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2023 DIGILAW 412 (JK)

Mst. Dilshada Mushtaq v. Uco Bank

2023-08-18

SANJAY DHAR

body2023
JUDGMENT : 1) The original petitioner, namely, Sheikh Mushtaq Ahmad, has sought a direction upon the respondents to compute and release the subsistence allowance in his favour with effect from 27.11.2011 till 29.09.2011 by giving the benefit of pay revisions and increase in rates of subsistence allowance as provided in the rules. A further direction has been sought upon the respondents to release the retiral benefits including monthly pension, leave encashment and provident fund strictly as per the rules governing the field. 2) The original petitioner was working as Cashier-cum-Clerk in Srinagar Branch of the respondent Bank. It appears that one Sheikh Shabnam Qayoom was maintaining a Savings Bank Account bearing No.19693 with UCO Bank, Srinagar. On 29.11.2000, a cheque book was shown to have been issued to the said account holder. On 19.12.2000, a cheque for an amount of Rs.2.20 lacs from out of the aforesaid cheque book was shown to have been issued from the Savings Bank Account of the account holder. On 27.06.2001, Sheikh Shabnam Qayoom, the account holder, lodged a complaint with the respondent Bank that she had not obtained the cheque book nor had she issued the cheque for withdrawal of Rs.2.20 lacs. FIR No.65/2001 came to be lodged with Police Station, Maisuma, by the respondent Bank and after investigation of the case, nothing was proved against the original petitioner, as such, challan was not filed against him. However, the respondent Bank initiated departmental proceedings against the original petitioner and he was placed under suspension on 27.11.2001. On 21.02.2002, a charge sheet was served upon the original petitioner in which it was alleged that he had taken delivery of the cheque book in question and thereafter defrauded the bank by withdrawing an amount of Rs.2.20 lacs. After the original petitioner filed his reply to the charges, a regular enquiry was conducted, wherein his involvement in the matter was established, whereafter penalty of discharge from service was imposed upon him. The Appellate Authority set aside the finding on charge of receiving the cheque book but maintained the finding that the original petitioner had withdrawn the money. Accordingly, the penalty of discharge from service with all superannuation benefits was imposed upon the original petitioner. 3) The aforesaid order came to be challenged by the original petitioner by way of a writ petition bearing SWP No.148/2006 before this Court. Accordingly, the penalty of discharge from service with all superannuation benefits was imposed upon the original petitioner. 3) The aforesaid order came to be challenged by the original petitioner by way of a writ petition bearing SWP No.148/2006 before this Court. Vide judgment dated 09.05.2008 passed in the aforesaid writ petition, the order of imposition of penalty upon the original petitioner was set aside. While doing so, the Court held that the original petitioner was not afforded due opportunity to cross-examine certain witnesses which has resulted in prejudice to him. While allowing the petition, the respondent Bank was given liberty to conduct a fresh enquiry against the original petitioner. 4) Pursuant to the judgment of this Court, the original petitioner was reinstated in service by the respondent Bank but it was provided that suspension order passed against him would continue. A fresh enquiry was conducted by the respondents against the original petitioner and ultimately, the disciplinary authority vide its final order dated 29th September, 2011, imposed penalty of discharge of the original petitioner from service with superannuation benefits i.e., pension, provident fund and gratuity as would be due otherwise under the Rules and Regulations prevailing at the relevant time and without disqualification for future employment. In the same order, the disciplinary authority concurred with the findings of the enquiry officer, who had concluded that the allegation regarding taking delivery of the cheque book relating to the account of Sheikh Shabnam Qayoom has been partly proved whereas the allegation regarding filling up of the cheque leaf from the cheque book in own writing of the original petitioner and thereafter forging signatures of Sheikh Shabnam Qayoom and withdrawing the amount by signing as Reyaz Ahmad as the recipient of the amount, has been proved. 5) The original petitioner has not thrown any challenge to order dated 29.09.2011 passed by the disciplinary authority but by way of instant writ petition, he has voiced certain other grievances. According to the original petitioner, during the period he was under suspension, he has not been paid subsistence allowance at the rates provided under the Rules and he has not been given the benefit of pay revisions which in turn would have led to revision in the rate of his subsistence allowance. According to the original petitioner, during the period he was under suspension, he has not been paid subsistence allowance at the rates provided under the Rules and he has not been given the benefit of pay revisions which in turn would have led to revision in the rate of his subsistence allowance. It has also been contended that the respondent Bank has ordered recovery of Rs.2.20 lacs from his retiral benefits though no such punishment has been awarded against him. It is pertinent to mention here that during pendency of the writ petition, the original petitioner died and the present writ petition is being pursued by his legal heirs. 6) The respondent Bank has contested the writ petition by filing a reply thereto. In its reply, the respondent Bank has submitted that all the dues to which the original petitioner was entitled to have been paid to him. It has been further submitted that respondent No.4 had asked the original petitioner to settle the account of dues with the Bank but he has not responded to these requests. The respondents have taken a stand that if at all anything is due to the original petitioner, they are ready to reconcile the accounts and pay the outstanding dues to the original petitioner provided he cooperates with them. The respondents have, however, submitted that since the petitioner has caused loss to the tune of Rs.2.20 lacs to the respondent Bank, as such, they are well within their rights to deduct the said amount along with interest from the dues of the petitioner. It has been submitted that an amount of Rs.2,96,649/ is lying against the original petitioner in Sundry Debtor account. It has also been contended that since the petitioner was discharged from service, he is not entitled for encashment of privilege leave which otherwise is provided under Point (9) of the Bipartite Settlement dated 06.09.1989. 7) I have heard learned counsel for the parties and perused the record of the case. 8) As already noticed, the original petitioner has been discharged from service on account of the fact that he has been found guilty of certain charges in a departmental enquiry. The said order has attained finality as the same has not been challenged by the original petitioner. 8) As already noticed, the original petitioner has been discharged from service on account of the fact that he has been found guilty of certain charges in a departmental enquiry. The said order has attained finality as the same has not been challenged by the original petitioner. As per order dated 29.09.2011 passed by the disciplinary authority, the original petitioner has been discharged from Bank’s service with superannuation benefits i.e., pension, provident fund and gratuity as would be otherwise due under Rules and Regulations without disqualification for future employment. 9) So far as the grant of leave encashment is concerned, it is to be noted that as per communication dated 05.07.2008, whereby, while reinstating the original petitioner pursuant to the judgment dated 09.05.2008 passed by this Court in SWP No.148/2006, the period of absence of the original petitioner has not been treated as period spent on duty. Therefore, the release of leave encashment part of the retiral benefits of the original petitioner has to be decided by the respondents in the light of the decision taken by them while placing the petitioner under suspension in terms of communication dated 05.07.2008. Since the said communication has not been challenged by the petitioner, therefore, the same has also attained finality. 10) That takes us to the question as to whether the respondent Bank is justified in effecting recovery of the amount which the original petitioner is stated to have fraudulently withdrawn from the account of Sheikh Shabnam Qayoom. Learned counsel for the petitioner has submitted that since the penalty as regards the recovery of the said amount has not been imposed upon the original petitioner by the disciplinary authority, therefore, it is not open to the respondent Bank to effect recovery thereof, that too with interest. In this regard the learned counsel has relied upon the judgment of the Kerala High Court in the case of State Bank of Travancore vs. Assistant Labour Commissioner (Central), Controlling Authority (Payment of Gratuity Act), Trivandrum & other, 2012 Legal Eagle (Ker) 2137, and the judgment of the Supreme Court in the case of Jaswant Singh Gill bs. Bharat Coking Coal Ltd. & others, (2007) 1 SCC 663 . Bharat Coking Coal Ltd. & others, (2007) 1 SCC 663 . 11) It is an admitted case of the parties that the service conditions of the original petitioner are governed by the UCO Bank Officer Employees (Discipline and Appeal) Regulations, 1976 and the Banking Employees Wages & Service Conditions formulated on the basis of Bipartite Settlement. As per Clause 12.2 of Bipartite Settlement dated 19.10.1966, which is applicable to the respondent Bank, there cannot be any forfeiture of the gratuity on account of misconduct except in cases where such misconduct causes financial loss to the bank and in that case to that extent only. Thus, once it is proved that an employee of the bank has committed a misconduct and the said misconduct has caused financial loss to the bank, it will be open to the bank to recover the said loss by forfeiture of the gratuity to the extent of loss caused. 12) Apart from the above, as per Clause (a) of Section 4(6) of Payment of Gratuity Act, the gratuity of an employee, whose services have been terminated for any act, wilful omission or negligence causing any damage or loss to, or destruction of, property belonging to the employer, shall be forfeited to the extent of the damage or loss caused. The expression ‘shall’ has been used in the aforesaid clause, meaning thereby that it is mandatory for an employer to deduct the amount of gratuity of an employee to the extent of loss caused if the employee has been terminated from service for having caused loss to the property of the employer. 13) So far as the ratio laid down in the judgments relied upon by learned counsel for the petitioner is concerned, the same is not applicable to the instant case, as in those cases, the services of the employees were not terminated for having caused loss to the employer but their services were terminated for the reasons which are covered by clause (b) of Section 4(6) of the Payment of Gratuity Act. As per the said clause, the forfeiture of the gratuity by the employer is discretionary and not mandatory. As per the said clause, the forfeiture of the gratuity by the employer is discretionary and not mandatory. In addition to this, in the case of State Bank of Travancore (supra), the gratuity of the employee was forfeited without issuing show cause notice to him whereas in Jaswant Singh Gill’s case (supra), amount of loss caused by the action of the employee was not quantified by the employer prior to forfeiture of the gratuity. The facts of the instant case are entirely different inasmuch as the respondent Bank has not passed any order of forfeiture of gratuity of the deceased employee as yet. Thus, the judgments relied upon by the petitioners are of no help to their case. 14) It has been contended by learned counsel for the petitioners that the Disciplinary Authority has imposed the punishment of discharge from service upon the original petitioner with superannuation benefits, therefore, the respondent Bank cannot deduct any amount from his retiral benefits. The argument is without any merit for the reason that the original petitioner, as per the punishment imposed upon him, was to be discharged from service with superannuation benefits as per the rules and regulations, meaning thereby that the original petitioner has to be given superannuation benefits subject to relevant rules and regulations. Clause (a) of Section 4(6) of the Payment Gratuity Act entitles the employer to deduct the amount of loss suffered by it from the gratuity of the employee. Thus, the retiral benefits can be given to the petitioners subject to this provision. 15) In the instant case, as already noted, the original petitioner has been found guilty of the charge of gross misconduct and it has been established in the disciplinary proceedings that he has defrauded the bank by withdrawing an amount of Rs.2.20 lacs from the account of Ms. Sheikh Shabnam Qayoom. Therefore, the respondent Bank would be within its right to deduct an amount of Rs.2.20 lacs from the gratuity which is due to the petitioner. This, of course, can be done by the Bank only after following the principles of natural justice. Sheikh Shabnam Qayoom. Therefore, the respondent Bank would be within its right to deduct an amount of Rs.2.20 lacs from the gratuity which is due to the petitioner. This, of course, can be done by the Bank only after following the principles of natural justice. However, the respondent Bank cannot deduct the interest accrued on the said from the retiral dues of the petitioner because as per its own case, the whole of the retiral benefits have not been paid to the original petitioner, meaning thereby that certain amount due to the original petitioner is still lying with the respondent Bank on which the Bank must have earned interest. Therefore, it would not be open to the respondent Bank to deduct the amount of interest on Rs.2.20 lacs from the retiral benefits due to the original petitioner. 16) It has been contended by learned counsel for the petitioner that once this Court vide its judgment dated 09.05.2008 passed in SWP No.148/2006 had directed reinstatement of the original petitioner, the respondents could not have placed him under suspension upon his reinstatement in terms of communication dated 05.07.2008. 17) The aforesaid argument of learned counsel for the petitioner appears to be misconceived for the reason that as per Regulation 12(4) of the UCO Bank Employees (Discipline and Appeal) Regulations, 1976, where a penalty of dismissal etc. from service imposed upon an officer or employee under suspension is set aside or declared void by a Court of law and the disciplinary authority decides to held further enquiry on the allegations on which the penalty of dismissal etc. was originally imposed, the officer or the employee is deemed to have been placed under suspension by the competent authority from the date of the original order of dismissal etc. and shall continue to remain under suspension until further orders. In view of this Regulation, the action of respondent Bank to place the petitioner under suspension even after his reinstatement once they decided to hold a fresh enquiry, is absolutely in accordance with the relevant Regulations. 18) That takes us to the claim of the original petitioner as regards the dues on account of arrears of suspension allowance due to revision of pay and consequent increase in rates of suspension allowance. 18) That takes us to the claim of the original petitioner as regards the dues on account of arrears of suspension allowance due to revision of pay and consequent increase in rates of suspension allowance. On this aspect of the matter the respondents have fairly stated in their reply that they are ready to re-consider this issue once the petitioner comes forward and provides requisite details to them. Therefore, there shall be no difficulty for the respondents to re-work the amount of suspension allowance that has been actually paid to the original petitioner and that may be due to him on account of revision in the rates of suspension allowance as a result of pay revision. 19) In view of the above, the writ petition is disposed of with the following directions/observations: (I) The respondents shall calculate the amount that may be due to the original petitioner on account of arrears of suspension allowance due to change in rates of suspension allowance and due to revision in pay revisions and if anything is found due to the original petitioner, the same shall be paid to the petitioners within a period of one month from the date of this judgment. In this regard the petitioners shall extend all cooperation to the respondents by providing details of amount drawn by the original petitioner on account of subsistence allowance. (II) It shall be open to the respondent Bank to recover an amount of Rs.2.20 lacs (rupees two lacs and twenty thousand) from the original petitioner out of the dues on account of gratuity but it cannot deduct the amount of interest accrued on the aforesaid amount. In case the respondent Bank proposes to deduct the aforesaid amount from the gratuity, the same shall be done only after following the principles of natural justice. (III) It shall be open to the respondent Bank to take a decision as regards the payment of amount on account of leave encashment after taking into account the fact that the suspension of the original petitioner has not been treated as period spent on duty.