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2024 DIGILAW 753 (ALL)

Anchal Kumar Tiwari v. State of U. P.

2024-03-11

J.J.MUNIR

body2024
JUDGMENT : J.J. Munir, J. 1. This matter has been heard on rather unconventional pleadings. On the 25th of August, 2023, the learned Counsel for the petitioner sought time to file a supplementary-affidavit, when the matter came up for admission. The writ petition was, accordingly, adjourned to 12th of September, 2023. A further adjournment was sought on that day. A supplementary-affidavit was filed in Court by the learned Counsel for the petitioner on 27.9.2023, when time was granted to file a supplementary counter-affidavit. The learned Counsel for the respondents filed a supplementary counter-affidavit on 11.10.2023. On that day, the parties did not press for further affidavits; not even a counter-affidavit to the writ petition. The matter was, accordingly, admitted to hearing, which proceeded forthwith, leading to judgment being reserved. 2. This writ petition is directed against an order dated 26th July, 2023 passed by the Secretary/Chief Executive Officer, Mainpuri District Cooperative Bank Ltd., punishing the petitioner after disciplinary proceedings with reversion from the post of Branch Manager Grade-II to Manager Grade-III, and, further, directing recovery of a sum of Rs. 8,53,480/- together with 6% interest on account of loss caused to the Bank. 3. The District Cooperative Bank Ltd., Mainpuri is a Cooperative Bank governed by the provisions of the U.P. Cooperative Societies Act, 1965 (for short, 'the Act of 1965') and service conditions of their employees are governed by the U.P. Cooperative Societies' Employees' Service Regulations, 1975 (for short, 'the Regulations'). The petitioner is employed with the Mainpuri District Cooperative Bank Ltd. (for short, 'the Bank') as a Branch Manager. He was posted as the Branch Manager at the Bhogaon Branch of the Bank. The Committee of Management of the Bank is the petitioner's appointing authority, which comprises the Board of Directors thereof. The Chief Executive Officer of the Bank, who is the Secretary of the Committee of Management, exercises all administrative powers conferred upon him for the purpose of managing the affairs of the Bank. 4. The petitioner was appointed a Clerk/Cashier in the year 2009. He was promoted to the post of the Junior Branch Manager in the year 2014. It is his case that he has been working to the satisfaction of higher officials of the Bank. The petitioner was posted as the Branch Manager at the Bhogaon Branch, District Mainpuri with effect from 1.9.2021. He was promoted to the post of the Junior Branch Manager in the year 2014. It is his case that he has been working to the satisfaction of higher officials of the Bank. The petitioner was posted as the Branch Manager at the Bhogaon Branch, District Mainpuri with effect from 1.9.2021. The petitioner has pleaded for a fact that as the Branch Manager, he was not assigned any role in dealing with direct cash deposits made by customers. The duties assigned to the petitioner at the Bhogaon Branch were to supervise the activities of various functionaries at the Branch, and, at the end of the day, make a tally of the balance-sheet with the cashier. In case, the cashier did not enter any cash deposit in the book, there are no means, according to the petitioner, to know about it, unless there was a complaint. The petitioner says that the genesis of the orders impugned, giving rise to the present writ petition, are that on 20.7.2022, a customer approached the Bank to make some payment through RTGS. That payment, however, could not be made because of insufficient funds. He complained in the matter to the petitioner and when the petitioner personally inquired into it, he found that it was the cashier of the Bank, who would deposit receipts but not credit the customer's account. To safeguard the interest of the Bank and the customer, the petitioner called upon the cashier, one Harish Chandra Gautam, and confronted him with the customer's complaint. The cashier admitted his guilt in writing as also the fact that he had not posted the customer's account with credits of deposit made by the latter. The petitioner made the cashier write a letter on 20.7.2022 and it was retained on record. The petitioner was confronted with the situation that called for disciplinary action against the cashier. He informed top officials of the bank, to wit, the Chief Executive Officer, since the petitioner was not empowered to initiate proceedings. The Deputy General Manager of the Bank was also informed over telephone and requested to come over to the Bank at the earliest. When the higher officers of the Bank reached there, the petitioner tendered them the written report against the cashier and also apprised them of the fact that the cashier had been made to pay the sum of Rs. 6,32,000/-, that he had apparently embezzled. When the higher officers of the Bank reached there, the petitioner tendered them the written report against the cashier and also apprised them of the fact that the cashier had been made to pay the sum of Rs. 6,32,000/-, that he had apparently embezzled. The petitioner also took into custody deposit receipts from the cashier, Harish Chandra Gautam, which bore the various dates of deposit by the customer, to wit, 2.7.2022, 7.7.2022 and 15.7.2022. The recovered amount from the cashier was deposited in the relative account on 20.7.2022. The written admission by Harish Chandra Gautam, the cashier about the fact that he had not deposited the customer's money in his bank account, was placed before the Chief Executive Officer when he reached the Bank on 20.7.2022. 5. Notwithstanding the fact that it was the petitioner who acted promptly upon intimation of this fraud, the petitioner says that he became a victim of office politics and framed in the matter, charging him of negligence and vicarious liability. The petitioner was suspended from service pending inquiry, just two days after the incident i.e. on 22.7.2022. An interim inquiry report was submitted by the Deputy General Manager, where the entire allegations were directed at the cashier and the petitioner held responsible for negligence of duty. There is then by the petitioner a whole lot of pleas of fact and law raised to demonstrate the absence of any liability for him, but that is not a matter with which this Court is concerned. 6. A First Information Report was lodged against Harish Chandra Gautam and the petitioner, giving rise to Crime No. 424 of 2022, under Sections 420, 409 IPC, P.S. Bhogaon, District Mainpuri. The petitioner was granted anticipatory bail in the matter by this Court vide order dated 31.10.2022 passed in Criminal Misc. Anticipatory Bail Application under Section 438 Cr.P.C. No. 10110 of 2022. The Investigating Officer, during the investigation, did not find any complicity for the petitioner and exculpated him. The petitioner, however, remained suspended from service. The petitioner says that he was the man, who unearthed the embezzlement by the cashier, and yet he was proceeded with against by the respondents in their disciplinary jurisdiction. He was served with two charge-sheets, one dated 31.10.2022 and a supplementary dated 3.1.2023, charging him with embezzlement of funds in collusion with the cashier. 7. The petitioner says that he was the man, who unearthed the embezzlement by the cashier, and yet he was proceeded with against by the respondents in their disciplinary jurisdiction. He was served with two charge-sheets, one dated 31.10.2022 and a supplementary dated 3.1.2023, charging him with embezzlement of funds in collusion with the cashier. 7. It is the petitioner's case that he demanded evidence collected against him and wrote various letters demanding documents. Nothing was provided to the petitioner in order to enable him to submit an effective reply to the charge-sheet. The bank proceeded unilaterally and called upon the petitioner through a show-cause notice dated 3.4.2023, asking him to show-cause why he may not be held guilty and punished with reversion from the post of Manager Grade-II to Manager Grade-III, and saddled with recovery of a sum of Rs. 8,53,480/-, on the charge of embezzling funds in connivance with the cashier. The petitioner answered the show-cause notice vide his reply dated 13.4.2023, where again the grievance raised was that necessary documents had not been provided to him. He again pleaded not guilty. On the 15th of April, 2023, the Committee of Management of the Bank passed a resolution calling upon their members to discuss certain points, including the issue of considering the petitioner's reply to the show-cause notice with personal opportunity to him. 8. Pursuant to the said resolution, the petitioner was directed to appear before the Committee of Management on 27.4.2023. He appeared before the Committee on the date fixed, and thereafter, submitted his representation on 2.5.2023. It is the petitioner's case that there was a dissent in the Committee with a divided house of 7 to 6, out of the total 13. Six members spoke for the petitioner. However, on 27.4.2023, a resolution was passed by the Committee of Management to punish the petitioner, on which the impugned order dated 26.7.2023 passed by the Secretary/Chief Executive Officer of the Bank has followed. 9. Heard Mr. Aditya Yadav, learned Counsel for the petitioner, Mr. Ashok Kumar Lal, learned Counsel appearing on behalf of respondent Nos. 3 and 4 and Mr. R.D. Mishra, learned Standing Counsel on behalf of the State. 10. 9. Heard Mr. Aditya Yadav, learned Counsel for the petitioner, Mr. Ashok Kumar Lal, learned Counsel appearing on behalf of respondent Nos. 3 and 4 and Mr. R.D. Mishra, learned Standing Counsel on behalf of the State. 10. It is submitted by the learned Counsel for the petitioner in the first place that going by the provisions of Regulation 84 of the Regulations, two punishments cannot be awarded to an employee and has placed reliance for the purpose upon the law laid down by a Full Bench of this Court in Pancham Ram Yadav v. U.P. Co-Operative Federation Ltd. and another, 2019 (9) ADJ 1 (FB). Reliance has also been placed on the authority of a learned Single Judge in Vijay Bahadur Yadav v. Chairman, U.P. Cooperative Federation Ltd. Lucknow and others, 1992 AWC 1479 All. 11. The other submission, that is founded on the averments in paragraph No. 5 of the supplementary-affidavit, is that the establishment bore the burden of proving the charges by producing evidence on their behalf before the Inquiry Officer, including witnesses. It is argued that even if the petitioner was ex parte before the Inquiry Officer, it was the bounden duty of the establishment to produce evidence through a Presenting Officer, both documentary and oral, to prove the charges. The Inquiry Officer could not assume the charges in the charge-sheet to be true merely because the petitioner had not filed a reply or not appeared before the Inquiry Officer and produced evidence in his defence. 12. Mr. Ashok Kumar Lal and the learned Standing Counsel, on the other hand, have supported the impugned order and said that the entire record of proceedings show that despite extravagant opportunity provided to the petitioner, he chose not to avail the same and kept on harping on an issue of no consequence, to wit, the provision of copies of documents, on the basis of which the case was founded against him by the establishment. 13. This Court has considered the submissions advanced on behalf of the parties by learned Counsel very carefully and perused the record. 14. So far as the first point urged on behalf of the petitioner is concerned, it is necessary to refer to the provisions of Regulation 84 of the Regulations, which read: “84. 13. This Court has considered the submissions advanced on behalf of the parties by learned Counsel very carefully and perused the record. 14. So far as the first point urged on behalf of the petitioner is concerned, it is necessary to refer to the provisions of Regulation 84 of the Regulations, which read: “84. Penalties: (i) Without prejudice to the provisions contained in any other regulation, an employee who commits a breach of duty enjoined upon him or has been convicted for criminal offence or an offence under Section 103 of the Act or does anything prohibited by these regulations shall be liable to be punished by any one of the following penalties: (a) censure. (b) with holding of increment. (c) fine on an employee of Category IV (peon, chaukidar, etc.). (d) recovery from pay or security deposit to compensate in whole or in part for any pecuniary loss caused to the co-operative society by the employee's conduct. (e) reduction in rank or grades held substantively by the employee. (f) removal from service. (g) dismissal from service. (ii) Copy of order of the punishment shall invariably be given to the employee concerned and entry to this effect shall be made in the service record of the employee. (iii) No penalty except censure shall be imposed unless a show-cause notice has been given to the employee and he has either failed to reply within the specified time or his reply has been found to be unsatisfactory by the punishing authority. (iv) (a) The charge-sheeted employee shall be awarded punishment by the appropriate authority according to the seriousness of the offence: Provided that no penalty under sub-clause (e), (f) or (g) of clause (i) shall be imposed without recourse to disciplinary proceedings. (b) No employee shall be removed or dismissed by an authority other than by which he was appointed unless the appointing authority has made prior delegation of such authority to such other person or authority in writing. (v) The appointing authority or person authorised by him while passing orders for stoppage of increments shall state the period for which it is stopped and whether it shall have effect of postponing future increments or promotion.” 15. (v) The appointing authority or person authorised by him while passing orders for stoppage of increments shall state the period for which it is stopped and whether it shall have effect of postponing future increments or promotion.” 15. The question, if it was open to an establishment, the terms and conditions of whose employees are governed by the Regulations to impose more than one punishment, bearing in mind the provisions of Regulation 84 of the Regulations, received consideration of this Court in Vijay Bahadur Yadav (supra). In Vijay Bahadur Yadav, the learned Single Judge of this Court in the context of imposition of three penalties on the employee, whose terms and conditions of service were governed by Regulation 84, held: “4....... Under the aforesaid Regulation, the punishing authority is authorised to impose any one of the penalties provided there under. Censure, withholding of increment and recovery from pay are the penalties provided under the aforesaid Regulation.” 16. There was thereafter much conflict of opinion on the issue, which led to a reference being made to a larger Bench by a Division Bench of this Court. The matter came up before the Full Bench in Pancham Ram Yadav (supra). The questions referred to the Full Bench were: “1. Whether Regulation 84 of the U.P. Co-operative Societies Employees' Service Regulation 1975 read with Rule 83 of the U.P. Co-operative Federation Limited Karmchari Seva Niyamawali, 1980 services can be harmonized so as to uphold the punishment by way of dismissal of an employee coupled with an order directing recovery of an amount on the charge of a financial embezzlement or misappropriation to be included within the fold of Regulation 84? 2. Whether the law laid down in the case of Virendra Kumar Gupta v. State of U.P. and others (Supra) in respect of the true import of Regulation 84 read with Rule 83 aforesaid does not state the correct position of law as against the reasoning given by the learned Single Judge in paragraph No. 13 in the case of Satya Narain Mishra v. Praband Nideshak and another (Supra) and alternatively as to whether the statement of law in that regard as explained in the judgment of Satya Narain Mishra v. Praband Nideshak and another (Supra) should be accepted as the correct position of law ?” 17. Their Lordships of the Full Bench answered the reference in the following terms: “42. Their Lordships of the Full Bench answered the reference in the following terms: “42. We, therefore, answer the questions referred to us as under: (1) Since evident contradiction in the language of Regulation 84 of Regulations, 1975 and Rule 83 of Rules, 1980, the aforesaid provisions cannot be harmonized, hence Regulation 84 of Regulations, 1975 shall prevail over Rule 83 of Rules, 1980 and only one of the punishments prescribed can be imposed as specifically stated in Regulation 84 of Regulations, 1975. (2) The Division Bench judgment in Virendra Kumar Gupta's case (supra) lays down correct law and otherwise view expressed by learned Single Judge in Satya Narain Mishra's case (supra) as also expressed in the Reference order is not correct position of law.” 18. The aforesaid position of the law makes it clear that Regulation 84 of the Regulations limits the power of the establishment to the award of one of the enumerated punishments. The establishment cannot award more than one of the punishments enumerated under Regulation 84 at the same time. 19. In this view of the matter, so far as the first point goes, it has to be answered in favour of the petitioner, inasmuch as the order impugned awards distinctly two of the enumerated punishments under Regulation 84, to wit, one under clause (d) of Regulation 84(1) and the other under clause (e). 20. The next point, that is urged on behalf of the petitioner, is that even if an employee does not file a written statement to the charge-sheet or appear at the inquiry, it does not entitle the respondents to assume the charges to be true. It is the establishment's burden, particularly, in a case where a major penalty may be the outcome, to produce evidence, both documentary and oral in support of the charges before the Inquiry Officer. A perusal of the supplementary counter-affidavit shows that the respondents say that the date, time and place of hearing was fixed by the Inquiry Officer, but the petitioner did not appear. He did not file a reply to the two charge-sheets, including the supplementary. Repeat opportunities were given and documents that he demanded supplied. The fact, however, is not denied that the establishment did not produce any witnesses in support of the charges, though a copy of the inquiry report has not been annexed by either party. He did not file a reply to the two charge-sheets, including the supplementary. Repeat opportunities were given and documents that he demanded supplied. The fact, however, is not denied that the establishment did not produce any witnesses in support of the charges, though a copy of the inquiry report has not been annexed by either party. A perusal of the averments in the counter-affidavit, and more particularly, the impugned order as also the resolution of the Committee of Management dated 27.4.2023, show that the Inquiry Officer submitted an appraisal note on the two charge-sheets, described in Hindi as ^^leh{kkRed fVIi.kh** holding the petitioner guilty. There is no reference in the resolution of the Committee of Management or the impugned order about the Inquiry Officer having had before him any evidence produced in a formal proceeding on behalf of the establishment through a Presenting Officer on charges, which in this case on the own showing of the respondents, ran into as many as thirty-six in the first charge-sheet, and another five, in the supplementary. The tenor of the resolution passed by the Committee of Management dated 27.4.2023 and the impugned order clearly show that the Inquiry Officer dealt with the matter through an appraisal note, based on a perusal of the papers annexed to the charge-sheet and handed over by the establishment to him. 21. It is settled for a salutary principle that in an enquiry involving the imposition of a major penalty, it is imperative for the Inquiry Officer, even if he is otherwise an officer of the establishment, to distance himself and convene formal proceedings acting as an impartial arbiter. It is the burden of the establishment to produce evidence before the Inquiry Officer through a Presenting Officer, both documentary and oral, particularly, oral, that is to say, witnesses in support of the charges, where a major penalty may be imposed. It is open to the delinquent at the inquiry to appear and cross-examine witnesses produced by the establishment. After the establishment have produced their evidence, both documentary and oral, and the stage of cross-examination of the establishment's witnesses is over, the delinquent is to be given opportunity to produce evidence in his defence. If the delinquent does not file a reply to the charge-sheet or does not appear before the Inquiry Officer at all, that does not relieve the establishment of their burden to prove the charges. If the delinquent does not file a reply to the charge-sheet or does not appear before the Inquiry Officer at all, that does not relieve the establishment of their burden to prove the charges. It also does not license the Inquiry Officer to think that the charges set forth in the charge-sheet are proved because the delinquent has not appeared to explain himself. The Inquiry Officer has to direct the establishment to produce evidence and cannot hold the delinquent guilty by default. The delinquent can also not be held guilty by the Inquiry Officer by merely going through the charge-sheet and the papers annexed therewith. May not be the formality of evidence, as done in a Court of law, where procedure is regulated by the Indian Evidence Act, basic fairness in procedure requires that the establishment must produce both documentary evidence and witnesses in the first instance to establish the truth of the charges. This is quite independent of the fact, whether the delinquent defends himself or abstains from the beginning or at any later stage of the inquiry. In this regard, reference may be made to the decision of the Supreme Court in State of U.P. v. T.P. Lal Srivastava, (1996) 10 SCC 702 , where it has been held by their Lordships: “4. This appeal by special leave arises from the judgment of the Allahabad High Court made on 15-3-1993 in Writ Petition No. 12480 of 1987. The admitted position is that while the respondent was working as a Senior Marketing Inspector, a charge-sheet was served on him on 23-11-1984 calling upon him to explain the charges for committing gross irregularities in the movement of wheat outside the State of U.P. Instead of submitting reply to the charge-sheet, he went on dilly-dallying in submitting the reply. Several letters addressed to the respondent proved ineffective. Resultantly, the appellants took a decision on 26-6-1987 holding that the respondent was found guilty of misappropriation. Consequently, he came to be dismissed from service. The respondent challenged the same in the writ petition. The High Court has set aside the order in the impugned order holding that the documents have not been supplied to the respondent and, therefore, the action was vitiated by error of law. Consequently, he came to be dismissed from service. The respondent challenged the same in the writ petition. The High Court has set aside the order in the impugned order holding that the documents have not been supplied to the respondent and, therefore, the action was vitiated by error of law. We do not find any justification in the view taken by the High Court; the substratum of the result is that the appellants have not conducted any enquiry though the respondent had been avoiding to give the reply. Since the respondent had avoided to submit the reply, he has forgone his right to submit his reply. Nonetheless, the appellants are not absolved of the duty to hold an ex-parte enquiry to find out whether or not the charge has been proved. In the event of the Enquiry Officer finding that the charge is proved, he would submit his report to the disciplinary authority. The disciplinary authority should communicate the copy of the enquiry report to the respondent and seek an explanation for the proposed action thereon. If the respondent submits any explanation, the same may be taken into consideration and appropriate order may be passed according to law. Until then, the respondent must be deemed to be under suspension.” 22. So far as the salutary procedure governing inquiries, where a major penalty may be imposed is concerned, the law that it is the establishment's burden to prove the charges in the first instance not only by formally producing evidence before the Inquiry Officer through a Presenting Officer, but also to examine witnesses imperatively, is well-settled in view of the authority of the Supreme Court in State of Uttar Pradesh and others v. Saroj Kumar Sinha, (2010) 2 SCC 772 , Roop Singh Negi v. Punjab National Bank and others, (2009) 2 SCC 570 , State of Uttaranchal and others v. Kharak Singh, (2008) 8 SCC 236 and the Bench decisions of this Court in State of U.P. and another v. Kishori Lal and another, 2018 (9) ADJ 397 (DB)(LB), Smt. Karuna Jaiswal v. State of U.P. 2018 (9) ADJ 107 (DB)(LB) and State of U.P. v. Aditya Prasad Srivastava and another, 2017 (2) ADJ 554 (DB)(LB). 23. In the result, this petition succeeds and is allowed. 23. In the result, this petition succeeds and is allowed. The impugned order dated 26.7.2023 passed by the Secretary/Chief Executive Officer, Mainpuri District Cooperative Bank Ltd., Mainpuri and the resolution of the Committee of Management dated 27.4.2023 are hereby quashed. It will be open to the respondents, if they so elect, to proceed against the petitioner afresh from the stage of charge-sheet, granting due opportunity to him and bearing in mind the guidance in this judgment about the procedure to hold an inquiry. It is further ordered that if the respondents elect to initiate fresh proceedings, not more than one of the penalties, enumerated under Regulation 84 of the Regulations, shall be imposed. It is also ordered that in case of fresh proceedings being taken, no punishment higher than that which was imposed by the impugned order, since quashed by this judgment, shall be awarded. 24. There shall be no order to costs.