Bengaluru: Observing that guidelines issued by the department of public enterprises/bureau of public enterprises, ministry of heavy industries and public enterprises, are not applicable to nationalised banks, the high court upheld a decision of erstwhile Vijaya Bank to recover an indemnity bond amount of Rs 3 lakh from its former manager who quit before the lapse of the three-year period mandated in his appointment order.
Abhimanyu Kumar, a chartered accountant from Bihar, was appointed Vijaya Bank manager in Oct 2011 on condition that he serves a minimum of three years. He executed an indemnity bond while joining the bank.
He later wanted to join Steel Authority of India, but Vijaya Bank insisted he pay the Rs 3-lakh indemnity bond amount. He paid the money in July 2012 and joined SAIL.
In May 2013, he issued a notice to the bank seeking transfer of the bond amount to his current employer (SAIL), citing that department of public enterprise (DPE) guidelines permitted the same. The request was refused in Aug 2013.
He approached the high court and on April 19, 2023, a single bench ruled in his favour on the strength of DPE guidelines. Vijaya Bank filed a writ appeal against the order.
After perusing the materials on record, a division bench of Chief Justice NV Anjaria and Justice KV Aravind pointed out that nationalised banks are guided by instructions issued by their parent ministry (department of finances and services and department of economic affairs (banking division), ministry of finance.
“DPE guidelines are not applicable to public sector banks; they are applicable only to public sector enterprises which have different service condition packages and allow lateral movement of officials. The bank is not a govt department nor is it a public sector enterprise in that sense to which DPE guidelines may apply,” the division bench said.