Service Law; Manishkumar Arjanbhai Patel Vs. Saurashtra Gramin Bank [Gujarat High Court, 18-10-2016]

Contents

Constitution of India Articles 226 and 227 – Powers under – High Court may interfere if the finding is wholly arbitrary and capricious based on no evidence which no reasonable person could have ever arrived at.

Service Law – Departmental Inquiry – Delay in initiating the departmental inquiry – The delay by itself would not vitiate the departmental inquiry. This issue of delay would depend upon the facts of each case. At times, the charges may be so serious that the issue of delay would pale into insignificance.

Service Law – Departmental Inquiry – Issue of Malafide – Once the charges are held to be proved on the basis of the evidence on record, the issue of malafide, thereafter, pales into insignificance.

# IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALA

28/07/2016

SPECIAL CIVIL APPLICATION NO. 10226 of 1999

MANISHKUMAR ARJANBHAI PATEL….Petitioner(s)

Versus

SAURASHTRA GRAMIN BANK & 2….Respondent(s)

Appearance: MR ASHISH H SHAH, ADVOCATE for the Petitioner(s) No. 1 MR AS VAKIL, ADVOCATE for the Respondent(s) No. 1 RULE SERVED for the Respondent(s) No. 2 – 3

JUDGMENT

1. By this writ application under Article 226 of the Constitution of India, the writ applicant, a former Branch Manager of a Gramin Banik, has prayed for the following reliefs;

“(A) This Hon’ble Court be pleased to admit this petition.

(B) This Hon’ble Court be pleased to quash and set aside the impugned order dated 6.7.1999, Annexure-NN to this petition, rendered by the disciplinary authority i.e. Chairman.

(C) This Hon’ble Court be pleased to quash and set aside the order dated 15.10.1999 of the appellate authority as well as decision contained in their Board meeting held on 15.10.1999, which was communicated to the petitioner under forwarding letter dated 18.10.1999;

(D) This Hon’ble Court be pleased to quash and set aside the entire enquiry proceedings against the petitioner conducted pursuant to the charge-sheet issued to the petitioner;

(E) This Hon’ble Court be pleased to issue an appropriate writ, direction or order in the nature of mandamus, directing the respondent No.1 to reinstate the petitioner herein in service with full back wages and consequential benefits, as if the suspension order is not issued to the petitioner.

(F) Pending admission, hearing and final disposal of this petition, this Hon’ble Court be pleased to suspend operation, implementation and execution of the orders dated 6.7.1999 and decision dated 15.10.1999 of the appellate authority i.e. Board of directors of respondent Bank taken in their meeting held on 15.10.1999, Annexure-______ and Annexure-NN respectively annexed to this petition passed by the Chairman and appellate authority of the respondent Bank respectively;

(G) Be pleased to pass such other and further reliefs, as the nature and circumstances of the present case may require.”

2. The case of the writ applicant may be summarized as under;

2.1 The writ applicant joined the services of the respondent Bank on 1.1.1980 as a Branch Manager in the Officer Grade-I. A departmental charge sheet was issued to the writ applicant, substantially containing the following charges;

“Violating bank’s stipulated norms circular instructions, without carrying pre inspection and beyond his discretionary powers Shri M.A. Patel manager Vadatra Br. Sanctioned MTL for Rs.39800/- to Shri Karsan Manji Parmar of Bhatel on 11.6.92.

Violating bank’s stipulated norms, circular instructions, without carrying pre inspection and beyond Managers discretionary powers Shri M.A. Patel released ATL for Rs.38800/- for purchasing thresher and Rs.10000/- for ACC to Shri Suresh Mavji Parmar on 11.6.92 (ACC within his power) and 4.5.92 respectively.

Violating bank’s stipulated norms circular instructions without carrying pre-inspection, Shri M.A. Patel working as Br. Manager of Vadatara released limit for Rs.5000/- to Shri Jadeja Dilipsinh Vajesang of Vadatara on 11.6.92 for cycle store under his discretionary powers loan a/c. Is opened in MTL Ledger instead of CTL Ledger. Loan application for DL-1 on page no.1 only borrower’s name etc. is filled up no information against no.4 given page no.2 blank page no.3, 4 blank duly signed by applicant and manager Shri Patel did not submit control return to H.G. Also not submitted DL-1 to H.C.

Violating bank’s stipulated instructions, without carrying pre-inspections and without obtaining loan application and proof of residence i.e. Ration card, Shri. M.A. Patel released SBP CTL Limit for Rs.3300/- to Shri Jayesh Champaklal Pandit of Khambhalia for purchase of a cycle & cloth for doing business of cloth pert on 16.4.93.

Violating bank’s stipulated norms, circular, instructions, without carrying pre-post inspection, without receiving Loan application from sponsor Agency Shri M.A. Patel released limit for Rs.10,000/- to Shri Jagdish Govind Vadolia of Vadatra on 12.2.93.

Violating bank’s stipulated norms, circular instructions, without carrying pre-inspection, Shri M.A. Patel released ACC loan for Rs.7000/- to Shri Kurji Rama of Bhatel on 30.7.93.

Violating bank’s stipulated norms, circular instructions, without carrying pre-inspection, Shri M.A. Patel released ACC loan for Rs.7000/- to Shri Vala Kara village Bhatel on 30.7.93..

Violating bank’s stipulated norms, circular instructions, without carrying pre-inspection, Shri M.A. Patel released ACC loan for Rs.7000/- to Shri Kana Devji of Bhatel on 30.7.93.

Violating bank’s stipulated norms without carrying preinspection, without obtaining borrower’s photographs, Shri M.A. Patel released ACC for Rs.7000/- to Shri Jenti Kurji on 30.7.93. Bills for fertilizer seeds and labour work not obtained. Proper documents not obtained i.e. borrower has affixed Thumb impression on Adv.1 but C.C. 13 not obtained and thumb impression not identified.

Violating bank’s stipulated norms without carrying preinspection, without obtaining borrower’s photographs, without verifying revenue record submitted by applicant, Shri M.A. Patel released ACC for Rs.7000/- to Smt. Motiben Kurji Dalwadi of village Bhatel on 30.7.93.

Violating banks stipulated norms circular instructions, without carrying pre inspection Shri M.A. Patel released above limits of Rs.6500/- on 23.3.92 and 22.1.93 to one person Shri Dava Hira.

Violating bank’s stipulated norms, circulars instructions, without carrying pre inspection, Shri M.A. Patel Manager of Vadatara Br. released ACC for Rs. 10,000/- to Smt. Santokben Manji Parmar of Bhatel on 6.6.92.

Violating bank’s stipulated norms, circular instructions, pre-inspection, Shri M.A. Patel released ACC for Rs.10,000/- on 1.5.92 to Smt. Vijayaben Karsan Parmar of Bhatel.

Violating bank’s stipulated norms instructions without carrying pre post inspection, Shri M.A. Patel released working capital limit for Rs.9950/- to Shri Naran Lakhu beyond his discretionary powers on 5.3.93 (I) Rs.4950/- in cash (ii) 5000/- by cheque. To hide this fact he got a/c. opened in MTL ledger though no term loan was sanctioned for purchase of any machinery.

Violating bank’s stipulated norms, instructions, without carrying pre post inspecdtion, Shri. M.A. Patel released working capital limit for Rs.9500/- to Shri Rana Lakhu beyond his discretionary power on 5.5.93. (I) Rs.4950/- in cash (ii) Rs.5000/- by cheque. To hide this fact he got a/c opened in MTL ledger though no term loan was sanctioned for purchase of any machinery.

Violating bank’s norms circular instructinos, without carrying pre inspection Shri M.A. Patel has released CTL for Rs.6500/- to Shri Malde Hira Harijan of Hanjdapar on 23.3.92.

Violating bank’s stipulated norms, circular instructions, without carrying pre inspection, post inspection, without receiving loan application from sponsor Agency or without obtaining loan application from borrower in case of direct Finance, Shri M.A. Patel released loan for Rs.4000/- Smt. Jaliben Soma on 19.3.93 without obtaining documents also, Account has been opened in SBF MTL Ledger duly signed by Shri M.A. Patel.

Due to Shri M.A. Patel’s gross misconduct by virtue of misbehaviour with the officer in charge audit cell and two autitors, i.e., Staff members of H.O they felt a scene of horror and were stunned on account of horror created by Shri Patel. Shri Patel also failed to maintain proper due diligence and dignity of supervising staff of H.O. Shri Patel displayed gross negligence by using abusive and unparliamentary words expressed by him angriness in bank premises during public hours are as under;

While handling, maintaining, supervising control over bank’s advances and deposit portfolio, during his tenure as manager at Vadatara Branch, Shri M.A. Patel committed serious misconduct and allowed serious defficiencies in granting overdraft to SB a/c. No.240 of Jilla Vikas Gram Agency. Jamkhambhalia, during the period from 6.6.92 to 11.6.93, maximum to the tune of Rs.72331 ps. Though no powers are vested to branch manager to grant overdraft Shri Patel did not report this overdraft to H.O. Shri Patel also did not sign against posting entries in the ledger. Debit voucher are passed by Shri Patel in respect of subsidy granted to IRDP beneficiaries. Though there was no sufficient balance in the a/c. To pass debit vouchers. Main cash book is signed by Shri Patel.

While handling , maintaining, supervising control over bank’s advances nd deposit portfolio, several important registers introduced by Bank for smooth running and keep control over branch work. But Shri M.A. Patel committed serious misconduct and allowed serious deficiency by discontinuing Manager’s and Cashier’s key register and other important register during his tenure, as branch manager of Vadatra Br.”

2.2 To the aforesaid charge-sheet, a detailed reply was filed by the writ applicant denying all the charges.

2.3 An Inquiry Officer was appointed for the conduct of the departmental inquiry.

2.4 At the end of the departmental inquiry, the Inquiry Officer reached to the conclusion that all the charges were established.

2.5 A show-cause notice was issued thereafter by the Disciplinary Authority calling upon the writ applicant to show- cause as regards the findings recorded by the Inquiry Officer and the proposed penalty.

2.6 The Disciplinary Authority, i.e., the Chairman, Jamnagar Rajkot Gramin Bank, Head Office, Jamnagar, vide order dated 6th July, 1999, passed an order removing the writ applicant from the service. The order reads thus;

“I have carefully gone through the enquiry report, comprising of Charge-sheet, defence statements dt. 14.11.98, enqurity proceedings, report of findings submitted by the enquiry officer, Shri Patel’s comments on enquiry officer’s findings vide his letter dt. 26.3.99 and exhibits produced at the enquiry.

I find that all the charges No.1 to 21 have been held as proved by the enquiry officer. The charges include release of the advances in fictitious accounts, falsification of record, unauthorised absence, violation of norms of advances and non compliance with terms and conditions of the advances, release of advance in excess of powers, unauthorised absence and misrepresentation of fact therefore, use of the abusive language for the officer of the bank, improper maintenance of the key Register and threwings system and procedure of the bank is winds, release of double finance to one party and non ensuring and use of the fund etc. The charges levelled against Shri Patel are grave in nature. Shri Patel has overlooked all rules, reuglations, norms of the advances and failed to protect the interest of the bank. He has been found totally negligent in dealing with the bank’s business and doing so, he has tarnished the image of the bank causing irrepairable loss to the bank and the financial institutions like our bank all the transactions relate to monetary aspect and if such persons are allowed to continue in the bank’s service is threat to the organisation. Further, his continuation in services give wrong signal to other like minded persons and will causes loss to the bank.

As stated above, I carefully studied the enquiry report and find that the enquiry officer has followed all the principles of the natural justice and extended necessary justice to the employees. There is no reason to disbelieve the enquiry officer’s findings as the same are backed by documentary as well as oral evidence.

Although enquiry officer provided all the opportunity to Shri Patel to represent himself personally or through his representatives, Shri Patel neither represented himself nor could arrange the defence representative for him. Under the circumstances, there was no alternative to enquiry officer but to hold the enquiry Ex-parte. However, enquiry officer provided the copies of enquiry proceedings to Shri Patel and he has submitted his comments thereon. This takes care of providing justice by giving reasonable opportunity.

In view of the forgoing, I hereby decide to impose the following punishment on Shri Patel Removal from service which shall not be a “disqualification for future employment, with immediate effect.”

The suspension period of Shri Patel is treated as “off duty” period.

Shri Patel be advised accordingly.”

2.7 The writ applicant, being dissatisfied with the order of removal passed by the Disciplinary Authority, preferred an appeal before the Appellate Authority, i.e. the Board of Directors of the Bank. The appeal was also ordered to be dismissed vide order dated 15th October, 1999, which reads as under;

“Shri M.A. Patel, while working as Branch Manager at Vadatra, committed certain serous acts of misconduct. He was chargesheeted vide chargesheet No.JRGB: HC DISC CON: 149 dated 29.12.1995, regarding No.1 to 21. The Disciplinary Authority after careful consideration of the whole matter, has imposed the penalty of “Removal” from service which shall not be a disqualification for future employment with immediate effect. Suspension period of Shri Patel trated as “Off-duty” period” Vide Bank’s letter No.JRGB; HO: DISC: P&C: 125 dated 6.7.1999.

2. The appeal preferred by Shri M.A. Patel vide his letter No.Nil dated 21.7.1999 has been considered. The Appellate Authority have gone through the relevant papers, viz., (I) Charge sheet (ii) Records of findings of Enquiry Officer along with the proceedings of enquiry (iii) Order passed by the Disciplinary Authority and (iv) Points raised by Shri M.A. Patel in his appeal.

3. The appellate authority have found that while imposing the said penalty on Shri M.A. Patel, keeping in view the totality of the case and after considering the gravity of the proved charges, the Disciplinary Authority has already taken a lenient view and that the penalty imposed upon Shri M.A. Patel as above is not excessive and does not call for any modification to the order passed by the Disciplinary Authority. The Appellate Authority confine the same and hereby decide to dismiss the appeal of Shri M.A. Patel. Shri M.A. Patel be advised accordingly.”

2.8 Being dissatisfied, the writ applicant has come up with this writ application.

3. Mr. Champaneri, the learned counsel appearing for the writ applicant submitted that the departmental inquiry could be said to have stood vitiated on account of malice and malafide on the part of the superior authorities. Mr. Champaneri submitted that at the relevant point of time, his client had to meet the Chairman of the Bank and the Chairman had demanded illegal gratification of Rs.2500/- to wind up the entire controversy. Since such amount was not paid and further the writ applicant complained about the same before the Association, keeping such spite in mind, the departmental inquiry was ultimately instituted.

4. The principal argument of Mr. Champaneri is that in the course of the inquiry, the writ applicant had made a request that he may be permitted to defend himself through an advocate. Such request was declined. After such request was declined, the writ applicant made a further request that any person from the Officer’s Association may be provided to him so that such person can appear before the Inquiry Officer and defend the delinquent. According to Mr. Champaneri, such permission was granted and the writ applicant was permitted to appear before the Inquiry Officer along with such representative, but in the midst of the inquiry, that representative, ultimately, disowned the writ applicant. Mr. Champaneri submits that, thereafter, there was none to help the writ applicant and, therefore, the inquiry proceeded ex- parte.

5. His second argument is that for the acts of misconduct alleged to have been committed in the year 1992-93, the charge-sheet was issued in the year 1995 and, ultimately, the order of removal was passed in the year 1999. In such circumstances referred to above, Mr. Champaneri prays that there being merit in the writ application, the same may be allowed and the reliefs prayed for in the writ application be granted.

6. On the other hand this writ application has been vehemently opposed by Mr. A.S. Vakil, the learned counsel appearing for the Bank. Mr. Vakil submitted that no error not to speak of any error of law could be said to have been committed by the Bank in removing the writ applicant from the service. Mr. Vakil submits that, in all, 21 charges were levelled and all those are quite serious. After a full fledged inquiry, those charges were held to be established. He would submit that the entire report of the Inquiry Officer was accepted by the Disciplinary Authority as well as by the Appellate Authority.

7. He would submit that when there is some legal evidence on record and if such evidence has been accepted in a departmental inquiry, then the Court should be loath to disturb such findings on re-appreciation of the entire evidence.

8. He pointed out that there is no regulation which permits the delinquent to appear before the Inquiry Officer with an advocate. He further pointed out that the writ applicant was permitted to defend himself through a representative from the Officer’s Association, but unfortunately for the writ applicant, that representative also disowned him and, thereafter, the delinquent never participated in the inquiry. In such circumstances, according to Mr. Vakil no fault can be found at the end of the Inquiry Officer.

9. Mr. Vakil pointed out that in the year 1998, the writ applicant had challenged the decision of the Bank in not allowing the writ applicant to defend himself through an advocate. In short, he had raised the issue of absence of the defence representative. The said writ application being Special Civil Application No.6032 of 1998 was ultimately rejected vide order dated 29th July, 1998, which reads as under;

“The grievance voiced by the petitioner is that the respondent Bank is proceeding with the departmental enquiry in the absence of the defence representatiave. On 10.3.1998, one Mr K K Gajera withdrew himself as defence representative of the petitioner. The petitioner says that he has approached the Officers’ Association to which he belongs for providing new defence representative.

2. Having heard the learned Advocate for the petitioner, I am satisfied that the petitioner is trying to abuse the process of the Court. On an earlier occasion, he had approached this Court challenging the order of suspension which was registered as Special Civil Application No.971/97. The said application was rejected by order dated 4.3.97 noticing the fact that the charge- sheet includes several acts of commission and omission by the petitioner having financial repercussions. The petitioner approached the Division Bench of this Court by waya of appeal, which was registered as LPA No.257/97. The said LPA was rejected by order dated 20.3.1997. In substance, the allegations against the petitioner are –

(a) He remained unauthorisedly absent in the Branch Office and allowed operation of the Safe singly by the Cashier only which is very risky and jeopardising the bank’s interest;

(b) He also released loans/advances unauthorisedly beyond his discretionary power for which in some of the account though explanation was asked for, he submitted unsatisfactory reply;

(c) He used abusive language with the officers of the bank and also with the audit team who reached at the branch office for regular audit purpose.

2. The petitioner, on one breadth says that there is prolonged suspension and the enquiry has not been completed expeditiously and on the other breadth he says that further proceedings of the enquiry be stayed for the reason that the Officers’ Association is not nominating any defence representative. It is for the petitioner to arrange defence representative for him. The petitioner cannot have any grievance either before the bank or before the Court with respect to the Association to which he belongs. If the Officers’ Association has not nominated any defence representative, the petitioner should thank himself for the act of the Association to which he belongs.

There is no merit in this Special Civil Application. The Enquiry Officer will proceed punctually without granting any adjournment on such grounds. This Special Civil Application is accordingly rejected.”

10. Mr. Vakil further pointed out that the order of suspension was also challenged before this Court by filing Special Civil Application No.971 of 1997. The said writ application was ordered to be rejected summarily vide order dated 4 th April, 1997, which reads as under;

“Heard learned advocates for the parties. The petitioner, former Bank Manager challenges action of respondent Bank in suspending him from service under order dated 17th May, 1994 and for not proceeding further in any manner against the petitioner. Learned advocate Mr. Shah has appeared for the respondent Bank in response to the notice issued by this Court. Mr. Shah refers to the charge sheet issued against the present petitioner as far back as on 29th December, 1995. The charge sheet includes some 25 charges of a grave nature involving several acts of commission and omission by the petitioner and having financial repercussions. Mr. Shah as submitted that the inquiry could not proceed further on account of the administrative reasons and the date of hearing has been fixed on 28th March, 1997. In view of the nature and grativy of charges, order of suspension cannot be interfered with. Petition is, therefore, summarily rejected. Notice is discharges. There shall be no order as to costs.”

11. Against the order passed by the learned Single Judge referred to above, Letters Patent Appeal No.257 of 1997 was filed by the writ applicant herein, which was also ordered to be dismissed by an order dated 20th March, 1997, which reads as under;

” The reasons recorded by the Learned Single Judge for not interfering with the order of the Tribunal are germane, relevant, legal and proper. The learned Single Judge has also observed that the hearing of the inquiry has been fixed on 28.3.1997. Hence LPA is dismissed. We may clarify that we are not expressing any opinion on merits.”

12. He would submit that a Bank Officer is required to exercise higher standards of honesty and integrity. He deals with many of the depositors and the customers. Every officer/employee of the Bank is required to take all possible steps to protect the interests of the Bank and to discharge his duties with utmost integrity, honesty, devotion and diligence and to do nothing which is unbecoming of a Bank Officer. Mr. Vakil would submit that good conduct and discipline are inseparable from the functioning of every officer/employee of the Bank.

13. Mr. Vakil further submits that there was no delay in so far as initiating the departmental inquiry is concerned. Mr. Vakil invited my attention to the explanation offered by his client as regards the contention of delay raised by the writ applicant. In para-34 of the affidavit-in-reply, the following has been stated;

“34. With reference to para. 51-G and 51-H of the SCA, I deny what is stated therein. In this context it may be stated that the various branches of the Bank function under the specific norms, rules and regulations. Considering the fact that a detailed and comprehensive charge-sheet was required to be prepared containing as many as 21 charges having deep and immense gravity, the Bank with its limited infrastructure, staff strength, involving as many as 542 paper exhibits and 17 various witnesses as justified in taking some time in preparing the same. The Bank was further required to change the appointments of the Presenting Officers for the circumstances beyond its control. The petitioner was also permitted to engage his defence representative more particularly by letter dated 14.8.1997 (copy at Annexure-XI hereto) from the State Bank of Saurashtra Officer’s Association. Inquiry was delayed at the instance of the petitioner on several occasions. Some of which have been specified hereinabove.”

14. In such circumstances referred to above, Mr. Vakil prays that there being no merit in this writ application, the same may be rejected.

15. Mr. Vakil, in support of his submissions, placed reliance on the following decisions of the Supreme Court;

# (1) State Bank of India and others v. Bidyut Kumar Mitra and others, AIR 2011 SC (Supp) 798

# (2) Ganesh Santa Ram Sirur v. State Bank of India and another, AIR 2005 SC 314

# (3) State Bank of India and others v. Narendra Kumar Pandey, (2013) 2 SCC 740

# (4) State Bank of India and another v. Bela Bagchi and others, AIR 2005 SC 3272

# (5) Chairman and Managing Director, United Commercial Bank and others v. P.C. Kakkar, AIR 2003 SC 1571

16. Having heard the learned counsel appearing for the parties and having considered the materials on record, the only question that falls for my consideration is whether the disciplinary authority as well as the appellate authority committed any error in passing the impugned orders.

17. It is now well settled by a plethora of judgments of the Supreme Court that in exercise of its powers under Articles 226 and 227 of the Constitution of India should not venture into the re-appreciation of evidence or interfere with the conclusion arrived at by the disciplinary authority in the inquiry proceedings, if the same are conducted in accordance with law or go into the reliability / adequacy of evidence, or interfere, if there is some legal evidence on which the findings are based, or correct error of fact however grave it may be, or go into the proportionality of punishment unless it shocks the conscience.

18. It is equally well settled that the High Courts in exercise of its powers under Articles 226 and 227 can only consider whether the inquiry held by the competent authority was in accordance with the procedure established by law, and the principles of natural justice, whether irrelevant or extraneous consideration and/or exclusion of admissible or material evidence or admission of inadmissible evidence being influenced the decision rendering it vulnerable.

19. This Court may interfere if the finding is wholly arbitrary and capricious based on no evidence which no reasonable person could have ever arrived at.

20. The inquiring authority vide its report concluded that some of the charges were held to be established reflecting upon his devotion and diligence towards work. The disciplinary authority later considered the relevant records of the case including the findings of the inquiring authority and the submissions made by the petitioner and thought fit to pass the order of removal from service.

21. The appellate authority also looked into the matter and thought fit to affirm the order of removal from service considering the materials on record.

22. I take notice of the fact that the Inquiring Officer has examined each and every charge levelled against the writ applicant including the documents produced by the Presenting Officer and came to the conclusion that all the charges were fully proved. In a departmental inquiry, the Disciplinary Authority is expected to prove the charges on preponderance of probability and not on proof beyond the reasonable doubt.

23. The documents produced by the petitioner, which are as such not controverted by the petitioner, support all the allegations and the charges levelled against him.

24. In Narendra Kumar Pandey (supra), the Supreme Court, in paras 25 and 26, observed as under:

25. The High Court, in our view, under Article 226 of the Constitution of India was not justified in interfering with the order of dismissal passed by the appointing authority after a full-fledged inquiry, especially when the Service Rules provide for an alternative remedy of appeal. It is a well acceptable principle of law that the High Court while exercising powers under Article 226 of the Constitution does not act as an appellate authority. Of course, its jurisdiction is circumscribed and confined to correct an error of law or procedural error, if any, resulting in manifest miscarriage of justice or violation of the principles of natural justice. In

# State Bank of India and others v. Ramesh Dinkar Punde, (2006) 7 SCC 212 : 2006 AIR SCW 5457

this Court held that the High Court cannot re-appreciate the evidence acting as a court of Appeal. We have, on facts, found that no procedural irregularity has been committed either by the Bank, presenting officer or the Inquiring Authority. Disciplinary proceedings were conducted strictly in accordance with the Service Rules.

26. This court in

# State of Andhra Pradesh v. Sree Rama Rao, AIR 1963 SC 1723

held:

“7…Where there is some evidence, which the authority entrusted with the duty to hold the inquiry has accepted and which evidence may reasonably support the conclusion that delinquent officer is guilty of the charge, it is not the function of the High Court in a petition for a writ under Article 226 to review the evidence and to arrive at an independent finding on the evidence especially when the charged officer had not participated in the inquiry and had not raised the grounds urged by him before the High Court by the Inquiring Authority.”

25. In a very recent pronouncement in the case of

# Union of India and others v. P. Gunasekaran, (2015) 2 SCC 610

the Supreme Court in details has explained the position of law so far as the scope of interference in the matter relating to the disciplinary proceedings is concerned. I may quote the observations made by the Supreme Court from paras 12 to 20 as under:

12. Despite the well-settled position, it is painfully disturbing to note that the High Court has acted as an appellate authority in the disciplinary proceedings, re- appreciating even the evidence before the enquiry officer. The finding on Charge No. 1 was accepted by the disciplinary authority and was also endorsed by the Central Administrative Tribunal. In disciplinary proceedings, the High Court is not and cannot act as a second court of first appeal. The High Court, in exercise of its powers under Article 226/227 of the Constitution of India, shall not venture into reappreciation of the evidence. The High Court can only see whether:

(a). the enquiry is held by a competent authority;

(b). the enquiry is held according to the procedure prescribed in that behalf;

(c). there is violation of the principles of natural justice in conducting the proceedings;

(d). the authorities have disabled themselves from reaching a fair conclusion by some considerations extraneous to the evidence and merits of the case;

(e). the authorities have allowed themselves to be influenced by irrelevant or extraneous considerations;

(f). the conclusion, on the very face of it, is so wholly arbitrary and capricious that no reasonable person could ever have arrived at such conclusion;

(g). the disciplinary authority had erroneously failed to admit the admissible and material evidence;

(h). the disciplinary authority had erroneously admitted inadmissible evidence which influenced the finding;

(i). the finding of fact is based on no evidence.

13. Under Article 226/227 of the Constitution of India, the High Court shall not:

(i). re-appreciate the evidence;

(ii). interfere with the conclusions in the enquiry, in case the same has been conducted in accordance with law;

(iii). go into the adequacy of the evidence;

(iv). go into the reliability of the evidence;

(v). interfere, if there be some legal evidence on which findings can be based.

(vi). correct the error of fact however grave it may appear to be;

(vii). go into the proportionality of punishment unless it shocks its conscience.

14. In one of the earliest decisions in

# State of Andhra Pradesh and others v. S. Sree Rama Rao, AIR 1963 SC 1723

many of the above principles have been discussed and it has been concluded thus:

“7. …..The High Court is not constituted in a proceeding under Article 226 of the Constitution a court of appeal over the decision of the authorities holding a departmental enquiry against a public servant: it is concerned to determine whether the enquiry is held by an authority competent in that behalf, and according to the procedure prescribed in that behalf, and whether the rules of natural justice are not violated. Where there is some evidence, which the authority entrusted with the duty to hold the enquiry has accepted and which evidence may reasonably support the conclusion that the delinquent officer is guilty of the charge, it is not the function of the High Court in a petition for a writ under Article 226 to review the evidence and to arrive at an independent finding on the evidence. The High Court may undoubtedly interfere where the departmental authorities have held the proceedings against the delinquent in a manner inconsistent with the rules of natural justice or in violation of the statutory rules prescribing the mode of enquiry or where the authorities have disabled themselves from reaching a fair decision by some considerations extraneous to the evidence and the merits of the case or by allowing themselves to be influenced by irrelevant considerations or where the conclusion on the very face of it is so wholly arbitrary and capricious that no reasonable person could ever have arrived at that conclusion, or on similar grounds. But the departmental authorities are, if the enquiry is otherwise properly held, the sole judges of facts and if there be some legal evidence on which their findings can be based, the adequacy or reliability of that evidence is not a matter which can be permitted to be canvassed before the High Court in a proceeding for a writ under Article 226 of the Constitution.”

15. In

# State of Andhra Pradesh and others v. Chitra Venkata Rao, (1975) 2 SCC 557

the principles have been further discussed at paragraphs-21 to 24, which read as follows:

“21. The scope of Article 226 in dealing with departmental inquiries has come up before this Court. Two propositions were laid down by this Court in

# State of A.P. v. S. Sree Rama Rao, AIR 1963 SC 1723

First, there is no warrant for the view that in considering whether a public officer is guilty of misconduct charged against him, the rule followed in criminal trials that an offence is not established unless proved by evidence beyond reasonable doubt to the satisfaction of the Court must be applied. If that rule be not applied by a domestic tribunal of inquiry the High Court in a petition under Article 226 of the Constitution is not competent to declare the order of the authorities holding a departmental enquiry invalid. The High Court is not a court of appeal under Article 226 over the decision of the authorities holding a departmental enquiry against a public servant. The Court is concerned to determine whether the enquiry is held by an authority competent in that behalf and according to the procedure prescribed in that behalf, and whether the rules of natural justice are not violated. Second, where there is some evidence which the authority entrusted with the duty to hold the enquiry has accepted and which evidence may reasonably support the conclusion that the delinquent officer is guilty of the charge, it is not the function of the High Court to review the evidence and to arrive at an independent finding on the evidence. The High Court may interfere where the departmental authorities have held the proceedings against the delinquent in a manner inconsistent with the rules of natural justice or in violation of the statutory rules prescribing the mode of enquiry or where the authorities have disabled themselves from reaching a fair decision by some considerations extraneous to the evidence and the merits of the case or by allowing themselves to be influenced by irrelevant considerations or where the conclusion on the very face of it is so wholly arbitrary and capricious that no reasonable person could ever have arrived at that conclusion. The departmental authorities are, if the enquiry is otherwise properly held, the sole judges of facts and if there is some legal evidence on which their findings can be based, the adequacy or reliability of that evidence is not a matter which can be permitted to be canvassed before the High Court in a proceeding for a writ under Article 226.

22. Again, this Court in Railway Board, representing the

# Union of India, New Delhi v. Niranjan Singh, AIR 1969 SC 966

said that the High Court does not interfere with the conclusion of the disciplinary authority unless the finding is not supported by any evidence or it can be said that no reasonable person could have reached such a finding. In Niranjan Singh case this Court held that the High Court exceeded its powers in interfering with the findings of the disciplinary authority on the charge that the respondent was instrumental in compelling the shut-down of an air compressor at about 8.15 a.m. on May 31, 1956. This Court said that the Enquiry Committee felt that the evidence of two persons that the respondent led a group of strikers and compelled them to close down their compressor could not be accepted at its face value. The General Manager did not agree with the Enquiry Committee on that point. The General Manager accepted the evidence. This Court said that it was open to the General Manager to do so and he was not bound by the conclusion reached by the committee. This Court held that the conclusion reached by the disciplinary authority should prevail and the High Court should not have interfered with the conclusion.

23. The jurisdiction to issue a writ of certiorari under Article 226 is a supervisory jurisdiction. The Court exercises it not as an appellate court. The findings of fact reached by an inferior court or tribunal as a result of the appreciation of evidence are not reopened or questioned in writ proceedings. An error of law which is apparent on the face of the record can be corrected by a writ, but not an error of fact, however grave it may appear to be. In regard to a finding of fact recorded by a tribunal, a writ can be issued if it is shown that in recording the said finding, the tribunal had erroneously refused to admit admissible and material evidence, or had erroneously admitted inadmissible evidence which has influenced the impugned finding. Again if a finding of fact is based on no evidence, that would be regarded as an error of law which can be corrected by a writ of certiorari. A finding of fact recorded by the Tribunal cannot be challenged on the ground that the relevant and material evidence adduced before the Tribunal is insufficient or inadequate to sustain a finding. The adequacy or sufficiency of evidence led on a point and the inference of fact to be drawn from the said finding are within the exclusive jurisdiction of the Tribunal. See

# Syed Yakoob v. K.S. Radhakrishnan, AIR 1964 SC 477

24. The High Court in the present case assessed the entire evidence and came to its own conclusion. The High Court was not justified to do so. Apart from the aspect that the High Court does not correct a finding of fact on the ground that the evidence is not sufficient or adequate, the evidence in the present case which was considered by the Tribunal cannot be scanned by the High Court to justify the conclusion that there is no evidence which would justify the finding of the Tribunal that the respondent did not make the journey. The Tribunal gave reasons for its conclusions. It is not possible for the High Court to say that no reasonable person could have arrived at these conclusions. The High Court reviewed the evidence, reassessed the evidence and then rejected the evidence as no evidence. That is precisely what the High Court in exercising jurisdiction to issue a writ of certiorari should not do.”

16. These principles have been succinctly summed-up by the living legend and centenarian Justice V. R. Krishna Iyer in

# State of Haryana and another v. Rattan Singh, (1977) 2 SCC 491

To quote the unparalled and inimitable expressions:

“4. …… in a domestic enquiry the strict and sophisticated rules of evidence under theIndian Evidence Act may not apply. All materials which are logically probative for a prudent mind are permissible. There is no allergy to hearsay evidence provided it has reasonable nexus and credibility. It is true that departmental authorities and Administrative Tribunals must be careful in evaluating such material and should not glibly swallow what is strictly speaking not relevant under the Indian Evidence Act. For this proposition it is not necessary to cite decisions nor text books, although we have been taken through case-law and other authorities by counsel on both sides. The essence of a judicial approach is objectivity, exclusion of extraneous materials or considerations and observance of rules of natural justice. Of course, fair play is the basis and if perversity or arbitrariness, bias or surrender of independence of judgment vitiate the conclusions reached, such finding, even though of a domestic tribunal, cannot be held good. …..”

17. In all the subsequent decisions of this Court up to the latest in

# Chennai Water Supply and Sewarage Board v. T. T. Murali Babu, (2014) 4 SCC 108 : AIR 2014 SC 1141

these principles have been consistently followed adding practically nothing more or altering anything.

18. On Article I, the disciplinary authority, while imposing the punishment of compulsory retirement in the impugned order dated 28.02.2000, had arrived at the following findings:

“Article-I was held as proved by the Inquiry authority after evaluating the evidence adduced in the case. Under the circumstances of the case, the evidence relied on viz., letter dated 11.12.92 written by Shri P. Gunasekaran, provides a reasonable nexus to the charge framed against him and he did not controvert the contents of the said letter dated 11.12.92 during the time of inquiry. Nor did he produce any defence witness during the inquiry to support his claims including that on 23.11.92 he left the office on permission. There is nothing to indicate that he was handicapped in producing his defence witness. ….”

19. The disciplinary authority, on scanning the inquiry report and having accepted it, after discussing the available and admissible evidence on the charge, and the Central Administrative Tribunal having endorsed the view of the disciplinary authority, it was not at all open to the High Court to re-appreciate the evidence in exercise of its jurisdiction under Article 226/227 of the Constitution of India.

20. Equally, it was not open to the High Court, in exercise of its jurisdiction under Article 226/227of the Constitution of India, to go into the proportionality of punishment so long as the punishment does not shock the conscience of the court. In the instant case, the disciplinary authority has come to the conclusion that the respondent lacked integrity. No doubt, there are no measurable standards as to what is integrity in service jurisprudence but certainly there are indicators for such assessment. Integrity according to Oxford dictionary is “moral uprightness; honesty”. It takes in its sweep, probity, innocence, trustfulness, openness, sincerity, blamelessness, immaculacy, rectitude, uprightness, virtuousness, righteousness, goodness, cleanness, decency, honour, reputation, nobility, irreproachability, purity, respectability, genuineness, moral excellence etc. In short, it depicts sterling character with firm adherence to a code of moral values.

26. In Chairman and Managing Director, United Commercial Bank (supra), the Supreme Court in paras 14 and 15 held as under:

14. A Bank Officer is required to exercise higher standards of honesty and integrity. He deals with money of the depositors and the customers. Every officer/employee of the Bank is required to take all possible steps to protect the interests of the Bank and to discharge his duties with utmost integrity, honesty, devotion and diligence and to do nothing which is unbecoming of a Bank officer, Good conduct and discipline are inseparable from the functioning of every officer/employee of the Bank. As was observed by this Court in

# Disciplinary Authority-cum-Regional Manager v. Nikunja Bihari Patnaik, (1996) 9 SCC 69

it is no defence available to say that there was no loss or profit resulted in case, when the officer/employee acted without authority. The very discipline of an organization more particularly a Bank is dependent upon each of its officers and officers acting and operating within their allotted sphere. Acting beyond one’s authority is by itself a breach of discipline and is a misconduct. The charges against the employee were not casual in nature and were serious. These aspects do not appear to have been kept in view by the High Court.

15. It needs no emphasis that when a Court feels that the punishment is shockingly disproportionate, it must record reasons for coming to such a conclusion. Mere expression that the punishment is shockingly disproportionate would not meet the requirement of law. Even in respect of administrative orders Lord Denning M.R. in

# Breen v. Amalgamated Engineering Union, 1971 (1) All ER 1148

observed “The giving of reasons is one of the fundamentals of good administration”. In

# Alexander Machinery (Dedley) Ltd. v. Crabtres, 1974 LCR 120

it was observed : “Failure to give reasons amounts to denial of justice”. Reasons are live links between the mind of the decision-taker to the controversy in question and the decision or conclusion arrived at”. Reasons substitute subjectivity by objectivity. The emphasis on recording reasons is that if the decision reveals the “inscrutable face of the sphinx”, it can, by its silence, render it virtually impossible for the Courts to perform their appellate function or exercise the power of judicial review in adjudging the validity of the decision. Right to reason is an indispensable part of a sound judicial system. Another rationale is that the affected party can know why the decision has gone against him. One of the salutary requirements of natural justice is spelling out reasons for the order made, in other words, a speaking out. The “inscrutable face of a sphinx” is ordinarily incongruous with a judicial or quasi-judicial performance. But as noted above, the proceedings commenced in 1981. The employee was placed under suspension from 1983 to 1988 and has superannuated in 2002. Acquittal in the criminal case is not determinative of the commission of misconduct or otherwise, and it is open to the authorities to proceed with the disciplinary proceedings, notwithstanding acquittal in criminal case. It per se would not entitle the employee to claim immunity from the proceedings. At the most the factum of acquittal may be a circumstance to be considered while awarding punishment. It would depend upon facts of each case and even that cannot have universal application.

27. In Bela Bagchi (supra), the Supreme Court observed the following in para 15:

15. A Bank officer is required to exercise higher standards of honesty and integrity. He deals with money of the depositors and the customers. Every officer / employee of the Bank is required to take all possible steps to protect the interests of the Bank and to discharge his duties with utmost integrity, honesty, devotion and diligence and to do nothing which is unbecoming of a Bank officer. Good conduct and discipline are inseparable from the functioning of every officer/employee of the Bank. As was observed by this Court in

# Disciplinary Authority-cum-Regional Manager v. Nikunja Bihari Patnaik, (1996) (9) SCC 69

it is no defence available to say that there was no loss or profit resulted in case, when the officer/employee acted without authority. The very discipline of an organization more particularly a Bank is dependent upon each of its officers and officers acting and operating within their allotted sphere. Acting beyond one’s authority is by itself a breach of discipline and is a misconduct. The charges against the employee were not casual in nature and were serious. That being so, the plea about absence of loss is also sans substance.

28. In Ganesh Santa Ram (supra), the Supreme Court observed in paras 32 and 33 as under:

32. The learned senior counsel also relied on para 14 of the above judgment. Replying on the above passage, Mr. Salve submitted that the appellant, the Branch Manager of a Bank is required to exercise higher standards of honesty and integrity when he deals with the money of the depositors and the customers and, therefore, he is required to take all possible steps to protect the interest of the bank and to discharge his duties with utmost integrity, honesty, devotion and diligence and to do nothing which is unbecoming of the Bank Officer. According to Mr. Salve, good conduct and discipline are inseparable for the functioning of every officer, Manager or employee of the Bank, who deals with public money and there is no defence available to say that there was no loss or profit resulted in the case, when the Manager acted without authority and contrary to the rules and the scheme which is formulated to help the Educated Unemployed Youth. Mr. Salve’s above submissions is well merited acceptance and we see much force in the said submission.

33. The Bank Manager/Officer and employees and any Bank nationalised/or non-nationalised are expected to act and discharge their functions in accordance with the rules and regulations of the Bank. Acting beyond one’s authority is by itself a breach of discipline and Trust and a misconduct. In the instant case Charge No.5 framed against the appellant is very serious and grave in nature. We have already extracted the relevant rule which prohibits the Bank Manager to sanction a loan to his wife or his relative or to any partner. While sanctioning the loan the appellant does not appear to have kept this aspect in mind and acted illegally and sanctioned the loan. He realized the mistake later and tried to salvage the same by not encashing the draft issued in the maiden name of his wife though the draft was issued but not encashed. The decision to sanction a loan is not an honest decisions. The Rule 34(3)(1) is a rule of integrity and therefore as rightly pointed out by Mr. Salve, the respondent Bank cannot afford to have the appellant as Bank Manager. The punishment of removal awarded by the Appellate Authority is just and proper in the facts and circumstances of the case. Before concluding, we may usefully rely on the judgment

# Regional Manager, U.P. SRTC, Etawah and Ors. v. Hoti Lal and Anr. reported in 2003(3) SCC 605

Wherein this Court has held as under :-

“If the charged employee holds a position of trust where honesty and integrity are inbuilt requirements of functioning, it would not be proper to deal with the matter leniently. Misconduct in such cases has to be dealt with iron hands. Where the person deals with public money or is engaged in financial transactions or acts in a fiduciary capacity, the highest degree of integrity and trustworthiness is a must and unexceptionable. Judged in that background, conclusions of the Division Bench of the High Court do not appear to be proper. We set aside the same and restore order of the learned single Judge upholding the order of dismissal.”

29. Thus, having regard to the settled law and in the overall view of the matter, I am of the view that the Disciplinary Authority as well as the Appellate Authority committed no error in arriving at the conclusion that the writ applicant was guilty of the acts of misconduct as alleged.

30. I am not impressed by the submission of Mr. Champaneri as regards the delay in initiating the departmental inquiry. The delay has been explained by the Bank. The delay by itself would not vitiate the departmental inquiry. This issue of delay would depend upon the facts of each case. At times, the charges may be so serious that the issue of delay would pale into insignificance, like the case in hand.

31. In the same manner, I am not impressed by the submission that the entire action against the writ applicant was malafide and was at the instance of the Chairman of the Bank. Once the charges are held to be proved on the basis of the evidence on record, the issue of malafide, thereafter, pales into insignificance.

32. As a result of the aforesaid discussion, this writ application fails and is hereby rejected. Rule is discharged.

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