Allahabad High Court
M.N.Verma vs Union Of India & Others on 30 July, 2010
Judgment reserved on 04.05.2010
Judgment delivered on 30.07.2010
Civil Misc. Writ Petition No.48264 of 2008
M.N. Verma Vs. Union of India & Ors.
Hon. Sunil Ambwani, J.
Hon. Kashi Nath Pandey, J.
The petitioner was appointed as clerk/ typist in State Bank of India in the year 1967. He was granted promotion in the officers cadre on 15.11.1977 and in Officer Middle Management Grade Scale-II on 1.11.1990. The petitioner was, thereafter, promoted as Branch Manager at CMP Degree College, Allahabad Branch of the bank on 30.1.2004.
By this writ petition the petitioner has prayed for writ of certiorari quashing the order dated 20.4.2007 passed by the General-II, State Bank of India, Local Head Office, Lucknow, as also the order dated 12.3.2008 by which he was dismissed from service in terms of Rule 67 (j) of the State Bank of India Officers Service Rules for having violated Rule 50 (4) of the SBI Officers Services Rules; and the appellate order dated 12.3.2008 passed by the Chief General Manager, State Bank of India, Local Head Office, Lucknow, dismissing the departmental appeal.
The petitioner was placed under suspension in terms of Rule 68 (A) of the SBI Officers Service Rules on 18.6.2005 on certain acts of gross misconduct during his posting as Branch Manager in CMP Degree College at Allahabad. He was served with chargesheet dated 27.1.2006 and 31.1.2006 alleging as follows:-
"Charge No.1 You failed to conduct Pre-sanction survey before sanctioning Housing Loan and Post disbursement Inspection and released installments without ensuring stage wise constructions and end use of funds of installments already disbursed. You disbursed next installments without taking the actual progress of constructions.2
ALLEGATION ON WHICH CHARGE NO.1 IS BASED Housing loans were sanctioned for the plots located in extensively Agricultural area lacking basic facilities like water, road, electricity etc. Installments were disbursed without linkage to stage wise construction.
Due to this act, the loan amount was disbursed while the houses were only nominally/ partially or totally not constructed. Further while disbursing of next loan installment, you did not adopt need-based approach linking disbursement to actual progress of construction. Thus you flagrantly violated Bank's instructions and exposed the Bank to financial loss e.g. Account No. Name (S/Shri) Date of Amount Rs.
Sanction
26513 N.K. Nishad 26.05.04 5.00 lac
26636 S.K. Yadav 16.07.04 3.64 lac
26601 S. Srivastava 13.06.04 4.55 lac
26652 A. Pandey 11.08.04 5.00 lac
26449 Vijay 15.02.04 5.00 lac
26497 A.K. Gupta 14.03.04 5.00 lac
26462 A. Malviya 24.03.04 5.00 lac
26509 R. Sahu 24.03.04 5.00 lac
26522 A.K. Bhola 17.04.04 5.00 lac
26594 M.C. 25.05.04 5.00 lac
Kesarwani
Charge No.2
You failed to cross check the Income tax returns submitted by the borrowers for availing Housing Loans.
ALLEGATION ON WHICH CHARGE NO.2 IS BASED The genuineness of ITRs, being the basis for sanction of loans were not cross checked either by obtaining assessment certificate of copy of statement of account or Pass Book e.g. 26613, 16636, 26601, 26652, 26449, 26497, 26462, 26509, 26522, 26594 3 Charge No.3 While appraising Housing loans, availability of margin money/ deficit to be met by the borrowers have not been ascertained and brought on record.
ALLEGATION ON WHICH CHARGE NO.3 IS BASED You sanctioned and disbursed the Housing Loans without ensuring the actual availability of margin money with the borrowers, resulting in the projects remaining incomplete e.g. 26613, 26636, 26601, 26652, 26449, 26497, 26462, 26509, 26522, 26594 Charge No.4 Role of middleman have been allowed by you in sanction of housing loan in as much as even submission of Income Tax returns were arranged by him.
ALLEGATION ON WHICH CHARGE NO.4 IS BASED ACCOUNT OF ALFRED DAVID & SMT. DORTHY DAVID You sanctioned on 01.03.2004 a Housing Loan of Rs.5.00 lacs to Shri Alfred David and Smt. Dorthy David with the involvement of middle man Shri Ravi Srivastava and installments were released without ensuring end use of previous installments.
Charge No.5 Accommodation loan was given by you to close loan account sanctioned earlier.
ALLEGATION ON WHICH CHARGE NO.5 IS BASED You sanctioned Housing loan on 19.02.2004 for Rs.2.00 lacs to Smt. Sushma Chaurasia and Shri Suresh Kumar for construction of house. Smt. Sushma Chaurasia purchased a ready build house of ADA from Suman Devi, and 75% of the loan amount i.e. Rs.1,51,313.91 was allowed to be transferred to Housing Loan Account No.26450 of Shri Suresh Kumar on 06.04.04 to close his Housing Loan account.
Charge No.6 A number of limits i.e. cash credit limit of Rs.5.00 lac & Rs.7.50 lac were irregular sanctioned by you for giving undue benefits to the borrower Shri Amit Ganguli.4
ALLEGATION ON WHICH CHARGE NO.6 IS BASED A number of limits have been irregularly sanction by you to Shri Amit Ganguli for giving undue benefits to him. The irregularities committed by you are as under:-
(i) Cash Credit limit of Rs.5 lacs has been sanctioned on 26.04.2004 to M/s A.R. Sales Corporation (Shri Amit Ganguli Partner) despite the fact that Cash Credit limit of Rs.2.50 lacs sanctioned on 30.01.04 to M/s Ganguli Optical Science Emporium (Shri Amit Ganguli, Proprietor) was already running in the Branch. The business as shown of the firm is entirely different. Out of the Cash Credit limit of Rs.2.50 lac sanctioned on 30.01.2004 and disbursed on 06.02.2004, you transferred a sum of Rs.2.00 lac to current account No.01050070031 of Shri Ganguli.
End use of the funds was thus not ensured.
(ii) The limit of Rs.5.00 lacs has been disbursed on 27.04.2004 and a sum of Rs.4.99 lac was allowed to be withdrawn in cash on the same day without ensuring end use thereof.
(iii)Although the disbursal has been made on 27.04.2004, the partnership deed of the firm was executed on 04.03.2005. The limit was thus sanctioned/ disbursed to a non-existing firm.
(iv)You sanctioned/ disbursed the loan on 27.04.2004 to enable Shri Ganguli to purchase on 11.05.2004 part of house No.129/140 with the proceeds of the loan. Thus you passed on undue advantage to Shri Ganguli.
(v) The limit was released on 27.04.2004 without creating Equitable Mortgage. It was created on 12.05.2004 of the house purchased on 11.05.2004. You have thus allowed diversion of Cash Credit funds.
(vi)You sanctioned a Cash Credit limit of Rs.7.50 lacs, Account No.01660065117 (10518192746) on 14.10.2004 to M/s. Ganguli Optical Science Emporium (Shri Amit Ganguli Proprietor). Proceeds of this loan have been allowed by you to be diverted as under:
(a) Rs.5.00 lacs to Cash Credit Account of M/s A.R. Sales Corporation.
(b) Rs.2.50 lacs to Cash Credit Account of M/s.
Ganguli Optical & Science emporium.
(vii)You sanctioned the above limit of Rs.7.50 lac without the recommendation of the Field Officer posted at the Branch.
5(viii)The limit has been disbursed without obtaining collateral security. Equitable Mortgage of residential property purchased on 22.07.2004 has been obtained on 24.11.2004 i.e. after more than one month of the disbursement of Cash Credit limit.
(ix)There are no transaction in the Cash Credit Account No.01660065117 (10518192746) excepting the details shown above. The account has turned NPA with outstanding in excess of Rs.7.78 lacs. The limit has been sanctioned by you to a non-existent unit."
The prosecution documents were supplied to the petitioner with covering letter dated 24.5.2006 enclosing all the documents to be relied upon in the departmental enquiry in respect of each of the allegations. The petitioner verified the receipt of the documents on 23.6.2006 with an exception that on allegation Nos.1, 2 and 3 the documents listed at Item No.I and II were not made available, the photocopy was produced, which was not acceptable to the petitioner. The rest of the documents were perused in original. On allegation No.4 the original documents were perused except item listed against Point No.5 namely letter dated 20.5.2005 of Shri Alfred David (Borrower). With regard to allegation No.5 the original documents except document at Point No.5 namely Unit Inspection Register of the two loan accounts was perused by him. In respect of charge No.6 the original documents were perused except item No.8 listed against (viii) namely statement of Shri R.P. Gautam, the then Field Officer dated 20.5.2005. The petitioner submitted his reply and also submitted a list of defence documents on 18.7.2006.
The presenting officer's brief was submitted on 7.11.2006 and was given to the petitioner containing therewith arguments of the Presenting Officer, in respect of each of the loan account mentioned in the charges. The petitioner submitted his defence brief on 27.2.2007. His case was defended by his defence representative Shri G.C. Verma. The preliminary hearing of the case was held on 21.4.2006 at Vigilance Department, State Bank of India, Local Head Office, Lucknow and the regular hearing 6 took place on 26.9.2006 at State Bank of India, CMP Degree College, Allahabad Branch and the enquiry was concluded on the same day. The findings of the enquiry officer on each of the charges are given as below:-
"I have examined the arguments of prosecution and defence and it is observed that Charged Officer has sanctioned and disbursed the above housing loans on Arazi land No.41, situated at Mauza-Dhanua, Pargana-Arail, Tehsil-Karchna.
Defence has produced DEX (1/20, 2/1-26, 3/1-22, 4/1-30, 5/1-33, 6/1-21, 7/1-31, 8/1-23, 9/1-37, 10/1-26) in respect of copies of the sale deed, Lawyer's NEC report and Recital in respect of above housing loans. From perusal of the sale deed DEX (1/65, 2/12, 3/11, 4/9, 5/23, 6/12, 7/16, 8/13, 9/14-15, 10/11, it is observed that all the plots under reference are located in residential area under the Awas Vikas limits and the land is being used for the residential purposes. Defence has also argued that infrastructure like water, roads and electricity etc. are available thereat. The contention of defence in respect of other part of allegation that subsequent loan installments were recommended for payment by the Field Officer is not tenable, as defence themselves argued that all the remarks (adverse) were incorporated by the Field Officer him self in the Inspection Register. Both the arguments of the defence are contradictory to each other. It is, therefore, evident that Charged Officer has released the subsequent housing loan installments without ensuring the end use of funds of the previous installments and without linkage to actual progress of construction of the houses, which resulted in non completion of the projects in respect of all the above housing loans.
I, therefore, hold allegation No.1 as partly substantiated.
I have examined the arguments of prosecution and defence and it is observed that although 3 years ITRs are enclosed with all the housing loan documents in case of account no.26513, 26652 and 26522 one year Tax deposit challen is enclosed but figures incorporated in the ITRs are not evidenced to ascertain their genuineness. The contention of the defence that Savings Bank Account statements were although obtained by the Charged Officer at the material time but later being misplaced, while handing over the documents to CBI Officials is not tenable, as all the documents were handed over to the CBI Officials were duly listed and duly acknowledged by them.7
I, therefore, hold the allegation No.2 as substantiated.
I have examined the arguments of prosecution and defence and it is observed that margin money as stipulated by the Bank must be deposited by the borrowers as their stake in the project, which was not deposited by the borrowers in respect of all the above cases. The contention of defence regarding treating the borrowers investment in the plot as margin money is not tenable.
I, therefore, hold the allegation No.3 as substantiated.
I have examined the arguments of prosecution and defence and it is observed that allegation of involvement of middleman could not be established due to non production of Shri Alfred David, the housing loan borrower in the enquiry proceedings.
Regarding arranging of ITRs by the middleman and releasing the loan installments without ensuring the end use of funds is also not established as the prosecution could not produce any documentary evidence in support of their contention. I, therefore, hold the allegation No.4 as not substantiated.
Therefore, Charge No.4 stands not proved.
I have examined the arguments of prosecution and defence and it is observed that Charged Officer has transferred a part loan amount of the new housing loan to close the outstanding of the previous housing loan sanctioned and disbursed to the same borrower to accommodate him. I, therefore, hold the allegations No.5 as substantiated.
Therefore, charge No.5 stands proved.
I have examined the arguments of prosecution and defence and it is observed that Charged Officer has sanctioned and disbursed Cash credit Limits to M/s A.R. Sales Corporation and M/s Ganguli Opticals & Science Emporium of Rs.5.00 lacs and Rs.7.50 lacs respectively and allowed the diversion of funds to their other accounts. Shri Amit Ganguli transferred the funds of the firm to his personal account, which was evidenced vide statement of account enclosed with the loan documents. From perusal of loan documents, it is observed that a sum of Rs.5.00 lacs and Rs.2.50 lacs were diverted to other account and not utilized for the activity for which Cash Credit limit was sanctioned to the firm. It is, therefore, evident that Charged Officer has unduly accommodated Shri Amit Ganguli. The contention of the Defence that Cash Credit 8 limit of Rs.2.50 lacs sanctioned to M/s Ganguli Optical & Science Emporium dated 31.1.2004 was not sanctioned by the Charged Officer but sanctioned by the previous incumbent, is not tenable, as disbursement of the C/C limit was done by the Charged Officer. The contention of the Charged Officer that Field Officer, posted in the Branch at the material time not recommend the sanction of cash credit limits due to lack of job knowledge in not tenable. I, therefore, hold the allegation No.6 as substantiated.
Therefore, Charge No.6 stands proved."
The enquiry officer in his report dated 9.3.2007 thus found charge No.1 to be partly proved, the charge Nos.2 and 3 to be proved, charge No.4 to be not proved and charge Nos.5 and 6 to be proved.
The petitioner submitted his defence to the enquiring authorities dated 9.3.2007, which was received by him on 15.3.2007. His defence statement dated 20.3.2007 was considered by the General Manager-II/ appointing authority. It was found by him that lapses are serious in nature and have caused loss to the bank. The petitioner failed to discharge his duty with utmost sincerity, dignity, devotion and diligence, and acted in a manner unbecoming of an officer in violation to rule 50 (4) of the SBI Officers Service Rules. His conduct was highly detrimental to the bank interest. The appointing authority further find that the petitioner has tried to shift the burden of responsibility towards Field Officer. The petitioner released the installment of house loan without ensuring the margin money and end use of funds. He unduly accommodated a policy of transferring the proceeds of cash credit of the firm in the personal account of the proprietor of the firm. These acts were found to be in violation of Rule 50 (4) of the SBI Officers Service Rules. The appointing authority thus decided and punished the petitioner with penalty of dismissal from service in terms of Rule 67 (j) of the State Bank of India Officers Service Rules. The suspension period was directed to be treated as such, that is, not to be counted as on duty and no salary and allowance would be payable except subsistence allowance, which was already 9 paid to him. The petitioner's appeal to the appellant authority was dismissed by a long and reasoned order considering his defence on each of the allegations and grounds in detail by order of the appellate authority/ Chief General Manager, State Bank of India, Local Head Office, Lucknow dated 12.3.2008. Aggrieved the petitioner filed this writ petition.
The petitioner was dismissed from service 10 days before the date of his superannuation.
Shri Ashok Khare, learned counsel for the petitioner submits that the departmental enquiry was not conducted in conformity with principle of natural justice. Some of the documents in support of the charges were not supplied nor inspection permitted. There was no order rejecting such request or communicating any reason for non supply/ non inspection of the documents. The list of documents supplied clearly indicates that statement of Shri R.P. Gautam, the then Field Officer dated 20.5.2005 enumerated at Item No.8 under allegation No.6 was not supplied. The petitioner, therefore, could not prepare his defence. The copy of the laid down bank instructions to be followed for ascertaining genuineness of the income tax returns as also the instructions regarding obtaining assessment certificates were also not provided. Copy of the title deed in respect of loan account was not given tot he petitioner.
Shri Ashok Khare submits that allegations levelled against the petitioner and the findings recorded do not make out any of the charge of misconduct for initiating disciplinary action and to punish the petitioner. The enquiry report demonstrates that the findings recorded are only with regard to technical breach of procedure and sanction of loans. There was no allegation or finding with regard to any ill-will, ulterior motive and the loss causes to the bank. The entire enquiry was held within one working day and the petitioner was dismissed 10 days before his retirement after 40 years of satisfactory service in which his work and conduct was appreciated and he had received regular 10 promotion. During his entire career the petitioner has sanctioned thousands of loans without any allegation of irregularity. The penalty of dismissal is wholly disproportionate with the allegations levelled against the petitioner.
Shri Ashok Khare has relied upon the judgments of the Supreme Court in Union of India & Ors. Vs. J. Ahmed, (1979) 2 SCC 286 to submit that deficiency in personal character or personal apology do not constitute misconduct for taking disciplinary action. The matter of efficiency, failure to attain highest standard of administrative ability while holding a high post would not by itself constitute misconduct. There must be negligence in performance of duty and lapse in performance or error of judgment in evaluating the developing situations but that does not constitute misconduct unless the consequences directly attributable to negligence are such, as are irreparable or the resultant damage is so heavy that the degree of culpability would be very high. An error can be indicative of negligence. Carelessness can often be productive of more harm than deliberate wickedness or malevolence. But in any case, failure to attain the highest standard of efficiency in performance of duty permitting an inference of negligence does not constitute misconduct.
Shri Ashok Khare submits relying upon State of Punjab & Ors. Vs. Ram Singh Ex-Constable, (1992) 4 SCC 54 that there is distinction between 'gravest misconduct' and 'grave misconduct'. Before awarding an order of dismissal it is mandatory that dismissal order is made only when there are gravest acts of misconduct, since it impinges upon the pensionary rights of the delinquent after putting long length of service. In this case a constable was loitering in a drunken condition near bus stand while on duty and when brought to hospital abused the doctors, the court held that the act constitute gravest act of misconduct warranting dismissal from service.
11In State of U.P. & Ors. Vs. Ramesh Chandra Mangalik, (2002) 3 SCC 443 the Supreme Court held that where charge of commission of irregularities is not result of mere omission or lack of competence the question whether the charge constituted misconduct or not would depend upon the factual statements in the case.
In Inspector Prem Chand Vs. Government of NCT of Delhi & Ors., (2007) 4 SCC 566 the Supreme Court reiterated that the error of judgment or negligence simplicitor is not misconduct. In a given case what should have been done, depends on the facts and circumstances of the case and no hard and fast rule can be laid down. The petitioner was Inspector (Malaria). A member of the raiding party offerred tainted money to him. He refused to accept it. The tainted money was not seized and that prosecution ended in acquittal. In disciplinary proceedings no finding was recorded that delinquent police inspector was guilty of an unlawful behaviour in relation to discharge of his duties. The Supreme Court said that in the given circumstances, the appellant cannot be said to have committed any misconduct.
On the proportionality of punishment to the charges levelled against the officer, Shri Ashok Khare has relied upon Bhagat Ram Vs. State of Himachal Pradesh & Ors., 1993 SCC (L&S) 342 in which it was held that dismissal on trivial charge namely where out of 21 trees 17 were in forest and 4 were on the private land of an individual. Forest guard had paid compensation for illegal felling causing loss to the government. On the joint enquiry the enquiry against the co-delinquent was separated. One of the three charges were proved against the appellant. There was no evidence led to show that the appellant as Class-IV employee was aware of all technical rules prescribed for holding enquiry and was entitled to be defended by a government servant of his choice. The enquiry was found to be held in violation of principle of natural justice and that while allowing the appeal the Supreme Court observed that a 12 minor infraction of duty leading to a trivial charge of negligence of checking hammer marks on trees and which did not cause any loss to the government, it was not fair to punish the employee and also to order a fresh enquiry. The Supreme Court found that withholding two increments with future effect and payment of 50% arrears would be sufficient punishment.
Shri Vipin Sinha appearing for the bank would submit that all the documents relied upon by the bank were given to the petitioner to prove the allegations against him. The complete set of such documents; application with all enclosures including salary certificate, income proof, IT return forms and unit inspection register were provided to him. The defence representative gave a certificate on 25th September, 2006 that all the documents have been perused. The documents listed at Item No.5 under allegation No.4 relating to letter dated 20th May, 2005 of Shri Alfred David was also perused by the petitioner. Unit Inspection Register in respect of allegation NO.5 of the two loan account was also perused and signed and the minute of proceedings was singed by the chargesheeted officer. In para 19 o the counter affidavit it is stated that after perusing the minutes of the enquiry, the enquiring officer advised the chargesheeted officer that since the perusal of the original prosecution and defence document has been done, whether these were genuine and were to be admitted, the chargesheeted officer confirmed and admitted the genuineness of the documents perused by him. The certificate of inspection dated 25th September, 2006 clearly bears the testimony to perusal of all the documents by the petitioner and thereafter no objection of non supply of document was made by him in the enquiry proceedings. Further it is stated in para 24 that a report in respect of CMP Degree College, Allahabad Branch was lodged by the bank with CBI. As per the Rules and norms the CBI Officer has taken custody of the original documents. The notorised duplicate copy of the documents were, however, kept in the branch, which were perused by the 13 charge sheeted officer. He had taken no objection to perusing these documents. The CBI had found sufficient material for initiating action against the petitioner and for the said purpose sanction was also sought but in the meanwhile the petitioner was dismissed from service.
It is denied by Shri Vipin Sinha that the bank did not suffer any financial loss on account of negligence of the petitioner in sanctioning loan transactions. In para 36 it is clearly stated relying upon loss statement prepared by the bank that the bank had sufferred a financial loss to the tune of Rs.73,48,421.16.
In reply Shri Khare submits that the allegations of financial loss is wholly imaginary. There was no allegation or charge against the petitioner for embezzlement or financial improprietory. The entire amount of gratuity has been paid to the petitioner and that CBI Special Court, Prevention of Corruption Act has in Case No.51 of 2007; RC No.18A/5, State Vs. S.N. Lal under Section 120B, 420, 468 and Section 13 (2) of the Prevention of Corruption Act accepted the final report submitted by the CBI on the ground that all the 13 persons including the women, have been made accused in the mater of residential loan given by the bank. The allegations are of civil nature and that the bank has already filed a suit for recovery of the money and thus in view of the circumstances and insufficient evidence it is not proper to rope in the accused and to cause him mental, physical and financial hardships. The charge sheet in the criminal case was set aside and the petitioner and other accused were discharged.
Shri Vipin Sinha submits that the government's contribution to the provident fund was paid by the trustees to the bank. He was paid on the direction of the trustees of the bank the provident fund amount of Rs.4,63,398/- on 25th September, 2007, with reference to the employee's own contribution. The gratuity of Rs.3.5 lacs with delayed interest was also paid on 27th August, 2008. The leave 14 encashment was, however, not paid as the petitioner is not entitled to pension and other terminal benefits.
We have gone through the allegations against the petitioner, material relied upon by the bank and the defence taken and the findings recorded by the enquiry officer. On the first charge the enquiry officer found that the residential loans were given for construction of house of all the plots located in the residential area under Awas Vikas limits, and that land was being used for residential purposes for which infrastructure like water, road and electricity was available. The Field Officer had already recommended for payment of loan installments. The enquiry officer, however, found that the arguments of the defence were contradictory and that the charged officer had released the subsequent housing loan installment without ensuring the end use of the fund of the previous installment linked to actual progress of the construction of houses. The charge was thus partly proved.
In respect of charge No.2 the enquiry officer found that though 3 year's ITR as per norms were enclosed with all the housing loan document in case of Account No.26513, 26652, 26552, only one year's tax deposit challen was enclosed and that figures incorporated in the income tax return were not evidence to ascertain their genuineness. The contention of the officer that the saving bank account statements were obtained by the charged officer but they were misplaced while handing over to CBI was not accepted as the documents were duly listed and duly acknowledged by CBI officers. The third charge related to ensuring the margin money to be available with the borrowers. It was found that as against the terms and conditions of the loan the borrowers did not deposit any margin money as their stake in the project in respect of 10 cases proving charge No.3.
The charge No.4 related to housing loan of Rs.5 lacs to Shri Alfred David and Smt. Dorthy David through middleman Shri Ravi Srivastava and this charge was not proved as Shri David was 15 not examined. In respect of charge No.5 the enquiry officer did not dispute the defence statement that initial housing loan was sanctioned to Shri Suresh Kumar for a project situate at 208 EWS, ADA Colony, Neem Sarai, Allahbad. Subsequently on the request of the borrower on account of some family dispute the project was transferred in the name of his wife Smt. Sushma Chaurasia and the loan account was regularised by closing previous housing loan account. The enquiry officer did not record any finding whether the transaction was irregular or the manner in which the loss was caused to the bank in closing the previous housing loan account by transferring the project in the name of Smt. Sushma Chaurasia. There are no finding as to how this transfer of loan account in the name of Shri Suresh Kumar was irregular and against the interest of the bank.
In respect of allegation on which charge No.6 was based, it was observed that partnership deed of the firm was executed on 4.3.2005, whereas the loan was disbursed on 27.4.2004; equitable mortgage was created on the house as collateral security on 12.5.2004. At that time the sanctioning cash credit limit was not in existence. The charged officer had sanctioned cash credit limit of Rs.7.5 lacs on 14.1.2004 to the same unit in which Shri Amit Ganguly was proprietor of the firm. The enquiry officer found that the charged officer had diverted the funds to the other accounts of Shir Amit Ganguly and that these amounts were not utilised for the activity for which the cash credit limit was sanctioned. The charged officer had unduly accommodated Shri Amit Ganguly in the transactions.
From the aforesaid discussions we find that charge No.1 was partly proved and charge No.4 was not proved by the enquiry officer. This leaves charge Nos.1, 2, 5 and 6 against the petitioner, to be found proved by the enquiry officer.
This Court has consistently held in D.S. Bisnoi vs. State Bank of India 2004 (1) ESC 381; Sudhir Singh vs. District 16 Cooperative Bank 2003 (1) ESC 465; Ram Pratap Sonekar vs. Allahabad Bank 2000 (2) ESC 814; K.K. Singh vs. Gomti Gramin Bank 2002 (1) ESC 257, delivered by Division Benches, relying upon Disciplinary Authority vs. N.B. Patnaik 1996 (4) SCC 457; State Bank of India vs. T.J. Pant 1999 (4) SCC 759, that the High Court, in exercise of its jurisdiction under Article 226 of the Constitution of India, cannot sit in appeal over the findings recorded by the disciplinary authority of the bank based upon the enquiry report. Where full opportunity is given to the employee of the bank to defend himself, the High Court would not interfere in the findings on technical and flimsy grounds. In Disciplinary Authority vs. N.B. Patnaik (supra) the Supreme Court observed that even if no loss has been caused to the bank, an act beyond the authority of the officer of the bank amounts to misconduct.
In Tara Chand Byas vs. Chairman JT 1997 (3) SC 500 a bank employee was punished for giving loans without adequate security. The Supreme Court upheld the punishment. In State Bank of India vs. T.J. Pal (1999) 4 SCC 759 the Supreme Court observed that proof of actual loss was not necessary for punishing a bank employee. In Union of India vs. Vishwa Mohan 1998 (4) SCC 310 it was held by the apex court that absolute devotion, diligence and integrity is required from the employees in the banking business, otherwise the confidence of the public will be impaired.
In Dr. Ram Pal Singh vs. State of UP and others (2006) 2 ESC 1182 Allahabad (DB) a Division Bench of this Court held that the jurisdiction of court in the matters of challenge to the findings recorded by the enquiry officer and the disciplinary authority is very limited. The Court cannot sit in appeal over such findings. It only reviews the manner in which the decision was taken. The jurisdiction of the High Court under Article 226 of the Constitution of India in such matters is confined to correct errors 17 of law or procedural matters and violations of principles of natural justice resulting in miscarriage of justice. The judicial review is permissible against the decision making process and not against the decision itself. A similar view was taken by Division Bench in Sarvesh Kumar Sharma vs. Nuclear Power Corporation of India Ltd and another 2006 (2) ESC 1153.
In Regional Manager and Disciplinary Authority SBI Hyderabad vs. S. Mohad. Gaffar the Supreme Court interpreted the words 'gross misconduct' as against the 'minor misconduct' under the 'Shashtriya Award' and 'Desai Award' applicable to the employees of the bank and held that the expression 'gross misconduct' is not to be viewed or considered as it may appear or appeal to the perception of the court. It has to be construed in the context of the definition. If any act is done prejudicial to the interest of the bank or gross negligence involves, or is likely to involve the bank in serious loss and where the employee of the bank knowingly makes a false statement in any document pertaining to or in connection with the employment with the bank, the findings on such issue would amount to gross misconduct. The penalty or punishment imposed by the disciplinary authority or appellate authority will not be treated to be excessive, shocking conscious of the court, if it is permissible. The High Court does not normally interfere or substitute its own opinion and impose some other punishment or penalty than the punishment imposed by the bank.
Similar view was also taken in Union of India and others vs. K.G. Singh (2006) 3 ESC 373 (SC) limiting judicial review to the deficiency in the decision making process and not the decision itself.
The petitioner was given full and adequate opportunity to defend himself. He was served with chargesheet with statement of allegation and was given and permitted inspection of all the relevant documents relied upon by the enquiry officer. The 18 petitioner appeared in the enquiry proceedings and was represented by a defence representative of his choice. The preliminary hearing and regular hearing took place in the presence of the petitioner. The enquiry officer considered the documents produced by the department and the defence and found the allegation on charge No. 1 to be partly proved and allegation of charge Nos.2, 3, 5, and 6 to be proved against the petitioner. The charges proved against the petitioner related to negligence in performance of his duties. It cannot be said that the petitioner was not guilty of the allegations levelled against him or that the allegations were so trivial or inconsequential that the punishment of dismissal of service could not be awarded by the disciplinary authority.
We have also taken into consideration the pleas that the charges were not sufficient to visit the petitioner with punishment of dismissal, close to his superannuation. The disciplinary authority was required to consider the effect of long association of the petitioner as officer with the bank. We, however, cannot substitute our opinion on the punishment awarded by the disciplinary authority and affirmed by the appellate authority, on the ground of compassion. The allegations found proved against the petitioner are not such on which the punishment of dismissal can be treated to be grossly disproportionate, to shock the conscience of the Court.
The writ petition is dismissed.
Dt.30.07.2010 SP/