Gujarat High Court
C S Amin vs Assistant General Manager Sbi on 14 December, 2016
Author: J.B.Pardiwala
Bench: J.B.Pardiwala
C/SCA/11340/2000 CAV JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL CIVIL APPLICATION NO. 11340 of 2000
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE J.B.PARDIWALA
==========================================================
1 Whether Reporters of Local Papers may be allowed
to see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy of
the judgment ?
4 Whether this case involves a substantial question of
law as to the interpretation of the Constitution of
India or any order made thereunder ?
==========================================================
C S AMIN....Petitioner(s)
Versus
ASSISTANT GENERAL MANAGER SBI, REGION III & 2....Respondent(s)
==========================================================
Appearance:
MR KB PUJARA, ADVOCATE for the Petitioner(s) No. 1
MR PRANAV G DESAI, ADVOCATE for the Respondent(s) No. 1 - 2
RULE SERVED for the Respondent(s) No. 3
==========================================================
CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALA
Date : 14/12/2016
CAV JUDGMENT
1. By this writ application under Article 226 of the Page 1 of 37 HC-NIC Page 1 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT Constitution of India, the writ applicant, a former employee of the State Bank of India, has prayed for the following reliefs;
"(A) to quash and set aside the inquiry proceedings held against the petitioner by the respondents pursuant to the charge sheet dtd. 6.1.1998 as per Annexure C (B) to quash and set aside the order of dismissal of the petitioner passed by the respondent no.2 on 19.5.1999 (received by the petitioner on 22.5.199) as per Annexure I (C ) to quash and set aside the order of the Appellate Authority the respondent no.3 herein dated 20.4.2000 (received by the petitioner on 5.5.2000) as per Annexure K (D) to direct reinstatement of the petitioner in service of the respondents with full back wages, continuity of service and all other consequential benefits;
(E) to direct the respondents to pay to the petitioner all the back wages and other monetary benefits becoming payable on reinstatement, with interest at the rate of 18% per annum thereon.
(F) Pending the admission, hearing and final disposal of this petition, be pleased to direct the respondents to allow the petitioner to discharge duties and to draw regular salaries as he was doing prior to the impugned order.
(G) to grant any other appropriate and just reliefs."
2. The facts of this case may be summarized as under;
2.1 While the writ applicant herein was serving as an Officer In charge, NRI Section at the Nadiad Branch of the State Bank of India, a departmental charge-sheet came to be served upon him, containing the following charges;
Page 2 of 37HC-NIC Page 2 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT "An FCNR STDR for GBP 42,555/- favouring Shri Mahesh C. Patel and Mrs. Kumudben M. Patel (E or S) due on 30.01.1996 was issued by Nadiad branch on 08.02.1993 and was held in safe custody at the branch. The holders have maintained that they neither signed any document nor gave any discharge on the reverse of the STDR for the overdraft of Rs.12 lacs granted by the branch on 03.03.1993 to Shri Rajubhai R. Patel in his current account No.P-491. The signature on the overdraft documents does not tally with those of the FCNR STDR.
I) Shri Amin failed to verify the signature of the depositor(s) on STDR (FCNR) for GBP 42555/-, application for OD, Security delivery letter and Form A-2 all dated 03.03.1993.
ii) The signatures on the above documents did not tally with the official records and certain colomns/fields were not filled in. But Shri Amin unauthorizedly put his initials on the proposal with remarks "Sanctioned Chief Manager (PBD)". He did not exercise due deligence while recommending a large loan proposal to Shri R.R. Patel, a third party, with no previous connection with the branch.
iii) He thereby misled Shri N.H.Shah, Officiating as CM (PBD), in sanctioning a loan of Rs.12 Lacs to one Shri R.R. Patel.
iv) He did not enter the particulars of withdrawal of the said FCNR/STDR in the relevant safe custody register/ledger though the same was maintained by him and he was dealing with NRI safe custody scrips of P&S Divison.
v) All the time of withdrawal of the above FCNR/STDR from safe custody he did not obtain COS-49 so as to ensure the signature appearing thereon were tallied with those of the branch records.
vi) He did not identify the impersonator, Shri Mukeshkumar C. Patel, who had executed the loan documents as Mr. Mahesh C. Patel has brother nor bring such impersonation to the notice of the higher authorities despite the fact that he knew that the person was not Mahesh C. Patel, one of the beneficiaries of said FCNR deposit. Further, he was well aware of the identity of the impersonator Shri Mukeshkumar C. Patel who maintained an NRI a/c No.MI872-59/16 at the branch because his NRI account was opened through his (CS Amin's) introduction. Thus he suppressed the vital facts which led Page 3 of 37 HC-NIC Page 3 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT to prepetration of fraud and huge loss to the bank.
vii) He introduced the borrower Shri R. R. Patel to the bank, verified his signature and opened his current account No.P/491 on 03.03.1993 without obtaining prior approval of the competent authority at the branch. On the same day he put up the loan papers for sanction of an overdraft of Rs.12 Lacs to Shri R.R. Patel by the officiating CM (PBD).
viii) By aforesaid actions he facilitated the fraudster in defrauding the bank, and was an accomplice in the said fraud and thus exposed the bank to an avoidable loss of Rs.23.25 Lacs plus interest from 01.04.96 onwards."
3. An Inquiry Officer was appointed for the purpose of conducting the departmental inquiry. The Inquiry Officer held the charges to have been established against the writ applicant herein.
4. The final conclusion drawn by the Inquiry Officer, in his inquiry report, is as under;
"MY FINDINGS Since all the above allegations stand proved, the allegation (viii) (a)(b)(c) also stands proved.
I furnish hereunder my final findings in respect of the articles of charge contained in the chargesheet.
Articles of Charge MY FINDINGS
Failure to protect interest of Since all the supporting allegations of
the Bank; displaying gross this articles of charge have been
negligence; lack of integrity, proved, the charge stands fully
honesty, devotion and established.
diligence in discharge of
duties and thereby
facilitatating miscreants to
perpetrate fraud resulting in
loss to the Bank/exposing the
Bank to the risk of loss and
Page 4 of 37
HC-NIC Page 4 of 37 Created On Thu Dec 15 00:19:14 IST 2016
C/SCA/11340/2000 CAV JUDGMENT
acting in a manner
unbecoming of a bank official
in terms of Rule No.50(4) of
State Bank of India Officers
Service Rules.
5. The writ applicant herein filed a detailed reply to the show-cause notice issued by the Disciplinary Authority as regards the findings recorded by the Inquiry Officer and the proposed penalty.
6. The Disciplinary Authority thought fit to impose the penalty of dismissal from the service. The order dated 13th May, 1999 passed by the Disciplinary Authority reads as under;
"Arising out of certain acts of serious misconduct allegedly committed by Shri C.S. Amin, Officer, JMGS I during his incumbency as Asst. Manager, Nadiad Branch, he was chargesheeted for major penalty action vide chargesheet No.AZO/DISC/336 dated 6.1.98 under rule 68(2) (iii) of the State Bank of India Officers Service Rules. The charge against Shri Amin was;
"Failure to protect interest of the Bank, displaying gross negligence lack of integrity, honesty, devotion and diligence in discharge of duties and thereby facilitating miscreants to prepetrate fraud resulting in loss to the Bank/exposing the Bank to the risk of loss and acting in a manner unbecoming of a bank official in terms of Rule No.50(4) as State Bank of India Officers Service Rules.
2. Eight allegations were levelled against Shri Amin in support of the above mentioned charge.
3. Shri Amin submitted his defence statement on 21.2.98. As he denied the charge levelled against him, the Disciplinary Authority remitted the case for departmental enquiry on 26.3.98. The enquiry officer's report was received on 22.1.99. The EO's report was sent to the CSO for his submission. The CSO has made his Page 5 of 37 HC-NIC Page 5 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT submission thereon on 27.2.99.
4. The Disciplinary Authority after considering the findings of the Enquiry Officer has recorded his views in his note of recommendation.
5. I have carefully perused the enquiry proceedings, managemenr, exhibits as well as defence exhibits, briefs of Presenting Officer and the defence representative report of the Enquiry Officer, the submission of the CSO on the enquiry report and the views and the recommendation of the Disciplinary Authority. Having thus, examined various aspects of the case, I agree with the reasoning and views of the Disciplinary Authority.
6. Considering the nature of the charges, I am of the opinion that the ends of justice would be adequately met by imposing the punishment of dismissal from service under Rule No.67(i) of State Bank of India Officers Service Rules, on the CSO, Shri C.S. Amin, Officer, JMGS I. I Order accordingly.
7. I further order that a copy of the this order alongwith a copy of the Note of recommendations of the Disciplinary Authority and the Dy. General Manager, Ahmedabad Zonal Office, be served on the CSO, Shri C.S. Amin, Officer JMGS I and copies of both the above documents be placed in the service file of the official."
7. Being dissatisfied with the order passed by the Disciplinary Authority, imposing the punishment of dismissal from the service, the writ applicant preferred an appeal before the Appellate Authority, i.e., the Chief General Manager. The appeal also came to be dismissed vide order dated 20 th April, 2000. The Appellate Authority, while dismissing the appeal, observed as under;
"(i) The punishment has been imposed in consideration of his serious lapses/betrayal of trust involving a huge amount after all the relevant allegations and charge have been duly proved during the course of the enquiry. It is natural that the punishment will have its own Page 6 of 37 HC-NIC Page 6 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT course/impact having a far reaching ramificaqtion.
(ii)(a) While the management enjoys a prerogative for brining any one as Management witness, the defence had the full opportunity to cross examine the witness to prove their points.
(b) Once a document has been accepted as Management Exhibit (ME/13) it need not be necessarily testified again. In this case, the G.R. Had the opportunity to cross examine the maker (MW3) of the above mentioned document, accepted as M.E. (ME/1), Hence, Shri Amin's contention is not correct.
(c ) The Management Witness (ME-1) and (MW/3) have confirmed in their testimony during the course of the enquiry that it was the duty of Shri Amin as In-charge, NRI Cell to verify the signature of the holder of the FCNR STDR in question pertaining to his cell before withdrawing the instrument from safe custody and to complete all the formalities including obtaining of signature on COS 49 etc. Further, though the security was withdrawn from safe custody and security register was made in July 1993. This has been confirmed by the then Asst. General Manager of Nadiad Branch in terms of his letter dated 04.02.1997 (ME/17).
(iii) The D.A.'s concurrence with the E.O's views/findings is based on evidences produced and facts about the allegations proved. In the same way the Appointing Authority has perused the entire case of the lapses which have been proved beyond doubt with appropriate documentary evidences before taking a view in imposing the punishment.
(iv) Shri Amin, despite having faith in judgment of the Appellate Authority, has preferred to file a writ petition in the Honourable High Court of Gujarat to restrain the Bank from excluding the penalty order. Of course, his petition was dismissed by the High Court who had fined him Rs.5,000/- instead.
(v) Shri Amin admits having closely known the family of Shri Chhotubhai Patel. He knew his two sons by face (ME/24.). Incidentally, it is evident from the related account opening form that Shri Amin has introduced both Page 7 of 37 HC-NIC Page 7 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT the accounts of Shri Mukesh C. Patel as well as Shri R.R. Patel, In that case, it is difficult to believe that Shri Amin did not notice the impersonation done by Shri Mukesh C. Patel. It is unlikely that Shri Amin had unknowingly allowed Shri Mukesh C. Patel to sign as Mahesh C. Patel on the loan documents even when he (Shri Amin) himself had inroduced the account of Shri Mukesh C. Patel. Instead of objecting to the case of impersonation, Shri Amin helped Shri R.R. Patel in obtaining the overdraft of Rs.23.25 lacs against the FCNR STDR in the name of Shri Mahesh C. Patel and his wife not only by preparing the loan documents but also by putting his initial in token of having verified everything implying thereby that everything was in order and these need not be verified again. Shri Amin also did not obtain approval of the competent authority for introducing and opening the account of Shri R.R. Patel on 03.03.1993 itself. (it was on this very date the overdraft was also granted to Shri R.R. Patel).
Regarding the point of comparison in imposing punishments, the appropriate authority has taken into account all the aspects so that the respective penalties meet the ends of justice as per the gravity of individual cases.
(vi) Shri Amin was aware of others' duties and responsibilities, but he was unaware of his own responsibilities as In-charge, NRI Cell. As Officer-in- charge, NRI cell, Shri Amin should have verified the signature on COS 49 by way of identifying the actual depositor of the FCNR STDR pertaining to his Cell for withdrawing the STDR from Bank's safe custody. This has also been testified by the Management witness. His failure to do so has led to the occurrence of the fraud. The Bank has taken appropriate actions against the responsible officers. Hence, Shri Amin's plea is not acceptable.
(vii) The outcome of the suit filed by the Bank for the recovery of the avoidable financial loss of Rs.23.25 lacs plus interest from 01.04.1996 onwards, has no bearing upon Shri Amin's lapses for which the Bank has taken appropriate action.
(viii) The Bank has appreciated whatever good work done by Shri Amin. However, his under noted misdeeds Page 8 of 37 HC-NIC Page 8 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT are also in Bank's record that throw light on his track record.
(a) For wrongly crediting the proceeds of one Letter of Credit to another account, his one increment was withheld for one year without cumulative effect in June, 1988.
(b) For crediting the proceeds of a Refund Order for Rs.500/- issued by Mahendra Suiting Ltd. favouring one Shri R.B. Shrimali, to his own account, Shri Amin was reverted from MMGS-II to JMGS-I with the basic placed at Rs.6,900/- in March 1996 (w.e.f 23.03.1996)."
8. Being dissatisfied with the orders referred to above, the writ applicant has come up with this writ application.
9. I take notice of the fact that in the course of the hearing of this writ application, on 30th April, 2010, a suggestion was made by this court that the Bank may reconsider/substitute the penalty of dismissal, considering the fact that the two co- delinquents, although were held to be guilty of the charges, yet were imposed with minor penalty. Accordingly, the writ applicant herein was asked to prefer a representation in that regard. The representation of the writ applicant dated 7 th May, 2010 was considered by the Chief General Manager as the Appellate Authority and the same came to be rejected. The observations in the order dated 10th August, 2010 are as under;
"11. The punishments against the various officials other than Shri Amin have been imposed in keeping with the nature and gravity of lapses/misconduct on their part which were held as proved and strictly in compliance with the principles of natural justice and in a fair and equitable manner. The punishment imposed on Shri Amin is commensurate to the acts of serious misconduct on his Page 9 of 37 HC-NIC Page 9 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT part and his implied complicity in the release of fraudulent loan.
ii) The Management Witness (ME-1) and (MW-3) have confirmed in their testimony during the course of enquiry that it was the duty of Shri Amin as In-charge, NRI Cell, to verify the signature of the holder of FCNR STDR in question and to complete all the formalities inclu9ding obtaining of signature on COS-49 etc.. Further, though the security was withdrawn from the safe custody on 03.03.1993, the related entry in the safe custody and security register was made in July 1993. This has been confirmed by then then Assistant General Manager of Nadiad Branch in terms of his letter dated 04.02.1997 ME-17).
iii) Shri Amin admits having closely known the family of Shri Chhotubhai Patel. He knew his two sons by face (M\E/24). Incidentally, it is evident from the related account opening from that Shri Amin has introduced both the accounts of Shri Mukesh C. Patel as well as R.R. Patel.
In that case, it is difficult to believe that Shri Amin did not notice the impersonation done by Shri Mukesh C. Patel. It is unlikely that Shri Amin had unknowingly allowed Shri Mukesh C. Patel to sign as Shri Mukesh C. Patel on the loan documents even when he (Shri Amin) himself had introduced the account of Shri Mukesh C. Patel). Instead of objecting to the case of impersonation, Shri Amin helped Shri R.R. Patel in obtaining the overdraft of Rs.23.25 lacs against the FCNR STDR in the name of Mahesh C. Patel and his wife not only by preparing the loan documents but also by putting his initial in token of having verified everything implying thereby that everything was in order and these need not be verified again. Shri Amin also did not obtain approval of the competent authority for introducing and opening the account of Shri R.R. Patel on 03.03.1993 itself (it was on this very date the overdraft was also granted to Shri R.R. Patel)
iv) The punishment has been imposed in consideration of serious lapses/betrayal of trust involving a huge amount and after all the relevant allegations and charges have been duly proved during the course of enquiry. It is natural that punishment will have its own course/impact having a far reaching ramification.
Page 10 of 37HC-NIC Page 10 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT
12. An authority vested with administrative powers, which is required to strike a judicious balance between the interests of the institution and its employees while exercising such powers, has to consider, weigh and take into account many other factors lest its decisions, instead of being upheld as just and equitable, get condemned as misplaced sympathy' . In this case, the facts remain.
(I) That Shri Amin was charge-sheeted and proceeded against for "major' penalty and that all the serious allegations and the resultant charge of misconduct have been found established beyond doubt both by the Inquiring Authority and the disciplinary Authority.
(ii) That the imputations against Shri Amin are not mere acts of omission or negligence, but intentional acts of impropriety jeopardizing the interests of the Bank. In such commission on the part of an official holding a responsible position in the Bank, which is akin to the fence grazing the crop, mens ria is conspicuous.
(iii) That the Bank has suffered a huge loss of more than Rs.23.25 lacs plus interest on account of the said acts.
(iv) That the Disciplinary Authority has vividly rationalized recommendation to impose the extreme penalty, with which the Appointing Authority has concurred. The motivating factors behind the imposition of the penalty of dismissal are not only loss to the Bank and the presence of mens rea in the established acts of misconduct but also the impending necessity to dispense with the services of the delinquent due to loss of confidence in him.
13. The Bank officers/employees holding positions of trust where honesty and integrity are inbuilt requirements of functioning and therefore, their matters require to be dealt with firmly with firm hands and not leniently, and in such cases, there is no place for generously or misplaced sympathy. 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 Page 11 of 37 HC-NIC Page 11 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT 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. 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 Shri C.S. Amin were not casual in nature and were serious. The appellant/petitioner, no doubt, held a position of trust where honesty and integrity were inbuilt requirements of functioning. His proved acts of misconduct fraught with malafide had caused loss of faith in him. Hence, it was incumbent on the authorities concerned to deal with his case in the manner expected of them in the interests of justice and fair play and in order to ensure against miscarriage of justice.
Decision
14. Given the foregoing, I do not consider it expedient to interfere with the order of penalty passed by the Appropriate Authority, which, I am fully convinced, is not only impeccable on facts but also unambiguously supported by unassailable reasons in support of the conclusions reached. No other valid ground has been raised by the petitioner, which requires to be commented upon. The penalty ibid has been recommended/inflicted by the Disciplinary Authority/Appointing Authority after due compliance with the provisions of the service rules in vogue then and the principles of natural justice. The punishment is considered appropriate and proportionate and the procedure adopted just, far and equitable. The order passed by the Appellate Authority on the appeal submitted by Shri Amin is very reasoned and strong on facts and the appeal was rejected after considering the entire case records and the gravity of misconduct is the part of Shri Amin. I am, therefore, not inclined to modify the major penalty of dismissal inflicted by the Appropriate Authority on Shri C.S. Amin. I order accordingly.
13. This order be communicated to Shri Kaushik B. Pujara, advocate for Shri C.S. Amin as well as to the appellant/petitioner Shri C.S. Amin, and a copy hereof Page 12 of 37 HC-NIC Page 12 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT placed in his service file. The order is issued without prejudice to the rights and contentions of Bank in the said case no.11340/2000. A copy of the order may also be endorsed to Shri Pranav G. Desai, Bank's advocate."
10. Mr. K.B. Pujara, the learned counsel appearing for the writ applicant vehemently submitted that the Bank committed a serious error in dismissing the writ applicant from the service. Her would submit that assuming for the moment that there was an omission on the part of the writ applicant so far as the verification of the papers were concerned, that, by itself, could not have resulted into anything wrong because the custody of the FCNR STDR was not with the writ applicant and it is the custodian of the safe custody who should have ensured that before withdrawal of FCNR STDR the entry was made in the register and was initialed and then delivered. Mr. Pujara would submit that it was for Mr. N.H. Shah, the Officiating Chief Manager (P&B) to obtain the CSO-49 as he had himself verified the signature of the depositor and had withdrawn the safe custody article. The writ applicant was not the custodian of the scrips and according to the instructions of the Bank also it was not the responsibility of the writ applicant.
11. Mr. Pujara submitted that his client knew the depositor by face as his father was maintaining good relations with the entire staff of the branch. The account of Mr. Mukesh C. Patel was opened in 1989 and the writ applicant had introduced him because the father of Shri Mukesh C. Patel was known to the staff of the branch.
12. According to Mr. Pujara, the borrower Shri R.R. Patel was known to his client and, therefore, his client had introduced his Page 13 of 37 HC-NIC Page 13 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT account, but the loan papers were prepared with the full knowledge of Mr. N.H. Shah, the Officiating Chief Manager (P&B) and he recommended accordingly.
13. Mr. Pujara submits that his client was made a scapegoat for the misfeasance and malfeasance of Mr. N.H. Shah, who was also separately charge-sheeted in connection with the same incident, but was let off with a minor penalty of censure only.
14. Mr. Pujara, in the last, submitted that having regard to the nature of the charge, the penalty of dismissal could be said to be shockingly disproportionate.
15. In such circumstances referred to above, he prays that there being merit in this writ application, the same may be allowed and the impugned order of dismissal may be quashed.
16. Mr. Pujara, in the alternative submitted that applying the doctrine of proportionality, i.e., the vetnusbory principles, the penalty of dismissal deserves to be substituted with any other minor penalty.
17. On the other hand, this writ application has been vehemently opposed by Mr. Desai, the learned counsel appearing for the Bank. Mr. Desai would submit that the Inquiry Officer, after a full fledge inquiry and having regard to all the relevant aspects of the matter, held the charges against the writ applicant to have been established. He would submit that the findings recorded by the inquiry officer were accepted by the disciplinary authority and the disciplinary authority, Page 14 of 37 HC-NIC Page 14 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT accordingly, thought fit to impose the penalty of dismissal from the service. The appellate authority also looked into the matter and thought fit to dismiss the appeal. He would submit that the matter was reconsidered by the appellate authority pursuant to the suggestion of this Court and upon reconsideration also the Bank did not deem fit to substitute the penalty of dismissal with any other penalty. He would submit that having regard to the limited scope of interference in exercise of the extraordinary jurisdiction under Article 226 of the Constitution of India, this Court may not disturb the findings recorded by the authorities.
18. In such circumstances referred to above, Mr. Desai prays that there being no merit in this writ application, the same may be rejected.
19. 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 writ applicant is entitled to any of the reliefs prayed for in this writ application.
20. I take notice of the fact that the inquiring authority 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 proportionality and not on proof beyond the reasonable doubt.
Page 15 of 37HC-NIC Page 15 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT
21. In the case of 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."
22. In a very recent pronouncement in the case of Union of Page 16 of 37 HC-NIC Page 16 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT 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;Page 17 of 37
HC-NIC Page 17 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT
(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 Rao1, 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 Page 18 of 37 HC-NIC Page 18 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT 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 Page 19 of 37 HC-NIC Page 19 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT 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 Page 20 of 37 HC-NIC Page 20 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT 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 Page 21 of 37 HC-NIC Page 21 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT 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 the Indian 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. ....."Page 22 of 37
HC-NIC Page 22 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT 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 226/227 of 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 Page 23 of 37 HC-NIC Page 23 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT 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.
23. In the case of 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 Page 24 of 37 HC-NIC Page 24 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT 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.
24. In the case of 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 Page 25 of 37 HC-NIC Page 25 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT 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.
25. In the case of 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.Page 26 of 37
HC-NIC Page 26 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT
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."
26. In the case of A.L. Tripathi (Supra), the observations of Page 27 of 37 HC-NIC Page 27 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT the Supreme Court in Para-36 are relevant:-
36. We may also mention that the appellant has contended that there is no evidence that the appellant has actually defrauded the Bank or actual loss or damage has been caused to the Bank or actual risk has been incurred by the Bank. That is true. But the charge against the appellant was that he had so conducted himself which exposed the Bank to grave risk and for which his explanation was not accepted, after considering his explanation and after personal hearing reasonably an opinion may be formed that his conduct was such that defrauding of the Bank might have been caused. These were the charges against, him and these are the charges upon which he was accused. Therefore, whether actual loss or damage had been caused or not, is in our opinion immaterial.
In that view of the matter, we are of the opinion that the arguments on this aspect of the matter on behalf of the appellant cannot be accepted. In that view of the matter, it is not necessary to express any opinion on the question whether these rules under which the enquiry was conducted were statutory rules or not and as such whether the appellant has any statutory remedy against the orders impugned.
27. In view of the various judgments referred to above, no case could be said to have been made out by the writ applicant herein for interference. It is not a case of "no evidence". If there is some legal evidence on record and the same has been accepted, then this Court should not interfere in the matters arising from the departmental inquiry.
28. The above takes me to consider the last submission of Mr. Mehta that the penalty of dismissal in the facts of the case and having regard to the nature of the misconduct could be said to be shockingly disproportionate.
Page 28 of 37HC-NIC Page 28 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT So far as this issue is concerned, I can do no better than relying upon a Division Bench decision of this Court in the case of 'J.H. Joshi Vs. State of Gujarat (Special Civil Application No.5691 of 2002; decided on 10/05/2005). G.S. Singhvi, J (As His Lordship Then Was) has explained in details the doctrine of proportionality and Wednesbury Rules.
29. I may quote the observations of the Division Bench as under:-
The doctrine of proportionality and Wednesbury rule evolved in England in Council of Civil Services Union Vs. Minister for Civil Services (1983) 1 AC 768 and Associated Provincial Picture Houses Limited Vs. Wednesbury Corporation - 1948 2 All ER 680 have been applied by the Courts in India in various decisions. In Union of India Vs. C.G. Ganayutham - AIR 1997 SC 3387, the Supreme Court considered the ambit and scope of the doctrine of proportionality and Wednesbury rule in the light of various judicial pronouncements and laid down the following propositions:
"(1) To judge the validity of any administrative order or statutory discretion normally the Wednesbury test is to be applied to find out if the decision was illegal or suffered from procedural improprieties or was one which no sensible decision-maker could, on the material before him and within the framework of the law, have arrived at. The Court would consider whether relevant matters had not been taken into account or whether irrelevant matters had been taken into account or whether the action was not bonafide.
The Court would also consider whether the decision was absurd or perverse. The Court would not however go into the correctness of the choice made by the administrator amongst the various alternatives open to him. Nor could the Court substitute its decision to that of the administrator. This is the Wednesbury test. (2) The Court would not interfere with the administrator's decision unless it was illegal or Page 29 of 37 HC-NIC Page 29 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT suffered from procedural impropriety or was irrational in the sense that it was in outrageous defiance of logic or moral standards. The possibility of other tests, including proportionality being brought into English Administrative Law in future is not ruled out. These are the CCSU principles.
(3)(a) As per Bugdaycay, Brind and Smith, as long as the European Human Rights Convention (Contention) is not incorporated into English Law, the English Courts merely exercise a secondary judgement to find out if the decision maker could have, on the material before him, arrived at the primary judgment in the manner he has done.
(3)(b) If the Convention is incorporated in England making available the principle of proportionality, then the English Courts will render primary judgement on the validity of the administrative action and find out if the restriction is disproportionate or excessive or is not based upon a fair balancing of the fundamental freedom and the need for the restriction thereupon. (4)(a) The position in our country in administrative law, where no fundamental freedoms are involved, is that the Courts/Tribunals will only play a secondary role while the primary judgement as to reasonableness will remain with the executive or administrative authority. The secondary judgement of the Court is to be based on Wednesbury the CCSU principles as stated by Lord Greene and Lord Diplock respectively to find if the executive or administrative authority has reasonably arrived at his decision as the primary authority.
(4)(b) Whether in the case of administrative or executive action affecting fundamental freedoms, the Courts in our country will apply the principle of 'proportionality' and assume a primary role, is left open, to be decided in an appropriate case where such action is alleged to offend fundamental freedoms."
In Apparel Export Promotion Council Vs. A.K. Chopra - (1999) 1 SCC 759, the Supreme Court reiterated the otherwise well settled principles of law on the scope of judicial review of disciplinary action taken by the employer and laid down the following propositions:-
"It is a settled position that in departmental proceedings, the disciplinary authority is the sole Page 30 of 37 HC-NIC Page 30 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT judge of facts and in case an appeal is presented to the appellate authority, the appellate authority has also the power/and jurisdiction to re-appreciate the evidence and come to its own conclusion, on facts, being the sole fact-finding authorities. Once findings of fact, based on appreciation of evidence are recorded, the High Court in writ jurisdiction may not normally interfere with those factual findings unless it finds that the recorded findings were based either on no evidence or that the findings were wholly perverse and/or legally untenable. The adequacy or inadequacy of the evidence is not permitted to be canvassed before the High Court. Since the High Court does not sit as an appellate authority over the factual findings recorded during departmental proceedings, while exercising the power of judicial review, the High Court cannot, normally speaking, substitute its own conclusion, with regard to the guilt of the delinquent, for that of the departmental authorities. Even in so far as imposition of penalty or punishment is concerned, unless the punishment or penalty imposed by the disciplinary or the departmental appellate authority, is either impermissible or such that it shocks the conscience of the High Court, it should not normally substitute its own opinion and impose some other punishment or penalty.
Further, it is a well-settled principle that even though judicial review of administrative action must remain flexible and its dimension not closed, yet the court, in exercise of the power of judicial review, is not concerned with the correctness of the findings of fact on the basis of which the orders are made so long as those findings are reasonably supported by evidence and have been arrived at through proceedings which cannot be faulted with for procedural illegalities or irregularities which vitiate the process by which the decision was arrived at. Judicial review, is directed not against the decision, but is confined to the examination of the decision-making process.Page 31 of 37
HC-NIC Page 31 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT Judicial review, not being an appeal from a decision, but a review of the manner in which the decision was arrived at, the court, while exercising the power of judicial review, must remain conscious of the fact that if the decision has been arrived at by the administrative authority after following the principles established by law and the rules of natural justice and the individual has received a fair treatment to meet the case against him, the court cannot substitute its judgement for that of the administrative authority on a matter which fell squarely within the sphere of jurisdiction of that authority."
In Om Kumar Vs. Union of India - AIR 2000 SC 3689, the Supreme Court traced the history of the principle of proportionality, referred to the propositions culled out in Ganayutham's case (supra), noticed the decision of the House of Lords in R. Vs. Chief Constable of Sussesc ex.p. International Trader's Ferry Ltd. (1999) 1 All ER 129, wherein the principles of Wednesbury and proportionality were almost equated and held that where the decision of an administrative authority is attacked being arbitrary, the principle of secondary review will have to be kept in mind. Paragraphs 28, 29 66 to 71 of this judgement which theortises the law on the subject are reproduced below:
"28. By 'proportionality' we mean the question whether, while regulating exercise of fundamental rights, the appropriate or least restrictive choice of measures has been made by the Legislature or the Administrator so as to achieve the object of the legislation or the purpose of the administrative order, as the case may be. Under the principle, the Court will see that the Legislature and the administrative authority 'maintain a proper balance between the adverse effects which the legislation or the administrative order may have on the rights, liberties, or interests of persons keeping in mind Page 32 of 37 HC-NIC Page 32 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT the purpose which they were intended to serve. The Legislature and the administrative authority are, however, given an area of discretion or a range of choices but as to whether the choice made infringes the rights excessively or not is for the Court. That is what is meant by proportionality."
"29. The above principle of proportionality has been applied by the European Court to protect the rights guaranteed under the European Convention for the Protection of Human Rights and Fundamental Freedoms, 1950 and in particular, for considering whether restrictions imposed were restrictions which were 'necessary' - within Arts.8 to 11 of the said Convention (corresponding to our Art. 19(1) and to find out whether the restrictions imposed on fundamental freedoms were more excessive than required. (Handyside V. UK (1976) 1 EHR p.737) Articles 2 and 5 of the Convention contain provisions similar to Art. 21 of our Constitution relating to life and liberty. The European Court has applied the principle of proportionality also to questions of discrimination under Art. 14 of the Convention (corresponding to Art.14 of our Constitution). (See European Administrative Law by J. Schwaze, 1992. Pp.677-866)."
"66. It is clear from the above discussion that in India where administrative action is challenged under Art.14 as being discriminatory, equals are treated unequally or unequals are treated equally, the question is for the constitutional Courts as primary reviewing Courts to consider correctness of the level of discrimination applied and whether it is excessive and whether it has a nexus with the objective intended to be achieved by the Administrator. Here the Court deals with the merits of the balancing action of the Administrator and is, in essence, applying 'proportionality' and is a primary reviewing authority."
"67. But where, an administrative action is challenged as 'arbitrary' under Art. 14 on the basis of Royappa (as in cases where Page 33 of 37 HC-NIC Page 33 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT punishments in disciplinary cases are challenged), the question will be whether the administrative order is 'rational' or 'reasonable' and the test then is the Wednesbury test. The Courts would then be confined only to a secondary role and will only have to see whether the Administrator has done well in his primary role, whether he has acted illegally or has omitted relevant factors from consideration or has taken irrelevant factors in to consideration or whether his view is one which no reasonable person could have taken. If his action does not satisfy these rules, it is to be treated as arbitrary. (In G.B. Mahajan V. Jalgaon Municipal Council (1991) 3 SCC 91 at p. 111 :(AIR 1991 SC 1153 at . 1165), Venkatachaliah, J. (as he then was) pointed out that 'reasonableness' of the Administrator under Art. 14 in the context of Administrative Law has to be judged from the stand point of Wednesbury rules. In Tata Cellular V. Union of India (1994) 6 SCC 651 at Pp. 679-
680: (1994 AIR SCW 3344 and at Pp.3369-70In Regional Manager U.P. SRTC V. Hoti Lal, (2003) 3 SCC 605, the Supreme Court outlined the mode to be adopted for determining whether the punishment imposed by the disciplinary authority is shockingly disproportionate and observed as under:: AIR 1996 SC 11); Indian Express Newspapers Vs. Union of India (1985) 1 SCC 641 at p.691:(AIR 1986 SC 515 at Pp.542-
43): Supreme Court Employees' Welfare Association V. Union of India (1989) 4 SCC 187 at p.241 : (AIR 1990 SC 334 at p.368: 1990 Lab IC 324 at p.358) and U.P. Financial Corporation V. GEM CAP (India) Pvt.Ltd. (1993) 2 SCC 299, at p. 307: (1993 SC 1435 at p.1439), while judging whether the administrative action is 'arbitrary' under Art.14 (i.e.otherwise than being discriminatory), this Court has confined itself to a Wednesbury review always."
"71. Thus, from the above principles and decided cases, it must be held that where an administrative decision relating to punishment in disciplinary cases is questioned as 'arbitrary' under Art.14, the Court is confined to Wednesbury principles as a secondary reviewing Page 34 of 37 HC-NIC Page 34 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT authority. The Court will not apply proportionality as a primary reviewing Court because no issue of fundamental freedoms nor of discrimination under Art.14 applies in such a context. The Court while reviewing punishment and if it is satisfied that Wednesbury principles are violated, it has normally to remit the matter to the Administrator for a fresh decision as to the quantum of punishment. Only in rate cases where there has been long delay in the time taken by the disciplinary proceedings and in the time taken in the Courts, and (in) such extreme or rate cases can the Court substitute its own view as to the quantum of punishment."
In Regional Manager U.P. SRTC V. Hoti Lal (2003) 3 SCC 605, the Supreme Court outlined the mode to be adopted for determining whether the punishment imposed by the disciplinary authority is shockingly disproportionate and observed as under:
"The Court or tribunal while dealing with the quantum of punishment has to record reasons as to why it is felt that the punishment was not commensurate with the proved charges. The scope for interference is very limited and restricted to exceptional cases. In the impugned order of the High Court no reasons whatsoever have been indicated as to why the punishment was considered disproportionate. Failure to give reasons amounts to denial of justice. A mere statement that it is disproportionate would not suffice. It is not only the amount involved but the mental set-up, the type of duty performed and similar relevant circumstances which go in to the decision-making process while considering whether the punishment is proportionate or disproportionate. 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 Page 35 of 37 HC-NIC Page 35 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT of integrity and trustworthiness is a must and unexceptional." (underlining is ours) In Director General, RPF V. Ch. Sai Babu (2003) 4 SCC 331, the Supreme Court reiterated that the High Court should ordinarily not interfere with the discretion exercised by the disciplinary authority in the matter of imposition of punishment and observed:
"Normally, the punishment imposed by a disciplinary authority should not be disturbed by the High Court or a tribunal except in appropriate cases that too only after reaching a conclusion that the punishment imposed is grossly or shockingly disproportionate, after examining all the relevant factors including the nature of the charges proved, the past conduct, penalty imposed earlier, the nature of duties assigned having due regard to their sensitiveness, exactness expected and discipline required to be maintained, and the department/ establishment in which the delinquent person concerned works."
30 The above noted decision of this Court gives a clear idea of the limited scope of judicial review of the discretion exercised by the employer to impose the particular penalty on the delinquent employee. The Supreme Court has repeatedly emphasised that the High Courts cannot exercise appellate jurisdiction in such matters and substitute their opinion for the one formed by the disciplinary authority. It has also been held that the punishment imposed by the competent authority cannot be modified/substituted with a lesser penalty unless the Court is satisfied that the same is grossly or shockingly disproportionate or is so unreasonable that no person of reasonable prudence would have imposed such punishment in the facts and circumstances of the case.
Page 36 of 37HC-NIC Page 36 of 37 Created On Thu Dec 15 00:19:14 IST 2016 C/SCA/11340/2000 CAV JUDGMENT
31. For determination of the question whether the punishment imposed by the disciplinary authority is grossly or shockingly disproportionate, the Court has to take into consideration all the relevant factors including the nature of charges proved, the past conduct of the employee, the punishment if any imposed earlier, the nature of duties assigned to the employee having due regard to their sensitiveness, performance norms if any laid down by the employer and above all the paramount requirement of maintaining discipline in the service.
32. For the forgoing reasons, this writ-application fails and is hereby rejected. Rule is discharged.
(J.B.PARDIWALA, J.) Vahid Page 37 of 37 HC-NIC Page 37 of 37 Created On Thu Dec 15 00:19:14 IST 2016