating therein that though as per Head Office norms, the loanee was to give equitable mortgage of landed property worth Rs.70,000/-(rupees seventy thousand) but, under the threat by the loanee to take return of his deposits, the petitioner contacted the senior Manager CAD requiring his advice and only after getting the advice of the senior Manager over telephone, he relaxed the condition. On the above plea, the petitioner requested the authorities not take any action against him. The petitioner’s further case is that in spite of his reply dated 25.08.2001 being forwarded by the Manager where the petitioner was working at the relevant time, the Chairman formed disciplinary authority vide reference No.PAD/HO/2284/01-02 dated 24.09.2001, required the petitioner to submit a written statement of defence within fifteen days of receipt of the said letter. In response to which, the petitioner submitted his written statement of defence denying the allegation and charge-sheet against him. While refuting the allegation, the petitioner specifically disclosed the advice and approval of the then senior Manager CAD basing on which he had released the loan amount. In response to which, the petitioner submitted his written statement of defence denying the allegation and charge-sheet against him. While refuting the allegation, the petitioner specifically disclosed the advice and approval of the then senior Manager CAD basing on which he had released the loan amount. In spite of his clear explanation, the disciplinary proceeding was initiated under the impression against the petitioner that he has no response to the charge-sheet. In the enquiry proceeding, the Enquiry Officer on 15.10.2001 allowed the petitioner to verify certain documents and on the 2nd day, i.e., on 20.01.2002 he dropped the enquiry with an observation that the petitioner has admitted the charges. Since the petitioner had not made any admission on the very same day he submitted the representation (22.01.2002) expressing that he has never committed any mistake nor he has admitted the charges before the Enquiry Officer. The petitioner alleged that in spite of his above representation, the disciplinary authority wrote letter no.PAD/VIG/HO/140/02-03 dated 21.08.2002 requiring the petitioner to give his comments to the Enquiry Report within fifteen days, enclosing therein a copy of the enquiry report. In response to the letter dated 21.08.2002 the petitioner on 31.08.2002 submitted his comments repeating the submissions he has already made and prayed before the disciplinary authority to exonerate him from the charges. By subsequent letter dated 31.08.2002, the petitioner wrote to the disciplinary authority that the concerned loan dues has already been liquidated by November 2002 thus again requested to exonerate him from the charges. 4. Considering the response of the petitioner, the disciplinary authority passed final order imposing major penalty of “(a) Degrading the CSO in Officer Cadre, i.e, to JMG Scale-I with the present initial basic pay applicable to JMG Scale-I. (b) Withholding the promotion of CSO for five chances on his eligibility by debarring him to participate in the promotion exercise from JMG scale-I to MMG Scale-II in Officer Cadre.” 5. Challenging the aforesaid order of punishment, the petitioner preferred an appeal before the Board of Directors on 15.05.2003, in the meanwhile the petitioner also approached this Court in W.P.(C) No.5228 of 2003 challenging the order of punishment which writ petition was disposed of on 24.06.2003 with the observation that since the petitioner is pursuing other remedies of appeal High Court was not inclined to interfere with the impugned penalty at that stage, however, this Court directed the appellate authority to dispose of the appeal as early as possible. In the meanwhile, the appeal was disposed of on 23.02.2003 with an order of rejection. The petitioner has assailed the order of punishment as well as the final order in the appeal on the ground that same are illegal, he had at no point of time admitted the charges, the observation of the disciplinary authority that the petitioner has not replied to the charges is contrary to the reality. The disciplinary authority before passing the punishment order ought to have considered his reply dated 22.01.2002. Further the disciplinary proceeding also is bad in the eye of law for not following the minimum basic requirements in case of a disciplinary proceeding such as no evidence, no opportunity of hearing, being followed in the disciplinary proceeding. 6. Per contra, the bank on its appearance relying on its counter submitted that the petitioner was required to disburse the loan as per term fixed by the Head Office in this particular case. The Cash Credit facility was allowed without adhering to the terms and conditions fixed by the Head Office. The charge-sheeted officer, i.e., the petitioner had exceeded his jurisdiction by not adhering to the conditions fixed by the Head Office. The petitioner has failed to serve the bank faithfully and honestly and he has contravened the provisions contained in Cuttack Gramya Bank Staff Service Regulation, 1980. Petitioner failed to prove that he has obtained the approval of waiving of condition from the senior Manager CAD over telephone. Loan disbursement has been over looking the Head Office stipulations noted in the sanction letters, which action is detrimental to the Banks interest. The petitioner failed to submit reply/written statement of defence to the charge memo within stipulated period of time. Loan disbursement has been over looking the Head Office stipulations noted in the sanction letters, which action is detrimental to the Banks interest. The petitioner failed to submit reply/written statement of defence to the charge memo within stipulated period of time. The petitioner was given sufficient opportunity in enquiry proceeding held on 22.01.2002, he admitted the charges and he had even signed the proceeding file admitting this position and he cannot regal out of the same by virtue of his present plea which are a developed story. 7. During the course of argument, though the counsel for the Bank strenuously argued that in view of specific admission of the petitioner in the disciplinary proceeding there was no need for further enquiry yet he contended that the disciplinary proceeding was concluded following the requirements of law. The opposite parties also denied the allegation of the petitioner that there is noncompliance of principle of natural justice in the proceeding. By denying all the allegations made by the petitioner it justified their action claming that there has been no illegality committed either in the disciplinary proceeding or by the disciplinary authority or by the appellate authority. The petitioner though filed rejoinder to the counter affidavit, but the same is a repetition of its statement already made in the writ. From the pleadings of the parties narrated hereinabove, the following points emerges for consideration. 1. If the disciplinary proceeding in relation to the charges against the petitioner is properly conducted or not? 2. If the appellate authority has considered the allegation of the petitioner in its right perspective? 8. Coming to reply on point no.1, the pleading of the party discloses that the enquiry report was submitted with a finding based on so-called admission of the petitioner. A perusal of the proceeding dated 22.01.2002 of the concerned disciplinary proceeding as appearing at Annexure-7 to the writ petition reveals as follows:- “The Enquiry Officer wanted to ascertain from the whether he admit the charges, the CSO admit the charges and the enquiry has been dropped and The report will be submitted to the disciplinary authority within due course.” On being asked, the Charge-sheeted Officer submitted a written defence specifically denying the allegations made against him. The petitioner repeated his counter statement that based on telephonic advice by senior Manager for relaxation of the loan condition he sanctioned the loan without insisting for the equitable mortgage. The petitioner repeated his counter statement that based on telephonic advice by senior Manager for relaxation of the loan condition he sanctioned the loan without insisting for the equitable mortgage. Even though in Para-14 of the writ petition, the petitioner has indicated that that he had submitted a representation before the enquiry officer recording his admission but the perusal of his representation dated 22.01.2002 as available at Annexure-8 do not disclose anything in that regard. It appears to be just a repetition of his reply already made. Consequent upon closer of the domestic enquiry, an enquiry report as appearing at Annexure-9, was submitted on 24.07.2002 disclosing therein that the charges leveled against the petitioner found to be true. Based on finding by the Enquiry Officer the disciplinary authority imposed the following punishments :- “(a) Degrading the CSO in Officer Cadre, i.e., to JMG Scale-I with the present initial Basic Pay applicable to JMG Scale-I. (b) Withholding the promotion of CSO for five chances on his eligibility by debarring him to participate in the promotion exercise from JMG Scale-I to MMG Scale-II in Officer Cadre.” 9. On perusal of the statements of the opposite party in the counter affidavit as well as documents filed by the respective parties the same no where discloses that a disciplinary proceeding further continued beyond the proceeding dated 22.01.2002. The recording on 22.01.2002 discloses that the disciplinary proceeding was dropped in view of admission of charges by the petitioner. The Enquiry Officer also submitted his report based on the admission by the petitioner. The objection dated 22.01.2002 vide Annexure-8 to the writ petition reveals that the petitioner went on objecting the view of the disciplinary authority. There is no document available indicating admission of charges by the petitioner except so-called recording dated 22.01.2002. 10. At this stage, I would like to discuss here some of the decisions of the Apex court covering the dispute in the present case. In AIR 1963 S.C. 364 in para-23. the Hon’ble Apex court held as follows:- A.I.R. 1964 S.C. 364 The Hon’ble Apex court held as follows:- “In exercising its jurisdiction under Article 226 on such plea, the High Court cannot consider the question about the sufficiency or adequacy of evidence in support of a particular conclusion. In AIR 1963 S.C. 364 in para-23. the Hon’ble Apex court held as follows:- A.I.R. 1964 S.C. 364 The Hon’ble Apex court held as follows:- “In exercising its jurisdiction under Article 226 on such plea, the High Court cannot consider the question about the sufficiency or adequacy of evidence in support of a particular conclusion. That is a matter which is within the competence of the authority which deals with the question; but the High Court can and must enquire whether there is any evidence at all in support of the impugned conclusion.” 2. In (2008) 3 SCC 484 in para-17 the Hon’ble Apex court held as follows:- “17. The departmental proceeding is a quasi-judicial one. Although the provisions of the Evidence Act are not applicable in the said proceeding, principles of natural justice are required to be complied with. The courts exercising power of judicial review are entitled to consider as to whether while inferring commission of misconduct on the part of a delinquent officer relevant piece of evidence has been taken into consideration and irrelevant facts have been excluded therefrom. Inference on facts must be based on evidence which meet the requirements of legal principles. The Tribunal was, thus, entitled to arrive at its own conclusion on the premise that the evidence adduced by the Department, even if it is taken on its face value to be correct in its entirety, meet the requirements of burden of proof, namely, preponderance of probability. If on such evidences, the test of the doctrine of proportionality has not been satisfied, the Tribunal was within its domain to interfere. We must place on record that the doctrine of unreasonableness is giving way to the doctrine of proportionality.” 3. In (2006) 5 SCC 88 in Para-25 the Hon’ble Apex court held as follows:- “25…….Although the charges in a departmental proceeding are not required to be proved like a criminal trial, i.e., beyond all reasonable doubt, we cannot lose sight of the fact that the enquiry officer performs a quasi-judicial function, who upon analyzing the documents must arrive at a conclusion that there had been a preponderance of probability to prove the charges on the basis of materials on record. While doing so, he cannot take into consideration any irrelevant fact. He cannot refuse to consider the relevant facts. He cannot shift the burden of proof. While doing so, he cannot take into consideration any irrelevant fact. He cannot refuse to consider the relevant facts. He cannot shift the burden of proof. He cannot reject the relevant testimony of the witnesses only on the basis of surmises and conjectures. He cannot enquire into the allegations with which the delinquent officer had not been charged with.” 4. In 2009(1) OLR (SC)-875 the Hon’ble Apex court in Para-6, 7 and 8 held as follows:- “6. Natural justice is another name for common sense justice. Rules of natural justice are not codified canons. But they are principles ingrained into the conscience of man. Natural justice is the administration of justice in a common sense liberal way. Justice is based substantially on natural ideals and human values. The administration of just is to be freed from the narrow and restricted considerations which are usually associated with a formulated law involving linguistic technicalities and grammatical niceties. It is the substance of justice which has to determine its form. 7. The expressions “natural justice” and “legal justice” do not present a water-tight classification. It is the substance of justice which is to be secured by both, and whenever legal justice fails to achieve this solemn purpose, natural justice is called in aid of legal justice. Natural justice relieves legal justice from unnecessary technicality, grammatically pedantry or logical prevarication. It supplies the omissions of a formulated law. As Lord Buckmaster said, no form or procedure should ever be permitted to exclude the presentation of a litigants’ defence. 8. The adherence to principles of natural justice as recognized by all civilized States is of supreme importance when a quasi-judicial body embarks on determining disputes between the parties, or an administrative action involving civil consequences is in issue. These principles are well settled. The first and foremost principle is what is commonly known as audi alteram partem rule. It says that no one should be condemned unheard. Notice is the first limb of this principle. It must be precise and unambiguous. It should appraise the party determinatively the case he has to meet. Time given for the purpose should be adequate so as to enable him to make his representation. In the absence of a notice of the kind and such reasonable opportunity, the order passed becomes wholly vitiated. It must be precise and unambiguous. It should appraise the party determinatively the case he has to meet. Time given for the purpose should be adequate so as to enable him to make his representation. In the absence of a notice of the kind and such reasonable opportunity, the order passed becomes wholly vitiated. Thus, it is but essential that a party should be put on notice of the case before any adverse order is passed against him. This is one of the most important principles of natural justice. It is after all an approved rule of fair play. The concept has gained significance and shades with time when the historic documents was made at Runnymede in 1215, the first statutory recognition of this principle found its way into the “Magna Carta”. The classic exposition of Sir Edward Coke of natural justice requires to “vocate, interrogate and adjudicate”. In the celebrated case of Cooper v. Wandsworth Board of Works [(1863) 143 ER 414] the principle was thus stated: “Even God did not pass a sentence upon Adam, before he was called upon to make his defence. “Adam” says God, “where are thou? Hast thou not eaten of the tree whereof I commanded thee that thou shouldest not eat”.” 11. Coming back to the case at hand, the perusal of record at Annexure-7, Annexure-8 and Annexure-9 clearly reveals that there was absolutely no enquiry into the charges leveled against the petitioner in the alleged enquiry proceeding neither any documents exhibited from either side nor there is evidence laid from either side nor there is even any discussion on materials available on record and the records reveal the proceeding was dropped merely for admission by the delinquent. Since the Charge-Sheeted Officer went on objecting the charges leveled against him even after the proceeding was dropped on 22.01.2002 in the interest of justice, the enquiry should have been allowed to continue and or to have been closed after recording the evidence of the parties and with a reason thereof. Law reflected hereinabove does not approve such enquiries. Since the Charge-Sheeted Officer went on objecting the charges leveled against him even after the proceeding was dropped on 22.01.2002 in the interest of justice, the enquiry should have been allowed to continue and or to have been closed after recording the evidence of the parties and with a reason thereof. Law reflected hereinabove does not approve such enquiries. Since the petitioner went on disputing the charges even after recording of so-called admission for ends of justice even at the stage of consideration of the enquiry report by the disciplinary authority, it was well within its domain to ask the Enquiry Officer to conclude the enquiry performing the requirements in the enquiry proceeding and for submitting a detailed report on the alleged charges. Rather the enquiry was allowed to be completed in a perfunctory manner. Even in the appeal stage also the resistance of the petitioner continued and the appellate authority also closed its eyes on the above subject. The entire pleadings of the parties as borne from the writ petition, counter, the affidavits filed thereafter and the case record produced before me, no where reveals that the management is able to establish the charges beyond reasonable doubt. On the other hand, the material goes to establish that the enquiry was concluded purely on the recording of so-called admission of the petitioner, i.e., Charge-Sheeted Officer, which the delinquent went on objecting. The proposed punishment imposed by the disciplinary authority as well as order of the appellate authority being based on such sole recording of admission are all improper and illegal in the eye of law and does not get the support of the law of land. 12. In view of the above, I hold that the so-called enquiry as bad in the eye of law having not followed the basic principles required in a departmental proceeding and thus I hold the question no.1 in favour of the petitioner and against the management. 13. Now, coming to deal with question No.2, in view of my observation that findings of the disciplinary proceeding is bad in the eye of law, the decision of the appellate authority being based on such erroneous conclusion of an enquiry is also bad in law. 13. Now, coming to deal with question No.2, in view of my observation that findings of the disciplinary proceeding is bad in the eye of law, the decision of the appellate authority being based on such erroneous conclusion of an enquiry is also bad in law. Consequently, while answering the question number-2 in favour of the petitioner I allow the writ petition and I declare both the orders vide Annexures 12 and 14 as bad in law and he is entitled to all consequential reliefs he has suffered on account of impugned action. 14. Considering the allegation against the petitioner that he has violated the terms and conditions in the matter of grant of loan to be a serious one, I direct the Bank authority to re-start the enquiry from the stage of proceeding dated 22.01.2002 and the enquiry proceeding has to be completed within a period of three months from the receipt of this judgment affording natural justice to the petitioner. 15. The writ petition succeeds with the above direction. However, there shall be no order as to costs.