Allahabad High Court
Dinesh Kumar Srivastava vs M.D. Bank Of Baroda Baroda Corporate ... on 26 July, 2017
Author: Narayan Shukla
Bench: Narayan Shukla
HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH Court No. - 2 A.F.R. Case :- SERVICE BENCH No. - 22613 of 2016 Petitioner :- Dinesh Kumar Srivastava Respondent :- Managing Director, Bank Of Baroda and others Counsel for Petitioner :- Gopesh Tripathi Counsel for Respondent :- Prashant Kumar Srivastava,Lalit Shukla Hon'ble Shri Narayan Shukla,J.
Hon'ble Virendra Kumar-II,J.
(Delivered by Hon'ble Virendra Kumar-II, J.)
1. Heard Shri Gopesh Tripathi, learned counsel for the petitioner as well as Shri Lalit Shukla, learned counsel for the respondents.
2. This writ petition has been instituted on behalf of petitioner for quashing of the order dated 25.07.2013 and the order dated 17.03.2015 passed in appeal, whereby petitioner has been compulsorily retired from the post of Branch Manager vide impugned order dated 25.07.2013.
3. It is pleaded that petitioner had joined the services of Bank of Baroda in clerical cadre on 17.01.1978. His work and conduct was satisfactory, up to the mark and unblemished, therefore, he was promoted on 18.08.1984 as Officer in Junior Management Grade-I by the competent authority. He was again promoted to Middle Management Grade-II vide order dated 16.06.2000. The petitioner was in due course posted as Branch Manager of Inhauna Branch on 18.08.2009. A new lady officer was also appointed who was unable to make inspections in rural/ remote areas.
4. It is further pleaded that Assistant General Manager of the Bank issued letter dated 29.01.2013 seeking the petitioner's version with regard to certain alleged irregularities occurred during his place of posting at Inhauna Branch. He submitted his reply to the above mentioned notice on 29.01.2013. It is pointed out that two accounts, mentioned in the letter of Assistant General Manager, were not sanctioned by him, whereas twenty three accounts were running satisfactorily and were standard assets. It is contended that charge sheet dated 21.06.2013 was served on him on 05.07.2013 after attaining the age of superannuation on 31.07.2013 by the Deputy General Manager. This charge sheet was related to the regulation (3) read with regulation (24) of the Bank of Baroda Officer Employees (Conduct) Regulations, 1976 (hereinafter referred to as the, 'Regulations, 1976'). These charges were levelled against the petitioner regarding procedural lapses. No charge of wrong identification of borrower, illegal gratification, mala fide swing, undue favour or exceeding delegated authorities have been levelled against the petitioner.
5. It is mentioned that disciplinary authority, vide order dated 22.07.2013, appointed inquiry officer as well as the presenting officer. The inquiry authority fixed 23.07.2013 for preliminary hearing at zonal office. During the course of proceedings of inquiry petitioner was orally advised by the inquiry authority that since the charges are not serious and he is going to retire on 31.07.2013, if he accept the charges, disciplinary authority would take the lenient view and his terminal benefits would be released on the date of superannuation of imposing nominal punishment. Therefore, he admitted the charges, believing the assurance given by the inquiry authority. The inquiry authority concluded the inquiry by mentioning in the order sheet that the petitioner was asked to rethink for his version, what he had submitted before the inquiry officer and that he voluntarily accepted the allegations and charges. The disciplinary authority, on 23.01.2013, handed over the inquiry report submitted by the inquiry officer, but the record of the inquiry was not sent to the disciplinary authority, since no enclosures are mentioned in the finding, which is the violation of Regulation 6(21)(ii) of the Bank's Discipline and Appeal Regulations (hereinafter referred to as the, 'Appeal Regulations'). The Deputy General Manager, vide order dated 25.07.2013, imposed the penalty of compulsory retirement, which is not only excessive, but disproportionate to the charges proved.
6. It is also contended that according to the circular dated 28.09.2000 issued by Central Vigilance Commission, he was not provided copy of first and second stage advice during the course of inquiry, therefore, sufficient opportunity to make a representation was not given to the petitioner and above mentioned circular and principles of natural justice were violated.
7. The petitioner preferred an appeal on 08.09.2013 against the punishment order dated 25.07.2013 before the General Manager on the ground that documents in support of the charges were not provided, copy of first stage as well as second stage advice of the Central Vigilance Commission was not provided to him. The General Manager, vide letter dated 16.09.2013 recommended for granting 3/4 compulsory retirement pension in contravention of the Regulation 33 of the Bank of Baroda (Employees) Pension Regulations, 1995 (hereinafter referred to as the, 'Pension Regulations, 1995'). The petitioner, on advice of the Bank, again preferred a fresh appeal. The Bank provided him on 31.10.2014 some listed documents. The petitioner filed supplementary appeal on 14.11.2014, refuting account wise charges and allegations, inter alia, on the ground that guidelines, alleged to have been violated, were not produced during the inquiry. The petitioner's revised appeal was rejected by the appellate authority on 17.03.2015 relying upon the order sheet No.1. The petitioner again requested on 16.07.2015 for grant of compulsory retirement pension at the rate of 100%. The Bank has released pension payment order on 08.07.2016 and credited the arrears of pension and commutation amount in his account.
8. It is further pleaded that petitioner could not file the writ petition due to financial constraints, on the other hand, he has relied upon the law laid down by Hon'ble Supreme Court in S.B.I. and others Vs. D.C. Agarwal : 1993 (1) SCC.
9. On the above mentioned grounds, facts and circumstances, following reliefs have been sought:
"(i) Issue a writ, order or direction in the nature of certiorari quashing the impugned orders dt. 25.07.13 and 17.03.15, contained as Annexure No. 1 & 2 to the writ petition.
(ii) Issue a writ, order or direction in the nature of Mandamus commanding the opp. parties to release the full pensionary benefits i.e. full pension, difference of gratuity etc, considering him superannuate on 31.07.13."
10. Counter affidavit has been filed on behalf of the respondents. It is refuted that the post of Branch Manager is equivalent to Class-II, as no such provision has been made by the Bank in Service Regulations. The good conduct cannot be sole criteria for promotion. The petitioner applied for promotion and through competition he was selected. The contention of the petitioner is also controverted by the respondents that newly appointed lady posted at Inhauna Branch was unable to make inspections as alleged by the petitioner. It is also mentioned in the counter affidavit that the petitioner, during his posting as Branch Head at Inhauna Branch, District Chhatrapati Shahuji Maharaj Nagar, committed serious irregularities in advance accounts due to gross negligence, commission, omission, lapse on his part. He causes loss of substantial amount and reputation of Bank. KYC documents were not collected and verified by him from the original documents regarding these accounts. The charges of misuse of his post and authority, omission/ lapses on his part were levelled against him. This contention of the petitioner was also controverted by the respondents that inquiry authority advised the petitioner that charges are not of serious nature and his retirement is due on 31.07.2013, if he accepts the charges, lenient view would be taken and nominal punishment would be imposed and terminal benefit would be released on the date of superannuation. The order sheet No.1, Annexure-7 clearly shows that when petitioner accepted the allegations and charges, the inquiry authority again asked to rethink his decision. The inquiry authority has not advised the petitioner to accept the allegations and charges levelled against him. The petitioner has admitted the charges voluntarily, unconditional and without any duress through a hand written letter(Annexure-1).
11. It is further submitted that memorandum was served upon the petitioner. He was accorded ten days' time to submit his written statement of defence. He had not demanded any documents and accepted the allegations and charges levelled against him. On the first date of hearing, he again admitted the allegations and charges without any duress. The punishment order dated 25.07.2013 was received by the petitioner on the same day. The penalty of compulsory retirement was rightfully imposed against him by the disciplinary authority. According to the provisions of Regulation 33(1) of Pension Regulations, 1995, recommendation was made by the Regional Authority on 07.08.2003 for release of compulsory retirement dues. Therefore, representation dated 06.08.2016 of the petitioner was considered and action was taken as per the guidelines. The guidelines related to the cases referred to Central Vigilance Commission has no relevance in the case of the petitioner, still the first stage and second stage advices were provided to the petitioner. The xerox copies of the documents were provided on 21.03.2016 to him. No other documents were demanded by him. The copies of pre sanction and post sanction reports carried out by the petitioner are available in the record of the Branch of the Bank relating to 37 accounts in question. The documents available at the Branch are mentioned in para-21 of the counter affidavit.
12. It is further pleaded that the General Manager, vide letter dated 16.09.2013 has recommended for grant of 3/4 compulsory retirement, which is an order and in accordance with Regulation 33(1) of the Pension Regulations, 1995. The competent authority has found no merits in the appeal and no substantive grounds for interfering the disciplinary order dated 25.07.2013 were available, hence the said appeal was dismissed. The request dated 16.07.2015 made by the petitioner for grant of compulsory retirement pension at the rate of 100% has been forwarded on 03.08.2015 to the Head Office of the Bank for doing the needful. The petitioner has himself solely responsible for delay in release of compulsory retirement pension to him, because despite communications, he did not apply for grant of compulsory retirement pension under the Pension Regulations, 1995. The whole inquiry proceedings and punishment order were in accordance with the regulations, therefore, the writ petition is not tenable in the eye of law, lacks merit and deserves to be dismissed.
13. The petitioner has filed rejoinder affidavit by reiterating his earlier contentions.
14. The learned counsel for the petitioner has relied upon the decisions of Hon'ble Supreme Court in the case of Oriental Bank of Commerce and others Vs. S. S. Sheokand and another : (2014) 5 SCC 172 and argued that Hon'ble Supreme Court in para-20 of the said judgment has held as follows:
"We have considered the submissions of both the counsel. When we come to the question of imposition of punishment on the respondent, what we find is that undoubtedly, there was a serious allegation against him, and as it has been held in the case of Disciplinary Authority-Cum-Regional Manager (supra), such acts could not be condoned. At the same time, we have also to note that the bank management itself had taken the view in the initial stage that the action did not require a major penalty. It is also relevant to note that the High Court was also informed at the stage of review that the Bank was considering imposition of a minor penalty. It is quite possible to say that the bank management did arrive at its decision to maintain a major penalty at a later stage on its own, and not because of the dictate of the CVC, but at the same time it has got to be noted that the CVC report had been sought by the management of the bank, and thereafter the punishment had been imposed. As observed in the case of State Bank of India (supra), may be that the Disciplinary Authority had recorded its own findings, and had arrived at its own decision, but when this advise from CVC was sought, it could not be said that this additional material was not a part of the decision making process. When this report was not made available to the respondent, it is difficult to rule out the apprehension about the decision having been taken under pressure. Any material, which goes into the decision making process against an employee, cannot be denied to him. In view of the judgment in the case of Disciplinary Authority-cum- Regional Manager (supra), the decision of the Bank could have been approved on merits, however, the two judgments in the cases of Nagaraj Shivaraj Karajgi (supra) and State Bank of India (supra) lay down the requisite procedure in such matters, and in the facts of this case, it will not be appropriate to depart from the dicta therein. On this yardstick alone, a part of the judgment of the High Court interfering with the punishment will have to be sustained."
15. We have perused the impugned punishment order dated 25.07.2013 and the inquiry report submitted by the inquiry authority. The inquiry authority has submitted its report dated 23.07.2013 before the Disciplinary Authority/ Deputy General Manager, Bank of Baroda (Zonal Office). It is mentioned in this report that he was appointed vide order dated 22.07.2013 as inquiry authority and memorandum dated 21.06.2013 containing statements of allegations and article of charges in respect of alleged irregularities and lapses committed by the petitioner during his posting and functioning as Branch Head of Inhauna at Chhatrapati Shahuji Maharaj Nagar, Sultanpur Region was served upon him. Shri J. K. Verma was appointed as Presenting Officer for this case. The preliminary hearing was fixed on 23.03.2013. The petitioner submitted before the inquiry authority that he had received copy of memorandum dated 21.06.2013 and have gone through the contents of the same. He also submitted that he does not want to contest the case and unconditionally and voluntarily and without any duress accepts all the charges and allegations levelled against him. According to this memorandum one more opportunity was given to the petitioner by the inquiry authority and asked him to rethink over his version what he had told before the inquiry authority. The petitioner again confirmed his earlier version and again stated that he had thought in peaceful mind and again confirmed his version and accepted all the allegations and charges served upon him unconditionally, voluntarily and without any duress. The inquiry authority found that during his posting and functioning as Branch Head at Inhauna, Chhatrapati Shahuji Maharaj Nagar, certain irregularities/ lapses were observed on the part of the petitioner in various advance accounts. Therefore, on the basis of admission made by the petitioner, allegation Nos. A(1 to 14), B(1 to 5) and C were stand proved.
16. The inquiry authority has mentioned in its report as follows:
"(1) He did not take all possible steps to ensure and protect the interest of Bank but in fact made such omissions and committed such acts which were detrimental and injurious to the interest of the Bank.
(2) He acted otherwise than in his best judgment and violated Rules, Systems and Procedure of the Bank.
(3) He misused his Post and Authority was reckless in sanctioning large number of advances to the borrowers.
(4) Due to his acts of omission & commission, the Bank is exposed to substantial financial loss."
17. Copy of inquiry report was received by the petitioner on 23.07.2013 as revealed by the order dated 23.07.2013 passed by Deputy General Manager/ Disciplinary Authority. It is also mentioned in this order that upon considering the written statement of defence of the petitioner, the inquiry authority was appointed vide order dated 22.07.2013 under Regulation 5(2) read with Regulation 6(2) of Regulations, 1976.
18. We have also perused Annexure-7, order sheet No.1 dated 23.07.2013 prepared by Inquiry Authority in presence of Presenting Officer and the petitioner. Annexure-7 reveals that on 23.07.2013 regular hearing of inquiry was held on this date, the petitioner had submitted before the inquiry authority that he does not want to contest the case and accepts all the allegations and charges levelled against him vide memorandum dated 21.06.2013 voluntarily without any duress and pressure. The inquiry authority advised to the petitioner to rethink over his version, but the petitioner reiterated the same version and voluntarily accepted the allegations and charges levelled against him.
19. The petitioner has submitted that the inquiry authority assured him about the leniency to be taken by the disciplinary authority but he is unable to establish by cogent, relevant and sufficient evidence that any such assurance was given by the inquiry authority to the petitioner. No complaint has been made by the petitioner after 23.07.2013 that any such assurance was given to the petitioner by the inquiry authority, subject to which he had admitted all the allegations and charges framed against him on 21.06.2013.
20. Annexure-6 is available on record, which is a computerized typed copy signed by the petitioner on 23.07.2013. The contents of this application revealed that the petitioner willfully admitted and accepted the allegations and article of charges levelled against him. He carefully gone through the contents of the same memorandum dated 21.06.2013 and vide this application had confirmed that he had understood the allegations and charges levelled against him. It is mentioned in this application by the petitioner that, "I further want to bring in your kind notice that I do not want to contest the case and unconditionally, voluntarily, without any duress and pressure accept all the allegations and charges levelled against me". Notice of preliminary hearing scheduled to be held on 23.07.2013 was served as Annexure-5 on the petitioner.
21. We have also perused Annexure-3, memorandum/ article of charges dated 21.06.2013, in which details of statements of allegations relating to 37 advance accounts have been mentioned, which are as follows:
"1. He himself carried out Pre & Post sanction inspection, appraisal, recommendation, sanction etc. in above mentioned -37- loan accounts, without involving any other officer posted at Inhauna branch in loan sanctioning process and did not adhere to four eye principle, thus violated bank's extant guidelines.
2. He did not generate/scrutinize CIBIL Search Reports before sanctioning the loan to these borrowers to safeguard the interest of the Bank. Further, he sanctioned loans to -20- borrowers living outside the Service Area Approach of the Branch without obtaining No Dues Certificate from other banks operating in the area and violated Bank's extant guidelines.
3. He did not carry out Pre- Sanction Inspection properly i.e. specific details of proposed/existing business units, their exact location/surroundings, details about the borrowers' residential location, their exact surroundings/neighborhood etc. are not mentioned in the Pre Sanction Inspection report. Independent justification for loan are not incorporated and loan is recommended and sanctioned by him simply on the basis of recommendation of the sponsoring agency, thus proper due diligence has not been exercised.
4. Post Sanction Inspection has been carried in a very casual manner i.e. specific detail of assets created from term loan, its value, details of its make etc. are not mentioned. Further, he also did not incorporate specific details of raw materials, finished goods available at the site, number of persons employed etc in the report.
5. He did not carry out any independent appraisal and assessment of the loan facility of loans sanctioned under Government Sponsored Scheme. He also did not make any independent assessment of the income generation and repayment capacity in these loan accounts, did not examine the economic viability of these units before giving sanction and simply relied on loan proposals received from the sponsoring agency without its proper scrutiny.
6. He did not ensure to obtain Guarantee Cover under CGTMSE Scheme as per Bank's extant guidelines for loans under Government Sponsored Schemes (except loan accounts mentioned under serial no.24, 27, 30 & 33). Further, in many accounts, Third Party Guarantee has been obtained even though third party guarantee has not been stipulated in the terms of Sanction.
7. He sanctioned -32- loan accounts sponsored by KVIB against the target of -1- without any justification, authority. In many cases, KYC documents of the borrowers/guarantors were not obtained. Those obtained and kept on record were not verified from the original.
8. He did not scrutinize Form No. 135 submitted by the borrowers and accepted them without any supporting documents. Form No. 135 submitted by the borrowers are incomplete i.e. proper details of immovable property are not mentioned, basis of annual income mentioned in the Form No. 135 was not ascertained by him in all the above mentioned accounts. Further, he did not prepare Form No. 117A i.e. report on means and outstandings of the Borrowers.
9. He did not ensure to obtain insurance of assets financed by the bank/hypothecated to bank in -10- accounts mentioned under serial no. 4, 8, 16, 18, 19, 21, 25, 25, 27, 28. Further, in four loan accounts under serial no. 12, 14, 20 & 24 assets created out of term loan were not got insured by him, thus did not follow Bank's extant guidelines and failed to protect the interest of the Bank.
10. He released full limits to borrowers without ascertaining correct Drawing Powers/ without obtaining Stock Statements.
11. He did not ensure to obtain Stock/ Book debt Statements in most of the Cases and full disbursement off working capital funds were allowed without ascertaining correct drawing power. Further, he allowed disbursements from CC a/c, mostly in cash, either by transferring the amount from CC a/cs into respective SB a/cs of the borrowers from where amount was allowed to be withdrawn in cash or from CC a/c itself, hence end use of Bank's fund were not ensured.
12. He did not carry out/ ensure to carry out bi-monthly/ periodical stock inspection in the Cash Credit Accounts and failed to ensure end use of Bank's fund.
13. He failed to notice that in -14- loan a/cs, bills from one single supplier M/s Mirza Iron store, have been submitted by the borrowers who were sanctioned loans for different purposes i.e. Rice Mill (Imran Khan & Vinay Kumar Singh), Furniture Udyog (Mohd. Yashin, Mohd. Nadeem, Mr. Sukhram, Mr. Fawad Hussain), Atta Chakki (Mr. Mani Ram), Black Smithing (Mr. Irfan Ali), Cement Jali Udyog (Satish Kumar), Oil Mill (Md. Islam & Takshin Ahmad), Dairy Product (Jahid Khan), Polisher (Mr. Akshay Kumar & Mr. Sidh Nath) and did not try to ascertain the veracity of these bills nor enquired whether the firm of M/S Mirza Iron Store is dealing in those items mentioned in the bill. Subsequently, it is reported that no assets are available with the borrower Mohd Yashin, Mani Ram, Satish Kumar, Jahid Khan, Mohd. Nadem, Fawad Hussain and Mr. Taksheen Ahmad and borrowers have misutilized the fund.
14. He did not monitor the conduct of these accounts properly, did not initiate effective steps even when the monthly interest/ installments were not being deposited in many loan accounts & turn over in many CC a/cs were not satisfactory and failed to protect the interest of the Bank.
B. Account - wise irregularities :-
1. M/s Bansh Brick Field (Prop. Smt. Geetu Singh), LIMITS:- T/L Rs. 14.25 lac & CC Rs. 9.50 lacs:-
a. He sanctioned the loan to the borrower without obtaining training Certificate, Pollution Clearance Certificate, copy of license etc. b. He did not examine the issue that how a lady promoter will manage the manufacturing and marketing of the Bricks.
c. He sanctioned the loan under CGTMSE scheme, still obtained third party guarantee in violation of CGTMSE Scheme guidelines and due to this defect, the enforceability of guarantee cover may not be available.
d. Unit is not running, there was no credit turnover in the CC a/c during the period of his posting (except one credit of FDR proceeds), still he did not initiate any step for recovery to protect the interest of the Bank. A/c has degraded to NPA category, recovery is not forthcoming and bank is likely to suffer substantial financial loss.
2. M/S Vishnu Interlocking (Prop. Mr. Dinesh Kumar Pathak), LIMITS :- T/L Rs. 7.00 lac & CC Rs. 16.00 lac:-
a. He sanctioned loan to M/s Vishnu Interlocking (Prop. Mr. Dinesh Kumar Pathak) ignoring the fact that Mr. Pathak is an existing borrower of Bhadaiyan branch, where Mr. Srivastava was earlier posted as Branch Manager and had himself sanctioned the loan to Mr. D K Pathak (loan a/c No. 229206/84 jointly in the name of Mr. Rikhi ram & Mr. D. K. Pathak) and also in the name of his wife (M/S Suraj Jali Udyog Prop. Smt. Malti devi w/o Mr. D K Pathak, a/c No. 229206/236). These existing loan accounts at Bhadaiyan branch were reportedly under stress and not running satisfactorily, still he did not scrutinize the existing loan a/c of Mr. Pathak, did not obtain credit report from Bhadaiyan branch, thus accommodated the party.
b. He did not carry out pre-sanction inspection before sanctioning the facility.
c. He ignored the fact that in the Affidavit submitted by the party, the place of residence has been shown at Inhauna but in other supporting KYC documents, it is mentioned as Bhadaiyan.
d. He accepted highly inflated value of property at Rs.8.69 lacs as per valuation report dated 20.03.2010 which was purchased on 21.12.2009 at a price of Rs. 2.10 lac. Further, in the inspection report of property carried out by him, he has mentioned the value as Rs. 6.00 lac ignoring bank's extant guidelines.
e. He did not obtain the personal guarantee of the mortgagor.
f. He released the loan facility without getting the loan documents vetted by bank's panel lawyer.
3. M/S Radhey Shyam Rice Mill (Prop. Mr. Ambika Sharan Singh), Limit CC Rs. 20.00 lac:-
a. He did not carry out pre-sanction inspection before sanctioning the facility.
b. He released the loan facility without getting the loan documents vetted by the bank's panel lawyer.
c. He accepted highly inflated value of property at Rs. 52.30 lacs as per valuation report dated 02.08.2010 whereas as per sale deed (Sale deed was less than three years old) the purchase cost of property was only Rs. 2.00 lac. Further, in the inspection report of property carried out by him on 19.08.2010, he has mentioned the value of property as Rs. 43.60 lac ignoring bank's extant guidelines. He did not carry out annual review of the facility, did not ensure to obtain Balance sheet etc and also did not carry out any post disbursement inspection to verify end use of Bank's fund.
d. He did not monitor the conduct of the account properly, did not initiate any steps for recovery. Account has since degraded to NPA category, Auction Bid under SURFAESI Act -2002 has failed, borrowers are not cooperating and bank is likely to suffer substantial financial loss.
4. M/S Radhey shyam Traders (Prop. Mr. Sandeep Pratap Singh), Limit Rs. 15.00 lac:-
a. He did not obtain the Balance Sheet, Profit & Loss account of the firm for last three years nor obtained the estimated balance sheet for the current year duly verified by CA and accepted the Projected sales of Rs. 80.00 lac without any base and verification from VAT/Sales tax return etc in gross violation of Bank's extant guidelines.
b. He released the loan facility without getting the loan documents vetted by bank's panel lawyer.
c. He did not obtain personal guarantee of Mr. Ranjeet Singh as stipulated in terms of sanction in the appraisal note.
d. He did not obtain personal guarantee at Rs. 53.50 lacs as per valuation report dated 20.10.2009 of Er. Mr. B P Singh whereas as per sale deed dated 25.01.2007 the purchase cost of property was only Rs. 1.10 lac without any independent assessment of the value of property, its marketability particularly when the property is reportedly situated at a remote village. He also did not obtain the land use conversion certificate as mentioned in his undated Inspection report on property. He, thus failed to protect the interest of the Bank.
e. He did not carry out annual review of the facility, did not ensure to obtain Balance sheet etc and also did not carry out any post disbursement inspection to verify end use of Bank's fund.
f. He did not monitor the conduct of the account properly, did not initiate any steps for recovery. The credit turn over in the account was not at all satisfactory when compared to accepted projected sales of the firm by him. The account has since degraded to NPA category, bank is exposed to substantial financial loss as disposal of the mortgaged property may be very difficult looking to its location and acceptance of highly inflated value at the time of sanction.
5. M/s Parvati Food Products (Prop. Sri Rabi Shankar Tewari), Limit Rs.24.00 lac:-
a. He did not obtain the Balance Sheet, Profit & Loss account of the firm for last three years nor obtained the estimated balance sheet for the current year duly verified by CA and accepted the Projected sales of Rs.120.00 lac without any base and verification from VAT/Sales tax return etc in gross violation of Bank's extant guidelines.
b. He sanctioned the limit of Rs. 24.00 lac against the value of Rs. 30.00 lacs of mortgaged property in violation of Bank's extant guidelines.
c. He accepted highly inflated value of property at Rs.32.20 lacs as per valuation report dated 25.10.2009 of M/S Gupta Associates whereas as per sale deed dated 15.06.2009 the purchase cost of property was only Rs. 23.00 lac. Further, in the inspection report on property carried out by him, he has mentioned the accepted value of property as Rs.30.00 lac ignoring the value mentioned in the sale deed. Subsequently, the value of the property as per valuation report dated 28.05.2013 of Er. R C Verma is reportedly Rs.11.30 lac only.
d. He released the loan facility without getting the loan documents vetted by bank's panel lawyer.
e. He did not monitor the conduct of the account properly, did not initiate any steps for recovery. The credit turn over in the account f. was not at all satisfactory when compared to accepted projected sales of the firm by him. The account has since degraded to NPA category, bank is exposed to substantial financial loss as disposal of the mortgaged property may be very difficult looking to its location and acceptance of highly inflated value at the time of sanction.
g. He did not carry out annual review of the facility, did not ensure to obtain Balance sheet etc and also did not carry out any post disbursement inspection to verify end use of Bank's fund.
Due to his lapses in appraisal, non examination of economic viability, lack of proper follow up, -28- loan accounts have since degraded into NPA category (out of which -12- accounts have met with quick mortality) as on date. Branch has also now reported that assets are not available in -18- loan accounts, chances of recovery appears bleak in these accounts and bank is exposed to substantial financial loss."
22. The Disciplinary Authority vide impugned order dated 25.07.2013 has considered the inquiry report submitted by the inquiry authority, has dealt with every aspect of the allegations and article of charges framed against the petitioner. It is mentioned in this order about the nature of lapses and financial irregularities committed by the petitioner regarding advance accounts of the concerned firms. It is also mentioned in this order that due to lapses in appraisal, non examination of economic viability, lack of proper follow up, 28 loan accounts have since degraded into NPA category, out of which 12 accounts have met with quick mortality as on date. Branch has also now reported that assets are not available in 18 loan accounts, chances of recovery appears bleak in these accounts and bank is exposed to substantial financial loss.
23. It is also mentioned in this order that the charge sheeted officer, the petitioner, in his representation/ submissions on the findings of the inquiry authority stated that he has already accepted all the allegations and charges served upon him vide memorandum dated 21.06.2013 and submitted to take as sympathetic view. Since the petitioner had unconditionally, voluntarily and without any duress accepted all the allegations and charges during the course of inquiry, therefore, agreeing with the findings of the inquiry authority in holding of the allegations and charges levelled against the petitioner as proved. The petitioner also made stipulation on the inquiry report and had reiterated its acceptance of all the allegations and charges unconditionally, voluntarily and without any duress, therefore, the disciplinary authority passed the punishment order of compulsory retirement against the petitioner.
24. The petitioner in para-30 of the writ petition has mentioned that the bank has released the pension payment order on 08.07.2016 and credited the arrears of pension and commutation amount in his account. The petitioner, as has contended in para-12 of the writ petition, is not able to prove this fact that during the course of departmental inquiry proceedings he was orally advised by the inquiry authority that since the charges are not serious and he is going to retire on 31.07.2013, if he accepts the charges, the disciplinary authority would take lenient view and his terminal benefits would be released on the date of superannuation by imposing nominal punishment. The so called assurance is after thought as alleged by the petitioner because he himself moved application before the inquiry authority, admitting the allegations and article of charges levelled against him. If this assurance was given by the inquiry authority then he certainly would have made complaint against them, i.e., inquiry authority and the presenting officer after submission of the inquiry report. But no such complaint has been made by the petitioner by mentioning in his representation. He has mentioned in his representation only to take sympathetic view for passing the punishment.
25. Likewise, the appellate authority has disposed of the revised appeal dated 14.11.2014 preferred by the petitioner vide order dated 17.03.2015. The contentions raised by the petitioner in revised appeal has been dealt with in detail. The appellate authority has mentioned in this order that the petitioner has preferred this second appeal and as per his demand photocopies of documents were provided to him. He has not demanded further documents for defence of his case. The grievance of the appellant is an after thought as during inquiry he has already accepted unconditionally and voluntarily all the allegations and charges levelled against him. The appellate authority has also found as follows:
"It is evident from the records that Mr. Srivastava released full working capital limit to the borrowers without obtaining stock statement and also did not ensure to carry out bimonthly inspection in the Cash Credit account. From the statement of accounts of the said account, it is evident that the disbursement of cash credit limits were mostly allowed in cash. His contention that no documents were produced is baseless as in all the accounts there are no stock statement and full set of copies of loan proposal files were given to him on his demand. Mr. Srivastava has willingly not contested the departmental inquiry though sufficient opportunities were given to him. As such his arguments at this stage have no merit. Further, during the inquiry proceedings he has accepted unconditionally and voluntarily all the allegations and charges levelled against him.
Here it should be noted that from the records of the case, it is evident that the copies of Post Sanction Inspections Reports were already provided to him at a later stage, wherein Mr. Srivastava has not mentioned the use of Term Loan given to the borrower and the values of stock available with them. He has only made a general remark that end use verified and in some cases he himself has mentioned that "no shop exists" (A/c No. 05/749 & 06/479), Borrower has been asked to repay the loan (A/c No. 05474), no shop found (A/c No. 05/485). In all these cases also full working capital limit were released. Apart from few Post Sanction Inspection reports there is no stock statement on the record. Had there been no supporting documents produced in the inquiry, he should not have accepted the allegations unconditionally and voluntarily during the inquiry and contested it.
However, instead of that during the inquiry proceedings he has accepted unconditionally and voluntarily all the allegations and charges leveled against him."
26. It is also observed by the appellate authority that, "it is noted that all the above mentioned arguments raised by Mr. D. K. Srivastava are a repetition of his arguments made during the course of enquiry proceedings. Mr. Srivastava has preferred this second appeal and as per his demand photocopies of the documents were provided to him. He has not demanded further documents for defence of his case. The grievance of the appellant is an after thought as he has already accepted unconditionally & voluntarily all the allegations and the charges levelled against him at all the stages of enquiry, that too knowing fully well about the gravity of allegations and charges leveled against him. Hence, his contentions are baseless".
27. Vide order dated 17.03.2015, the revised appeal of the petitioner was dismissed by the appellate authority after considering the contentions of the petitioner. The appellate authority has also considered pre sanction inspection and post sanction inspection reports prepared by the petitioner and observed as follows:
......... "It should be noted that Pre-Sanction Inspection on the records of branch does not indicate the place visited by the Appellant as NO LAND MARK of nearby place has been mentioned in the Report. The Pre Sanction Inspection contain general comments, it does not indicate the types of raw material required for the business, whether the same is available in nearby place, value or stock available at the site etc., which are very much required for taking credit decision in the proposals. Hence, it is apparent that the appellant did not prepare the report in the prescribed format and did not incorporate all the required details in the same. Further, during the inquiry proceedings he has accepted unconditionally and voluntarily all the allegations and charges leveled against him. Hence, the submissions made now are an afterthought & does not have any merit. ..........
......... It is apparent that in none of the Post Sanction Inspection Report he has mentioned about the details of assets created out of the loan, its value, make, details of raw materials, finished goods and whether the unit is working or not. The basic ethics of carrying out Post Sanction Inspection is to verify utilisation of funds financed by its bank. His contention that there is no column to mention the details as alleged in the Memorandum has no merit as there is column No.17 wherein inspecting officer has to mention "comments regarding end use of fund". In this column, he has made general remark such as fund utilized, shop opened etc. Further, during the inquiry proceedings he has accepted unconditionally & voluntarily all the allegations and charges leveled against him. Hence, there is no merit in his submissions.".............
28. On the other hand, learned counsel for the respondents has relied upon the following case law, which are as follows:
(i) The Hon'ble Supreme Court in para-4 of the case, Additional District Magistrate (City) Agra Vs. Prabhakar Chaturvedi and another : (1996) 2 SCC 12 has held as under:
........4. So far as the grievance about the non-examination of witnesses and non-supply of documents is concerned, in our view, the High Court has erred in ignoring the salient features of the case, namely, that Respondent 1 himself by his statement dated 14-12-1984 admitted to have received an amount of Rs.21,000 and odd and which could not be deposited by him along with his associate on account of their carelessness and fault. It is difficult to appreciate how the said statement could be said to have been brought about by any coercion as tried to be submitted on behalf of Respondent 1. But even apart from that the order sheet of the Enquiry Officer clearly shows that Respondent 1 Prabhakar as well as Sajan Kumar had submitted that they have not to give any documentary or oral evidence and that is how their evidence was closed. Under these circumstances the subsequent request by Respondent 1 to examine four more witnesses was rightly considered by the Enquiry Officer to be an afterthought and accordingly such request was rightly rejected. In fact on account of the clear admission contained in writing given by Respondent 1 on 14-12-1984 the charge against him stood proved on admission and the only question that remained to be considered was about the nature of punishment to be imposed on him. When Respondent 1 was guilty of misappropriation of such a large amount of Rs. 21,000 and odd for couple of months it could not be said that the punishment of dismissal as imposed on him was in any way uncalled for or was grossly disproportionate to the nature of the misconduct proved against Respondent 1. For all these reasons the order of the High Court cannot be sustained and is, therefore, quashed and set aside. The writ petition filed in the High Court will stand dismissed. However, in the facts and circumstances of the case there will be no order as to costs."
(ii) The Hon'ble Supreme Court in para-7 of the case, Delhi Transport Corporation Vs. Shyam Lal : (2004) 8 SCC 88 has held as under:
"7. We find that the Tribunal's conclusions are prima facie not correct. The statement made by the passenger who had paid excess money to the checking officer is not in the nature of hearsay evidence. Additionally, the effect of the admission regarding guilt as contained in the letters dated 13-1-1989 and 24-2-1989 have not been considered in the proper perspective. It is a fairly settled position in law that admission is the best piece of evidence against the person making the admission. It is, however, open to the person making the admission to show why the admission is not to be acted upon.
(iii) The Hon'ble Supreme Court in paras-16 to 21 of the case, Chairman & Managing Director, V.S.P. and others Vs. Goparaju Sri Prabhakara Hari Babu : (2008) 5 SCC 569 has held as under:
"16. Indisputably, the respondent was a habitual absentee. He in his explanation, in answer to the charge-sheet pleaded guitly admitting the charges. In terms of Section 58 of the Evidence Act, charges having been admitted were not required to be proved. It was on that premise that the enquiry proceeding was closed. Before the enquiry officer, he did not submit the explanation of his mother being ill. He, despite opportunities granted to report to the duty, did not do it. He failed to explain even his prior conduct.
17. In Sangramsinh P. Gaekwad v. Shantadevi P. Gaekwad this Court noticing Section 58 of the Evidence Act held: (SCC p. 380, para 214) "214. In terms of the aforementioned provision, things admitted need not be proved. In view of the admission of Respondent 1 alone, the issue as regard allotment of 6475 shares should have been answered in favour of the appellants. The company petitioner at a much later stage could be permitted to take a stand which was contrary to or inconsistent with the original pleadings nor could she be permitted to resile from her admissions contained therein."
18. It was observed that judicial admission can be made the foundation of the rights of the parties.
19. A subsequent explanation before another authority, which had not been pleaded in the departmental proceedings, cannot by itself be a ground to hold that the principles of natural justice had not been complied with in the disciplinary proceedings.
20. The jurisdiction of the High Court in this regard is rather limited. Its power to interfere with disciplinary matters is circumscribed by well-known factors. It cannot be set aside a well-reasoned order only on sympathy or sentiments. (See Maruti Udyog Ltd. v. Ram Lal; State of Bihar v. Amrendra Kumar Mishra; SBI v. Mahatma Mishra; State of Karnataka v. Ameerbi; State of M.P. v. Sanjay Kumar Pathak and Uttar Haryana Bijli Vitran Nigam Ltd. v. Surji Devi.)
21. Once it is found that all the procedural requirements have been complied with, the courts would not ordinarily interfere with the quantum of punishment imposed upon a delinquent employee. The superior courts only in some cases may invoke the doctrine of proportionality. If the decision of an employer is found to be within the legal parameters, the jurisdiction would ordinarily not be invoked when the misconduct stands proved. (See Sangfroid Remedies Ltd. v. Union of India.)"
(iv) The Hon'ble Supreme Court in paras-34 and 35 of the case, Manoj H. Mishra Vs. Union of India and others : (2013) 6 SCC 313 has held as under:
"34. We have noted in detail the submissions made by Mr. Bhushan, though strictly speaking, it was not necessary in view of the categorical admission made by the appellant before the enquiry officer. Having admitted the charges understandably, the appellant only pleaded for reduction in punishment before the High Court. The leaned Single Judge has clearly noticed that the counsel for the appellant has only submitted that the punishment is disproportionate to the gravity of the misconduct admitted by the appellant. The prayer made by the appellant before the Division Bench in the letters patent appeal for amendment of the grounds of appeal to incorporate the challenge to the findings of guilt was rejected.
35.In our opinion, the learned Single Judge and the Division Bench have not committed any error in rejecting the submissions made by the learned counsel for the appellant. We are not inclined to examine the issue that the actions of the appellant would not constitute a misconduct under the Rules. In view of the admissions made by the appellant, no evidence was adduced before the enquiry officer by either of the parties. Once the enquiry officer had declined to accept the conditional admissions made by the appellant, it was open to him to deny the charges. But he chose to make an unequivocal admission, instead of reiterating his earlier denial as recorded in preliminary hearing held on 26-12-1994. The appellant cannot now be permitted to resile from the admission made before the enquiry officer. The plea to reopen the enquiry has been rejected by the appellate as well as the revisional authority. Thereafter, it was not even argued before the learned Single Judge. The learned counsel had confined the submission to the quantum of punishment. In letters patent appeal, the Division Bench declined to reopen the issue. In such circumstances, we are not inclined to exercise our extraordinary jurisdiction under Article 136 for reopening the entire issue at this stage. Such power is reserved to enable this Court to prevent grave miscarriage of justice. It is normally not exercised when the High Court has taken a view that is reasonably possible. The appellant has failed to demonstrate any perversity in the decisions rendered by the Single Judge or the Division Bench of the High Court."
(v) The Hon'ble Supreme Court in para-22 of the case, Viveka Nand Sethi Vs. Chairman, J & K Bank Ltd. and others : (2005) 5 SCC 337 has held as under :
"22. The principle of natural justice, it is trite, is no unruly horse. When facts are admitted, an enquiry would be an empty formality. Even the principle of estoppel will apply.[See Gurjeewan Garewal (Dr.) v. Dr. Sumitra Dash.] The principles of natural justice are required to be complied with having regard to the fact situation obtaining therein. It cannot be put in a straitjacket formula. It cannot be applied in a vaccum without reference to the relevant facts and circumstances of the case. (See State of Punjab v. Jagbir Singh and Karnataka SRTC v. S.G. Kotturappa.)"
29. Therefore, disciplinary authority as well as appellate authority has elaborately applied their mind on all the aspects of allegations and article of charges levelled against the petitioner and took decision vide impugned orders dated 25.07.2013 and 17.03.2015. Moreover, during the course of departmental inquiry the petitioner himself has accepted and admitted in writing all the article of charges and allegations made against him. Therefore, there was no necessity to provide him first stage and second stage advice of Central Vigilance Commission according to the Government Order dated 28.09.2000 issued by Government of India. Moreover, according to counter affidavit, contention has been taken by respondents that it were supplied to the petitioner. There is no requirement by the department/ Bank to prove admitted article of charges and allegations levelled against the petitioner. Therefore, the case law relied upon by the petitioner is of no help for him. We do not find any fault or deficiency in decision making process during the course of departmental disciplinary proceedings.
30. In the above mentioned circumstances, the writ petition devoid of merit, hence dismissed.
Order Date :- 26.7.2017 Mustaqeem