Gujarat High Court
Dipak L Dave vs State Bank Of India & 2 on 8 October, 2015
Author: J.B.Pardiwala
Bench: J.B.Pardiwala
C/SCA/9163/2003 CAV JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL CIVIL APPLICATION NO. 9163 of 2003
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE J.B.PARDIWALA
==========================================================
1 Whether Reporters of Local Papers may be allowed No
to see the judgment ?
2 To be referred to the Reporter or not ? No
3 Whether their Lordships wish to see the fair copy of No
the judgment ?
4 Whether this case involves a substantial question of No
law as to the interpretation of the Constitution of
India or any order made thereunder ?
==========================================================
DIPAK L DAVE....Petitioner(s)
Versus
STATE BANK OF INDIA & 2....Respondent(s)
==========================================================
Appearance:
MR GM JOSHI, ADVOCATE for the Petitioner(s) No. 1
M/S TRIVEDI & GUPTA, ADVOCATE for the Respondent(s) No. 1
RULE SERVED for the Respondent(s) No. 2 - 3
==========================================================
CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALA
Date :08/10/2015
CAV JUDGMENT
1. By this writapplication under Article 226 of Page 1 of 29 HC-NIC Page 1 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT the Constitution of India, the petitioner a dismissed Bank employee, has prayed for the following reliefs: "(A) Allow this petition.
(B) Declare that subclause (ii) of Rule 68(3) of State Bank of India Officers service Rules is ultrawires article 14 and 16 of the Constitution of India or unconstitutional as it confers an unfated and unguided power on the Disciplinary authority to unilaterally change the findings arrived at by the Inquiry Officer.
(C) Quash and set aside the order dated 29.11.2002 passed by the Reviewing Authority of the respondent Bank confirming the order passed by the Disciplinary Authority dismissing the petitioner from service and confirmed by the Appellate Authority vide order dated 29.05.2002 at AnnexureP. (D) Quash and set aside the dismissal order dated 27.12.2000 at AnnexureN passed by respondent No.3 being in violation of principles of natural justice and without authority of law."
2. The case of the petitioner may be summarized as under:
3. The petitioner was appointed as a Clerk on 16th August, 1977 in the respondentBank. On 1st August, 1984, the petitioner was appointed as a TraineeOfficer by the Chief General Manager, Local Head Office, Ahmedabad. Thereafter, the Page 2 of 29 HC-NIC Page 2 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT petitioner was posted at the various capacities in the Bank during his tenure as Officer in the cadre of (MMGIII). In October, 1994 he was appointed as the Branch Manager, Atladara Branch, where he continued up to April, 1997.
4. On 5th July, 1997, he came to be suspended on the allegations of having indulged in certain fraudulent transactions as a Branch Manager.
5. A show cause notice dated 13th October, 1997 was issued by the Assistant General Manager RegionII, Zonal Office, Vadodara calling upon the petitioner to show cause why disciplinary action should not be taken against him for his alleged involvement in the forex business transactions with M/s. Gujarat Glass Company, Vadodara and M/s. Gujarat Graphics and Mirrors, Vadodara.
6. On 15th November, 1997, the petitioner tendered his explanation in writing. On 30th July, Page 3 of 29 HC-NIC Page 3 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT 1998 chargesheet was issued levelling two allegations against the petitioner.
7. The departmental chargesheet was issued on the basis of the inquiry which was carried out by the Vigilance Department of the respondentBank.
8. The Central Bureau of Investigation also independently investigated into the alleged fraud.
9. On 26th November, 1998, the petitioner had addressed a letter to the disciplinary authority informing that he was not in a position to give a proper reply to the chargesheet and submit the statement of defence as all the original files, papers and documents were in the custody of the CBI. He requested that such documents be made available to him for filing appropriate and effective statement of defence.
10. It is his case that such request was turned down by the disciplinary authority.
Page 4 of 29HC-NIC Page 4 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT
11. On submission of the report by the CBI, the order of suspension of the petitioner came to be revoked on 31st March, 1999 and the petitioner was once again posted as the Manager (Trainee) at the Staff Trainee College, Ahmedabad.
12. On 15th December, 1998 one Shri H.R. Herani, an officer of the Vigilance Department of the Bank was appointed as the inquiry officer. On 5th February, 1999 the departmental inquiry commenced.
13. The Bank examined eleven witnesses in the course of the inquiry, whereas, the petitioner examined three witnesses on his behalf.
14. The inquiry officer tendered his report dated 24th January, 2000 stating that some of the charges were found to be proved, some not proved and few partly proved.
Page 5 of 29HC-NIC Page 5 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT
15. The disciplinary authority vide letter dated 10th March, 2000 addressed to the petitioner informed that he was not in agreement with findings of the inquiry officer and assigned his own reasons why he differed on certain issues with the inquiry officer. The disciplinary authority also informed the petitioner to file an appropriate representation in that regard within a period of fifteen days.
16. On 5th October, 2000 the petitioner filed his reply to the showcause notice dated 10th March, 2000 referred to above.
17. Ultimately, vide order dated 27th December, 2000 the petitioner was dismissed from the service. On 29th May, 2002 the appeal filed by the petitioner also came to be dismissed by the appellate authority.
Page 6 of 29HC-NIC Page 6 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT
18. On 12th July, 2002 the Review Application filed by the petitioner before the review authority (Committee) at Mumbai also came to be rejected.
19. Being dissatisfied with the action of the Bank the petitioner has come up with this writ application.
20. Mr. Joshi, the learned advocate appearing for the petitioner confined his submission to the extent of the violation of the principles of natural justice is concerned.
21. His principle argument is that the disciplinary authority as well as the appellate authority (Committee) failed to give his client an adequate opportunity to put forward his case in person. According to Mr. Joshi at no point of time the authorities permitted his client to make oral submissions in support of his case. Mr. Joshi invited my attention to the appeal memo of Page 7 of 29 HC-NIC Page 7 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT the appeal filed before the appellate authority against the order of dismissal. Mr. Joshi pointed out the prayers made therein. It reads thus:
"a. Order that an opportunity to make oral submission in support of appeal be given to the Appellant and to hear that Appellant in person.
b. Set aside the order No. CVD/KB/1022 of 27 122000 passed by the Disciplinary Authority and order that the appellant be reinstated in service.
c. Grant such other relief as deemed appropriate in the circumstances of the case and do justice in the interest of the Bank.
d. I request you to immediately process and reply to this appeal. As the time limit of 45 days expected of me by you, the Bank has large resources and therefore I also request you to reply within 45 days to relieve me from the protracted mental agony.
e. I also reserve my rights to submit my application under the voluntary Retirement Scheme (VRS).
22. He submitted that in view of the above, the petition be allowed and the order of dismissal be quashed.
23. On the other hand, this application has been vehemently opposed by Mr. Joshi the learned advocate appearing for the respondentBank. He Page 8 of 29 HC-NIC Page 8 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT submitted that no error not to speak of any error of law could be said to have been committed by the Bank in passing the order of dismissal. He submitted that the scope of interference in these type of matters under Article 226 of the Constitution is very limited.
24. He submitted that the judicial review is permissible only to the extent of the decision making process and not the decision itself.
25. Mr. Joshi has placed reliance on the following averments made in the affidavitin reply filed on behalf of the respondentBank:
"9. The allegations, averments and contentions made by the petitioner in para 1(A) of the petition and also those which are contrary to the present affidavitinreply are not admitted. I humbly submit that the allegations made by the petitioners to the effect that the transaction in question was not within the functions and duties of a Branch Manager of any unauthorized branch of the respondent Bank are misconceived and devoid of any substance and are not admitted. I furtehr humbly submit that the Baroda Industrial Estate Branch and Baroda Main Branch negotiated the export bills in question at the instance of Atladra Branch for its borrowers and therefore it was expected of the petitioner to verify the genuineness of the L/C. Not only this, fraud Page 9 of 29 HC-NIC Page 9 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT that took place was due to gross negligence shown on the part of the petitioner:
(a) in not scrutinizing the fake biils and fraudulent L/Cs.
(b) in not preparing detailed opinion reports on the borrowers mentioned in the charge sheet.
(c) in accepting the forged and fraudulent "title clearance certificate" in respect of the property deposited by the borrowers for equitable mortgage.
(d) in accepting the forged and fraudulent "title deeds" of the property deposited by the borrowers for equitable mortgage.
(e) in accepting the nonexistent property as collateral security, in view of, lapse on the part of petitioner in not carrying out the prior inspection of the property before accepting it as collateral security.
(f) in not ensuring the disbursement of term loan by way of direct release of payment to the suppliers as per terms of sanction and thereby falling to ensure the end use of funds.
(g) in not ensuring receipt of stock statements at regular intervals and in not ensuring recording of the drawing power and thereby in not ensuring proper control over the conduct of Cash Credit accounts of the units of the borrowers.
(h) in not ensuring meaningful scrtinisation of the Book Debts Statements and thereby not ensuring proper control over the conduct of the cash Credits accounts of the units of the borrowers.
(i) in not ensuring regular inspection of the units of the borrowers and in not ensuring recording of the observations of inspections in the branch inspection register and thereby not ensuring proper control over the conduct of Cash Credit account of the units of the borrowers.
(j) in not ensuring the verification of genuineness of very large credits (i.e. far in excess of the sanctioned limits) in the Cash Page 10 of 29 HC-NIC Page 10 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT Credit account of the units of the borrowers.
(k) in allowing huge cash withdrawals and also issue of drafts for huge amounts in lieu of cash withdrawals and thereby not ensuring proper control over the conduct of the Cash Credit account of the units of the borrowers.
(l) in acceding to the intriguing request of the borrowers for forwarding the LCs and export bills (a) to the International Banking (B) Division of Baroda instead of Baroda Industrial Estate Branch where the earlier export bills were negotiated and (b) later on to Industrial Finance Branch at Baroda instead of IB Division at Baroda Main Branch where the earlier export bills were negotiated and outstanding.
(m) in not verifying/not ensuring verification of the signature of the officials who purportedly signed the Debit Transfer Responding Advices (debit TRS) received from Baroda Main Branch, more particularly when they represented amount of Telegraphic Transfers received at Baroda Main Branch as was evident from the contents of such debit TRS, despite knowing that the export bills of the units are negotiated at Baroda Main Branch and not only this, few of these debit Trs were forged.
(n) in not making meaningful inquiries during visits to IB division at Baroda Main Branch during November 1996.
10. The allegations, averments and contentions made by the petitioner in para 1(B) of the petition and also those which are contrary to the present affidavitinreply are not admitted. It is further submitted that the D.A./A.A. have taken the decision independently after examining, thoroughly, all the aspects of the case and as the fraud was committed during the tenure of the petitioner at Atladra Branch, explanation came to be sought from him.
11. The allegations, averments and contentions made by the petitioner in para 1(C) of the petition and also those which are contrary to Page 11 of 29 HC-NIC Page 11 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT the present affidavitinreply are not admitted. It is further submitted that all the authorities i.e. Appointing Authority, Appellate Authority and Reviewing Authority have taken the decisions after examining all the aspects/evidences of the case. Not only this, the order that have been passed are just, legal, cogent, wellfounded/reasoned.
12. The allegations, averments and contentions made by the petitioner in para 1(D) of the petition and also those which are contrary to the present affidavitinreply are not admitted. The allegations that Appointing Authority who has passed the dismissal order of the petitioner who was an officer in MMGS III is lower in rank than the appointing authority of the petitioner are devoid of substance, misconceived, contrary to facts and provisions and not admitted. It is further submitted that the General Manager is the appointing authority of Officers scale MMGS III as per Staff Circular No.: CDO/PM/20/9697 dated 6.3.1997 (AnnexureI), issued by the respondent Bank and therefore, the allegations that have been raised by the petitioner are without any substance.
13. The allegations, averments and contentions made by the petitioner in para 1(E) of the petition and also those which are contrary to the present affidavitinreply are not admitted. I humbly submit that the irregularities that have been committed by the petitioner (which have already mentioned in para 8 of the present AffidavitinReply) and because of the said irregularities, the respondent Bank has been exposed to the likely loss of Rs.246.77 lakhs and therefore also the penalty imposed on the petitioner i.e. of dismissal from service is legal, proper and justified. Not only this, the authorities, after careful application of mind, looking to the gravity of misconduct and all other relevant aspects, had arrived at the said decision. It is further submitted that in the facts of the case and nature of gravity of the action/transaction in question, the decision of the Bank is fully justified and commensurate and reasonable and cannot be said to be illegal, arbitrary, noncommensurate, Page 12 of 29 HC-NIC Page 12 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT unreasonable or excessive as alleged or even otherwise.
14. The allegations, averments and contentions made by the petitioner in Para 1(F) of the petition and also those which are contrary to the present affidavitinreply are not admitted. It is humbly submitted that mere revocation of suspension order does not absolve the petitioner from the charges that have been levelled against him in the charge sheet and/or does not even imply much less prove that the petitioner was found to be not responsible, as alleged/claimed.
15. The allegations, averments and contentions made by the petitioner in para 2.4 of the petition and also those which are contrary to the present affidavitinreply are not admitted. It is further submitted that on the basis of available record and evidence, the General Manager (D&PB), D.A. and A.A. were satisfied that there were basis, evidence and justification and material/grounds for the disciplinary action against the petitioner.
16. The allegations, averments and contentions made by the petitioner in para 2.5 of the petition and also those which are contrary to the present affidavitinreply are not admitted. I further humbly submit that the charge sheet was issued by the disciplinary authority after consideration of petitioner's explanation which was not found satisfactory and it was considered that disciplinary action was warranted.
17. The allegations, averments and contentions made by the petitioner in para 2.6 of the petition and also those which are contrary to the present affidavitinreply are not admitted. It is further submitted that the petitioner himself has mentioned in the petition that the said files, papers, and documents were handed over to the Central Bureau of Investigation. As a result, the said materials were not available with the Bank at the relevant point of time. The Bank, therefore, took up the matter with the Central Bureau of Investigation, for verification, of Page 13 of 29 HC-NIC Page 13 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT said original documents that were handed over to them. The petitioner was given the opportunity to verify the said original documents on 30.09.1999 and 01.10.1999 at CBI office, Mumbai. It will not be out of place to mention at this stage that the said documents were made available to the petitioner after constant follow up by the respondent Bank.
18. The allegations, averments and contentions made by the petitioner in para 2.7 of the petition and also those which are contrary to the present affidavitinreply are not admitted.
19. The allegations, averments and contentions made by the petitioner in para 2.8 of the petition and also those which are contrary to the present affidavitinreply are not admitted. It is further submitted that the General Manager (D&PB), D.A. and A.A. after reviewing the case revoked the suspension order of the petitioner and thereafter came to be reinstated in service from 1.4.1999 and thereby was posted at Staff Training Centre, Ahmedabad, which is an innocuous position.
20. The allegations, averments and contentions made by the petitioner in para 2.10 of the petition and also those which are contrary to the present affidavitinreply are not admitted. It is further submitted that the allegations with regard to the inquiry officer dividing the 2 charges leveled against the petitioner in the charge sheet in 9 and 11 allegations are frivolous, and devoid of merits. I humbly submit that there were two distinct charges leveled against the petitioner by the Disciplinary authority and alongwith them there were separate supporting allegations to prove the charges.
21. The allegations, averments and contentions made by the petitioner in para 2.11 of the petition and also those which are contrary to the present affidavitinreply are not admitted. It is further submitted that the petitioner was given sufficient, enough and reasonable opportunity of hearing during the course of inquiry and while forwarding the Page 14 of 29 HC-NIC Page 14 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT copy of the inquiry officer's report alongwith disciplinary authority's comment, where he differed with the findings of the inquiry officer, to the petitioner, the petitioner was given enough opportunity to make his submissions and/or representations and this can beseen clearly seen from para 2.11 (d) of the petition. Not only this, while sending the inquiry officer's report and disciplinary authority's comments, no penalty, whatsoever, was suggested and/or advised to the petitioner and therefore the question of alleged enhancement of the penalty does not arise. The allegation to the effect that the disciplinary authority while sending the inquiry report reversed the findings of the inquiry officer without there being any notice for enhancement of penalty or without giving the petitioner an opportunity of personal hearing before disagreeing with inquiry officer, are not admitted as being misconceived and devoid of any basis or merits.
22. The allegations, averments and contentions made by the petitioner in para 2.12 of the petition and also those which are contrary to the present affidavitinreply are not admitted. It is further submitted that the allegations with regard to not giving any opportunity of hearing. Whatsoever, to the petitioner before reversing the finds of the inquiry officer are frivolous and without any substance and contrary to record.
23. The allegations, averments and contentions made by the petitioner in para 2.13 of the petition and also those which are contrary to the present affidavitinreply are not admitted and more particularly the allegation that the Appellate authority did not consider the appeal for quite long time. It is further submitted that the petitioner was given enough opportunity of hearing during the course of inquiry. It is further submitted that as far as personal hearing before the Appellate Authority is concerned, no such provision is laid down in the service rules i.e. as per the applicable rules personal hearing is not contemplated or provided at the time of consideration of appeal by the appellate Page 15 of 29 HC-NIC Page 15 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT authority.
24. The allegations, averments and contentions made by the petitioner in para 2.14 of the petition and also those which are contrary to the present affidavitinreply are not admitted. It is further submitted that as far as personal hearing before the Reviewing authority is concerned, no such provision is laid down in the service rules.
25. The allegations, averments and contentions made by the petitioner in ground 3A(1) of the petition and also those which are contrary to the present affidavitinreply are not admitted. It is further submitted that the allegation with regard to the impugned order of dismissal confirmed by the Appellate authority and Reviewing authority is in gross violation of principles of natural justice is wholly baseless, misconceived, unreasonable and devoid of any merits. I further humbly submit that the petitioner was given enough opportunity to represent and / or to make submissions on the Inquiry officer's findings and also on the comments/reasoning of the Disciplinary authority for differing with the findings of the inquiry officer. Not only this, the said opportunity was also availed by the petitioner before final findings on the charges were recorded by the Appointing Authority and only thereafter, the penalty, came to be imposed. I further humbly submit that the disciplinary authority recorded the findings after receiving and fully considering the submissions from the petitioner on inquiry officer's report along with comments of the disciplinary authority where he had differed with the findings of the inquiry officer and therefore the allegation made by the petitioner with regard to the disciplinary authority allegedly reversing the findings of the inquiry officer without issuing any notice and without giving any opportunity of personal hearing, whatsoever, are wholly unjustified and far from truth baseless and untrue and misconceived. It is further submitted that the case cited by the petitioner is not applicable under the present set of facts and circumstances.
Page 16 of 29HC-NIC Page 16 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT
26. The allegations, averments and contentions made by the petitioner in ground 3A(2) of the petition and also those which are contrary to the present affidavitinreply are not admitted. It is further submitted that the allegations and averments are repeated time and again, by the petitioner.
27. The allegations, averments and contentions made by the petitioner in ground3A(3) of the petition and also those which are contrary to the present affidavitinreply are not admitted. I further humbly submit that the petitioner is repeating the allegations time and again. I further submit, at the cost of repetition, that the allegation about not giving any opportunity of personal hearing is improper, unjust and without any substance. It is further submitted that enough opportunity of personal hearing was accorded to the petitioner during the inquiry proceeding and as far as providing opportunity of personal hearing to the petitioner during appeal and review is concerned, no such provision is laid down the service rules.
28. The allegations, averments and contentions made by the petitioner in ground 3A(4) of the petition and also those which are contrary to the present affidavitinreply are not admitted. It is further submitted that disciplinary authority has recorded reasons for disagreement with the findings of inquiry officer on allegation 1(a), 3,4 and 5 of ChargeI and allegations 1, 2 and 3 of Charge II and the same was forwarded to the petitioner along with Inquiry Officer's report for his submission and it was only after, considering the submissions made by the petitioner on Inquiry Officer's report and disciplinary authority's reasons for disagreeing with the findings of the Inquiry Officer that the Appointing authority came to the conclusion that the petitioner was guilty of charges levelled against him. Not only this, the petitioner had availed the said opportunity and therefore, the allegations made by the petitioner with regard to not providing any opportunity of hearing, Page 17 of 29 HC-NIC Page 17 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT whatsoever is wholly frivolous, untrue, misleading, unfounded and without any substance. I further submit that there has been no violation of Article 14 and 16 of the Constitution of India as alleged or otherwise and in my humble submission in view of the aforesaid reasons, the order passed by the Appointing Authority are just and legal and proper and reasonable and do not deserve to be set aside as claimed or otherwise.
29. The allegations, averments and contentions made by the petitioner in ground3A(5) of the petition and also those which are contrary to the present affidavitinreply and more particularly the allegation that the petitioner was appointed by the Chief General Manager of the respondent Bank, are not admitted. It is further submitted that as per the bank's circular No.CDO/MP/20/9697 dated 6.3.1997, the General Manger is the Disciplinary as well as the Appointing Authority for the officers MMGS III and the petitioner was falling within the above mentioned category."
26. He submitted that in view of the above there being no merit in this writ application the same be rejected.
27. In support of his submissions he has placed reliance on the following decisions:
(i) State of Uttar Pradesh and aother v. Man Mohan Nath Sinha and another [2009 (8) SCC 310] Page 18 of 29 HC-NIC Page 18 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT
(ii) National Fertilizers Ltd. and another v.
P.K. Khaha [2005 (7) SCC 597]
(iii) J.A. Naiksatam v. Prothonotary & Senior Master, High Court of Bombay and others, [2004 (8) SCC 653].
(iv) Ganesh Santa Ram Sirur v. State Bank of India and another [2005 (1) SCC 13].
28. Having heard the learned counsel appearing for the parties and having gone through the materials on record the only question that falls for my consideration is whether the respondent committed any error in passing the impugned orders.
29. I am not impressed by the submission of Mr. Joshi that even if the rule does not not specifically say that the delinquent employee should be given personal hearing when it disagrees with the Inquiry Officer, the same should be read into the provisions of the delinquent employee should be given an Page 19 of 29 HC-NIC Page 19 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT opportunity of personal hearing before the final decision is taken in the matter.
30. In the aforesaid context I may usefully rely on the following observations made by the Supreme Court in the Case of J.A. Naiksatam (Supra): "5. The learned counsel for the appellants contended that as per the Bombay High Court (Discipline and Appeal) Rules (for short 'the Bombay Rules'), the appellants were entitled to get a copy of the report of the Enquiry Officer and they should have been heard before the same was accepted or rejected by the disciplinary authority. The contention was that by virtue of rule 8, according to the appellants' counsel, though the report of the enquiry officer was furnished, the appellants were not given an effective opportunity to place their arguments against this and it was contended that even before the issuance of show cause notice and the disciplinary authority had made up his mind and had already taken a decision disagreeing with the enquiry officer and seeking an explanation from the delinquent officers was only an empty formality and there was thus serious violation of principles of natural justice.
6. The relevant rule of the Bombay Rules reads as follows :
"8. Action on the inquiry report : (1) The disciplinary authority, if it is not itself the inquiring authority may, for reasons to be recorded by it in writing, remit the case to the inquiring authority who shall thereupon proceed to hold the further inquiry according to the provisions of Rule 7 of these Rules as far as may be.
(2) The disciplinary authority shall if it is not the inquiring authority, consider the record of the inquiry and record its findings on each charge. If it disagrees with the findings of the inquiring authority on any article of charge, it shall record its reasons for such disagreement.
(3) If the disciplinary authority having regard to its findings on all or any of the articles of charge is of the opinion that any of the minor Page 20 of 29 HC-NIC Page 20 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT penalties should be imposed on the High Court servant, it shall notwithstanding anything contained in Rule 10 of these Rules on the basis of the evidence adduced during the inquiry held under Rule 7 determine what penalty, if any, should be imposed on the High Court servant and make an order imposing such penalty.
(4) (i) If the disciplinary authority, having regard to its findings on all or any of the articles of charge is of the opinion that any of the minor penalties should be imposed on the High Court servant, it shall
(a) furnish to the High Court servant, a copy of the report of the inquiry held by it and its findings on each article of charge, or where the inquiry has been held by it and its findings on each article of charge, or where the inquiry has been held by an inquiring authority appointed by it a copy of the report, of such authority and a statement of its findings on each article of charge expressly stating whether or not it agrees with the finding of the inquiring authority, together with brief reasons for its disagreement, if any, with the findings of the inquiring authority; and
(b) give to the High Court servant a notice stating the penalty proposed to be imposed on him and calling upon him to submit within fifteen days of receipt of the notice or such further time as may be allowed such representation as he may wish to make on the proposed penalty on the basis of the evidence adduced during the inquiry held under Rule 7 of these Rules.
(ii) The disciplinary authority shall after considering the representation, if any, made by the High Court servant determine what penalty, if any, should be imposed on the High Court servant and make such order as it may deem fit."
As per Rule 8 of the Bombay Rules, if the disciplinary authority is not agreeing with the reasons given by the enquiry officer it would be open to the disciplinary authority to hold further enquiry in accordance with the provisions of Rule 7 and Rule 8(2) shows that if the disciplinary authority disagrees with the findings of the enquiry officer on any of the articles of charge he shall record his reasons for such disagreement. Subrule 4(i)(a) of Rule 8 of the Bombay Rules further shows that the copy of the report of the enquiry officer and his finding on each article of Page 21 of 29 HC-NIC Page 21 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT charge together with brief reasons of shall be given to the delinquent employee. The rule further says that the disciplinary authority shall give its reasons for disagreeing with the decision of the enquiry officer. The counsel for the appellants contended that even if the rule does not specifically says that the delinquent employee should be given personal hearing when it disagrees with the enquiry officer, the same shall be read into the provision and the delinquent employee shall be given an opportunity of personal hearing before a final decision is taken in the matter. In this connection, reliance was placed on the decision of this Court in the case of Punjab National Bank and ors. v. Kunj Behari Misra etc. (1998) 7 SCC 84. In this case this Court was interpreting the Regulation 7 of the Punjab National Bank Officer Employees' (Discipline and Appeal) Regulations, 1977. The said regulation states that the disciplinary authority if it disagrees with the findings of the enquiry officer he can give his reasons for such disagreement and can record its own findings if the evidence on record is sufficient for that purpose. Even though the regulation did not contemplate of giving a fresh opportunity to the delinquent employee, this Court, while interpreting the said regulation held that :
"The result of the aforesaid discussion would be that the principles of natural justice have to be read into Regulation 7(2). As a result thereof, whenever the disciplinary authority disagrees with the enquiry authority on any article of charge, then before it records its own findings on such charge, it must record its tentantive reasons for such disagreement and give to the delinquent officer an opportunity to represent before it records its findings. The report of the enquiry officer containing its findings will have to be conveyed and the delinquent officer will have an opportunity to persuade the disciplinary authority to accept the favourable conclusion of the enquiry officer. The principles of natural justice, as we have already observed, require the authority which has to take a final decision and can impose a penalty, to give an opportunity to the officer charge of misconduct to file a representation before the disciplinary authority records its findings on the charges framed against the officer."
The same view was expressed by this Court in the case of Yoginath D. Bagde v. State of Maharashtra Page 22 of 29 HC-NIC Page 22 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT and Anr., (1999) 7 SCC 739, and in paragraph 31 this Court has held :
"In view of the above, a delinquent employee has the right of hearing not only during the enquiry proceedings conducted by the enquiry officer into the charges levelled against him but also at the stage at which those findings are considered by the disciplinary authority and the latter, namely, the disciplinary authority forms a tentative opinion that it does not agree with the findings record by the enquiry officer. If the findings recorded by the enquiry officer are in favour of the delinquent and it has been held that the charges are not proved, it is all the more necessary to give an opportunity of hearing to the delinquent employee before reversing those findings. The formation of opinion should be tentative and not final. It is at this stage that the delinquent employee should be given an opportunity of hearing after he is informed of the reasons on the basis of which the disciplinary authority has proposed to disagree with the findings of the enquiry officer. This is in consonance with the requirement of Article 311(2) of the Constitution as it provides that a person shall not be dismissed or removed or reduced in rank except after an enquiry in which he has been informed of the charges against him and given a reasonable opportunity of being heard in respect of those charges. So long as a final decision is not taken in the matter, the enquiry shall be deemed to be pending. Mere submission of findings to the disciplinary authority does not bring about the closure of the enquiry proceedings. The enquiry proceedings would come to an end only when the findings have been considered by the disciplinary authority and the charges are either held to be not proved or found to be proved and in that event punishment is inflicted upon the delinquent. That being so, the "right to be heard" would be available to the delinquent up to the final stage. This right being a constitutional right of the employee cannot be taken away by any legislative enactment or service rule including rules made under Article 309 of the Constitution."
Relying on these decisions, the counsel for the appellants contended that after the receipt of the report from the enquiry officer, the disciplinary authority should have given notices to the appellants with its tentative conclusion and an opportunity be given to the delinquent before the report of the enquiry officer is reversed by the disciplinary authority.It was also argued that the Page 23 of 29 HC-NIC Page 23 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT appellants should have been heard by the disciplinary authority before such a decision was rendered. Even though the rule as such does not contemplate of giving an opportunity of being given to the delinquent appellants before the disciplinary authority takes a final decision to disagree with the reasons given by the enquiry officer, such a provision could be read into the rule but even then the appellants cannot be heard to say that there shall be a personal hearing by the disciplinary authority. In the instant case, the appellants were given a copy of the tentative decision of the disciplinary authority and the appellants furnished detailed explanation and we are of the view that the principles of natural justice have been fully complied with and we do not find any infraction of rules or infirmity in the said decision.
7. The counsel further contended that from the tentative decision it could be spelt out that the disciplinary authority had already taken a final decision in the matter and the details have been given therein and the opportunity which was given to the appellants was only an exercise in futility.We are not inclined to accept this contention. It is true that the disciplinary authority gave its reasons for disagreement with the report of the Enquiry Officer and the appellants had given their fullfledged explanation and if at all the disciplinary authority gave detailed tentative decision before seeking explanation from the appellants, it enabled then to give an effective representation and the principles of natural justice were fully complied with and it cannot be said that the appellants were not being heard in the matter."
31. In the case of Ganesh Shanta Ram Sirur (supra) the Supreme Court made the following observations: "30. Union of India and Anr. v. Jesus Sales Corporation was cited for the proposition as to taking into consideration the facts and circumstances of each case to exercise discretion and that it does not flow the rule that before exercising such discretion the appellate authority should hear the appellant and that this discretion Page 24 of 29 HC-NIC Page 24 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT can be exercised by the appellate authority as the said authority may deem think proper. He further contended that whenever a statute vest discretion in an authority to exercise the statutory power, such authority can exercise the same in an unfettered manner and that whenever an unfettered discretion has been exercised, courts have refused to countenance the same. He also invited our attention to para 5 of the above judgment which is to the following effect : "The courts cannot insist that under all circumstances and under different statutory provisions personal hearings have to be afforded to the persons concerned. If this principle of affording personal hearing is extended whenever statutory authorities are vested with the power to exercise discretion in connection with statutory appeals, it shall lead to chaotic conditions. Many statutory appeals and applications are disposed of by the competent authorities who have been vested with powers to dispose of the same. Such authorities which shall be deemed to be quasijudicial authorities are expected to apply their judicial mind over the grievances made by the appellants or applicants concerned, but it cannot be held that before dismissing such appeals or applications in all events the quasijudicial authorities must hear the appellants or the applicants, as the case may be. When principles of natural justice require an opportunity to be heard before an adverse order is passed on any appeal or application, it does not in all circumstances mean a personal hearing. The requirement is complied with by affording an opportunity to the person concerned to present his case before such quasijudicial authority who is expected to apply his judicial mind to the issues involved."
31.Mr. Salve invited our attention to Para 17 of the Judgment in State Bank of Patiala and Ors. v. S.K. Sharma, 1996 (3) SCC 364, which deals with the opinion of the House of Lords in United Kingdom. He also drew our attention to S. L. Kapoor v. Jagmohan, 1980 (4) SCC 379 and Managing Director ECIL v. B. Karunakar's, 1993 (4) SCC 727 in paras 25, 26 and
28. The decisions relied on and cited above make one thing clear namely principles of natural justice cannot be reduced to any hard and fast formulae and as said in Russel v. Duke of Norfold (1949) 1 All ER 109, these principles cannot be put in a strait jacket. Their applicability depends upon the context and the facts and circumstances of each case. The objective is to ensure a fair hearing, a fair deal Page 25 of 29 HC-NIC Page 25 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT to a person whose rights are going to be affected. In our opinion, the approach and test adopted in Karunakar's case (supra) should govern all cases where the complaint is not that there was no hearing, no notice, no opportunity of hearing but one of not affording a proper hearing that is adequate or a full hearing or violation of a procedural rule or requirement governing the enquiry.
32.On proportionately of punishment imposed, Mr. Salve cited Chairman and Managing Director, United Commercial Bank and Ors. v. P.C. Kakkar, 2003 (4) SCC 364. In the above case it was observed : "In B.C. Chaturvedi v. Union of India 1995 (6) SCC 749, it was observed :
"18. A review of the above legal position would establish that the disciplinary authority, and on appeal the Appellate Authority, being factfinding authorities have exclusive power to consider the evidence with a view to maintain discipline. They are invested with the discretion to impose appropriate punishment keeping in view the magnitude or gravity of the misconduct. The High Court/Tribunal, while exercising the power of judicial review, cannot normally substitute its own conclusion on penalty and impose some other penalty. If the punishment imposed by the disciplinary authority or the Appellate Authority shocks the conscience of the High Court/Tribunal, it would appropriately mould the relief, either directing the disciplinary/appellate authority to reconsider the penalty imposed, or to shorten the litigation, it may itself, in exceptional and rare cases, impose appropriate punishment with cogent reasons in support thereof."
33. 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 Page 26 of 29 HC-NIC Page 26 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT 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.
34. The Bank Manager/Officer and employees and any Bank nationalized/or nonnationalized 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."
Page 27 of 29HC-NIC Page 27 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT
32. Thus, the conspectus of the above referred decisions of the Supreme Court would suggest that the disciplinary authority, and on appeal the appellate authority, being fact finding authorities have the exclusive power to consider the evidence with a view to maintain discipline. They are invested with the discretion to impose an appropriate punishment keeping in view the magnitude or gravity of the misconduct.
The High Court, while exercising the power of judicial review, should not normally substitute its own conclusion on the findings recorded including the penalty.
33. This is not a case where there was no hearing, no notice or no opportunity of hearing but the complaint is one of not affording hearing in person. The omission on the part of the authorities in not giving personal hearing to the petitioner would not render the order of dismissal illegal or would vitiate the proceedings.
34. Having regard to the materials on record I am fully convinced that adequate opportunity was given to Page 28 of 29 HC-NIC Page 28 of 29 Created On Fri Oct 09 02:10:45 IST 2015 C/SCA/9163/2003 CAV JUDGMENT the petitioner to meet with the charges levelled against him and after due consideration of the entire evidence on record the final decision to dismiss the petitioner from service was taken.
35. In view of the above, I do not find any merit in this writapplication and it is not possible to grant any relief to the applicant as prayed by him in this petition.
36. In the result, this application fails and is hereby rejected.
(J.B.PARDIWALA, J.) Manoj Page 29 of 29 HC-NIC Page 29 of 29 Created On Fri Oct 09 02:10:45 IST 2015