STATE BANK OF BIKANER & JAIPUR Vs NEMI CHAND NALWAYA
Bench: R.V. RAVEENDRAN,A.K. PATNAIK, , ,
Case number: C.A. No.-005861-005861 / 2007
Diary number: 4363 / 2007
Advocates: ANIL KUMAR SANGAL Vs
A. SUMATHI
IN THE SUPREME COURT OF INDIA Reportable
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 5861 OF 2007
STATE BANK OF BIKANER & JAIPUR .......APPELLANT
Versus
NEMI CHAND NALWAYA .....RESPONDENT
O R D E R
R. V. Raveendran J.,
The respondent was employed as a clerk in the
Kalindri branch of the appellant Bank. He was issued a
charge-sheet dated 30.8.1988. The two charges against him
are extracted below :
(i) On 14.10.1987, you disclosed the balance of SB Account No.1025 of Shri Dharamchand Nathaji lying in in-operative account to an unidentified person posing himself as the said account holder though the person was not having even Pass Book of that account. This disclosure of secrecy led a fraudulent withdrawal of Rs.6,000/- from the said account thereby putting the bank into loss.
(ii) On 14.10.1987, you have advised Shri I.M. Rawal, the counter clerk handling Savings Banks ledgers to transfer the balance lying in account number 1025 in the name of Shri Dharam Chand Nathaji from in-operative Savings Bank ledger to that of operative ledgers without first obtaining the permission of the Branch Manager which is a pre-requirement in all such cases. It is further alleged that you have collected the withdrawal form purported to have been signed by the depositor, handed over the
same to Shri I.M. Rawal, the counter clerk, obtained token and after it was passed for payment by the Branch Manager, obtained payment from paying cashier Shri S.R. Meghwal The real depositor has subsequently complained that the signature on withdrawal form was forged and the matter is now under police investigation.”
The charge-sheet followed a preliminary enquiry by one H.
S. Sharma, an officer of the appellant bank, in which the
respondent broadly admitted the facts constituting the
subject matter of the two charges.
2. A joint inquiry was held in respect of the
charges against the respondent and two others namely I.M.
Rawal and S.R. Meghwal. Several witnesses were examined.
The Inquiry Officer submitted a report dated 12.6.1989
holding that both the charges against the respondent were
proved. He also held that the charges against I.M. Rawal
and S.R. Meghwal were also proved. The disciplinary
authority considered the inquiry report. He was of the
view that on the material placed in the inquiry, the
respondent was not guilty of the first charge. He, however,
concurred with Inquiry Officer in regard to the finding of
guilt recorded in respect of the second charge. He,
therefore, issued a show cause notice dated 23.6.1990
proposing to impose the punishment of dismissal in regard
to the second charge. After considering the respondents’
reply, the disciplinary authority, by order dated 1.8.1990,
imposed the punishment of dismissal. The matter rested
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there for several years.
3. In the meanwhile, on the basis of a complaint by the
Branch Manager, a charge-sheet was filed before the Chief
Judicial Magistrate, Sirohi, in regard to the allegations
which were the subject matter of the departmental enquiry.
The criminal court acquitted the respondent by judgment
dated 7.7.1994, holding that charges were not proved beyond
doubt. Thereafter, he filed a writ petition (WP
No.5761/1994) challenging his dismissal, on the ground that
he was acquitted in the criminal case. The said writ
petition was disposed of by a brief order dated 26.5.1997
observing that he may avail the remedy of appeal and the
appellate authority may consider the explanation for delay
in submitting the appeal.
4. The respondent filed an appeal before the Appellate
Authority, with an application for condonation of delay.
The appellate authority, by order dated 7.10.1997,
dismissed the application for condonation of delay and
consequently dismissed the appeal.
5. The respondent challenged the order of the appellate
authority in WP No.450/1998. A leaned Single Judge of the
Rajasthan High Court dismissed the writ petition on the
ground that the appellate authority had not committed any
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error in dismissing the appeal on the ground of delay. The
respondent filed a special appeal and the division bench of
the High Court allowed the appeal by the impugned judgment
dated 4.4.2006. The pendency of the criminal case was
accepted as sufficient explanation regarding delay. The
division bench held that the non-filing of the appeal by
the respondent in time was due to a bona fide impression
that he could do so after the disposal of the criminal
proceedings. With reference to merits, the division bench
held that no wilful or fraudulent conduct with intention to
cause loss to the appellant Bank, nor misappropriation by
the respondent, was made out. The division bench was of
the view that the case was not one where respondent had
acted in wilful dereliction of duty; and that in an
increasing customer-friendly atmosphere in the Bank, the
respondent had acted bona fide and allowed the person
considered by him to be a valued customer to operate on the
account not realising that such person was impersonating
the account holder. The High Court was of the view that in
such circumstances, the question of loss of confidence
would not arise and the punishment of dismissal was grossly
disproportionate to the misconduct. Therefore, it set
aside the order of dismissal and directed reinstatement
with full backwages and consequential benefits. The said
order is challenged in this appeal by special leave.
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6. It is now well settled that the courts will not act as
an appellate court and reassess the evidence led in the
domestic enquiry, nor interfere on the ground that another
view is possible on the material on record. If the enquiry
has been fairly and properly held and the findings are
based on evidence, the question of adequacy of the evidence
or the reliable nature of the evidence will not be grounds
for interfering with the findings in departmental
enquiries. Therefore, courts will not interfere with
findings of fact recorded in departmental enquiries, except
where such findings are based on no evidence or where they
are clearly perverse. The test to find out perversity is to
see whether a tribunal acting reasonably could have arrived
at such conclusion or finding, on the material on record.
Courts will however interfere with the findings in
disciplinary matters, if principles of natural justice or
statutory regulations have been violated or if the order is
found to be arbitrary, capricious, mala fide or based on
extraneous considerations. (vide B. C. Chaturvedi vs.
Union of India – 1995 (6) SCC 749, Union of India vs. G.
Gunayuthan – 1997 (7) SCC 463, and Bank of India vs.
Degala Suryanarayana – 1999 (5) SCC 762, High Court of
Judicature at Bombay vs. Shahsi Kant S Patil – 2001 (1) SCC
416).
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7. When a court is considering whether punishment of
‘termination from service’ imposed upon a bank employee is
shockingly excessive or disproportionate to the gravity of
the proved misconduct, the loss of confidence in the
employee will be an important and relevant factor. When an
unknown person comes to the bank and claims to be the
account-holder of a long inoperative account, and a bank
employee, who does not know such person, instructs his
colleague to transfer the account from “dormant” to
“operative” category (contrary to instructions regulating
dormant accounts) without any kind of verification, and
accepts the money withdrawal form from such person, gets a
token and collects the amount on behalf of such person for
the purpose of handing it over to such person, he in effect
enables such unknown person to withdraw the amount contrary
to the banking procedures; and ultimately, if it transpires
that the person who claimed to be account holder was an
imposter, the bank can not be found fault with if it says
that it has lost confidence in the employee concerned. A
Bank is justified in contending that not only employees who
are dishonest, but those who are guilty of gross
negligence, are not fit to continue in its service.
8. Several witnesses were examined to prove the charge.
One of them was H.S. Sharma who conducted the preliminary
inquiry and to whom the respondent had made a statement
broadly admitting the facts which constituted the subject
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matter of the second charge. I.M. Rawal, who was the
cashier and I.C. Ojha, the officiating Branch Manager were
also examined. Based upon their evidence, the Inquiry
Officer found the respondent to be guilty of the second
charge and that has been accepted by the disciplinary
authority. The High Court has interfered with the said
finding without expressly holding that the said finding of
guilt was erroneous. The High Court has proceeded as if it
was sitting in appeal over the departmental inquiry and
interfered with the finding on a vague assumption that the
respondent must have acted bonafide in an “increasing
customer friendly atmosphere”. There was no justification
for the division bench to interfere with the finding of
guilt.
9. The fact that the criminal court subsequently
acquitted the respondent by giving him the benefit of
doubt, will not in any way render a completed disciplinary
proceedings invalid nor affect the validity of the finding
of guilt or consequential punishment. The standard of proof
required in criminal proceedings being different from the
standard of proof required in departmental enquiries, the
same charges and evidence may lead to different results in
the two proceedings, that is, finding of guilt in
departmental proceedings and an acquittal by giving benefit
of doubt in the criminal proceedings. This is more so when
the departmental proceedings are more proximate to the
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incident, in point of time, when compared to the criminal
proceedings. The findings by the criminal court will have
no effect on previously concluded domestic enquiry. An
employee who allows the findings in the enquiry and the
punishment by the disciplinary authority to attain finality
by non-challenge, cannot after several years, challenge the
decision on the ground that subsequently, the criminal
court has acquitted him.
10. We are, therefore, of the view that the High Court was
not justified in quashing the punishment and directing
reinstatement with backwages and consequential benefits.
In fact, the order of the High Court directing back wages
amounts to rewarding a person who has been found guilty of
a misconduct.
11. However having regard to the fact that the proven
charge did not involve either misappropriation or
fraudulent conduct and the other circumstances of the case,
we are of the view that the punishment of dismissal should
be substituted by compulsory retirement, which does not
involve reinstatement.
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12. We, accordingly, allow the appeal and set aside the
judgment of the High Court. We uphold the finding of guilt
recorded by the disciplinary authority, but modify the
punishment from ‘dismissal’ to ‘compulsory retirement’.
There is therefore no question of grant of any back-wages.
......................J. ( R.V. RAVEENDRAN
)
New Delhi; ......................J. March 01, 2011. ( A.K. PATNAIK )
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