M. Mahalingam vs Syndicate Bank and 2 Others

The writ petition is for the issue of writ of certioraified mandamus to call for the records relating to the orders of the first respondent dated

5.1.1991 bearing ref.Nos.03/PD:IRD/DA-6 and 04/PD:IRD/DA-6 Ex.A. as confirmed by the order of the second respondent dated 31.5.1991

and 26.4.1991 (bearing Ref.Nos.148/PD: IRD/DA-7 and 91/PD:IRD/DA-7-Ex.B ) and third respondent dated 24.10.1991 (bearing

Ref.Nos.248/PD:IRD/DA- 7 and 247/PD:IRD/DA-7 Ex.C. ) and quash the same and direct the respondents to reinstate the petitioner in service

with continuity of service with full backwages and all other attendant benefits.

The case of the petitioner is that he joined the respondent bank as clerk in the year 1974 and got promotions in the usual course. Lastly, he was

holding the post of Assistant Manager at Madras Central Accounts Officer and prior to that as the Manager at Mopur Branch at Nellore District.

The petitioner was removed from service by orders of the first respondent-Personnel Manager/Disciplinary Authority, dated 5.1.1991 in respect of

the charge sheets dated 27.3.1987 and 18.8.1988. The charge sheets related to the period when the petitioner was working as the Manager of the

South Mopur Branch of the respondent bank at Nellore District. The charges levelled against the petitioner in the first charge sheet dated

27.3.1987 were, that the petitioner indiscriminately drew sundry advances for petrol charges between January 1984 and June, 1985 and he did

not account for the same, and within that period, he had drawn amount to the tune of Rs.28,350 whereas the actual amount spent on petrol was

only Rs.4,289.53. On 23.2.1985, he had drawn a part of his salary amounting to Rs.1,900 in advance without the permission of the competent

authority and this was in violation of Rule 16 of the Service rules; one Ealasudhakar, a customer of the bank came and deposited a D.D. on

8.6.1985 for Rs.4,000 and the petitioner discounted it and gave him only Rs.1,600 and appropriated the balance of Rs.2,400 on the plea that a

third party cheque presented by him earlier on 4.1.1985 for the amount of Rs.2400 drawn on the Catholic Syrian Bank, Nellore, had been lost in

transit and the further allegation was that the petitioner deposited the said amount of Rs.2,400 subsequently to the bank on 13.6.1985 and

misappropriated the amount for five days. The second charge sheet dated 18.8.1988 contained three charges. The first charge was that a customer

by name Sundara Ramaiah brought Rs.5,000 for depositing the same into the bank on 23.12.1985 and the petitioner did not credit it into his

savings bank account No.92 but on the contrary, the petitioner has misappropriated the same and made a ficitious entry for the said amount in the

account. The second charge was dropped. The third charge relate to grant of 11 loans amounting to Rs.47,000. The petitioner was charge sheeted

on the above charges. With regard to the first charge sheet dated 27.3.1987, the enquiry officer by his findings dated 30.11.1990 came to the

conclusion that charge No.1, 2 and 4 stood proved in the enquiry and charge No.3 stood deleted from the charge-sheet by the disciplinary

authority. With regard to the second charge sheet dated 18.8.1988, the enquiry officer by his findings dated 27.11.1990 came to the conclusion

that charge no.1 stood proved in the enquiry, charge No.2 has been deleted by the disciplinary authority and charge No.3 stood proved against

the petitioner. Based on the findings of the enquiry officer, the first respondent disciplinary authority removed the petitioner from services of the

bank, by order dated 5.1.1991. According to the petitioner, the first respondent-disciplinary authority without furnishing a copy of the report of the

enquiry officer to him with regard to the two charge sheets dated 27.3.1987 and 18.8.1988, came to the conclusion of removing the petitioner

from service and passed the final orders on 5.1.1991 removing the petitioner from service. While passing the order of such removal, the

disciplinary authority has enclosed a copy of the report of the enquiry officer. Aggrieved by the said order of removal passed by the first

respondent-disciplinary authority, the petitioner has filed appeal before the second respondent Assistant General Manager. The second

respondent-appellate aulhority by his order dated 31.5.1991 and 26.4.1991 respectively, has passed the order confirming the orders passed by

the disciplinary authority against the petitioner i.e. punishment of removal from the services of the bank with immediate effect, which shall not be a

disqualification for future employment. Aggrieved by the said orders passed by the appellate authority, the petitioner has again preferred review

petitions before the third respondent-reviewing authority- Executive Director of Syndicate Bank, Manipal. The third respondent-reviewing

authority by its order dated 24.10.1991, has rejected the review petitions and confirmed the orders passed by the disciplinary authority and the

appellate authority. Aggrieved by the above orders passed by the respondents, the petitioner has filed the above writ petition.

Learned counsel for the petitioner vehemently contended that the petitioner was not given sufficient opportunity by the enquiry officer to putforth

his case, during the enquiry proceedings and he was not furnished with the documents required by him to substantiate his contentions. Without

giving adequate opportunity of hearing to the petitioner, the enquiry officer rendered his findings holding that the charges leveled against the

petitioner were proved. Based on the findings recorded by the enquiry officer, the disciplinary authority proceeded to pass orders removing the

petitioner from service, even without furnish a copy of the report of the enquiry officer before passing such order of removal and the order of

removal has been confirmed by the appellate authority and the reviewing authority on the appeal and the review filed by the petitioner. Learned

counsel for the petitioner has also contended that had the petitioner been furnished with necessary documents required by him, before the

conclusion of the enquiry, he would have placed the material facts before the enquiry officer and the petitioner would not have faced the

consequential order of removal from service passed by the authorities. Learned counsel for the petitioner has also contended that non-furnishing of

a copy of the enquiry report to the petitioner by the disciplinary authority before passing the order of removal from the services of the bank, is

violative of the principles of natural justice. Learned counsel for the petitioner has submitted that in the appeal filed by the petitioner before the

appellate authority though the petitioner has raised the point that he was not furnished with the copy of the report of the enquiry officer before the

order of removal from service came to be passed, and only in the order passed by the disciplinary authority, the report of the enquiry officer has

been enclosed, that was not considered by the appellate authority and there was no findings on that issue. For these reasons, learned counsel for

the petitioner submitted that the orders passed by the first respondent disciplinary authority, removing the petitioner form the service of the bank

and the ordered passed by the second and third respondent-appellate authority and the reviewing authority, confirming the orders passed by the

first respondent-disciplinary authority are liable to be set aside. To substantiate her contentions, learned counsel for the petitioner relied upon the

decisions of the Supreme Court in Managing Director, ECIL, Hyderabad, Vs. Karunakar, etc. etc., and U.P.(Madhya Ganna Bee ) Evam Vikas

Nigam Limited v. Prem Chandra Gupta and others0 1999 SCC (L&S) 623.

Learned counsel for the respondent bank has submitted that the order of removal for the petitioner from service was passed by the first

respondent-disciplinary authority after going through the findings recorded by the enquiry officer who has arrived at the findings holding the charges

leveled against the petitioner were proved on the basis of the materials placed before him during the enquiry proceedings. He has also submitted

that the order of removal of the petitioner came to be passed on the ground that he has committed grave offences when he was in the services of

the bank and the petitioner was given sufficient opportunity of hearing before the enquiry officer, during the enquiry proceedings. He has also

submitted that the appellate authority and the review authority second and third respondents herein have rightly confirmed the orders passed by the

disciplinary authority and such orders passed by the respondents authorities are sustainable. He has also submitted that there is no provision in the

regulations formulated by the respondent bank to provide for a copy of the enquiry officer''s report before the final orders are passed. Hence the is

no bounden duty on the part of the respondent bank to furnish a copy of the enquiry officer''s report giving opportunity to the petitioner before the

punishment of removal from service was inflicted. To substantiate his contentions, learned counsel for the respondents bank has relied upon the

decision of the Supreme Court in Union Bank of India Vs. Vishwa Mohan, and the decision of a Division Bench of Kerala High Court in The

Assistant General Manager (P), Personnel Department, Syndicate Bank v. B.K. Mahim 2000 L.I.C. 2186.

Countering to the above submission made by the learned counsel for the respondents bank, learned counsel for the petitioner has submit that

denial of the report of the enquiry officer is a denial of reasonable opportunity and a breach of the principles of natural justice and such regulations

formulated by the respondent bank are held to be invalid, as observed by the Supreme Court in Managing Director, ECIL, Hyderabad, Vs.

Karunakar, etc. etc., .

In Managing Director, ECIL, Hyderabad, Vs. Karunakar, etc. etc., , the Supreme Court has observed as follows:

.....It is for the first time in Union of India and others Vs. Mohd. Ramzan Khan, , that this court laid down the law. That decision made the law laid

down there prospective in operation, i.e. applicable to the orders of punishment passed after 20th November 1990.....

The Supreme Court, in the above cited decision Managing Director, ECIL, Hyderabad, Vs. Karunakar, etc. etc., has further observed as follows:

Since the denial of the report of the inquiry officer is a denial of reasonable opportunity and a breach of the principles of natural justice, it follows

that the statutory rules, if any, which deny the report to the employees are against the principles of natural justice and, therefore, invalid. The

delinquent employee will, therefore, be entitled a copy of the report even if the statutory rules do not permit the furnishing of the report or are silent

on the subject.

The facts in Union Bank of India Vs. Vishwa Mohan, show that the enquiry proceedings were proceeded with ex parte. At paragraph 7 of its

decision, the Supreme Court has observed as follows:

we may briefly indicate the reasons which weighed with the High Court to set aside the order of dismissal dated 7th January, 1991 and 30th May

1991, passed by the Disciplinary Authority and the Appellate Authority respectively. The High Court assume that the copy of the inquiry report

was never furnished to the respondent at any stage and therefore, the respondent was greatly prejudiced due to non-receipt of the copy of the

inquiry report. Factually, this is incorrect, in appears that the copy of the report was not furnished to the respondent until the Disciplinary Authority

passed the order of dismissal on 7th January, 1991. But however, the said copy appears to have been served on the respondent when he filed the

statutory representation/appeal under the Regulations before the Appellate Authority.

In the case on hand, it is not a case of ex parte enquiry. Hence the decision of the Supreme Court in the above cited case, does not cover the

particular circumstances of the case on hand.

In B.K. Mahim''s case 2000 L.I.C. 2186 cited by the learned counsel for the respondent, a Division Bench of the Kerala High Court has held

that non-supply of enquiry report before imposing the punishment of dismissal, would not vitiate the enquiry proceedings, as there is no provision in

the Regulations of the Bank to furnish enquiry report to the delinquent office before imposing the punishment. It is pertinent to note that in B.K.

Mahim''s case 2000 L.I.C. 2186 cited above, the disciplinary authority has passed the final orders on 20.7.1989 before the decision of the

Supreme Court in Union of India and others Vs. Mohd. Ramzan Khan, . A reading of the decision of the Kerala High Court in the above cited

case shows that the decision of the Supreme Court in Managing Director, ECIL, Hyderabad, Vs. Karunakar, etc. etc., has not been placed before

the Court and the Division Bench of the Kerala High Court had no occasion to consider the said decision of the Supreme Court in Managing

Director, ECIL, Hyderabad, Vs. Karunakar, etc. etc., while dealing with the case of B.K. Mahim, 2000 L.I.C.2186. Hence the above case is not

applicable to the present case.

In this case, it is not in dispute that though the respondents have served the copy of the Enquiry Officers Report, to the petitioner, the same was

served only along with the impugned order passed on 5.1.1991. From the above, it is clear that the petitioner had no reasonable opportunity to

show cause against the punishment of his removal from service basing on the enquiry officers report. The Apex Court in Managing Director, ECIL,

Hyderabad, Vs. Karunakar, etc. etc., has held that the law laid down in Union of India and others Vs. Mohd. Ramzan Khan, would be applicable

to all the punishments made after 20.11.1990. In this case, the impugned order was passed on 5.1.1991. Though the learned counsel for the

respondent has argued that the there is no need to furnish the enquiry officer''s report as the regulations do not provide, the above contention has

no force of law in view of the observations made by the apex court in Managing Director, ECIL, Hyderabad, Vs. Karunakar, etc. etc., . Hence it

has to be held that the action of the respondents in not furnishing the Enquiry Officers report before passing the final orders is on violation of the

principles of natural justice, following the decision of the Supreme Court in Managing Director, ECIL, Hyderabad, Vs. Karunakar, etc. etc., .

Learned Counsel for the respondents has further argued that the petitioner had not filed his explanation to the show cause notice issued on the

basis of the charges. Hence he is not entitled for any relief. On the other hand, learned counsel for the petitioner has argued that the petitioner could

not submit his explanation as he had sought for copies certain documents to submit his explanation by letters dated 6.5.1988 and 14.2.1990 but

the same were not furnished by the bank. Meanwhile, the respondent proceeded with the enquiry and hence the petitioner participated in the

enquiry. Under the circumstances she has argued that the submission made by the learned counsel for the respondents has no basis.

Following the decision of the Supreme Court in Managing Director, ECIL, Hyderabad, Vs. Karunakar, etc. etc., , it has to be held that the

action of the respondents in not affording reasonable opportunity to the petitioner by furnishing the report of the enquiry officer, is in clear violation

of the principles of natural justice and the impugned order followed thereon is also held to be illegal. Accordingly, the impugned order of removal

from service passed against the petitioner, by the disciplinary authority and confirmed by the appellate authority and the review authority-second

and third respondents, is set aside. The writ petition is allowed. No costs.

In U.P.(Madhya Ganna Bee) Evam Vikas Nigam Limited v. Prem Chandra Gupta 1999 SCC (L&S) 623, the Supreme Court at Paragraph 5

of its decision has held as follows:

While we are not persuaded to interfere with the direction of the High Court setting aside the order of dismissal and the consequential

reinstatement of respondent 1 keeping in view the law laid down by the Constitutional Bench in Managing Director, ECIL, Hyderabad, Vs.

Karunakar, etc. etc., we consider it appropriate to direct that after the reinstatement of respondent 1, the appellants shall have the liberty to

proceed with the enquiry if they so consider it proper and in that event, they may even place respondent 1 under suspension if found necessary by

them and continue the enquiry from the stage of furnishing respondent 1 with a copy of the enquiry report. We make an order accordingly, insofar

as the grant of consequential benefit of back wages is concerned, that will be decided, in case an enquiry is held, at the conclusion of that enquiry.

The enquiry, if any, shall be concluded within one year from the date of the direction by the appellants to hold such an enquiry after the

reinstatement of respondent 1. In that event, respondent 1 shall co-operate with the enquiry officer and not cause any hindrance in its completion.

Following the decision of the Supreme Court in U.P.(Madhya Ganna Bee) Evam Vikas Nigam Limited v. Prem Chandra Gupta and others,

1999 SCC (L &S) 623, the respondent is directed to reinstate the petitioner in service as he was not furnished with a copy of the report of the

enquiry Officer, before the order of removal from service, was passed against him by the disciplinary authority. The reinstatement of the petitioner

shall be made within a period of four months from the date of receipt of a copy of this order. After the reinstatement of the petitioner and also the

furnishing of a copy of the report of the enquiry officer, to him, the respondent shall have the liberty to proceed with the enquiry if they so consider

it proper and in that event, they may even place the petitioner under suspension if found necessary by them and continue the enquiry from the stage

of furnishing the petitioner with a copy of the enquiry report. Insofar as the grant of backwages is concerned, that will be decided, in case an

enquiry is held, at the conclusion of that enquiry. The entire proceedings shall be completed within a period of six months from the date of

reinstatement of the petitioner in the services of the respondent bank. At this stage, learned counsel for the petitioner submitted that the petitioner

may be granted liberty to make a representation to the concerned authorities, opting to go on voluntary retirement, after his reinstatement. The

petitioner is permitted to make a representation to the concerned authorities opting to go on voluntary retirement, after his reinstatement. On

making such representation, it is open to the respondents to consider the case of the petitioner for voluntary retirement. Since the orders were

passed in the main writ petition, the petition to fix an early date for disposal of the writ petition i.e. W.M.P.No.15631 of 1998 is dismissed.