Calcutta High Court
Pranab Kumar Roy vs Punjab National Bank on 31 March, 2026
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IN THE HIGH COURT AT CALCUTTA
CONSTITUTIONAL WRIT JURISDICTION
ORIGINAL SIDE
Present:
The Hon'ble Justice Ananya Bandyopadhyay
WPO No. 59 of 2017
Pranab Kumar Roy
-Vs-
Punjab National Bank
(Formerly Known As United Bank Of India) And Ors.
For the Petitioner : Mr. Debrup Bhattacharjee
Mr. S. S. Biswas
Mr. Siddharth Singh
For the Respondent-Bank : Mr. R. N. Majumder
Mr. S. M. Obaidullah
Judgment on : 31.03.2026
Ananya Bandyopadhyay, J.:-
1. The instant writ petition has been filed by the petitioner against the
purported Order of the Executive Director and Disciplinary Authority
dated November 25, 2014 bearing Ref. No.PD/DIR/10/1616
(C)/5117/2014 in respect of the Disciplinary Proceeding initiated against
him by the respondent-Bank by way of Letter of Charge bearing Ref.
No.HO/PD/DIR/1616 (C)/7712/2011 dated 29.10.2011 along with
Addendum No.HO/PD/DIR/1616 (C)/938/2013 dated 28.05.2013 and
No.PD/DIR/09/1616(C)/3188/2013 dated 17.10.2013 and the Order of
the Appellate Authority dated April 06, 2016 upholding the order and
punishment imposed by the Disciplinary Authority vide Order dated
November 25, 2014.
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2. The respondent no.1 comprised one of 14 major banks to be nationalized
on July 19, 1969. On and from 1st April, 2020, the United Bank of India
merged with the respondent no.1 bank. The respondent no.2 and 3 were
the officers of the respondent no.1. The respondents no.1 to 3 formed the
State within the meaning of Article 12 of the Constitution of India.
3. The petitioner, the erstwhile employee of respondent no.1 Bank, was
appointed in service of the United Bank of India prior to its merging on
March 05, 1974 as Direct Officer and held the post of General Manager on
the date of his superannuation on 31.10.2011. His entire tenure of 37
years of employment was unsullied devoid of allegation except the present
one being mala fide and baseless without any proof thereof.
4. On 29.10.2011, i.e., two days prior to his date of superannuation, the
petitioner was served with a purported charge-sheet bearing Ref.
No.HO/OD/DIR/1616 (C)/7712/2011 dated 29.10.2011. In the said
charge-sheet, it was alleged that the petitioner had committed certain
irregularities while sanctioning the loan amounts to companies and had
purportedly violated the said Bank’s Lending Policy dated 06.05.2009 in
the process consequently failing to protect the interest of the said Bank,
in contravention of Regulation 3(1) and 3(3) of the United Bank of India
Officer Employees’ (Discipline and Appeal) Regulations, 1976 amounting
misconduct under Regulation 24 of the said Regulations. Thereafter
further charges were added to the said charge-sheet by way of Addendum
No.PD/DIR/06/1616(C)/938/2013 dated 28.05.2013.
5. It was pertinent to state that the actions of the petitioner with regard to
which the purported disciplinary action had been initiated against him
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were all in pursuance of discharging of official duties by the petitioner.
The same were bona fide actions based on professional expertise of the
petitioner and were also approved by his seniors.
6. The petitioner, through a letter dated 31st October, 2011 and letter dated
June 06, 2013 addressed to the Chairman and Managing Director, United
Bank of India, communicated his preliminary objections against the
charges levelled against him.
7. On 31st October, 2011, the petitioner received a letter from the Executive
Director of the respondent no.1 the then United Bank of India (now
known as Punjab National Bank) which stated the Disciplinary Proceeding
initiated against him in view of the abovementioned charge-sheet dated
29.10.2011 would continue after his superannuation. It was further
stated he would not receive any pay and/or allowances after the date of
cessation of his service and also would not be entitled to his retirement
benefits till the final disposal of the disciplinary proceeding initiated
against him.
8. Upon receipt of such reply from the petitioner, the Disciplinary Authority,
vide its letter dated 14.08.2013, informed the petitioner that the
Disciplinary Authority had decided to hold an enquiry into the allegations
against the petitioner and accordingly one Naresh Kumar Kapoor, General
Manager (RBD, Marketing & ADC) United Bank of India as Enquiry Officer
and one Anil Kumar Sinha, General Manager (IT) United Bank of India
were appointed.
9. The petitioner stated upon appointment of said Enquiry Officer and the
Present Officer to hold an enquiry against the petitioner in respect of the
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aforesaid charges, a further addition to the charge-sheet was made by
virtue of Addendum No.PD/DIR/09/1616 (C)/3188/2013 dated
17.10.2013. The petitioner, vide his letter dated October 28, 2013 replied
to the aforesaid charge-sheet thereby denying all the allegations levelled
against him.
10. The petitioner stated in the meantime, the petitioner sent one
representation dated May 17th, 2013 addressed to the Chairman and
Managing Director of the erstwhile United Bank of India (now Punjab
National Bank) being the respondent no.1 Bank agitating therein his
grievances against the Bank and specifying the allegations in the charge-
sheet related to loan accounts which were sanctioned one to two years
prior to his retirement and raised question towards the delay in framing
the said charges. Moreover, it was indicated the charge-sheet had not
raised any mala fide intentions on part of the petitioner, however, flagged
out certain technical errors.
11. Irrespectively the enquiry proceeding commenced against the petitioner
and the said Presenting Officer submitted his report dated April 04, 2014
and the petitioner correspondingly submitted his defence arguments
before the Enquiry Officer. Upon completion of the said enquiry
proceeding, the Enquiry Officer submitted his report before the
Disciplinary Authority on June 04, 2014 and subsequent thereto on June
30, 2014 the petitioner submitted his written submissions before the
Disciplinary Authority. During continuance of the enquiry proceedings,
the petitioner requested the Bank to provide certain documents but in
vain.
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12. Thereafter the Disciplinary pronounced its order vide communication
dated November 25, 2014 bearing Ref. No.PD/DIR/10/1616
(C)/5117/2014, thereby holding the petitioner indulged in reckless
financing out of public money thus exposing the Bank to a huge loss and
imposed the harshest major penalty, i.e., dismissal which should
ordinarily be a disqualification for future employment as per Clause 4(j) of
the United Bank of India Officer Employees’ (Discipline and Appeal)
Regulations 1976 and further holding that the petitioner would not be
entitled to any terminal benefits other than the provisional pension
already paid to him and his contribution to the Provident Fund. As per
the said order he would not be entitled to the following terminal benefits:-
i. Pension/communication of pension in terms of Regulation 22
read with Regulation 46 of United Bank of India (Employees’)
Pension Regulation, 1995.
ii. Gratuity in terms of Regulation 46(1)(e) of United Bank of India
Officers’ Service Regulations, 1979.
iii. Encashment of accrued leave as on notional date of
superannuation in terms of Regulation 38 of United Bank of
India Officers’ Service Regulations, 1979.
13. The petitioner, being aggrieved by the punishment imposed upon him,
preferred an appeal before the Appellate Authority on 05th January, 2015
against the findings of the Disciplinary Authority. The Appellate Authority
delivered its order on 06th April, 2016 prejudically eliciting non-
application of mind.
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14. The Order of the Appellate Authority dated 6th April, 2016 resonated the
Order of the Disciplinary Authority and the Report of the Enquiry Officer
without appreciating the valid opposition and concomitant explanation
by the petitioner in his petition, upheld the punishment pronounced by
the same.
15. The finding against the petitioner did not explicit his mala fide intention.
Neither the Report of the Enquiry Officer or the Order of the Disciplinary
Authority nor the Order of the Appellate Authority delineated any mala
fide intention of the petitioner of making any wrongful gain or for causing
loss to the respondent no. 1 Bank. The charges against the petitioner
would only define irregularities by the petitioner while sanctioning the
said loan accounts.
16. Without the proof of any mala fide on part of the petitioner, it was
arbitrary on the part of the Disciplinary Authority as well as the Appellate
Authority to impose the harshest punishment upon the petitioner.
17. The facts which the Disciplinary Authority and the Appellate Authority
failed to appreciate were enumerated hereunder:-
i. With regard to Charge 1.1 – The Disciplinary authority failed to
appreciate that TEV Report was to be considered only for large
infrastructure project and the said project did not qualify as one.
ii. With regard to Charge 1.2 – The Disciplinary Authority failed to
appreciate that in the Lending Policy relevant at the time of
sanctioning of the said loan, it was laid down that the assessment
might be done on the basis of cash budget system and only in the
subsequent year was the word “may” replaced by the word “should”,
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the Disciplinary Authority failed to appreciate the said assessmentwas made as per the Lending Policy of the respondent no.1 Bank in
existence at the time of assessment.
iii. With regard to Charge 1.4 – The Disciplinary Authority did not take
into account the fact that the Senior Manager and with regard to
Charge 1.1 and 1.2. Manager of R.O. along with the Senior Manager
of the branch made a joint inspection.
iv. With regard to Charges 2.1 and 2.2, the same as that had been
stated with regard to Charge 1.1 and 1.2.
v. With regard to Charge 3.1 – The Disciplinary Authority made an
observation “It is a matter of common prudence that ACR is calculated
on the basis of actual assets”. The Appellate Authority upheld such
reasoning of the Disciplinary Authority. It was pertinent to mention
that that such view of the Disciplinary Authority was based on its
person ideas and not on the basis of evidence and depositions.
vi. With regard to Charge 3.3 – It was observed by the Disciplinary
Authority in paragraph 7 of the report that the petitioner’s
statements were lies. This only portrayed the personal bias of the
Disciplinary Authority against the petitioner.
vii. With regard to Charge 3.4 – The Disciplinary Authority failed to
appreciate the installments were paid, interest was serviced and
account was not a stressed one. Further, the Disciplinary Authority
observed the petitioner should have gone to the sources to verify the
actual conduct of the account. The last part being the personal
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observation of the Disciplinary Authority was not based upon anyevidence.
viii. With regard to Charge 4.1 – The plea of the Disciplinary Authority
that there is no documentary evidence to prove that processing
official had verified the information offered by the prospective
borrower company was against the rules and spirit of the
Disciplinary Proceeding as “burden of proof” led on the Presenting
Officer and not upon the C.S.O. (petitioner herein).
ix. With regard to Charge 4.2 – The plea of the petitioner that the net
cash generation of the company which was evident from the balance-
sheet analysis had increased sharply in the three consecutive years.
x. With regard to Charge 5.1 – The argument put forward in case of
charge 1.1 was applicable.
xi. With regard to Charges 5.3 and 5.4 – It was submitted that both the
Disciplinary Authority and the Appellate Authority failed to
appreciate that there was a stipulated condition in terms of sanction
that a Chartered Accountant’s certificate was necessary for
utilization of funds and the Chartered Accountant in case of
necessity might employ some other competent agency to know the
technicalities.
xii. With regard to Charge 5.5 – The Disciplinary Authority’s observation
that non-availability of the inspection report as on a later date did
not mean the property was not inspected and was based on a wrong
premise as it had been admitted by both the Enquiry Officer and the
Disciplinary Authority that inspection was conducted by the
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Assistant General Manager, Bangaluru Cantonment Branch on11.08.2009. The Appellate Authority also failed to apply its mind and
appreciate the arguments put forward in this regard on behalf of the
petitioner.
xiii. With regard to Charge 6.1 – The Disciplinary Authority and the
Appellate Authority failed to appreciate the same argument as put
forward with regard to Charge 1.1.
xiv. With regard to Charge 6.2 – The Disciplinary Authority and the
Appellate Authority failed to take into consideration that ME 30
would not be applicable in that regard as there was no element of
advance remittance.
xv. With regard to charges 6.3 and 6.4 – The Disciplinary Authority and
the Appellate Authority failed to take into consideration that the
C.S.O (the petitioner herein) made it clear that utilization of funds
would have to be certified by a C.A firm.
xvi. With regard to Charge 6.5 – The Disciplinary Authority and the
Appellate Authority failed to take into consideration that the Valuer
who had been appointed had been doing the work for the Bank for a
very long time and thus the petitioner in good faith entrusted him
and also in case of allegations over valuation, the said Valuer was to
be made accountable and the C.S.O.
xvii. With regard to Charge 6.6 – It was further stated the C.S.O
(petitioner) could not be made liable for the different valuations made
by different Valuers.
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xviii. With regard to Charge 7.1 – It was stated the Disciplinary Authority
and the Appellate Authority failed to appreciate the same argument
as put forward with regard to Charge 1.1.
xix. With regard to Charge 7.2 – The petitioner pointed out the inherent
contradictions of the Enquiry Officer’s findings before the
Disciplinary Authority. Neither did the Disciplinary Authority’s
Report nor the Appellate Authority’s Order touched upon the same
and reiterated what was stated by the Enquiry Officer.
xx. With regard to Charge 7.3 – The Enquiry Officer, Disciplinary
Authority as well as the Appellate Authority failed to appreciate the
defence put forward by the petitioner that ME no.30 did not have any
relevance with regard to the same as payment to vendor was made
upon receipt and installation of software by the purchaser.
xxi. With regard to Charges 7.4 and 7.5 – The Disciplinary Authority
failed to appreciate that the petitioner while acting C.S.O included a
term in the sanction that certification of Chartered Accountant was a
must for further disbursement and also for ensuring utilization of
funds, the underlying principle being that the Chartered Accountant,
in case of necessity might take help of any expert agency.
xxii. The charge-sheets were framed in such a way that in between
Branch Manager and General Manager (petitioner) there was no any
other tier of signatories. The loan proposals were placed before the
petitioner after screening through different tiers. Apart from the
proposal being vetted by the Regional Level Credit Committee
comprising of Senior Manager (Advance), Senior Manager
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(Inspection), Senior Manager (Admn.) Chief Manager (Credit), the
proposal was processed by one Senior Officer and recommended by
the then AGM/DGM. In other words, before being placed to the desk
of the petitioner, the proposals were passed through the hands of
several Senior Level Officers having experience of 10-15 years in
handling credit proposals. It was mentioned that at Bank’s Head
Office, the loan proposals sanctioned by Bank’s Board, CMD, ED and
GM at HO were placed before them at the same way after being
screened by different tiers.
xxiii. With regard to Charges 1.1, 1.2, 2.1, 2.2, 3.1, both the Disciplinary
Authority and Appellate Authority did not give any cognizance to the
Discretionary Power noting system. After sanction of any loan
proposal by the Sanctioning Authority, the entire process note was
sent to the next Higher Authority for noting. In the instant case, the
proposal with entire process note was sent by the petitioner to the
Executive Director and noted the same (DE-4, 6, 9 & 15) without
raising any question on the alleged lapses and that noting carried the
certificate “We have scrutinized the said DP statement and found that
General Manager (Southern Region) (i.e petitioner) has considered
proposals within the Discretionary Power on Loans & Advance in
conformity with Bank’s Lending Policy as contained in dt.04 May-2009
and Circular No.O&M/DP/2/OM-050/09-10 CPPMI/ Lending
Policy/15/OM-57/2009 dated 06.05.2009”.
xxiv. As per Bank’s Circular no.CPPMI/ADV/398/O&M-0960/10 dated
30.03.2010, Staff Accountability report of all NPA accounts with
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outstanding balance above Rs.50 lacs were to be placed before the
Committee of General Managers and accordingly the report of three
accounts namely, AGS Infotel Ltd., Ignis Technology & Nexxoft Infotel
Ltd. were placed before the Committee of GMs on 20.10.2011 and the
examination of staff accountability by three General Managers
showed no lapses in respect of processing and sanction (DE-3) but
the Disciplinary Authority and Appellate Authority remained.
18. It was submitted that the Appellate Authority failed to apply its individual
mind while dealing with the said appeal and thereby only echoed what
had been stated in the report of the Disciplinary Authority.
19. Further, it was submitted that none of other Officers against whom
Disciplinary Proceedings were initiated in connection with the sanctioning
of the said loans had been given such harsh punishment as the
petitioner. The said Officers had been downgraded or made to take
voluntary retirement yet none of their retirement benefits had been
cancelled. Such treatment of the octogenarian petitioner only showed the
vindictive attitude of the respondent no.1 Bank towards the petitioner.
20. The Learned Advocate representing the petitioner submitted as follows:-
i. The Enquiry Report was prepared by unilateral consideration of the
case made out by the Presenting Officer without proper appreciation
of evidence being perverse and liable to be set aside.
ii. The actions of the petitioner with regard to which the purported
disciplinary action had been initiated were all in pursuance of
discharging of official duties by the petitioner. The same were bona
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fide actions based on professional expertise of the petitioner andwere also approved by the seniors of the petitioner.
iii. The said Order of the Appellate Authority resonated the Order of the
Disciplinary Authority and the Report of the Enquiry Officer. Without
appreciating the valid opposition put forward by the petitioner in his
petition, the Appellate Authority blindly supported the view of the
Disciplinary Authority and upheld the punishment pronounced by
the same.
iv. There had been no finding against the petitioner which showed any
mala fide intention on the part of the petitioner. Neither the Report of
the Enquiry Officer nor the Order of the Disciplinary Authority or the
Order of the Appellate Authority delineated any mala fide intention of
the petitioner of making any wrongful gain or for causing loss to the
respondent no.1 Bank. The charges brought against the petitioner
herein could at best be called irregularities by the petitioner while
sanctioning the said loan accounts.
v. Without the proof mala fide on the part of the petitioner, it was
arbitrary on the part of the Disciplinary Authority as well as the
Appellate Authority to impose the harshest punishment upon the
petitioner.
vi. None of other Officers against whom Disciplinary Proceedings were
initiated in connection with the sanctioning of the said loans had
been given such harsh punishment as the petitioner. The said
Officers had been downgraded or made to take voluntary retirement
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yet none of their retirement benefits had been cancelled as opposedto the punishment meted out to the petitioner.
vii. The punishment awarded to the petitioner was harsh and the same
had no nexus to the irregularities, if any, committed by the petitioner
and the writ petition must be allowed.
21. The Learned Advocate representing the respondents submitted as
follows:-
i. The charge-sheet bearing No.HO/OD/DIR/1616 (C)/7712/2011
dated 29.10.2011 was issued against the petitioner for
irregularities committed by the petitioner in M/s. Ignis
Technology Solutions Pvt. Ltd. and M/s. AGS Infotech Ltd.
Thereafter Addendum charge-sheet No.PD/DIR/06/1616
(C)/938/2013 dated 28.05.2013 was issued against the
petitioner for irregularities committed by him in loan accounts
M/s. Capture Systems Pvt. Ltd. and M/s. Nexxoft Infotel Ltd.
and another Addendum charge-sheet bearing
No.PD/DIR/09/1616 (C)/3188/2013 dated 17.10.2013 was
issued against the petitioner for irregularities committed by him
in loan accounts, M/s. Binary Spectrum Softech Pvt. Ltd., M/s.
Acropetal Technologies Ltd. and M/s. Kinfotech Technologies
Ltd. The bank has been exposed to financial loss of Rs.123.56
crore.
ii. The loan accounts, M/s Ignis Technology Solution (P) Ltd
sanctioned for Rs. 30 Crore on 08/04/2010 became NPA on
30/06/2011, M/s AGS Infotech Ltd sanctioned for Rs.23.73
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Crore on 08/12/2009 became NPA on 02/08/2011, M/s
Capture Systems Pvt Ltd sanctioned for Rs. 20 Crore on
19/03/2010 became NPA on 31/12/2010, M/s Nexxoft Infortel
Ltd sanctioned for Rs. 16 Crore on 26/08/2009 became NPA on
30/06/2011, M/s Binary Spectrum Softech (P) Ltd sanctioned
for 16 Crore on 20/10/2009 became NPA on 31/03/2012, M/s
Acropetal Technologies Ltd sanctioned for 20 Crores became
NPA on 30/09/2012 and M/s Kinfotech Technologies Limited
sanctioned for Rs. 30 Crore on 28/10/2009 became NPA on
31/12/2011. It would be evident from the above facts that all
the loans were sanctioned almost I (one) year prior to the
retirement of the petitioner and all the accounts turned NPA
within 2 years from the date of sanction. Natually, the
irregularities in the said loan accounts had surfaced only when
the petitioner was at the verge of his retirement.
iii. Subsequent to identification of irregularities committed by the
petitioner, the bank had issued charge sheet against the
petitioner on 29/10/2011 i.e. two days prior to the date of his
superannuation date and since the disciplinary proceedings
initiated against the petitioner was pending as on 31/10/2011,
the bank had invoked Regulation 20 (3)(iii) of the United Bank of
India (Officers) Service regulations, 1979. It is humbly
submitted that the Regulation 20 (3) (iii) of the UBI (Officers)
Service Regulations, 1979 permits the Bank to continue
disciplinary proceedings even after retirement of an officer
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employee if the proceedings was initiated prior to his retirement
and for such proceedings the employee is deemed to be in
service for the purpose of continuance and conclusion of the
proceedings. It is submitted that the charge sheet in the instant
case was served upon the petitioner prior to his retirement and
the proceedings were conducted and concluded as per
procedure detailed in the UBI Officer Employees’ (Discipline &
Appeal) Regulations, 1979.
iv. There was nothing on records to suggest that the findings of the
enquiry officer were perverse. In this connection reliance had
been placed on a decision of the Hon’ble Supreme Court
reported (2003) 3 SCC 583 (Lalit Popli-Vs- Canara Bank) held as
follows:-
“17. While exercising jurisdiction under Article 226 of the
Constitution the High Court does not act as an appellate
authority. Its jurisdiction is circumscribed by limits of judicial
review to correct errors of law or procedural errors leading to
manifest injustice or violation of principles of natural justice.
Judicial review is not akin to adjudication of the case on merits
of an appellate authority.
18. In B.C. Chaturvedi v. Union of India the scope of judicial
review was indicated by stating that review by the court is of
decision making process and where the findings of the
disciplinary authority are based on some evidence, the court or
the tribunal cannot reappreciate the evidence and substitute its
own finding.”
v. Reliance was also placed in this regard on a decision of the
Hon’ble Supreme Court reported in (2003) 9 SCC 191 (Sub-
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Divisional Officer, Konch -Vs- Maharaj Singh). The relevant
portion of the said decision replicated below:-
“5. In view of the submissions made at the Bar, we have
scrutinized the impugned order of the High Court. A bare
perusal of the same makes it crystal clear that the High Court
in exercise of its jurisdiction under Article 226 has
reappreciated the entire evidence, gone into the question of
burden of proof and onus of proof and ultimately did not agree
with the conclusion arrived at by the enquiring officer, which
conclusion was upheld by the disciplinary authority as well as
the U.P. Public Service Tribunal. It has been stated by this
Court on a number of occasions that the jurisdiction of the High
Court under Article 226 is a supervisory one and not an
appellate one, and as such the Court would not be justified in
reappreciating the evidence adduced in a disciplinary
proceeding to alter the findings of the enquiring authority. In
the aforesaid premises, we have no hesitation to come to the
conclusion that the High Court exceeded its jurisdiction under
Article 226 in interfering with the findings arrived at by the
enquiring authority by re-appreciation of the evidence adduced
before the said enquiring authority. We, therefore, set aside the
impugned order of the High Court and the writ petition filed
stands dismissed. This appeal is allowed.” (Emphasis added).vi. On the question of integrity and honesty of a Bank
officer/employee, the Hon’ble Supreme Court in a decision
reported in 1997 II LLJ 26 (Tara Chand Vyas -Vs- Chairman and
Disciplinary Authority & Ors.) inter alia held as follows:-
“The employees and officers working in the banks are not
merely the trustees of the society, but also bear responsibility
and owe duty to the society for effectuation of socio-economic
empowerment. Their acts and conduct should be in discharge
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of that constitutional objectives and if they derelict in the
performance of their duty, it impinges upon the enforcement of
the constitutional philosophy, objective and the goals under the
rule of law. Corruption has taken deep roots among the
sections of the society and the employees holding public office
or responsibility equally became amenable to corrupt conduct in
the discharge of their official duty for illegal gratification. The
banking business and services are also vitally affected by
catastrophic corruption. The disciplinary measure should,
therefore, aim to eradicate the corrupt proclivity of conduct on
the part of the employees/officers in the public offices including
those in banks. It would, therefore, be necessary to consider,
from this perspective, the need for disciplinary actions to
eradicate corruption to properly channelise the use of the public
funds, the live wire for effectuation of socio-economic justice in
order to achieve the constitutional goals set down in the
Preamble and to see that the corrupt conduct of the officers
does not degenerate the efficiency of service leading to
denationalization of the banking system. What is more, the
Nationalisation of the banking service was done in the public
interest. Every employee/officer in the bank should strive to
see that banking operations or services are rendered in the
best interest of the system and the society so as to effectuate
the object of Nationalisation. Any conduct that damages,
destroys, defeats or tends to defeat the said purposes
resultantly defeats or tends to defeat the constitutional
objectives which can be meted out with disciplinary action in
accordance with rules lest rectitude in public service is lost and
service becomes a means and source of unjust enrichment at
the cost of the society”. (Emphasis added.)
5. The charges that have been proved in the enquiry were gross
misconduct and the punishment of removal of the petitioner
was fully justified. The petitioner has contended in ground No.3
inter alia as follows:-
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“It cannot be expected from the petitioner to prove anything
which is not actual but presumptive, likelihood and mere
possibilities.”
vii. In this connection to counteract the said contention reliance is
placed on the decision of the Hon’ble Supreme Court reported in
(1999) 4 SCC 759 (State Bank of India & Ors.-Vs- T. J. Paul) in
which it was inter alia as follows:-
“15. Taking up the definition of “gross misconduct” in para
22(iv), it is obvious that clause 9h) does not apply because the
charge is not one of insubordination or disobedience of specific
orders of any superior officer. Coming to clause (I) of para 22
(iv), the doing of any act prejudicial to the interests of the Bank,
or gross negligence or negligence involving or likely to involve
the Bank in serious loss is gross misconduct. In other words
likelihood of serious loss coupled with negligence is sufficient to
bring the case within gross misconduct. The enquiry officer’s
finding of “gross misconduct” on the ground of not obtaining
adequate security is, therefore, correct and cannot be said to be
based on no evidence as held by the High Court. This can be
contrasted with para 22(vi) (c) under minor misconduct which
deals with “neglect of work and negligence in performing of
duties”.
16. The contention of the learned Senior Counsel for the
respondent ignores the fact that “gross negligence or negligence
likely to involve the Bank in serious loss” would come under
major misconduct within para 22(iv) (1). As stated above, even
assuming that there is not gross negligence, simple negligence
will come under major misconduct if accompanied by
“likelihood” of serious loss and this is clear from para 22(iv) (1).
Hence the finding of the enquiry officer regarding gross
misconduct is correct and could not have been set aside by the
High Court. The findings of the enquiry officer clearly bring the
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case under “major misconduct”. As held in Disciplinary
authority-cum-Regional Manager v. Nikunja Bihari Patnaik
proof of loss is not necessary.” (Emphasis added.)
viii. The Hon’ble Supreme Court in a decision reported in 1996 SCC
(L & S) 1194 (Disciplinary authority-cum-Regional Manager v.
Nikunja Bihari Patnaik) inter alia held as follows:-
“It may be mentioned that in the memorandum of charges, the
aforesaid two regulations are said to have been violated by the
respondent. Regulation 3 requires every officer/employee of the
bank to take all possible steps to protect the interests of the
bank and to discharge his duties with utmost integrity,
honesty, devotion and diligence and to do nothing which is
unbecoming of a bank officer. It requires the bank
officer/employee to maintain good conduct and discipline and
to act to the best of his judgment in performance of his official
duties or in exercise of the powers conferred upon him. Breach
of Regulation 3 is ‘misconduct’ within the meaning of
Regulation 24. The findings of the Inquiry Officer which have
been accepted by the disciplinary authority, and which have
not been disturbed by the High Court, clearly show that in a
number of instances the respondents allowed overdrafts or
passed cheques involving substantial amounts beyond his
authority. True, it is that in some cases, no loss has resulted
from such acts. It is also true that in some other instances such
acts have yielded profit to the bank but it is equally true that in
some other instances the funds of the bank have been placed
in jeopardy; the advances have become sticky and
irrecoverable. It is not a single act; it is a course of action
spreading over a sufficiently long period and involving a large
number of transactions. In the case of a bank for that matter, in
the every case of any other organisation officer/employee is
supposed to act within the limits of his authority. If each officer
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/employee is allowed to act beyond his authority, the discipline
of the organisation/bank will disappear; the functioning of the
bank would become chaotic and unmanageable. Each officer of
the bank cannot be allowed to carve out his own little empire
wherein he dispenses favours and largesse. No organisation,
more particularly, a bank can function properly and effectively
if its officers and employees do not observe the prescribed
norms and discipline. Such indiscipline cannot be condoned on
the specious ground that it was not actuated by ulterior
motives or by extraneous considerations. The very act of acting
beyond authority that too a course of conduct spread over a
sufficiently long period and involving innumerable instances is
by itself a misconduct. Such acts, if permitted, may bring in
profit in some cases but they may also lead to huge losses.
Such adventures are not given to the employees of banks
which deal with public funds. If what we hear about the
reasons for the collapse of Barings Bank is true, it is
attributable to the acts of one of its employees, Nick Leeson, a
minor officer stationed at Singapore, who was allowed by his
superiors to act far beyond his authority. As mentioned
hereinbefore, the very discipline of an organisation `and more
particularly, a bank is dependant upon each of its employees
and officers acting and operating within their allotted sphere.
Acting beyond one’s authority is by itself a breach of discipline
and a breach of Regulation 24. No further proof of loss is really
necessary though as a matter of fact, in this case there are
findings that several advances and overdrawals allowed by
the respondent beyond his authority have become sticky and
irrecoverable.” (Emphasis added.)ix. In this connection reliance was also placed on a decision of the
Hon’ble Supreme Court reported in (1998) 4 SCC 310 (Union
22
Bank of India-Vs- Vishwa Mohan). The relevant partition of thesaid decision stated as below:-
“12. After hearing the rival contentions, we are of the firm view
that all the four charges which were inquired into relate to
serious misconduct. The respondent was unable to
demonstrate before us how prejudice was caused to him due to
non-supply of the Inquiry Authority’s report/findings in the
present case. It needs to emphasised that in the banking
business absolute devotion, diligence, integrity and honesty is
to be preserved by every bank employee in particular the bank
officer. If this is not observed, the confidence of the
public/depositors would be impaired. It is for this reason; we
are of the opinion that the High Court had committed an error
while setting aside the order of dismissal of the respondent on
the ground of prejudice on account of non-furnishing of the
Inquiry report/findings to him.” (Emphasis added.)x. On the question of proportionality of the punishment reliance is
placed on a decision of the Hon’ble Supreme Court reported in
(2009) 13 SCC 272 (Government of Andhra Pradesh and Others –
vs-P. Chandra Mouli and Another). The relevant portion of the
said decision is reproduced below:
“14. It is trite that the power of punishment to an employee is
within the discretion of the employer and ordinarily the courts
do not interfere, unless it is found that either the enquiry
proceedings or punishment is vitiated because of non-
observance of the relevant rules and regulations or principles of
natural justice or denial of reasonable opportunity to defend
etc. or that the punishment is totally disproportionate to the
proved misconduct of an employee. All these principles have
23
been highlighted in Indian Oil Corporation -vs. Ashok Kumar
Arora and Lalit Popli -vs.- Canara Bank SCC pp. 77, 78.”
xi. It was submitted that conducts of the petitioner did not instill
confidence on the bank to retain him in the service of bank by
imposing any other lesser punishment. The charges that were
proved against the petitioner involve gross financial
irregularities which have exposed the bank to huge losses. In
this connection reliance is placed on a decision of the Hon’ble
Supreme Court reported in (2005) 3 SCC 254 (Divisional
Controller, KSRTC (NWKRTC)-vs.-A.T. Mane). The relevant portion
of the decision is stated below:-
“12. Coming punishment, one should bear in mind the fact that
it is not the amount of money misappropriated that becomes a
primary factor for awarding punishment; on the contrary, it is
the loss of confidence which is the primary factor to be taken
into consideration. In our opinion, when a person is found
guilty of misappropriating the corporation’s funds, there is
nothing in the corporation losing confidence or faith in such a
person and awarding a punishment of dismissal.
13. This Court in the case of B.S.Hullikatti held in a similar
circumstances that the act was either dishonest or was so
grossly negligent that the respondent therein was not fit to be
retained as a conductor. It also held that in such cases there is
no place for generosity or misplaced sympathy on the part of
the judicial forums and thereby interfere with the quantum of
punishment.”
xii. Finally it was submitted that in view of the proposition of law as
laid down by the Hon’ble Supreme Court in a decision reported
in (2003) 4 SCC 364 (Chairman and Managing Director, United
24
Commercial Bank & ors -vs- P.C. Kakkar) this Hon’ble Court may
be pleased not to interfere with the decision of the Disciplinary
Authority as there has been no error on the decision making
process. The relevant portion of the said decision is replicated
below:-
“11. The common thread running through in all these decisions
is that the Court should not interfere with administrator’s
decision unless it was illogical or suffers from procedural
impropriety or shocking to the conscience of the Court, in the
sense that it was in defiance of logic or moral standards. In
view of what has been stated in the Wednesburry’s case
(supra), that the Court would not go into the correctness of the
choice made by the administrator open to him and the Court
should not substitute its decision to that of the administrator.
The scope of judicial review is limited to the deficiency in
decision-making process and not the decision.”
xiii. As regards the claim for Payment of gratuity and other benefit it
is submitted that the petitioner is not entitled to any monetory
benefits and gratuity for the reasons as set forth in paragraph
19 of the Affidavit in opposition of the Respondents in paragraph
19 thereof wherein it has been stated the bank has been
exposed to fiancial loss of Rs.123.56 crore. The petitioner is not
entitled to any gratuty for the reasons as stated in Paragraph 19
of the Affidavit in opposition as also the stand taken by the
Respondent Bank in earlier writ petition being W.P.NO.416 OF
2013 as would be evident from the judgment and order dated
1st April, 2014 as stated in Annexure-R-1″ at page 27 thereof.
25
Regulation 46 of United Bank of India (Officers) Service
Regulations, 1979 (hereinafter referred to as the said
regulations) reads as follows:-
“(1) Every officer shall be eligible for gratuity on –
(a) Retirement
(b) Death
(c) Disablement rendering him unfit for further service as
certified by a medical officer approved by the Bank;
(d) Resignation after completing ten years of continuous service;
or
(e) Termination of service in any other way except by way of
punishment after completion of 10 years of service.”
xiv. Apart from the abovementioned two provisions and in that the
UBI has also issued circular No.PD/DISC/08/99 dated 20th
May, 1999 dealing with entitlement of terminal benefits of the
employees of UBI in case of termination by way of punishment it
has been specifically mentioned that in case of termination by
way of dismissal from the service the loss caused by the
delinquent officer shall be recovered from his gratuity as per the
provisions of the Payment of Gratuity Act, 1972.
xv. It was submitted that the provision of Regulation 46 (1) (e) of the
United Bank of India (Officers) Service Regulation, 1979, which
is a statutory rule framed in exercise of the powers conferred by
Section 19 read with sub-section (2) of Section 12 of the
Banking Companies (Acquisition of Transfer of Undertakings)
Act, 1970 (hereinafter referred to as the Transfer of
Undertakings Act) being a special law has an overriding effect on
the provisions of Payment of Gratuity Act, 1972 following the
26
principle of Generalia Specialibus non derogant. In this
connection reliance may be placed on a principle laid down by
the Hon’ble Supreme Court in a decision reported in (2010) (10)
SCC 338 (P.Rajan Sandhi -vs- Union of India & Ors), the
relevant portion whereof is replicated below:-
“11. It may be seen that there is a difference between the
provisions for denial of gratuity in the Payment of Gratuity Act
and in the Working Journalists Act. Under the Working
Journalists Act gratuity can be denied if the service is
terminated as a punishment inflicted by way of disciplinary
act, as has been done in the instant case. We are of the opinion
that Section 5 of the Working Journalists Act being a special
law will prevail over Section 4(6) of the Payment of Gratuity Act
which is a general law. Section 5 of the Working Journalists Act
is only for working journalists, whereas the Payment of
Gratuity Act is available to all employees who are covered by
that Act and is not limited to working journalists. Hence, the
Working Journalists Act is a special law, whereas the Payment
of Gratuity Act is a general law. It is well settled that special
law will prevail over the general law, vide G.P. Singh’s
‘Principles of Statutory Interpretation’, Ninth Edition, 2004 pp.
133, 134.
12. The special law, i.e., Section 5(1)(a)(i) of the Working
Journalists Act, does not require any allegation of proof of any
damage or loss to, or destruction of, property, etc. as is
required under the general law, i.e., the Payment of Gratuity
Act. All that is required under the Working Journalists Act is
that the termination should be as a punishment inflicted by
way of disciplinary action, which is the position in the case at
hand. Thus, if the service of an employee has been terminated
by way of disciplinary action under the Working Journalists
Act, he is not entitled to gratuity.” (Emphasis added)
27xvi. In this connection reference may also be made of the decision of
the Hon’ble Supreme Court in a decision reported in (2007) 9
SCC 15 (Ramesh Chandra Sharma -vs-Punjab National Bank &
Another) about the effect of the Punjab National Bank (Officers)
Service Regulation, 1979 framed by the Board of Directors of
Punjab National Bank in consultation with Reserve Bank of
India in exercise of the power conferred under Sub-section (2) of
Section 19 of the read with Section 12 of the Banking
Companies (Acquisition and Transfer of Undertakings) Act,
1970. United Bank of India (Officers) Service Regulation, 1979 is
pari materia of Punjab National Bank (Officers) Service
Regulation, 1979 The relevant portion of the said decision is
replicated below:-
“17. We have noticed hereinbefore that the Bank have made
Regulations which are statutory in nature. Regulation 20(3)(iii)
of the said Regulations reads thus:-
“20 (3)(iii). The officer against whom disciplinary proceedings
have been initiated will cease to be in service on the date of
superannuation but the disciplinary proceedings will
continue as if he was in service until the proceedings are
concluded and final order is passed in respect thereof. The
concerned officer will not receive any pay and/or allowance
after the date of superannuation. He will also not be entitled
for the payment of retirement benefits till the proceedings are
completed and final order is passed thereon except his own
contribution to CPF.”
28
xvii. The said Regulation clearly envisages continuation of a
disciplinary proceeding despite the officer ceasing to be in
service on the date of superannuation. For the said purpose a
legal fiction has been created providing that the delinquent
officer would be deemed to be in service until the proceedings
are concluded and final order is passed thereon. The said
Regulation being statutory in nature should be given full effect.
xviii. The effect of a legal fiction is well-known. When a legal fiction is
created under a statute, it must be given its full effect, as has
been observed in East End Dwellings Co. Ltd. vs. Finsbury
Borough Council [1951 (2) All E.R. 587) as under:-
“If you are bidden to treat an imaginary state of affairs as real,
you must surely, unless prohibited from doing so, also imagine
as real the consequences and incidents which, if the putative
state of affairs had in fact existed, must inevitably have from
accompanied it. One of these in this case is emancipation from
the 1939 level of rents. The statute says that you must imagine
a certain state of affairs; it does not say that having done so,
you must cause or permit your imagination to boggle when it
comes to the inevitable corollaries of that state of affairs.”
19. The issue is, thus, no longer res integra, which as would be
evident from the ratio laid down by this Court from time to
time.” (Emphasis added)
xix. It was submitted that in the instant case obviously a legal fiction
has been created i.e. whether provision of Payment of Gratuity
Act would apply or the Provisions of United Bank of India
(Officer’s) Service Regulations, 1979 shall apply.
29
xx. In the light of the decision of the Hon’ble Supreme Court in
PNB’s case (Supra) as well as the principle laid down by the
Hon’ble Supreme Court in P.Rajan Sandhi case (Supra) in my
opinion since “THE UNITED BANK OF INDIA (OFFICERS’)
SERVICE REGULATIONS, 1979” is a statutory regulation, and
accordingly by reason of termination of service of the
Respondent/Applicant he is not entitled to receive the gratuity
in terms of Regulation 46(1) (e) thereof.
xxi. Leaving aside the aforesaid the petitioner is not entitled to any
gratuity under the provisions of the Payment of Gratuity Act,
1972 by reason of the Bank being exposed to heavy financial
loss as discussed hereinbefore.
xxii. In the lights of the aforesaid decisions the ratio of which aptly
applies in the instant case, it is submitted that the writ petition
should be dismissed
22. Upon a comprehensive and sequential assimilation of the pleadings,
documents, memoranda and communications as disclosed across the
entirety of the writ petition, the factual conspectus, arranged in its
chronological and thematic continuity, unfolds thus:
The writ petition is directed against the order dated 25th
November, 2014, issued by the Executive Director acting as
Disciplinary Authority, bearing reference No. PD/DIR/10/1616
(C)/5117/2014, arising out of disciplinary proceedings initiated
against the petitioner. The appellate affirmation thereof,
30
rendered by order dated 06th April, 2016, also standsimpugned.
23. The disciplinary action originates in the issuance of a charge
memorandum bearing No. HO/PD/DIR/1616 (C)/7712/2011 dated
29.10.2011, which was subsequently supplemented by:
i. Addendum No. HO/PD/DIR/1616 (C)/938/2013 dated
28.05.2013, and
ii. Further Addendum No. PD/DIR/09/1616 (C)/3188/2013 dated
17.10.2013.
24. The respondent no. 1, a nationalised bank within the ambit of Article 12
of the Constitution, merged with United Bank of India with effect from 1st
April, 2020, while respondent nos. 2 and 3 functioned as officers under
the said establishment.
25. The petitioner entered service on 05th March, 1974 as a Direct Officer in
the United Bank of India and, upon an uninterrupted tenure of thirty-
seven years, superannuated on 31st October, 2011 while holding the
office of General Manager. The pleadings emphasise the absence of any
antecedent allegation during this prolonged period of service.
26. On 29th October, 2011, two days prior to superannuation, the petitioner
was served with the charge-sheet. The allegations therein pertained to
purported irregularities in sanctioning loan facilities to corporate entities,
allegedly in deviation from the Bank’s Lending Policy dated 06th May,
2009, and constituting misconduct under Regulation 3(1) and 3(3) read
with Regulation 24 of the United Bank of India Officer Employees’
(Discipline and Appeal) Regulations, 1976.
31
27. Immediately thereafter, the petitioner addressed communications dated
31st October, 2011 and 06th June, 2013 to the Chairman and Managing
Director, articulating preliminary objections. By a communication dated
31st October, 2011, the Executive Director intimated that disciplinary
proceedings would continue post-superannuation, with consequential
withholding of salary, allowances and retirement benefits pending final
adjudication.
28. The Disciplinary Authority, by letter dated 14th August, 2013, resolved to
conduct an enquiry, appointing:
i. Shri Naresh Kumar Kapoor, General Manager (RBD, Marketing
& ADC), as Enquiry Officer; and
ii. Shri Anil Kumar Sinha, General Manager (IT), as Presenting
Officer.
29. In the interregnum, the petitioner submitted a detailed representation
dated 17th May, 2013, wherein he adverted to the temporal delay in
initiation of proceedings, emphasised that the transactions in question
had been concluded one to two years prior to his retirement, and
characterised the alleged deviations as technical aberrations devoid of any
element of mala fide intent.
30. The enquiry proceedings culminated in the submission of the Enquiry
Report dated 04th April, 2014, which was formally placed before the
Disciplinary Authority on 04th June, 2014. Thereafter, the petitioner
submitted his written representations on 30th June, 2014. It is also set
forth that during the enquiry, the petitioner sought production of certain
documents, which, according to the pleadings, were not furnished.
32
31. By order dated 25th November, 2014, the Disciplinary Authority recorded
findings of reckless financial sanctioning and imposed the penalty of
dismissal from service, entailing disqualification from future employment.
The order further directed denial of terminal benefits, save for provisional
pension already disbursed and provident fund contributions, specifically
withholding:
i. Pension under Regulation 22 read with Regulation 46 of the
Pension Regulations, 1995;
ii. Gratuity under Regulation 46(1)(e) of the Officers’ Service
Regulations, 1979;
iii. Leave encashment under Regulation 38 of the said Regulations.
32. Aggrieved thereby, the petitioner preferred an appeal on 05th January,
2015, which came to be rejected by the Appellate Authority by order dated
06th April, 2016.
33. The petition thereafter delineates, with considerable granularity, the
facets which, according to the petitioner, eluded due consideration during
the disciplinary and appellate processes.
34. In relation to Charges 1.1, 1.2, 2.1, 2.2 and 3.1, it is recorded that no
cognizance was taken of the discretionary power noting system, under
which, upon sanction of a loan proposal, the entire process note was
required to be forwarded to the next higher authority for noting. The
pleadings advert to notings by superior authorities (DE-4, 6, 9 & 15),
which did not register any reservation and, on the contrary, certified that
the proposals had been scrutinised and found to be in consonance with
the Lending Policy dated 04th May, 2009 and Circular No.
33
O&M/DP/2/OM-050/09-10 CPPMI/Lending Policy/15/OM-57/2009
dated 06.05.2009.
35. With regard to Charge 1.1, emphasis is placed upon the applicability of
TEV Reports exclusively to large infrastructure projects. In Charge 1.2,
reference is made to the prevailing policy permitting assessment based on
the cash budget system. In Charge 1.4, it is recorded that joint
inspections had been undertaken by senior functionaries.
36. In respect of Charges 2.1 and 2.2, the submissions are reflective of those
advanced in relation to Charges 1.1 and 1.2. Under Charge 3.1, the
observation predicated upon “common prudence” in computing ACR on
actual assets is stated to be bereft of evidentiary underpinning. In Charge
3.3, the characterisation of the petitioner’s statements is noted, while
Charge 3.4 adverts to the fact that the loan accounts were regularly
serviced and did not assume the character of stressed assets.
37. With regard to Charge 4.1, the aspect of burden of proof resting upon the
Presenting Officer is emphasised, whereas Charge 4.2 refers to the
improved financial indicators of the borrower as discernible from balance-
sheet analysis.
38. In relation to Charges 5.1, 5.3 and 5.4, emphasis is placed upon the
stipulation requiring certification by Chartered Accountants as a
precondition for utilisation of funds, including the permissibility of
engaging competent agencies. Under Charge 5.5, inspection conducted on
11.08.2009 by the Assistant General Manager, Bengaluru Cantonment
Branch, is adverted to.
34
39. With respect to Charges 6.1 and 6.2, it is contended that the relevant
policy provisions, including ME-30, were inapplicable in the absence of
advance remittance. In Charges 6.3 and 6.4, the requirement of
certification by Chartered Accountant firms is reiterated. For Charge 6.5,
reliance is placed upon valuation conducted by an empanelled valuer,
while Charge 6.6 refers to variations in valuation by different valuers.
40. In relation to Charges 7.1 and 7.2, submissions analogous to earlier
charges are reiterated, including reference to inconsistencies in the
findings of the Enquiry Officer.
41. The subsequent pleadings further elucidate:
Under Charge 7.3, it is stated that ME-30 had no application, as
payments to vendors were contingent upon receipt and installation of
software. In respect of Charges 7.4 and 7.5, it is recorded that the
sanction conditions expressly mandated certification by Chartered
Accountants prior to further disbursement, thereby ensuring proper
utilisation of funds.
42. It is further delineated that the structuring of the charge-sheets did not
reflect the multi-tiered scrutiny through which loan proposals were
processed. The pleadings describe that proposals were examined at
various levels, including the Regional Level Credit Committee comprising
Senior Managers (Advance, Inspection, Administration) and Chief
Manager (Credit), thereafter processed by a Senior Officer and
recommended by the AGM/DGM before being placed before the petitioner.
A similar hierarchical process is stated to have prevailed at the Head
35
Office level in respect of proposals sanctioned by the Board, CMD, ED and
GM.
43. Further, reliance is placed upon the Bank’s Circular No.
CPPMI/ADV/398/O&M-0960 dated 30.03.2010, which mandated that
staff accountability reports in respect of accounts with outstanding
balances exceeding Rs. 50 lakhs be placed before the Committee of
General Managers. In this regard, reports pertaining to three accounts,
namely AGS Infotel Ltd., Ignis Technology and Nexxoft Infotel Ltd., were
placed before the Committee on 20.10.2011, and the examination
conducted by three General Managers did not disclose any lapse in
processing and sanction (DE-3).
44. It is further recorded that the Appellate Authority, while disposing of the
appeal, did not undertake an independent evaluation but reiterated the
conclusions recorded by the Disciplinary Authority.
45. The pleadings also advert to the treatment accorded to other officers
involved in the sanctioning process, noting that they were subjected to
comparatively lesser consequences such as downgrading or voluntary
retirement, without forfeiture of retiral benefits.
46. The Learned Advocate for the petitioner assails the impugned orders of
the Disciplinary Authority, as affirmed by the Appellate Authority, as
being vitiated by perversity, non-application of mind, and a manifest
disregard of the evidentiary record, thereby rendering the conclusions
legally unsustainable.
47. At the forefront of the challenge is the contention that the Appellate
Authority has abdicated its independent adjudicatory function, merely
36
reiterating the findings of the Disciplinary Authority in a mechanical
fashion, without undertaking a dispassionate reappraisal of the materials
on record. Such an approach, it is urged, denudes the appellate process
of its very purpose.
48. In this context, reliance is placed upon the judgment of the Hon’ble
Supreme Court in Allahabad Bank & Ors. vs. Krishna Narayan Tewari,
(2017) 2 SCC 308, wherein it has been enunciated that although a writ
court ordinarily exercises restraint in interfering with findings of fact
recorded in departmental proceedings, such restraint is not absolute.
Where the findings are unsupported by any evidence whatsoever or are
such as no reasonable person could have arrived at, judicial review not
only becomes permissible but imperative.
49. The petitioner further submits that the decision-making process stands
vitiated by selective consideration of evidence, inasmuch as relevant
materials have been ignored while inconsequential aspects have been
accorded undue weight. It is urged that the inference of misconduct must
be founded upon legally admissible and cogent evidence, satisfying the
threshold of rational probity. In aid of this submission, reliance is placed
upon Moni Shankar vs. Union of India & Ors., (2008) 3 SCC 484, wherein
it has been held that the High Court, in exercise of judicial review, is
entitled to examine whether the authority has taken into account relevant
evidence and excluded irrelevant considerations, and whether the
conclusions drawn are consistent with established legal principles.
50. Further fortifying the challenge, the petitioner invokes the decision in
Nand Kishore vs. State of Bihar, AIR 1978 SC 1277, to contend that
37
disciplinary proceedings, though not strictly governed by the rigours of
criminal trial, are nonetheless quasi-judicial in character, and must be
grounded in some evidence of a definite nature pointing towards guilt. A
finding resting on mere suspicion or conjecture, bereft of evidentiary
substratum, cannot be sustained.
51. The petitioner also assails the exercise of discretion by the authorities as
being arbitrary and informed by extraneous considerations, thereby
inviting judicial correction. In this regard, reliance is placed upon the
seminal decision in Hindustan Steel Ltd., Rourkela vs. A.K. Roy & Ors.,
AIR 1970 SC 1401, wherein it has been held that where discretion is
either not exercised at all or is exercised on irrelevant considerations, the
High Court would be justified in intervening.
52. Based on these doctrinal foundations, it is contended that:
i. The findings of misconduct are de hors the materials on record
and hence perverse;
ii. The evidentiary framework does not disclose any cogent basis
for attributing culpability to the petitioner;
iii. The authorities have misdirected themselves in law by
misconstruing the applicable lending policy and by imputing
liability in respect of matters beyond the petitioner’s temporal
and functional domain; and
iv. The cumulative effect of such infirmities renders the impugned
orders liable to be set aside.
53. In summation, the petitioner submits that the case is not one of mere
error in appreciation of evidence, but of fundamental infirmity in the
38
decision-making process, attracting the well-recognised grounds of
judicial review, and accordingly prays for the writ petition to be allowed.
54. The learned advocate appearing for the respondent Bank has, with
structured particularity, sought to sustain the disciplinary action by
placing reliance both on the factual matrix and settled principles
governing judicial review in service jurisprudence.
55. At the outset, it is submitted that the initiation of disciplinary proceedings
was neither belated nor procedurally infirm. A charge-sheet dated 29
October 2011, followed by successive addenda dated 28 May 2013 and 17
October 2013, was issued delineating multiple acts of irregular
sanctioning of loans in respect of several corporate entities, including M/s
Ignis Technology Solutions Pvt. Ltd., M/s AGS Infotech Ltd., M/s Capture
Systems Pvt. Ltd., M/s Nexxoft Infotel Ltd., M/s Binary Spectrum Softech
Pvt. Ltd., M/s Acropetal Technologies Ltd. and M/s Kinfotech
Technologies Ltd. These were not isolated aberrations but formed part of a
pattern of financial impropriety spanning several transactions.
56. It is emphasised that the cumulative financial exposure of the Bank on
account of such transactions stood at an alarming figure of Rs. 123.56
crores, thereby underscoring the gravity of the misconduct. The
chronology of events further reveals that the said loan accounts, though
sanctioned within a proximate timeframe prior to the petitioner’s
superannuation, turned non-performing assets within a remarkably short
span, thereby lending credence to the inference that the sanctioning
process suffered from serious irregularities attributable to the petitioner.
39
57. The respondents contend that the charge-sheet having been issued prior
to the date of superannuation, the continuance and culmination of the
disciplinary proceedings post-retirement is fully sanctioned by Regulation
20(3)(iii) of the United Bank of India (Officers’) Service Regulations, 1979.
By virtue of the said provision, the petitioner is deemed to be in service for
the limited purpose of continuation of the proceedings. It is urged that the
entire enquiry was conducted strictly in accordance with the prescribed
procedure and no infraction of principles of natural justice can be
discerned.
58. Turning to the merits of the findings, it is asserted that the conclusions
arrived at by the Enquiry Officer, as affirmed by the Disciplinary
Authority, are founded on cogent evidence and a rational appraisal
thereof, and cannot be characterised as perverse. In support of the limited
scope of judicial review, reliance is placed on Lalit Popli vs. Canara Bank,
(2003) 3 SCC 583, wherein it has been held that the High Court, in
exercise of jurisdiction under Article 226, does not sit as an appellate
authority and cannot reappreciate evidence to substitute its own findings.
59. The respondents further draw sustenance from the principle articulated
in B.C. Chaturvedi vs. Union of India, that judicial review is confined to
examination of the decision-making process and does not extend to re-
evaluation of factual conclusions where there exists some evidence in
support thereof.
60. Reinforcing this limitation, reliance is placed upon Sub-Divisional Officer,
Konch vs. Maharaj Singh, (2003) 9 SCC 191, to submit that
40
reappreciation of evidence by the High Court would amount to
transgressing the bounds of supervisory jurisdiction under Article 226.
61. On the nature and gravity of misconduct, the respondents have invoked
State Bank of India vs. T.J. Paul, (1999) 4 SCC 759, to contend that even
likelihood of serious loss coupled with negligence is sufficient to
constitute “gross misconduct” within the meaning of the service
regulations. It is emphasised that the petitioner’s failure to obtain
adequate security and adherence to due diligence norms clearly brings
the case within the ambit of major misconduct.
62. Further reliance is placed on Disciplinary Authority-cum-Regional
Manager vs. Nikunja Bihari Patnaik, (1996) SCC (L&S) 1194, to
underscore that actual proof of loss is not a sine qua non for establishing
misconduct in banking operations; acting beyond authority and in
derogation of prescribed norms is, by itself, sufficient to sustain
disciplinary action.
63. The respondents also rely upon Union Bank of India vs. Vishwa Mohan,
(1998) 4 SCC 310, to emphasise that in matters involving bank officials,
integrity, diligence and adherence to financial discipline are of paramount
importance, and any deviation therefrom erodes public confidence in the
banking system.
64. On the question of institutional integrity and the broader societal
implications of misconduct, reliance is placed upon Tara Chand Vyas vs.
Chairman & Disciplinary Authority (1997 II LLJ 26), wherein it has been
observed that bank officers are custodians of public funds and their
conduct must align with constitutional and socio-economic objectives.
41
Any deviation, particularly involving financial impropriety, warrants
stringent disciplinary response.
65. The respondents further contend that the petitioner’s acts were not
sporadic but constituted a continuous course of conduct involving
multiple transactions over a period of time, reflecting a conscious
disregard of the limits of authority. Acting beyond sanctioned powers,
particularly in financial institutions, is characterised as a serious breach
of discipline capable of destabilising institutional integrity.
66. Insofar as proportionality of punishment is concerned, reliance is placed
upon Government of Andhra Pradesh vs. Mohd. Nasrullah Khan, (2009)
13 SCC 272 (as referred in substance), to submit that interference with
punishment is warranted only when it is shockingly disproportionate.
67. Additionally, reliance is placed on Divisional Controller, KSRTC vs. A.T.
Mane, (2005) 3 SCC 254, to emphasise that loss of confidence is a
decisive factor in matters involving financial misconduct, and once such
confidence is eroded, the punishment of dismissal cannot be said to be
excessive.
68. It is, therefore, submitted that the charges having been duly established
in the enquiry as constituting gross misconduct involving serious
financial irregularities, and the punishment being commensurate with the
nature of the delinquency, no interference is called for in exercise of writ
jurisdiction.
69. In culmination, the respondents urge that the present case does not
disclose any procedural illegality, perversity, or violation of natural
justice. The findings are supported by evidence, the process is
42
unimpeachable, and the punishment is proportionate to the misconduct
established. The writ petition, therefore, does not merit interference and is
liable to be dismissed.
70. The present writ petition unfolds a narrative where the chronology of
events speaks with a clarity more eloquent than the conclusions sought to
be sustained. The petitioner, who devoted nearly four decades of service to
the respondent Bank, finds himself visited with the gravest civil
consequence at the twilight of his career–not upon a contemporaneous
evaluation of his conduct, but upon a retrospective construction of alleged
irregularities long after the transactions had been consummated and
absorbed into the institutional fabric.
71. The Court is thus called upon to examine whether the disciplinary
process, in its inception and evolution, retains the imprimatur of fairness,
or whether it stands vitiated by delay, dislocation of responsibility, and an
attempt to ascribe singular culpability within a manifestly collective
enterprise can be sustainable.
72. The traversal of the record reveals that the transactions in question–
sanction of credit facilities during 2009-2010–were not the product of an
isolated or unilateral decision. It emerged from a carefully layered
institutional mechanism, each tier of which bore defined responsibilities:
i. The branch level, where documentation was initiated and
preliminary verification undertaken;
ii. The Regional Office, where appraisal encompassed technical
feasibility, economic viability and risk assessment;
43
iii. The Deputy General Manager, who scrutinised andrecommended the proposals;
iv. The Regional Level Credit Committee, comprising experienced
officers entrusted with collective deliberation;
v. The petitioner, who, within delegated financial powers, accorded
sanction upon the material so placed;
vi. Thereafter, the higher authorities, before whom the decisions
were placed for noting of discretionary power.
73. The defence exhibits–particularly DE-4, DE-6, DE-9 and DE-15–stand
as contemporaneous endorsements of this process, recording that the
sanctions were accepted without reservation and certified to be in
consonance with the prevailing Lending Policy.
74. To isolate the petitioner from this continuum and to ascribe to him an
exclusive authorship of the decision is to truncate the institutional
narrative and to convert a collective judgment into an individual
indictment.
75. The charges, when stripped of their form and examined in substance,
reveal a pattern of retrospective attribution rather than contemporaneous
detection.
76. The insistence upon Techno-Economic Viability (TEV) reports, for
instance, is predicated on an assumption that such reports were
indispensable. Yet, the material indicated the accounts fell within the
SME/MSME framework, where such requirement was neither shown to be
mandatory nor insisted upon at the time of sanction.
44
77. Similarly, the allegations of inadequate verification of financial data and
irregular valuation are couched in broad generalities, invoking standards
of “prudence” without anchoring them to specific regulatory prescriptions
demonstrably breached by the petitioner alone.
78. Most significantly, the record did not disclose that these alleged
irregularities were flagged at the relevant time, either during sanction,
post-sanction review, or supervisory oversight. The accounts were, in fact,
subjected to periodic scrutiny by the Bank’s Credit Department without
adverse comment of the nature now alleged.
79. What emerges, therefore, is a post facto narrative of misconduct,
constructed after the passage of time, rather than a contemporaneous
identification of delinquency.
80. The temporal sequence bears reiteration:
i. Transactions: 2009-2010
ii. Charge-sheet: 29.10.2011 (two days prior to retirement)
iii. Addenda: 2013 (post-retirement).
81. The delay is neither explained nor contextualised. It is not suggested that
the alleged irregularities came to light belatedly due to any supervening
discovery. On the contrary, the material indicates that the transactions
were fully documented and subject to internal processes from inception.
82. The proximity of the charge-sheet to the petitioner’s retirement is,
therefore, not a mere coincidence of timing. It assumes a juridical
significance, for it transforms what ought to have been a timely
institutional response into a belated exercise of authority at the threshold
of cessation of service. Delay, in disciplinary jurisprudence, is not a mere
45
lapse of time; it is a lens through which the fairness of the process is
refracted; when such delay remains unexplained, it casts a shadow upon
the bona fides of initiation.
83. Rule 20(3)(iii) of the Union Bank Of India (Officers’) Service Regulations,
1979, is replicated as follows:-
“20.(3)(iii) – The Officer against whom disciplinary proceedings have
been initiated will cease to be in service on the date of superannuation
but the disciplinary proceedings will continue as if he was in service
until the proceedings are concluded and final order is passed in respect
thereof. The concerned Officer will not receive any pay and/or
allowance, after the date of superannuation. He will also not be entitled
for the payment of retirement benefits till the proceedings are completed
and final order is passed thereon except his own contribution to CPF.”
84. It is beyond dispute that disciplinary proceedings may be initiated so long
as the employer-employee relationship subsists. The Service Regulations
may, in certain circumstances, permit continuation of such proceedings
beyond retirement. However, this principle cannot be extended to
legitimise a process where:
i. The initiation itself is tenuous and belated, and
ii. The charges are expanded or supplemented after retirement.
85. The addenda dated 28.05.2013 and 17.10.2013, issued after the
petitioner had demitted office, do not merely clarify existing charges; they
augment and elaborate them, thereby assuming the character of fresh
imputation.
46
86. Once the jural relationship stands severed, the authority to initiate or
substantively expand charges stands extinguished. The legal fiction of
continuation cannot be invoked to breathe life into what is, in essence, a
post-retirement initiation.
87. The respondents have placed reliance upon Lalit Popli, Nikunja Bihari
Patnaik, T.J. Paul, and P.C. Kakkar, to emphasise the limited scope of
judicial review and the gravity of misconduct in banking operations.
88. These authorities, however, operate within a distinct factual matrix:
i. In Lalit Popli, the misconduct was direct, specific and evidenced
by clear material, leaving little room for ambiguity;
ii. In Nikunja Bihari Patnaik and T.J. Paul, the delinquent officers
had acted in excess of authority or in manifest disregard of
binding norms, thereby exposing the institution to risk through
individualised acts;
iii. In P.C. Kakkar, the process itself was unimpeachable,
warranting judicial restraint.
89. The present case, in contrast, is marked by:
i. Absence of individualised evidence, the decision being embedded
in a collective process;
ii. Endorsement by superior authorities at the relevant time,
negating any immediate perception of irregularity;
iii. Unexplained delay and post-retirement augmentation of
charges, impinging upon the fairness of the process itself.
47
90. The precedents relied upon by the respondents, therefore, do not advance
their case, for they presuppose a clear and contemporaneous
establishment of misconduct, which is conspicuously absent here.
91. Conversely, the principles enunciated in Allahabad Bank vs. Krishna
Narayan Tewari and Moni Shankar vs. Union of India–that findings
unsupported by evidence or arrived at by ignoring relevant material
warrant interference–resonate with the factual complexion of the present
case.
92. Perhaps the most compelling infirmity lies in the disjunction between
collective decision-making and singular liability.
93. The record reveals a continuum of responsibility, distributed across
multiple officers, each entrusted with defined functions. The petitioner’s
role, though final in form, was derivative in substance, resting upon the
appraisal, recommendation and concurrence of preceding tiers.
94. To attribute exclusive culpability to the petitioner is to abstract the final
act from the process that produced it, and to impose liability distinct from
context.
95. Disciplinary jurisprudence does not countenance such abstraction.
Liability must be specific, attributable, and supported by evidence of
individual delinquency. In its absence, the charge dissolves into a
collective shadow without an identifiable source.
96. The cumulative effect of the foregoing is indelible:-
i. The charges are retrospectively constructed rather than
contemporaneously established;
ii. The process is vitiated by unexplained delay and suspect timing;
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iii. The proceedings are impermissibly expanded after retirement,beyond the reach of the employer’s authority;
iv. The attribution of liability is incongruent with the collective
nature of the decision-making.
97. The present writ petition does not merely traverse the terrain of
disciplinary adjudication. It compels this Court to examine with a
measure of care and judicial sensitivity whether the charges itselves when
individually scrutinized bear the weight of sustainable culpability or
whether it dissolved upon closer inspection into a pattern of retrospective
inference drawn from a collective institutional process.
98. The enquiry, therefore, must proceed charge by charge, disentangling
allegation from assumption, and these charges proceed on the premise
that the petitioner failed to obtain Techno-Economic Viability (TEV)
Reports and did not adequately examine the credentials of promoters.
Upon a careful scrutiny of the record, it emerges that:
i. the loan proposals pertained to the SME/MSME segment where
the requirement of TEV reports was not shown to be mandatory
under the Lending Policy dated 06.05.2009;
ii. The proposals had undergone multi-tier appraisal, including
financial analysis, technical scrutiny and risk assessment at the
Regional Office level;
iii. No contemporaneous objection was raised by superior
authorities when the sanction notes were placed before them.
99. The charge, therefore, appears to be founded upon an ex post facto
elevation of standards, rather than an intentional breach of a binding
49
requirement applicable at the relevant time to the prejudice of the
respondent-Bank and wrongful gain of the petitioner.
100. The allegation that the petitioner adopted an improper method of financial
assessment by relying on the cash budget system is similarly attenuated.
The material on record indicates that:
i. The prevailing policy permitted such assessment within the SME
framework;
ii. The methodology adopted was not singular to the petitioner but
formed part of the accepted appraisal practice at the relevant
time.
101. The charge, thus, does not disclose any departure from an established
norm, but rather questions a methodology that was institutionally
accepted.
102. Charge 1.4 – Non-verification through inspection alleges failure to ensure
proper inspection. However:
i. The record reflects that joint inspections were conducted by
officials at the branch and regional levels;
ii. Inspection reports formed part of the appraisal material placed
before the petitioner.
103. The allegation, therefore, overlooks the distributed nature of inspection
responsibility, and seeks to attribute to the petitioner a function that had
already been discharged by designated officers.
104. Charges 3.1, 3.3 and 3.4 – Prudential norms and classification of
accounts. These charges invoke notions of “common prudence” and
50
question the petitioner’s assessment of asset classification. A closer
examination reveals:
i. The observations are generalised and not anchored to specific
regulatory prescriptions;
ii. The accounts, at the relevant time, were regularly serviced and
not classified as stressed assets;
iii. The conclusions are drawn from a retrospective assessment of
subsequent developments, rather than contemporaneous
indicators. Such reasoning, founded on hindsight, cannot
sustain a finding of misconduct.
105. Charges 4.1 and 4.2 – Burden of proof and financial indicators. The
allegation that the petitioner failed to establish due diligence is countered
by:
i. The presence of financial statements, projections and appraisal
notes forming part of the sanction record;
ii. Evidence of improved financial indicators at the time of
sanction.
106. The charge appears to invert the burden, expecting the petitioner to
anticipate future outcomes rather than assess present material.
107. Charges 5.3, 5.4 and 6.3, 6.4 – Certification by Chartered Accountants.
These charges allege failure to ensure certification of utilisation of funds.
The record indicates that:
i. The sanction terms themselves incorporated conditions
requiring certification by Chartered Accountants;
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ii. The monitoring of such compliance fell within the domain ofpost-disbursement supervision, involving multiple officers.
108. The petitioner’s role, being confined to sanction, cannot be extended to
continuous monitoring functions.
109. Charge 5.5 – Inspection dated 11.08.2009. This charge stands
contradicted by the record itself, which shows that:
i. An inspection was in fact conducted on 11.08.2009 by the
Assistant General Manager, Bengaluru Cantonment Branch.
110. The allegation, therefore, is factually unsustainable.
111. Charges 6.2 and 7.3 – Applicability of ME-30. The invocation of ME-30 is
predicated upon the assumption of advance remittance. However:
i. The material indicates that no such advance remittance had
occurred, rendering ME-30 inapplicable.
112. The charge, thus, rests on a misapplication of policy provisions.
113. Charges 6.5 and 6.6 – Valuation of securities The allegation of irregular
valuation is sought to be sustained on the basis of variation in valuation
figures. Yet:
i. The valuation was conducted by empanelled valuers, whose
reports formed part of the record;
ii. Variations in valuation, by themselves, do not establish
misconduct unless accompanied by evidence of deliberate
manipulation or disregard of norms, which is absent.
114. Charges 7.4 and 7.5 – Disbursement conditions. These charges allege
improper disbursement without ensuring compliance with sanction
conditions. The material reveals that:
52
i. The sanction incorporated specific safeguards, including
certification requirements;
ii. The actual disbursement and verification of utilisation involved
operational officers at the branch level.
115. The attribution of liability to the petitioner overlooks the functional
demarcation between sanction and execution.
116. The charge-wise scrutiny yields a consistent pattern:
i. The allegations are not anchored to specific, individualised acts
of misconduct;
ii. They rely upon retrospective reinterpretation of decisions taken
within an accepted institutional framework;
iii. They disregard the multi-tiered nature of responsibility,
attributing to the petitioner functions discharged by others;
iv. Certain charges are factually contradicted by the record itself.
117. The charges, when examined individually and collectively, fail to establish
a coherent, legally sustainable case of misconduct attributable to the
petitioner alone. They are, at best, expressions of institutional
dissatisfaction articulated with the benefit of hindsight. The law does not
permit disciplinary liability to be fastened upon assumptions and
conjectures.
118. The writ petition before this Court is not merely an invocation of
constitutional jurisdiction against an adverse disciplinary outcome. It is,
in its truest sense, a plea that the exercise of power be tested against the
touchstone of fairness, that the discipline of procedure be not divorced
53
from the ethics of justice, and that institutional authority remain
anchored to reason rather than retrospective apprehension.
119. For, when the edifice of disciplinary action is erected not upon
contemporaneous scrutiny but upon a belated reconstruction of events,
the Court is called upon to ask-not only whether the conclusion is
sustainable-but whether the process itself has retained its legitimacy.
120. In essence, the charges appear to be retrospective reflections, shaped by
subsequent developments, rather than contemporaneous indictments
grounded in identifiable misconduct.
121. Delay as a juridical indicator of time, in matters of disciplinary
jurisdiction, is not a neutral bystander. It is a witness to institutional
response, and at times, to its absence.
122. The transactions in question were concluded in 2009-2010. The accounts
were subject to internal review. Yet, no action was initiated until 29th
October, 2011, when the charge-sheet was served upon the petitioner two
days before his retirement.
123. The delay stands unexplained. It is not suggested that the alleged
irregularities were discovered belatedly. Nor is there any indication of
intervening circumstances that impeded earlier action.
124. The proximity of the charge-sheet to retirement, therefore, assumes a
significance that cannot be ignored. It transformed delay into design, and
raised a legitimate concern whether the initiation was motivated less by
contemporaneous necessity and more by the impending cessation of
service.
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125. The law does not prohibit delay; but it does insist that delay be explained,
justified, and fair. Where it is not, it casts a shadow upon the very
foundation of the proceedings.
126. The conduct of the Disciplinary Authority, when viewed in its entirety,
reveals a process that is incremental rather than cohesive.
127. The initial charge memorandum, issued at the cusp of retirement, is
followed by addenda in 2013, which expand and elaborate the allegations.
These are not mere clarifications; they are extensions of the narrative,
introduced after the petitioner had ceased to be in service.
128. Such a course is difficult to reconcile with the principles governing
disciplinary jurisdiction. For while the law permits continuation of
proceedings validly initiated, it does not countenance post-retirement
reconstruction of charges, nor does it permit the authority to refine its
case in stages until it attains a form capable of sustaining punishment.
129. The process, thus, appears less as a determination founded on settled
material, and more as an evolving attempt to justify an already conceived
conclusion.
130. The most disquieting aspect, however, lies in the attribution of liability.
131. The record speaks of a collective enterprise-of decisions shaped by
multiple hands, scrutinised by multiple minds, and endorsed at multiple
levels. Yet, the disciplinary process seeks to distil this collective exercise
into a singular culpability, fastening responsibility upon the petitioner
alone. Such attribution is not merely selective; it is structurally
incongruent.
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132. In an institutional framework where roles are defined and functions
distributed, liability must be correlative to responsibility. To impose
singular liability in the absence of singular control is to sever
accountability from context, and to substitute reason with expediency.
133. It is well-settled that disciplinary proceedings may be initiated so long as
the employer-employee relationship subsists. The regulations may, in
certain circumstances, permit continuation beyond retirement. But this
principle is not without boundary.
134. Where initiation is belated and infirm, and where charges are expanded
after retirement, the proceedings cease to be a continuation and assume
the character of a fresh assertion of authority without jurisdictional
foundation.
135. The addenda issued in 2013, therefore, cannot be sustained. They
traverse beyond the permissible limits of continuation and enter a domain
where the authority no longer retains the power to act.
136. The authorities relied upon by the respondents, emphasising limited
judicial review and the seriousness of banking misconduct, are not in
dispute. But precedent, like principle, must be applied with regard to
context. Those decisions proceed on the basis of:
i. clear, individualised misconduct;
ii. prompt and proximate action;
iii. processes free from infirmity.
137. The present case, marked by diffuse charges, delayed initiation, collective
decision-making, and post-retirement expansion, stands on an entirely
different footing.
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138. Conversely, the principles that permit judicial interference where findings
are unsupported by evidence or where relevant material is ignored, find
resonance in the present factual landscape.
139. In the ultimate analysis, the Court is not persuaded that the disciplinary
proceedings represent a fair and reasoned exercise of power. They are
marked by:
i. delay that remains unexplained;
ii. charges that are retrospective and inferential;
iii. attribution that is selective and contextually dissonant;
iv. expansion that transgresses jurisdictional limits.
140. The law does not permit such a process to culminate in civil
consequences of the gravest kind. For discipline, to be just, must be
timely, transparent, and tethered to evidence.
141. Retirement is not merely an administrative event. It is the constitutional
moment when the covenant between employer and employee reaches its
natural fulfillment — when a life spent in service finds its earned
resolution in the dignified repose of pension, gratuity, and leave
encashment. The law does not contemplate that this threshold should
become a site of ambush. And yet, the facts that animate the present
analysis present precisely such a tableau: a chargesheet issued on 29th
October, 2011 — two days before the petitioner’s retirement — arising
from loan transactions that occurred in the years 2009 and 2010, left
unaddressed by the Bank Authority for the better part of two years, and
suddenly activated at the penultimate moment of an entire career.
57
142. The existence of jurisdiction to issue the charge-sheet is only the first
question. The second — and in the circumstances of this case, the more
searching — question is this: what led the Bank Authority to remain
silent from 2009 to 2011 over alleged irregularities in a loan approval
process that involved an entire institutional hierarchy, and to discharge
its charge-sheet only two days before the petitioner’s departure from
service? The third question — perhaps the most consequential for the
petitioner — is whether charges that reflect no malice, no personal gain,
and no wrongful intention — charges that are, in their essential
character, technical process deficiencies — can justify the withholding of
pension, gratuity, and leave encashment from a person who gave his
career to the institution.
143. Once the charge-sheet has been issued before the date of retirement —
even if only by a day, or in the present case, two days — the proceeding is
validly initiated. The employer-employee relationship was then alive. The
jurisdiction of the disciplinary authority was then extant. The chargesheet
of 29.10.2011 stands on legally firm ground insofar as the question of
initiation is concerned.
144. The disciplinary proceedings, once validly initiated before retirement, may
— subject to applicable service rules — be continued and concluded even
after the petitioner’s superannuation, by operation of the legal fiction of
deemed continuance in service. Under such fiction, the petitioner is
treated as if still in service, but solely for the purpose of concluding those
proceedings, and for no other purpose whatsoever.
58
145. The alleged irregularities in loan transactions concern the years 2009 and
2010. The chargesheet was issued on 29th October, 2011. Between the
alleged acts and the chargesheet, there lies a chronological distance of
approximately one to two years. This distance is not merely a sequence of
dates. It is a statistical testament to something deeply disquieting — the
Bank’s own prolonged acquiescence in a state of knowledge without
action.
146. The loan transactions of 2009-2010 did not occur in a vacuum. They were
conducted through a hierarchical institutional process — a process in
which the staff at the lower levels were required to comply with distinct
formalities, documentation requirements, and internal protocols, before
the matter ascended through the chain to the petitioner for final
endorsement. Every rung of this ladder was visible to the Bank’s
supervisory machinery. Every disbursement passed through institutional
channels. yet, the Bank — possessed of all the knowledge that an
institutional lender possesses of its own processes — remained silent for
the better part of two years.
147. The silence of the institution is not neutral; it is acquiescence. An
acquiescence, extended across two years, raises the most searching
questions about the bona fides of a chargesheet issued forty-eight hours
before retirement.
148. The Writ Court is not a passive certifier of disciplinary proceedings. It is
not required to accept the bare fact of a chargesheet as conclusive of the
institution’s good faith. The Hon’ble Supreme Court has, through a rich
body of jurisprudence, recognised that the Writ Court may and must
59
examine the circumstances surrounding the initiation of disciplinary
proceedings when those circumstances raise a reasonable apprehension
of mala fide, selective prosecution, or disproportionate action.
149. In the present context, the Writ Court is called upon to ask — and is
entitled to insist upon an answer to — the following questions:
a) Why did the Bank Authority, possessed of knowledge of the loan
transactions of 2009-2010, remain silent for two years before
issuing the chargesheet? What delayed the application of
institutional mind?
b) The loan sanction process in the Bank involved a hierarchical
chain of approvals, beginning with staff at lower levels who were
required to comply with distinct formalities before the matter
reached the petitioner for endorsement. If there were
irregularities in the process, those irregularities pervaded the
entire chain. Why was the chargesheet directed solely or
principally against the petitioner at the apex of that chain, and
what action — if any — was taken against those at the lower
levels who were equally or more directly involved in the
compliance formalities?
c) The timing of the chargesheet — two days before retirement —
coincides almost precisely with the moment at which the Bank
stood to gain the maximum procedural advantage by ensuring
that disciplinary proceedings would be subsisting at the date of
superannuation, thereby creating a basis for withholding
60
pension, gratuity, and leave encashment. Was this coincidence,
or calculation?
d) Selective prosecution is the antithesis of institutional fairness.
When a hierarchical process of loan approval involves multiple
participants across multiple levels, and the chargesheet arrives
only at the door of the final endorser — two days before his
retirement — the Writ Court is not merely entitled to raise its
eyebrows. It is constitutionally obligated to raise its voice.
149. The loan transactions of 2009-2010 were not the unilateral acts of the
petitioner. They arose from a hierarchical institutional procedure in which
the staff at lower levels were required to comply with distinct formalities
— preparation of loan proposals, verification of documentation, initial
assessment of creditworthiness, compliance with internal norms — before
the matter was finally endorsed by the petitioner.
150. In the present case, the Writ Court is entitled — indeed, obligated — to
inquire: what action did the Bank take against those at the lower levels of
the hierarchy who were required to comply with the initial formalities?
Were those formalities complied with? If not, who bore the primary
responsibility for that non-compliance? If the deficiency lay at the lower
levels, how did the endorsement by the petitioner — the final signatory in
a chain of institutional approvals — constitute the primary or sole
delinquency?
151. Authority at the apex of a hierarchical process is not the same as
exclusive culpability for every deficiency that arose within it. The final
endorser is entitled to rely — within reason — on the compliance work of
61
those who preceded him in the institutional chain. To hold him solely
responsible for the failures of an entire hierarchy, while those who first
failed remain uncharged, is not discipline. It is scapegoating dressed in
the garb of institutional accountability.
152. There has to be a critical distinction — one that the Writ Court must
apply with care and constitutional conscience — between charges that
reveal a genuine delinquency of character (fraud, misappropriation,
deliberate falsification, personal enrichment at institutional expense) and
charges that amount to technical process deficiencies, administrative
oversights, or failures of supervision.
153. The charges framed against the petitioner on 29th October, 2011, as this
analysis understands them, relate to alleged irregularities in the issuance
of loans to customers during 2009-2010 — in the context of a hierarchical
approval process in which the petitioner’s role was that of the final
endorser, not the primary processor. The charges do not, on their face,
allege:
i. that the petitioner personally benefited from the loan transactions;
ii. that the petitioner deliberately falsified any records or documents;
iii. that the petitioner acted with mala fide intent or in collusion with any
borrower or fellow employee;
iv. that the petitioner caused pecuniary loss to the Bank by any act of
commission attended by dishonesty.
154. What the charges appear to indicate — and this is a finding that the Writ
Court must scrutinise with care upon a perusal of the actual chargesheet
62
— is that the petitioner, as the final endorser in a multi-layered
institutional process, failed to detect, question, or remedy certain
formality-based deficiencies that had originated at lower levels of the
hierarchy. This is a charge of supervisory insufficiency. It is a charge of
institutional process non-compliance. It is, in its essential character, a
charge of technical deficiency — not of moral turpitude, not of deliberate
wrongdoing, not of personal gain.
155. The disciplinary law of this country does not treat all lapses with the
same gravity. Between the officer who steals and the officer who
overlooked, between the employee who defrauded and the employee who
failed to supervise a formality, there is a chasm that the law of
proportionality insists must be reflected in the disciplinary consequence.
To treat technical process deficiency as if it were personal delinquency is
not discipline — it is the use of a sledgehammer to crack a nut.
156. The Hon’ble Supreme Court has consistently held — and this position is
now beyond controversy — that the punishment imposed in disciplinary
proceedings must be proportionate to the gravity of the misconduct
proved. In cases involving banking irregularities, the Court has drawn a
careful distinction between misconduct that warrants the severest
penalties (dismissal, removal, forfeiture of pension) and misconduct that
amounts to a lapse of oversight which, at most, warrants a minor or
moderate penalty.
157. In the present case, the Writ Court must apply this principle of
proportionality not merely to the quantum of any punishment but to the
very consequence of withholding terminal benefits. Pension, gratuity, and
63
leave encashment are not bounties that the institution may withhold at
will. They are constitutionally protected rights — the earned deferred
wages of a lifetime of service — which cannot be denied without strict
legal justification.
158. For the purpose of withholding or forfeiting terminal benefits, the
applicable service rules and the Payment of Gratuity Act, 1972 draw a
sharp and deliberate distinction. Gratuity, under Section 4(6) of the
Payment of Gratuity Act, 1972, may be forfeited only where the employee
has been terminated for misconduct involving acts of wilful omission or
negligence causing damage or loss, or for riotous or disorderly conduct or
any violent act, or for an offence involving moral turpitude. Pension may
similarly be withheld only where the misconduct is of a character that the
applicable Pension Regulations sanction as a ground for such withholding
— typically, grave misconduct, criminal breach of trust, forgery, or fraud.
159. The charges against the petitioner — technical deficiencies in a
hierarchical loan sanction process, attended by no evidence of personal
gain, malice, or deliberate fraud — do not, on their face, satisfy the
threshold for the forfeiture or withholding of terminal benefits. To
withhold pension, gratuity, and leave encashment on the basis of such
charges is to visit upon the petitioner a consequence disproportionate to
and unsupported by the character of the alleged delinquency.
160. The institution that withholds pension from a retired employee on the
strength of charges that reveal no fraud, no dishonesty, and no personal
enrichment, is not exercising discipline. It is administering financial
punishment by another name — and it is doing so, conspicuously, at a
64
time when the employee can no longer defend himself from within the
service. This the constitutional conscience of the Writ Court cannot
endorse.
161. The Writ Court is not empowered to act as an Appellate Court nor can
reassess evidence and such syntax is indomitable in service
jurisprudence. However will it not be menacing for a Writ Court to be a
mute spectator where an employee is subjected to sheer brutality being
thrust with a charge-sheet on the eve of his retirement having served the
respondent-Bank with unwavering loyalty only to be subjected to brazen
autocratic despotism, where the entire service career, reputation and
future life of the employee are disarrayed and sullied in the garb of a
disciplinary proceeding predominantly devoid of explicit misconduct on
the part of the petitioner, if at all technical deficiencies which formed a
broader perspective of collective responsibility.
150. The petitioner robbed of and deprived of claim of retiral benefits at the
end of nearly four decades of uninterrupted service has to fight for his
legitimate claims to combat against abominable act on the part of the
respondent-Bank, disregarding the plausible explanation through
representation by the petitioner which fell on deaf ears, frenzied by
authority and power to condemn the petitioner. Moreover, a charge was
framed against him in the context of a grant after his transfer, a
ridiculous embodiment of display of authoritative power unacceptable
under the stretch of any legal principles. The Writ Court is, therefore,
compelled to exercise its jurisdiction to abide by the constitutional
principles to safeguard and sanctify the rights of the petitioner whose
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mala fide intention and wrongful gain could not be established by the
respondent-Bank which had been in slumber for nearly two years from
the date of sanctioning of loan only to awaken at the opportune moment
to assassinate and annihilate the petitioner to his material devastation
and life destruction. Therefore in case where the process itself is initiated,
judicial restraint must yield to constitutional responsibility.
151. Since the petitioner had been deprived of his lawful entitlements and both
the Disciplinary Authority and Appellate Authority had expressed the
respective opinion of imposition of punishment upon the petitioner,
constructive purpose beneficial to the petitioner would hardly enure if the
misery of the petitioner was asked to be reconsidered by the aforesaid
Authorities. Moreover, the petitioner presently a septuagenarian person
must not be subjected to ignominy and hardship to face further dictum of
the aforesaid Authorities. The Writ Court in such an exceptional
circumstances considers it arduous to restore judicial faith and instil
constitutional values in favour of the petitioner and believes it onerous to
relieve the petitioner from any procedural entanglements at the behest of
the respondent-Bank.
152. Accordingly:
i. The charge memorandum dated 29.10.2011 and addenda dated
28.05.2013 and 17.10.2013 are set aside;
ii. The order dated 25.11.2014 passed by the Disciplinary
Authority and the Appellate Order dated 06.04.2016 are
quashed.
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iii. The petitioner shall be entitled to all consequential retiral
benefits including pension, gratuity and leave encashment,
which shall be released from a period of 12 weeks from the date
of communication of this Order. The respondent-Bank is also to
pay an interest of 6% per annum on the amount of gratuity and
leave encashment from the date of superannuation till the date
of disbursal of such benefits in favour of the petitioner.
153. In view of the above discussion, the instant writ petition being WPO No.59
of 2017 is allowed.
154. Accordingly, the instant writ petition stands disposed of.
155. There is no order as to costs.
156. All parties shall act on the server copy of this judgment duly downloaded
from the official website of this Court.
(Ananya Bandyopadhyay, J.)