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"1. On 14-1-1960, a sum of Rs. 30,400/- was paid to Mr. P.C. Jain by the Assistant Cashier Mr. Nand Kishore out of the cheque No. 43004 dated 14-1-60 drawn by Messrs Mool Chand Hari Kishan for Rs. 63,000/-. Taking this money Mr. P.C. Jain on the same day i.e. 14-1-1960 left for Muzaffarnagar in company of some persons to retire the following bills drawn by M/s. Gupta Iron Industries :Naya Bazar LBC 3 drawn on Puran Chand .... Rs. 5,100/-Naya Bazar LBC 5 drawn on Hiralal Shyam...... Rs. 4,950/-
(i) that on 14-1-1960, a sum of 30,400 was paid to the respondent by the Assistant Cashier Nand Kishore out of the amount payable on a cheque drawn by M/s. Mool Chand Hari Kishan for Rs. 63.000; '
(ii) that the respondent left the same day for Muzaffarnagar;
(iii) that he left for Muzaffarnagar in company of some persons to retire the bills drawn by M/s. Gupta Iron Industries;
(iv) that these bills of M/s. Gupta Iron Industries had been drawn on bogus firms;

However, we find that, on the other ingredients of the first charge, the Tribunal was justified in arriving at the conclusion that the findings recorded by the Enquiry Officer Were perverse. The Tribunal gave the reason that these findings were based on hearsay evidence. This view taken by the Tribunal appears to be fully justified. The first and the third elements of the charge relating to payment of the sum of Rs. 30.400 to the respondent by Nand Kishore, and of the respondent leaving for Muzaffarnagar in the company of some persons in order to retire the bills drawn by M/s. Gupta Iron Industries, were sought to be proved before the Enquiry Officer by the evidence of the Internal Auditor, N. N. Vazifdar, but the latter could not give any direct evidence. as he was not present at the time when money was paid to the resplendent or when the respondent left for Muzaffarnagar. He purported to prove these elements of the charge by deposing that a statement was made to him by Nand Kishore to the effect that Nand Kishore had paid Rs. 30,400 to the respondent and that, thereafter, the respondent left for Muzaffarnagar in the company of two persons. The Enquiry Officer accepted this evidence of Vazifdar, but, ignored the. fact that Vazifdar's evidence was not direct evidence in respect of the elements of the charge sought to be proved, and that Vazifdar was only trying to prove a previous statement of Nand Kishore which, as rightly held by the Tribunal, would amount to hearsay evidence. Nand Kishore himself was also examined as a witness, but, in his evidence, which was admissible as substantive evidence, he made no statement that this sum of Rs. 30,400 was paid by him to the respondent or that the respondent left for Muzaffarnagar in the' company of some persons to retire the bills drawn by M/s. Gupta Iron Industries. In fact. Nand Kishore even went further and denied that he had made any statement to Vazifdar as stated by Vazifdar. The Enquiry Officer was, of course, entitled to form his own opinion and to believe Vazifdar in preference to Nand Kishore; but, on this basis, the only finding that the domestic tribunal could record was that Nand Kishore's statement given before him was incorrect and that Nand Kishore had made statements to Vazifdar as deposed by Vazifdar. Those statements made by Nand Kishore to Vazifdar could not, however, become substantive evidence to prove the correctness of these elements forming part of the charge. It is in this connection that importance attaches to the views expressed by this Court in the cases cited above, where it was pointed out that a finding of a domestic tribunal may be perverse if it is not supported by any legal evidence. It is true that, in numerous cases, it has been held that domestic tribunals, like an Enquiry Officer, are not bound by the technical rules about evidence contained in the Indian Evidence Act; but it has nowhere been laid down that even substantive rules, which would form part of principles of natural justice, also can be ignored by the domestic tribunals. The principle that a fact sought to be proved must be supported by statements made in the presence of the person against whom the enquiry is held and that statements made behind the back of the person charged are not to be treated as substantive evidence, is one of the basic principles which cannot be ignored on the mere ground that domestic tribunals are not bound by the technical rules of procedure contained in the Evidence Act. In fact, learned counsel for the appellant Bank was unable to point out any case at all where it may have been held by this Court or by any other Court that a domestic tribunal will be justified in recording its findings on the basis of hearsay evidence without having any direct or circumstantial evidence in support of those findings.

These views expressed by this Court, in our opinion, bring out what was meant when this Court held that findings recorded by an Enquiry Officer must be supported by legal evidence. The evidence, as indicated in these cases, should consist of statements made in the presence of the workman charged. An exception was envisaged where the previous statement could be used after giving copies of that statement well in advance to the workman charged, but with the further qualification that previous statement must be affirmed as truthful in a general way when. the witness is actually examined in the.presence of the workman. Applying this principle to the present case, it is clear that the previous statement made by Nand Kishore to Vazifdar could not be taken as substantive evidence against the respondent, because Nand Kishore did not affirm the truth of that statement when he appeared as a witness and, on the other hand, denied having made that statement altogether. Even though his denial may be false, that fact would not convert his previous statement/into substantive evidence to prove the charge against the respondent when that statement was given to Vazifdar in the absence of the respondent and its truth is not affirmed 'by him at the time of his examination by the Enquiry Officer. This statement of Nand Kishore made to Vazifdar being ignored, it is clear that no other material was available to the Enquiry Officer on the basis of which he could have held that the sum of Rs. 30,400 was paid to the respondent by Nand Kishore and that Nand Kishore, there.after left for Muzaffarnagar in the company of some persons with that money.