Sukumar Bhattacharya vs Bank of India & Ors.

Shampa Sarkar, J.

This intra-court appeal has been filed, challenging the judgment and order dated February 26, 2004 passed by a learned Single Judge, in W.P. No.1490

of 2002. By the order impugned the learned Judge dismissed the writ petition without interfering with the orders of the disciplinary authority as also

that of the Appellate Authority.

Before the learned Single Judge the appellant assailed the order of punishment dated May 31, 2001, of “dismissal without notice†passed in

terms of Regulation 4 (j) of Bank of India Officer Employees (Discipline and Appeal) Regulation, 1978 (hereinafter referred to as the said

Regulations) by the respondent no.3 as also the order dated February 19, 2002 passed by the respondent no.2, the appellate authority. The above

orders were passed consequent upon initiation of a disciplinary proceeding against the appellant in terms of Regulation 6 of the Bank of India Officer

Employees’ (Discipline and Appeal) Regulation, 1976.

The facts of the case in a nutshell are as follows:-

When the appellant was the Manager of the Salkia Branch of the respondent no.1, namely, Bank of India, (hereinafter referred to as the Bank), one

Ajoy Kumar Mohanty described himself as the proprietor of Poly Cab Industries of Howrah expressed his desire to open a current account in the said

branch. The appellant instructed the sub-staff to take the said person to the dealing official for the actual opening of the account, without complying

with the necessary formalities. The said account was thereafter opened by an official of the bank on the instruction of the appellant, and a cheque

book was also issued.

A cheque dated August 22, 1997 for a sum of Rs.12,77,081/-issued by Indian Oil Corporation favouring Poly Cab Industries and drawn on State

Bank of India, Dhakuria Branch, was deposited on September 28, 1997 in the said account. The said cheque was cleared in usual course of business.

Thereafter, the said Ajoy Kumar Mohanty between September 23, 1997 and November 30, 1997, withdrew almost the entire amount.

Thereafter, Poly Cab Industries alleged that the account which was opened in the name of Poly Cab Industries by Ajoy Kumar Mohanty was a

fictitious account and the money had been fraudulently withdrawn by Ajoy Kumar Mohanty, who was not the proprietor and had no connection with

Poly Cab Industries. Thereafter, Poly Cab Industries filed a suit inter alia against the Bank claiming a money decree.

The Bank issued a charge-sheet on December 9, 1998, inter alia, alleging that the appellant with dishonest intentions had aided and abetted the said

Ajoy Kumar Mohanty who falsely claimed to be the proprietor of Poly cab Industries in opening the current account without any introduction and with

scant regard to the bank’s instructions and guidelines and thereby facilitating the said Ajoy Kumar Mohanty to deposit the allegedly stolen cheque

for Rs.12,77,081/- in the said account.

The appellant was also charged with aiding and abetting Ajoy Kumar Mohanty to enable him to withdraw the entire amount within 2/3 days and

thereby violating the bank’s norms and further permitting payment of cheque of Rs.3,80,000/- on September 24, 1997 in spite of objection of other

bank employees.

Accordingly, the charge against the appellant was commissioned of breach of Regulations 3 (1) and 24 of the said Regulations. The regulations are

set out here under:-

“Regulation 3(1): Every officer employee shall, at all times take all possible steps to ensure and protect the interests of the Bank and discharge his

duties with utmost integrity, honesty, devotion and diligence and do nothing which is unbecoming of a Bank Officer.

Regulation 24: A breach of any of the provisions of these regulations shall be deemed to constitute a misconduct punishable under the Bank of India

Officer Employees (Discipline and Appeal) Regulations, 1976â€​

On October 11, 1999, the departmental enquiry was concluded. The respondent no.4, as the inquiring authority, submitted a report to the respondent

no.3 but the report was not served upon the appellant. The appellant was informed that the said respondent no.3 was remitting the case back to the

respondent no.4 for further enquiry on the following issues:-

“(a) Whether the Current Deposit Account No.110738 in the name of Messers Polycab Industries is fictitious account? Whether Shri Ajay Kumar

Mahanty falsely claimed to be the proprietor of Messers Polycab Industries?

(b) Whether the cheque No.017186 dated 22-8-1997 for Rs.12,77,081/- issued by Indian Oil Corporation favouring Messers Polycab Industries, drawn

on State Bank of India, Dlhakuria Branch, and deposited in the said Current Deposit Account No.110738 on 20-9-1997 was a stolen cheque?

(c) Whether Bank of India suffered a pecuniary loss to the tune of Rs.12,76,800/- in the said Current Deposit Account No.110738?â€​

Against the said order of remittance the appellant had filed a writ petition bearing W.P. No.3513 (W) of 2000 which was dismissed by a learned

Single Judge of this Court by judgment and order dated March 1, 2000. The relevant portion of the order is set out here under:-

“………… Regulation 6 is, however, required to be followed. The words “as far as may be†have been used to denote that in the fresh or

further enquiry new evidence may be brought on record even after the delinquent has placed his cards at the original enquiry but by using the words

“according to the provisions of Regulation 6†it has been clarified that in the fresh or further enquiry once again the case in support of the charge

has to be closed on the basis of the new evidence or materials and then only it would be the obligation of the delinquent to place his cards once again

at such enquiry. I, therefore, find no reason to interfere with the impugned decision and accordingly reject the writ petition.â€​

The appellant aggrieved by the order of the learned Single Judge of this Court in W.P. No.3513 (W) of 2000 dated March 1, 2000 had preferred

an appeal before a Division Bench of this Court and the Division Bench had granted leave to the respondents to proceed with the departmental

enquiry, but, made the publication of the result thereof subject to the outcome of the appeal.

Subsequent thereto, the inquiring authority concluded the proceedings on the basis of the issues framed by the disciplinary authority and the

composite finding of the inquiring authority was forwarded to the appellant with a direction to submit his written representations, if any, to the finding

of the inquiring authority. Thereafter, the disciplinary authority upon consideration of the contents of the representation of the appellant passed the final

order of punishment dated May 31, 2001. The appellant was found guilty of the charges levelled against him and the order of punishment of dismissal

without notice in terms of Regulation 4 (j) of the said Regulations was awarded.

Against the final order of punishment, the petitioner preferred an appeal before the Appellate Authority under Regulation 17 of the said

Regulations. The Appellate Authority, namely the respondent no.2 affirmed the order of punishment. Thereafter the pending appeal before this

Hon’ble Court against judgment and order dated March 1, 2000 was withdrawn by the appellant.

Aggrieved by the orders of the Appellate Authority and the order of the disciplinary authority the appellant filed a writ petition bearing W.P.

No.1490 of 2002. The learned Single Judge after considering the rival contentions of the parties dismissed the writ petition by an order dated February

26, 2004. The findings of the learned Single Judge in the judgment and order which is impugned in this appeal can be summarized as hereunder:-

a) The Appellate Authority had found from the evidence led by the parties that apart from the cheque for a sum of Rs.3,80,000/-, on other cheques for

Rs.4,30,000/- and for Rs.1,70,000/-, the appellant had given written instruction “please pay†and the said cheques were passed only after the

petitioner had given written instructions.

b) The account which was opened on the specific instruction given by the appellant without any introduction were allowed to be operated within a

very short while for the purpose of withdrawing large sums of money and it could not have escaped the notice of the appellant himself.

c) The matter of internal management of the Bank with regard to discipline and conduct of employees had got no connection with the result of the suit

filed by a third party.

d) It would be permissible for the Bank to defend a Civil Suit by contending that there was no negligence on its part which would obviously be subject

to proof, but at the same time it would be perfectly competent for the Bank to take its officers and/or employees to task if their actions were contrary

to the established banking practice and procedure which would amount to acting in a manner unbecoming of a bank official.

e) Irrespective of the fact whether the Bank had suffered pecuniary loss or not the manner in which the appellant had conducted himself as a

manager clearly indicated that he was grossly negligent and did not take due care and was not diligent in his duty.

f) There was no perversity in the conclusions in the order of the appellate authority and it was not open for the Writ Court to reappraise the evidence

and come to a different conclusion.

g) In spite of opportunity being afforded to the appellant he did not bring his defence witness in the enquiry and upon considering the entire materials

on record the appellate authority had concurred with the finding of the inquiring authority.

h) Likelihood of serious loss coupled with negligence was sufficient to establish gross misconduct and there was no reason to interfere with the

findings of the appellate authority.

Before us, the submissions made on behalf of the appellant can be summarized as follows:-

a) The matter could not have been remitted back to the inquiring authority as it would amount to a fresh enquiry and the disciplinary authority by

remitting the matter desired a different kind of finding to suit the requirement of the Bank.

b) That the inquiring authority submitted the report after holding a fresh enquiry on the dictates of the respondent no.2 without providing the appellant

the earlier enquiry report dated October 11, 1999 although, the said report was relied upon in the second enquiry report dated September 13, 2000. The

non-furnishing of the earlier report amounted to violation of the principles of natural justice.

c) That under the garb of holding a further enquiry the Enquiry Officer held a fresh enquiry but did not allow the petitioner to recall the witnesses nor

did the inquiring authority himself recall the earlier witnesses. This omission amounted to procedural irregularity and was violative of Regulation 6 of

the said Regulations.

d) The Bank having taken a stand in the written statement in the suit (which was dismissed), filed by Poly cab Industries that the Bank had committed

no irregularity in clearing the cheque, and that there was no pecuniary loss suffered by Poly Cab Industries, no liability could be foisted upon the

appellant.

e) In view of the statement of the bank in the civil suit to the effect that there had been no pecuniary loss to the customer and also, there being no

finding that the bank had suffered pecuniary loss in the enquiry, the punishment of dismissal from service which amounted to disqualification for future

appointment was harsh and shockingly disproportionate.

The appellant placed reliance on the decision in Managing Director, ECIL, Hyderabad and Others. vs. B. Karunakar and Others reported in

(1993) 4 SCC 727.

The respondents, on the other hand, contended that the departmental enquiry was held strictly in accordance with the established practice and

procedure and the appellant was afforded every opportunity to defend the case. It was submitted on behalf of the respondent that the point of non-

supply of the first enquiry report dated October 11, 1999 was not available to the appellant, inasmuch as, the said point was already decided by a

learned Single Judge of this Court in the judgment and order dated March 1, 2000 passed in W. P. No.3513 (W) 2000. The learned Judge had held

that it was not obligatory on the part of the disciplinary authority either to serve a copy of the enquiry report to the appellant or to hear him. It was

further contended on behalf of the respondents that the disciplinary authority’s decision to remit the matter back for further hearing by the

inquiring authority on the issues mentioned therein also had been upheld by the learned Judge in the said proceeding. The respondents further stated

that the second enquiry report dated September 13, 2000 was served upon the appellant on October 16, 2000 which also contained the findings of the

inquiring authority contained in the earlier enquiry report dated October 11, 1999. The second enquiry report was a composite report. The appellant

was given an opportunity to file his representation to the enquiry report dated September 13, 2000 and upon consideration of the representation of the

appellant the order of punishment was passed by the disciplinary authority on May 31, 2001. Mr. Majumdar submitted that there had neither been any

violation of the principles of natural justice nor had there been any procedural impropriety.

It was also contended that the disciplinary authority and appellate authority did not mechanically accept the findings of the Enquiry Officer but had

also applied their own independent mind and had come to a particular finding which should not be interfered with. It was submitted that the petitioner

was totally negligent in the matter of opening the account and permitting payment of a high value cheque in the newly opened account. The language

of Regulation 3 (1) read with Regulation 24 clearly indicated that the petitioner had not taken steps to ensure and protect the interest of the Bank and

did not discharge his duties with utmost integrity, honesty, devotion and diligence and has done something which is unbecoming of a Bank Officer. Mr.

Majumdar distinguished the ratio of the judgment of B. Karunakar and Others (supra) and submitted that natural justice was not a straight jacket

formula and unless the appellant proved the prejudice caused to him due to non-supply of the first enquiry report the order of punishment could not be

set aside and the decision was not applicable in the facts of this case.

The respondent placed reliance on the decisions in Union Bank of India vs. Vishwa Mohan reported in (1998) 4 SCC 310, Chairman and

Managing Director, United Commercial Bank and Others vs. P. C. Kakkar reported in (2003) 4 SCC 364, Disciplinary Authority-Cum-Regional

Manager and Others vs. Nikunja Bihari Patnaik reported in 1996 SCC (L&S) 1194.

We have gone through the rival contentions of the parties and we find that the first issue raised by the appellant as to the legality of the order of

the disciplinary authority in remitting the matter back to the inquiring authority on three questions framed by the disciplinary authority had been decided

in favour of the respondents by a learned Single Judge of this Court by a judgment and order dated March 1, 2000 in a proceeding challenging the

validity of the said action of the disciplinary authority. The appellant had also subsequently withdrawn the appeal filed by him against the order dated

March 1, 2000. The learned Single Judge in the order impugned before us has correctly held that the said challenge was no longer open for

adjudication.

Next we come to the question of non-supply of the first enquiry report. In B. Karunakar (supra) which has been relied upon by the learned

advocate for the appellant it has been held that supply of the enquiry report was an essential part of reasonable opportunity of being heard and that the

employee should be given an opportunity to meet, explain and controvert the finding against him before an order of punishment was proposed to be

imposed upon him on the basis of the enquiry report. However, in the instant case the appellant was given a reasonable opportunity of making a

representation before the disciplinary authority in response to the second enquiry report dated September 13, 2000 which was a composite report and

on the basis of the said report and upon consideration of the representation of the appellant the order imposing punishment dated May 31, 2001 was

issued. The judgment of B. Karunakar (supra) does not help the appellant and the issue had also been settled by another learned Single Judge in the

judgment and order dated March 1, 2000 passed in W. P. No.3513 (W) of 2000 and cannot be re-opened at this stage.

Next comes the question of denial of reasonable opportunity and violation of the principles of natural justice. In S. K. Sharma (supra), the Apex

Court laid down certain basic principles keeping in view the context of disciplinary enquiry and orders of punishment. In the said judgment the principle

laid down in B. Karunakar (supra) was distinguished and it was held that just because a copy of the enquiry report was not served upon the delinquent

employee, the punishment ought not to be set aside as a matter of course. It was decided that in such cases a copy of the report should be furnished to

the delinquent officer and the courts should interfere with the punishment only if it was satisfied that there had been a failure of justice. In this case

the appellant had failed to show that non-supply of the first enquiry report had caused him any prejudice. He was also given reasonable opportunity of

being heard and opportunity to take inspection of the relevant documents relied upon by the Bank during the enquiry.

The next issue to be decided is whether, under the garb of further enquiry the inquiring authority had conducted a fresh enquiry but failed to

comply with the proper procedure by denying the appellant an opportunity to produce witnesses and recall the earlier witnesses. In support of this

contention, the appellant has failed to show a single document from which it would appear that his prayer for recalling of the prosecution witnesses

was denied by the inquiring authority. Moreover, the learned Single Judge came to a specific finding that despite several opportunities the appellant

had failed to examine his own witnesses. We also find that the issues which were framed by the disciplinary authority while remitting the matter back

to the inquiring authority, were part of the articles of charges and no new issue had been framed for further enquiry as such the contention of the

appellant that the inquiring authority, under the garb of further enquiry had held a fresh enquiry is not sustainable.

In the decision of P. C. Kakkar (supra) the scope of judicial review in disciplinary proceedings had been well settled. The relevant portion of the

said decision is quoted herein below:-

“11. The common thread running through in all these decisions is that the court should not interfere with the administrator’s decision unless it

was illogical or suffers from procedural impropriety or was 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 Wednesbury case 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.â€​

Applying the above principles laid down in P. C. Kakkar (supra) we are of the opinion that there was no illegality in the procedure followed either by

the inquiring authority or by the disciplinary authority.

The order of the Appellate Authority dated February 19, 2002 which is under challenge in the writ application indicates that the Appellate

Authority has gone into minute details with regard to appreciation of the evidence placed before the authorities.

We now deal with the contention of the appellant that in the absence of proof of pecuniary loss, the appellant could not be punished for misconduct

and saddled with any liability. We find from the order impugned that the learned Single Judge had considered this issue in detail. In this connection the

judgments relied upon by the learned advocate for the respondent requires discussion. In Nikunja Bihari Patnaik (supra) it has been held that the

discipline of a bank was dependent upon its employees and officers acting and operating within their allotted sphere. An officer acting beyond the

scope of his duty and in breach of discipline and norms of the bank, would be said to have committed misconduct and no further proof of losses were

really necessary in order to punish such an officer. In this case, the inquiring authority had come to a clear finding that the appellant violated the rules

of the bank and on account of his misconduct the bank could have suffered huge pecuniary loss.

In Vishwa Mohan (supra) it had been categorically held that in banking business, absolute devotion, diligence, integrity and honesty needs to be

preserved by every bank employee particularly the officers. If the same was not observed the confidence of depositors would be impaired and failure

on the part of the officers to maintain devotion to duty, diligence, integrity and honesty would amount to misconduct.

For the reasons aforesaid we hold that the findings of the learned Single Judge on the non-existence of any illegality or impropriety in the

procedure followed by the respondents is upheld. We also agree with the learned Single Judge on the point that the allegations of non-supply of the

first enquiry report and illegality of the decision in remitting the matter back to inquiring authority with fresh issues in order to suit the wishes of the

disciplinary authority were no longer available to the appellant in view of the judgment and order dated March 1, 2000 and subsequent withdrawal of

the appeal from the said order before a Division Bench of this Court. We also agree with the findings of the learned Single Judge that the appellant

was bound to maintain discipline and the commission of breach of the rules of the Bank in allowing opening of the account without any introducer and

permitting clearance of high value cheques within a very short period amounted to negligence of duty and lack of devotion which were misconduct as

per the Regulations.

Now the final contention of the appellant that the punishment imposed was harsh and grossly disproportionate to the gravity of the offence is taken

up for consideration. The scope of interference with the quantum and proportionality of punishment has been the subject matter of various decisions of

the Apex Court. Such interference cannot be a routine matter. In Union of India vs. G. Ganayutham reported in (1997) 7 SCC 463 the Apex Court

summed up the position relating to proportionality in paragraphs 31 and 32 of the said judgment. The relevant paragraph is quoted herein below:-

“31. The current position of proportionality in administrative law in England and India can be summarized as follows:

(1) To judge the validity of any administrative order or statutory discretion, normally the Wednesbury test is to be applied to find out if the decision was

illegal or suffered from procedural improprieties or was one which no sensible decision-maker could, on the material before him and within the

framework of the law, have arrived at. The court would consider whether relevant matters had not been taken into account or whether irrelevant

matters had been taken into account or whether the action was not bona fide. The court would also consider whether the decision was absurd or

perverse. The court would not however go into the correctness of the choice made by the administrator amongst the various alternatives open to him.

Nor could the court substitute its decision to that of the administrator. This is the Wednesbury test.

(2) The court would not interfere with the administrator’s decision unless it was illegal or suffered from procedural impropriety or was irrational-

in the sense that it was in outrageous defiance of logic or moral standards. The possibility of other tests, including proportionality being brought into

English Administrative Law in future is not ruled out. These are the CCSU (1985 AC 374) principles.

(3) (a) As per Bugdaycay, Brind and Smith as long as the Convention is not incorporated into English Law, the English Courts merely exercise a

secondary judgment to find out if the decision-maker could have, on the material before him, arrived at the primary judgment in the manner he had

done.

(3) (b) If the Convention is incorporated in England making available the principle of proportionality, then the English Courts will render primary

judgment on the validity of the administrative action and find out if the restriction is disproportionate or excessive or is not based upon a fair balancing

of the fundamental freedom and the need for the restriction thereupon.

(4) (a) The position in our country, in administrative law, where no fundamental freedoms as aforesaid are involved, is that the Courts/Tribunals will

only play a secondary role while the primary judgment as to reasonableness will remain with the executive or administrative authority. The secondary

judgment of the Court is to be based on Wednesbury and CCSU principles as stated by Lord Greene and Lord Diplock respectively to find if the

executive or administrative authority has reasonably arrived at his decision as the primary authority.

(4) (b) Whether in the case of administrative or executive action affecting fundamental freedoms, the Courts in our country will apply the principle of

‘proportionality’ and assume a primary role, is left open, to be decided in an appropriate case where such action is alleged to offend

fundamental freedoms. It will be then necessary to decide whether the Courts will have a primary role only if the freedoms under Articles 19, 21 etc.

are involved and not for Article 14.â€​

In P. C. Kakkar (supra) the legal position in India has been laid down in paragraph 12 of the decision. The relevant paragraph is quoted below:-

“12. To put it differently, unless the punishment imposed by the disciplinary authority or the Appellate Authority shocks the conscience of the

court/tribunal, there is no scope for interference. Further, to shorten litigation it may, in exceptional and rare cases, impose appropriate punishment by

recording cogent reasons in support thereof. In the normal course if the punishment imposed is shockingly disproportionate it would be appropriate to

direct the disciplinary authority or the Appellate authority to reconsider the penalty imposed.â€​

The Hon'ble Supreme Court took recourse to the provision of Article 14 to adjudicate the question of arbitrariness in the order of punishment in

Ranjit Thakur vs. Union of India & Ors., reported in (1987) 4 SCC 611, wherein the Hon'ble Supreme Court recognized the power of the Court to

examine the quantum of punishment in the

touchstone of proportionality in the event the punishment was shockingly

disproportionate to the misconduct proved. The relevant portion of the

above decision is quoted below:-

In Bhagat Ram v. State of Himachal Pradesh this Court held : [SCC p. 453, SCC (L&S) P. 353, para 15] It is equally true that the penalty

imposed must be commensurate with the gravity of the misconduct, and that any penalty disproportionate to the gravity of the misconduct would be

violative of Article 14 of the Constitution.

The point to note, and emphasise is that all powers have legal limits.

In the present case the punishment is so strikingly disproportionate as to call for and justify interference. It cannot be allowed to remain

uncorrected in judicial review.

The scope of exercising discretionary power by the High Court/Tribunal has further been explained in the matter of B.C. Chaturvedi vs. Union of

India & Ors. reported in (1995) 6 SCC 749 by observing that in the event the punishment imposed by the disciplinary authority or appellate authority

shocks the conscience of the High Court/Tribunal, ordinarily the Court or Tribunal should direct the disciplinary/Appellate Authority to reconsider the

penalty imposed and in exceptional and rare cases only, the Court/Tribunal may impose appropriate penalty and that too with cogent reasons in support

thereof. The relevant portion of the above decision is quoted below:-

A review of the above legal position would establish that the disciplinary authority, and on appeal the appellate authority, being fact-finding

authorities have exclusive power to consider the evidence with a view to maintain discipline. They are invested with the discretion to impose

appropriate punishment keeping in view the magnitude or gravity of the misconduct. The High Court/Tribunal, while exercising the power of judicial

review, cannot normally substitute its own conclusion on penalty and impose some other penalty. If the punishment imposed by the disciplinary

authority or the appellate authority shocks the conscience of the High Court/Tribunal, it would appropriately mould the relief, either directing the

disciplinary/appellate authority to reconsider the penalty imposed, or to shorten the litigation, it may itself, in exceptional and rare cases, impose

appropriate punishment with cogent reasons in support thereof.

The principle that emerges from the ratio of the above mentioned decisions of the Apex Court, is that, the courts in our country could cause a

secondary review by applying Wednesbury reasonableness while deciding whether a punishment in a disciplinary proceeding was so harsh so as to

shock the conscience of the Court. Whereas, the function of primary review was restricted to the field of infringement of fundamental freedoms

which was within the domain of the administrators. In the instant case, the punishment has to be scrutinized by applying the Wednesbury principle of

reasonableness. Whether the punishment of “dismissal which shall ordinarily be a disqualification for future employment,†was shockingly

disproportionate or not. Admittedly the allegation of causing pecuniary loss to the bank had not been proved. The bank, as defendant no. 2 in its

written statement filed in the Civil Suit instituted by Poly Cab Industries had stated as follows:

“12: That with reference to the statement made in Paragraph no. 12 of the plaint the defendant no.2 state that in the usual course of business

transactions it sent the cheque to the clearing house on behalf of its customer and the proceeds of the cheque has been realised and credited in the

customers accounts. Defendant no.2 states that the answering defendant as collecting Banker is protected under Section 131 of the N.I. Act. The

plaintiff has twisted the correct facts. The fact is that the impugned cheque was collected by the answering defendant in the A/c of Poly Cab

Industries through its proprietor Shri Ajoy Kumar Mohanti.

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That with reference to the statement made in paragraph no. 21 of the plaint, the defendant no. 2 denies and disputes that the impugned cheque

was meant for the plaintiff. Even if the same was meant for plaintiff, though denied, the answering defendant had no knowledge of the same when

presenting it in clearing for its customer M/s Poly Cab Industries crediting the proceeds in the account and allowing withdrawals in the account

operated by its proprietor Shri Ajoy Kumar Mohanti. The answering defendant says that in the absence of any suspicious circumstances being brought

to the notice of the defendant no.2, it could not have stopped operations in the account with it. The plaintiff has not given any averments of the alleged

negligence of defendant no. 2 but has made general allegations. In the absence of specific instances/averments of alleged negligence or alleged failure

of duty. The General allegations are to be thrown out and rejected under Code of Civil Procedure. The Plaintiff has not cited any reasons for its

allegations that the answering defendant could not have allowed encashment of the impugned cheque by Shri Ajoy Kumar Mohanti proprietor of M/s

Poly Cab Industries. The averments are vague and liable to be rejected. Moreover the averments in the plaint are full of contradictions. On the one

hand it states that it had no account with defendant no. 2 and on the other states in the plaint that defendant no. 2 had fiduciary relationship with the

plaintiff. The allegations of fraud/collusion are also vague and liable to be rejected. Save and except of para 21 of the plaint are denied.

With reference to the statements made in paragraph no.22 and 23 of the plaint the containts are strongly denied. The answering defendant has not

acted negligency or fraudulently in collecting the proceeds of the cheque in clearing for its customer and allowing payment, the allegations of collusion

with defendant no. 3 are false. The allegation of alleged loss suffered by the plaintiff to the sum of Rs.12,77,081/- are denied. The answering

defendant no. 2 has collected the proceeds for the customer of M/s. Poly Cab Industries in the normal course without knowledge of any alleged

suspicious circumstances and negligence and hence is protected under section 131 of N. I. Act. The answering defendant is not liable to the plaintiff

for any amount. In any case the alleged interest rate mentioned by the plaintiff is highly excessive and is not in respect of any commercial transaction

between the plaintiff and defendant no.2.â€​

It appears from the averments of the bank that there was no illegality in presenting the cheque for clearing as there was no suspicious

circumstance and that the action of the Bank was protected by the provisions of Section 131 of the Negotiable Instruments Act. The Bank also denied

the allegation of pecuniary loss caused to the customer. The Bank denied that the account was fictitiously opened by another person who was not the

proprietor of Poly Cab Industries. Thereafter the suit was withdrawn by Poly Cab Industries, the customer who had complained of the alleged loss of

the amount of Rs.12,77,081/- at the behest of the Bank. Most importantly, the charge of pecuniary loss was also not proved before the inquiring

authority.

In the circumstances, the punishment of dismissal from service which will be a disqualification for future employment is shockingly

disproportionate to the gravity of the offence that has been proved. While we may not interfere with the findings of guilt, in a case of this nature, but

having regard to the nature of the charge, we shall consider the proportionality of punishment to find out whether the same was perverse and/or

irrational. Considering the said findings of guilt on the charges of misconduct, we are aware that although negligence, breach of rules of the Bank and

lack of devotion have been proved, the charge of pecuniary loss caused either to the Bank or to the customer by the appellant has not been proved.

The penalty in this case was dismissal which affected the Right to Life and Livelihood of the appellant. Admittedly, neither the Bank nor the

customer had suffered any pecuniary loss on account of the negligence, carelessness and indiscipline of the appellant. Moreover, the stand of the

Bank in the civil suit and also the subsequent withdrawal of the civil suit by Poly Cab Industries indicate that the misconduct of the appellant could at

best be negligence and violation of the Rules of the Bank but dishonest intention to cause pecuniary loss to the Bank or to defraud the Bank or its

customer had not been proved and as such, the order of punishment was shockingly disproportionate, being violative of Article 21 of the Constitution

of India inasmuch, dismissal from service takes away the right to livelihood of the appellant for the present and also in the future.

We thus set aside the order of punishment of “dismissal from service without notice in terms of Regulation 4 (j) of the said Regulations and

modify the judgment and order impugned to the above extent with a direction upon the Respondents to impose any lesser punishment, as per its

Regulations and thereafter release the consequential benefits to appellant in accordance with law. Such exercise shall be completed within a period of

two months from the date of communication of this order, considering the fact that the disciplinary proceeding is almost 20 years old.

With the above observation the appeal is disposed of. There shall be no order as to costs.

Urgent Photostat certified copy of this judgment, if applied for be given to the parties on priority basis.