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Friday, February 28, 2014

Service matter - Senior manger was awarded with punishment of reducing him in two stages in pay scale with cumulative effect as the charge one was partly proved after consultation with CVC - High court set aside the same and further directed to give promotion - Apex court partly allowed the appeal and partly set aside the order of High court as his record is not satisfactory one , High court can not give such direction for promotion =Oriental Bank of Commerce & Ors. … Appellant (s) Versus S.S. Sheokand & Anr. … Respondent (s) =2014(Feb.Part) judis.nic.in/supremecourt/filename=41263

  Service matter - Senior  manger was awarded with punishment of reducing him in two stages in pay scale with cumulative effect as the charge one was partly proved  after consultation with CVC - High court set aside the same and further directed to give promotion - Apex court partly allowed the appeal and partly set aside the order of High court as his record is not satisfactory one , High court can not give such direction for promotion =
 Division Bench  of  Punjab  and  Haryana  High
Court in Civil Writ Petition  No.18847  of  2001,  allowing  the  said  Writ
Petition filed by the respondent, a Senior Manager  in  the  appellant-bank.
That judgment and  order  quashed  the  disciplinary  order  passed  by  the
appellant-bank reducing him in two  stages  in  pay  scale  with  cumulative
effect and also directed that he be considered for further promotion.=

Charge No.1 –  Respondent  had  unauthorisedly  purchased  3rd  party
           cheques/drafts of huge amount aggregating to Rs.45.23 crores for
           a number of parties much  beyond  his  discretionary  powers  of
           lending without completing pre-sanction formalities in violation
           of head office guidelines.  Thus he violated Regulation 3(i)  of
           Oriental  Bank   of   Commerce   Officer   Employees   (Conduct)
           Regulation, 1982.

      Charge  No.2  –  Respondent  had  released  advance  under  the  Prime
           Minister  Rojgar  Yojna,  and   unauthorisedly   insisted   such
           borrowers to provide  collateral  securities  in  the  shape  of
           immovable property and  guarantee  in  violation  of  the  above
           scheme.”
As per the head office circular, the  discretionary
powers of the Branch Manager at the relevant time were up to Rs.30 lacs for
purchasing bank drafts and government cheques, and up to  Rs.1.5  lacs  for
third party  cheques.   As  against  this  provision,  the  respondent  had
purchased cheques/drafts aggregating to Rs.45.23 crores as per the  details
produced in the inquiry report. This was done  without  any  authorization,
and particularly when the authority of the respondent in  this  behalf  was
placed under abeyance.  
- were  ratified  and confirmed by the higher authorities.

Charge-1 is held as partly proved.
Thus, the inquiry officer had held that the acts of omission and commission
on the part of the respondent were essentially in the nature of  procedural
lapses.  He held that  the  charge  of  lack  of  integrity  had  not  been
substantiated. Thus, charge No.1 mentioned above was, partly proved.
As far as charge No.2 is concerned, it was alleged therein that
the respondent had released advances under the Prime Minister Rojgar Yojna,
and  for  that  insisted   on   the   borrowers   to   provide   collateral
securities/guarantees of third party.  The inquiry officer, however,  noted
that the prosecution had not placed on record any single  primary  document
of the collateral securities/guarantees of third party to prove that  part.
He, therefore, held that charge No.2 was not proved.

The  Chief  Vigilance Officer 
thereafter sent a letter to the  disciplinary  authority  that  the
Central Vigilance Commission had advised  to  impose  a  major  penalty  of
reduction of two stages in pay scale, and thereupon the order  came  to  be
passed on 27.10.1999 imposing the punishment of reduction of two stages  in
pay scale. 
       The High Court essentially relied upon the judgment  and  order
rendered by this  Court  in  the  case  of  Nagaraj  Shivarao  Karjagi  vs.
Syndicate Bank Head Office, Manipal reported in AIR 1991 SC 1507.  In  that
matter also the bank had acted as per the advice of the  Central  Vigilance
Commission. The punishment was interfered by this Court.  In  paragraph  19
of its judgment, this Court observed as follows:-
      “19………..The punishment to be imposed whether minor  or  major  depends
           upon the nature of every case and the gravity of the  misconduct
           proved.   The  authorities  have  to  exercise  their   judicial
           discretion having regard to the facts and circumstances of  each
           case.  They cannot  act  under  the  dictation  of  the  Central
           Vigilance Commission or of the  Central  Government.   No  third
           party like the  Central  Vigilance  Commission  or  the  Central
           Government could  dictate  the  disciplinary  authority  or  the
           appellate authority as to how they should exercise  their  power
           and  what  punishment  they  should  impose  on  the  delinquent
           officer. (See. De  Smith’s  Judicial  Review  of  Administrative
           Action, Fourth Edition, p. 309).  The impugned directive of  the
           Ministry of Finance is, therefore, wholly  without  jurisdiction
           and plainly contrary  to  the  statutory  Regulations  governing
           disciplinary matters.”
Apex court conclusion :
Mr.  Bhatt,
learned senior counsel for  the  appellant  submitted  that  the  bank  was
required to refer the matter to the CVC  which  is  constituted  under  the
Central Vigilance Commission Act, 2003. 
Regulation 19 of  1982  Regulations
framed thereunder makes it obligatory whenever there is a  vigilance  angle
involved.  This regulation reads as follows:-
      “19. Consultation with the  Central  Vigilance  Commission:  The  Bank
           shall  consult  the  Central   Vigilance   Commission   wherever
           necessary,  in  respect  of  all  disciplinary  cases  having  a
           vigilance angle.”

      14.        That apart, he submitted that the bank had arrived at  its
decision on its own, and not because of any dictate  by  the  CVC.
We have also been informed that the  respondent  was  considered
for promotion once again in the  year  2005,  and  not  found  fit  for  the
promotion.  Thus, the bank had considered the respondent after the  impugned
judgment which was in favour of the respondent.  
We  are  not  concerned  as
such with this subsequent consideration, but this is only to point out  that
the bank had not declined to consider him.  
We are of course concerned  with
the direction in the impugned judgment to consider him once  again,  on  the
basis of the material prior to the judgment.  
Inasmuch as the record of  the
respondent was not satisfactory, in our view, there was no occasion for  the
High Court to give any such direction on the  footing  that  the  respondent
was denied the consideration only because  he  had  suffered  a  punishment.
That inference was not called for.
20.         In the  circumstances,  we  allow  this  appeal  only  in  part.
Whereas the  judgment  and  order  of  the  High  Court  setting  aside  the
punishment will remain, the direction to consider  him  for  promotion,  and
give him benefits on that footing will  have  to  be  set  aside,  which  we
hereby direct.  The respondent will however get  the  monetary  benefits  on
the footing that the said punishment is quashed.

21.         Appeal is, therefore, allowed in part as  above.   Parties  will
bear their own costs.
2014(Feb.Part) judis.nic.in/supremecourt/filename=41263
H.L. GOKHALE, J. CHELAMESWAR


                                                            REPORTABLE

                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION
                        CIVIL APPEAL NO. 3081 OF 2006

Oriental Bank of Commerce & Ors.              …      Appellant (s)

                                    Versus
S.S. Sheokand & Anr.                                     …   Respondent (s)


                          J  U  D  G  E  M  E  N  T

H.L. Gokhale J.

             This Civil Appeal seeks to challenge  the  judgment  and  order
dated 16.3.2004 rendered by a Division Bench  of  Punjab  and  Haryana  High
Court in Civil Writ Petition  No.18847  of  2001,  allowing  the  said  Writ
Petition filed by the respondent, a Senior Manager  in  the  appellant-bank.
That judgment and  order  quashed  the  disciplinary  order  passed  by  the
appellant-bank reducing him in two  stages  in  pay  scale  with  cumulative
effect and also directed that he be considered for further promotion.
The facts leading to this appeal are this wise:-
2.           The respondent at the relevant time was working as the  Senior
Manager in a branch of the appellant-bank at Narwana, Bahadurgarh.  It  was
noticed by the bank that he had purchased  third  party  cheques/drafts  of
huge amounts beyond the discretionary powers of  lending.   This  was  done
without  completing  the  pre-sanction  formalities.   The  appellant-bank,
therefore, served a show cause notice to the respondent  on  26.2.1997  for
committing these unauthorised acts.  The respondent filed a detailed  reply
dated 12.4.1997. Therein the respondent admitted committing of the  alleged
acts.  He, however, stated  that  this  was  done  with  the  intention  of
increasing the profits of the bank.  He also contended that  the  bank  had
not suffered any loss in these transactions.
3.          The appellant-bank, thereafter, charge-sheeted  the  respondent
on 1.12.1997 for two specific irregularities, they were as follows:-
      “Charge No.1 –  Respondent  had  unauthorisedly  purchased  3rd  party
           cheques/drafts of huge amount aggregating to Rs.45.23 crores for
           a number of parties much  beyond  his  discretionary  powers  of
           lending without completing pre-sanction formalities in violation
           of head office guidelines.  Thus he violated Regulation 3(i)  of
           Oriental  Bank   of   Commerce   Officer   Employees   (Conduct)
           Regulation, 1982.

      Charge  No.2  –  Respondent  had  released  advance  under  the  Prime
           Minister  Rojgar  Yojna,  and   unauthorisedly   insisted   such
           borrowers to provide  collateral  securities  in  the  shape  of
           immovable property and  guarantee  in  violation  of  the  above
           scheme.”

4.          The charge-sheet was  followed  by  an  inquiry.   The  inquiry
officer gave a report dated 26.2.1999 which was forwarded by the respondent
on 17.4.1999 to make a representation on the findings.  In paragraph  4  of
the report, the inquiry officer dealt with statement of SW-1 (State Witness
No.1) which stated that as per the head office circular, the  discretionary
powers of the Branch Manager at the relevant time were up to Rs.30 lacs for
purchasing bank drafts and government cheques, and up to  Rs.1.5  lacs  for
third party  cheques.   As  against  this  provision,  the  respondent  had
purchased cheques/drafts aggregating to Rs.45.23 crores as per the  details
produced in the inquiry report. This was done  without  any  authorization,
and particularly when the authority of the respondent in  this  behalf  was
placed under abeyance.  The respondent raised various technical  objections
with respect to the production of the documents, but essentially  contended
that his acts, which went beyond discretionary powers,  were  ratified  and
confirmed by the higher authorities.  He submitted that  these  instruments
were received from the respectable parties to increase the  profit  of  the
branch.  With respect to the instructions issued to  him  by  the  Regional
Manager to stop purchasing these cheques and drafts, he submitted  that  he
had not violated these instructions.
5.          The paragraph 4.3 of the Enquiry report contains the assessment
of evidence on charge No.1.  It reads as follows:-

            “4.3 Assessment of Evidence:-
      Ex. S.27 and S.28  are  head  office  circulars  which  lay  down  the
           discretionary powers of the  branch  incumbent.   SW1  confirmed
           that during the material time  the  powers  of  the  BM  (Branch
           Manager) was 30 lacs for purchase of bank draft and Rs. 1.5 lacs
           for third party cheques.  SW1 also confirmed that the CO(Charged
           Officer) had purchased cheques/drafts beyond  his  discretionary
           powers. He deposed that 77 cheques/drafts amounting to 40 crores
           and 153 cheques/drafts amounting to 14.63 crores were  purchased
           through clearing adjustment  account.   It  was  confirmed  that
           discounting  of  cheques/drafts  through   clearing   adjustment
           account was not permitted as per HO guidelines.   SW1  confirmed
           that Ex. S2 was HO (Head Office) Circular dated  11.12.95  which
           had placed in abeyance the discretionary powers of  the  BM  and
           Regional Heads in respect of loans and advances  except  in  the
           priority sector.  SW1 confirmed that s-15 was HO circular  dated
           23.10.96  releasing  the   aforesaid   restrictions.    It   is,
           therefore, evident that the powers of the BM  and  the  Regional
           Heads had been kept in abeyance between  11.12.95  to  23.10.96.
           On examining Ex. S.3, S4 and S.17, SW1 confirmed that the CO had
           unauthorisedly  purchased  cheques/drafts  during  the   period.
           Furthermore, SW1 confirmed that the  cheques  purchased  through
           clearing adjustment  account  are  that  of  sister  and  allied
           concerns.  Ex. S.27 and 28 would evidence that  this  power  was
           vested with the GM (General Manager) and higher  officers  only.
           SW1 also confirmed that since the parties in question were  also
           enjoying certain credit facilities sanctioned by RO/HO (Regional
           Office/Head  Office),  the  branch  should  not  have  purchased
           cheques/drafts of the parties under its own  powers.   Ex.  S-6,
           S.7, S.8 and S.9 are correspondence which proved that the higher
           formation of the bank had raised serious objections to the  CO’s
           purchase   of   cheques/drafts.    Ex.   S.10   and   S.12   are
           letters/replies of the CO where in he had admitted his mistakes.
            SW1 also confirmed that Ex.S.13 and S.14 are letters  from  the
           GM Personnel giving details  of  the  unauthorised  purchase  of
           cheques  and  drafts  by  the  CO,   which   were   beyond   his
           discretionary powers and made at a time  when  his  powers  were
           placed under abeyance. His non-reporting in the matter to RO has
           also been questioned.  Ex. S14 is a letter from the CO accepting
           the aforesaid matter with an assurance to not to repeat the same
           in future.  In view of the aforesaid evidence the contention  of
           the CO to treat the matter as that of  the  priority  sector  is
           naturally not tenable.  However, the CO has  stated  that  there
           was no loss to the bank.  The PO (Prosecuting Officer)  has  not
           disputed this.  Therefore, the act of omission and commission of
           the CO can essentially be  treated  as  procedural  lapses.  The
           charge of the lack of integrity has not been substantiated.

                 Charge-1 is held as partly proved.”
Thus, the inquiry officer had held that the acts of omission and commission
on the part of the respondent were essentially in the nature of  procedural
lapses.  He held that  the  charge  of  lack  of  integrity  had  not  been
substantiated. Thus, charge No.1 mentioned above was, partly proved.
6.          As far as charge No.2 is concerned, it was alleged therein that
the respondent had released advances under the Prime Minister Rojgar Yojna,
and  for  that  insisted   on   the   borrowers   to   provide   collateral
securities/guarantees of third party.  The inquiry officer, however,  noted
that the prosecution had not placed on record any single  primary  document
of the collateral securities/guarantees of third party to prove that  part.
He, therefore, held that charge No.2 was not proved.
7.          After receiving the inquiry  report  the  respondent  made  his
representation  dated  4.5.1999,  and  pleaded  that  he  deserved  to   be
exonerated.  The bank, thereafter, submitted all these papers to the  Chief
Vigilance Officer of the Bank to forward the same to  the  Chief  Vigilance
Commissioner (CVC). The respondent at that stage wrote  to  the  appellant-
bank on 28.6.1999 seeking this correspondence with the  CVC.   In  that  he
stated as follows:-
      “Now, after giving representation dated  4.5.99  on  the  findings  of
           inquiry officer dated 26.2.99, the stage has come  where  second
           stage advice has  to  be  remitted  to  the  CVC  through  Chief
           Vigilance Officer of  Oriental  Bank  of  Commerce  and  I  also
           understand that the case has been remitted or the same is in the
           process of remitting to the Chief  Vigilance  Officer  alongwith
           recommendations of action proposed for onward submission to  the
           Chief Vigilance Commissioner  (CVC).   In  the  light  of  above
           facts, you are requested to kindly supply me the copies  of  all
           such recommendations meant  for  second  stage  advice  and  the
           advice so received or likely to be received from the CVC for  my
           representation on these recommendations prior to  the  stage  of
           final disposal under  Regulation  ‘7’  of  Discipline  &  Appeal
           Regulations, 1982 so that the interest  of  my  defence  is  not
           jeopardized.”

8.           The  appellant  declined  that  request  of   furnishing   the
correspondence of papers exchanged  with  the  CVC.   The  Chief  Vigilance
Officer thereafter sent a letter to the  disciplinary  authority  that  the
Central Vigilance Commission had advised  to  impose  a  major  penalty  of
reduction of two stages in pay scale, and thereupon the order  came  to  be
passed on 27.10.1999 imposing the punishment of reduction of two stages  in
pay scale.  The respondent filed a departmental appeal, and the appeal came
to be rejected.  The review thereof was  also  rejected  by  the  Board  of
Directors.  The appellate order  dated  26.5.2000  passed  by  the  General
Manager (Personnel) who was the disciplinary authority at  the  end  of  it
stated as follows:-
      “……In this connection it is  submitted  that  awarding  of  punishment
           with cumulative effect falls  within  Regulation  4(f)  and  the
           Disciplinary Authority has independently applied its mind  while
           awarding the punishment.   It  is  further  submitted  that  the
           advice of the CVC is not binding on the Disciplinary  Authority.
           Since the CVC is rendering advice to the Disciplinary  authority
           the correspondence exchanged is not required to be  provided  to
           the charge sheeted employee. The  punishment  has  been  awarded
           keeping in view the gravity of the misconduct committed  by  the
           officer employee alongwith the submissions made by the employee.

                 Submitted for orders please.

                 SD/- General Manager (Per.)

            Disciplinary Authority.”

The Chairman & Managing Director, who was the appellate  authority,  passed
his orders into following words:-
                 “I don’t wish to entertain”
                                  Sd/-
                                  2.6.2000”

9.          Being aggrieved by  the  imposition  of  this  punishment,  the
respondent filed one Writ Petition earlier bearing No.4116 of 2001  to  the
Punjab and Haryana High Court on which an order came to be passed that  the
reviewing authority may consider the review application of the  respondent.
Time to take the decision was also extended on one occasion, and  the  High
Court was informed that the Bank was considering commutation of  the  major
penalty. The Chief Vigilance  Officer  of  the  bank  wrote  to  the  Chief
Vigilance Commission on 18.8.2001 that the penalty imposed deserved  to  be
modified to a minor penalty.  It, however, appears that the request was not
accepted and, the appellant-bank informed the respondent  that  the  review
petition was rejected.  This led the respondent to file Civil Writ Petition
No.18847 of 2001.  Apart from the prayer to quash the order of  punishment,
the respondent also sought a direction that he be  considered  for  further
promotion from the post which he was then holding viz. that of MMGS-III  to
SMGS-VI.  It was his contention that his turn had come up for consideration
for promotion, and it was declined because of this departmental action. The
High Court allowed the Writ Petition by the impugned judgment and order.
10.         The High Court essentially relied upon the judgment  and  order
rendered by this  Court  in  the  case  of  Nagaraj  Shivarao  Karjagi  vs.
Syndicate Bank Head Office, Manipal reported in AIR 1991 SC 1507.  In  that
matter also the bank had acted as per the advice of the  Central  Vigilance
Commission. The punishment was interfered by this Court.  In  paragraph  19
of its judgment, this Court observed as follows:-
      “19………..The punishment to be imposed whether minor  or  major  depends
           upon the nature of every case and the gravity of the  misconduct
           proved.   The  authorities  have  to  exercise  their   judicial
           discretion having regard to the facts and circumstances of  each
           case.  They cannot  act  under  the  dictation  of  the  Central
           Vigilance Commission or of the  Central  Government.   No  third
           party like the  Central  Vigilance  Commission  or  the  Central
           Government could  dictate  the  disciplinary  authority  or  the
           appellate authority as to how they should exercise  their  power
           and  what  punishment  they  should  impose  on  the  delinquent
           officer. (See. De  Smith’s  Judicial  Review  of  Administrative
           Action, Fourth Edition, p. 309).  The impugned directive of  the
           Ministry of Finance is, therefore, wholly  without  jurisdiction
           and plainly contrary  to  the  statutory  Regulations  governing
           disciplinary matters.”

11.         The High Court relied upon another judgment of  this  Court  in
the case of State Bank of India vs. D.C. Aggarwal reported in AIR  1993  SC
1197.  In that matter also, the  High  Court  had  quashed  the  punishment
imposed on the respondent, since the CVC report had not been  furnished  to
him.  In paragraph 5 of the judgment this Court observed as follows:-

      “5…… May be that the Disciplinary  Authority  has  recorded  its  own
           findings and it may be coincidental that reasoning and basis  of
           returning the finding of guilt are same as in the CVC report but
           it being a material  obtained  behind  back  of  the  respondent
           without his knowledge or supplying of any copy to him  the  High
           Court in our opinion did not commit any error  in  quashing  the
           order.”

12.         Therefore, in the present case, the High Court  set  aside  the
punishment imposed on the respondent. It also  issued  a  Mandamus  to  the
appellant-bank to consider the  respondent  for  promotion,  which  he  had
sought.  Being aggrieved by that judgment and order, this appeal  has  been
filed.  Mr. K.N. Bhatt, learned senior counsel appeared for the  appellants
and Mr. Nidhesh Gupta, learned senior counsel appeared for the respondent.
Submissions on behalf of the parties:-
13.         It was submitted on behalf of  the  appellants  that  the  High
Court had erred in interfering  with  the  punishment,  and  in  any  case,
directing consideration  of  the  respondent  for  promotion.   Mr.  Bhatt,
learned senior counsel for  the  appellant  submitted  that  the  bank  was
required to refer the matter to the CVC  which  is  constituted  under  the
Central Vigilance Commission Act, 2003. 
Regulation 19 of  1982  Regulations
framed thereunder makes it obligatory whenever there is a  vigilance  angle
involved.  This regulation reads as follows:-
      “19. Consultation with the  Central  Vigilance  Commission:  The  Bank
           shall  consult  the  Central   Vigilance   Commission   wherever
           necessary,  in  respect  of  all  disciplinary  cases  having  a
           vigilance angle.”

      14.        That apart, he submitted that the bank had arrived at  its
decision on its own, and not because of any dictate  by  the  CVC.   Charge
No.1 was a serious charge.  It  was  already  proved  in  the  Departmental
Enquiry, and although it is true that at some  stage  the  bank  management
thought that a lenient view may be taken, it specifically  arrived  at  its
own decision as can be seen from the appellate order.  In  his  submission,
there was no prejudice caused to the respondent by not making the report of
the CVC available to him.  Conduct of this type required a stringent action
to be taken.  He relied upon the judgment of this  Court  in  the  case  of
Disciplinary Authority-Cum-Regional  Manager  vs.  Nikunja  Bihari  Patnaik
reported in 1996 (9) SCC 69.  This Court has held in that matter that  when
the bank officer acts beyond his authority, it is a misconduct, and a proof
of any loss to the bank is not necessary.  That was a  case  where  also  a
senior officer of the Central Bank of India  had  allowed  over-drafts  and
passed cheques involving substantial amounts beyond his authority, and  the
respondent had been dismissed from his service.  Mr. Bhatt, submitted  that
in the instant case, the appellant-bank  had,  in  fact,  been  lenient  in
imposing the punishment of merely reducing the respondent by two grades.
15.         It was then submitted  by  Mr.  Bhatt,  that  in  any  case  the
direction to  consider  the  respondent  for  the  promotion  could  not  be
sustained.  He pointed out to us  that  the  respondent  had  been  punished
earlier for similar conduct on 27.10.1999.  He was considered for  promotion
in the year 2002, and subsequent to the impugned judgment in the  year  2005
also but was not found fit.  The  learned  counsel  for  the  appellant-bank
submitted that the question of promotion to such a senior  post  had  to  be
decided on merits and suitability of  the  candidate.   Mr.  Bhatt,  further
submitted that even if the punishment was to be interfered with,  there  was
no case for direction for promotion.
16.         It was submitted on behalf of the respondent on the other  hand,
that there was no loss suffered by the bank, and at the  highest  it  was  a
technical  lapse.  The  bank  management  had  also  decided  that  a  minor
punishment was required, and it was only because of the dictate of  the  CVC
that the disputed punishment  had  been  imposed.   Firstly,  there  was  mo
reason to refer the issue to the CVC since  there  was  no  vigilance  angle
involved therein. That apart, the report of CVC was not  made  available  to
the respondent, and it clearly amounted to denial  of  fair  opportunity  to
defend.  Mr. Gupta submitted that the denial of  promotion  was  essentially
because  of  this  punishment,  or  else  the  respondent  would  have  been
promoted. He, therefore, submitted that there was no occasion  to  interfere
with the impugned judgment and order.  Mr.  Gupta  submitted  that  the  two
judgments relied upon by the High Court in  the  case  of  Nagaraj  Shivarao
(supra) and State Bank of India (supra)  squarely  applied  to  the  present
case, and there was no occasion for this Court to take a different  view  or
to interfere with any part of the judgment.
Consideration of the submissions:-
17.         We have considered the submissions of both  the  counsel.   When
we come to the question of imposition of punishment on the respondent,  what
we find is that undoubtedly, there was a  serious  allegation  against  him,
and as it has been held in the case of  Disciplinary  Authority-Cum-Regional
Manager (supra), such acts could not be condoned.   At  the  same  time,  we
have also to note that the bank management itself had taken the view in  the
initial stage that the action did not require a major penalty.  It  is  also
relevant to note that the High Court was  also  informed  at  the  stage  of
review that the Bank was considering imposition of a minor  penalty.  It  is
quite possible to say that the bank management did arrive  at  its  decision
to maintain a major penalty at a later stage on its own, and not because  of
the dictate of the CVC, but at the same time it has got  to  be  noted  that
the CVC  report  had  been  sought  by  the  management  of  the  bank,  and
thereafter the punishment had been imposed.  As  observed  in  the  case  of
State Bank of India (supra), may be  that  the  Disciplinary  Authority  had
recorded its own findings, and had arrived at its  own  decision,  but  when
this advise from CVC was sought, it could not be said that  this  additional
material was not a part of the decision making process.   When  this  report
was not made available to the respondent, it is difficult to  rule  out  the
apprehension about the  decision  having  been  taken  under  pressure.  Any
material, which goes into the decision making process against  an  employee,
cannot be  denied  to  him.   In  view  of  the  judgment  in  the  case  of
Disciplinary Authority-cum- Regional Manager (supra), the  decision  of  the
Bank could have been approved on merits, however, the two judgments  in  the
cases of Nagaraj Shivaraj Karajgi (supra) and State Bank  of  India  (supra)
lay down the requisite procedure in such matters, and in the facts  of  this
case, it will not be appropriate to depart from the dicta therein.  On  this
yardstick alone, a part of the judgment of the High Court  interfering  with
the punishment will have to be sustained.

18.         Then, we come to the issue of direction of  the  High  Court  to
consider the respondent for promotion. The respondent was already in a  post
of a Senior  Manager.   He  was  seeking  a  promotion  to  a  still  higher
position.  Promotion as such, and in any case, to a higher  post  cannot  be
insisted as a matter of right.  In the instant case, it has been brought  to
our notice that the respondent was considered for promotion in 2002 and  was
not found fit.  It was pointed out by Mr. Bhatt that this was not merely  on
the basis of the punishment that was imposed  on  the  respondent.   He  had
previous adverse entry also in his record in the year 1999.   Besides,  even
if we look to the charge independently, purchasing third party  cheques  and
drafts of huge amounts beyond his authority of lending has been held  to  be
proved against the respondent, and  that  finding  has  not  been  seriously
contested and dislodged. Whether he deserved a major punishment or  not,  or
whether a lenient view of the allegations should  be  taken  by  considering
his conduct as a procedural lapse is another aspect.  In the  instant  case,
the decision to impose a major punishment had to be interfered with  because
of the manner in which the decision was taken.  It has also  been  submitted
that the High Court should have referred the matter back to the  appropriate
authority for reconsideration and imposition atleast of a minor penalty.  It
is apparent that it was not a case for  complete  exoneration,  however,  it
will  not  be  desirable  to  give  such  direction  after  so  many  years,
particularly, when the respondent has since  retired.  That  being  so,  the
order quashing the punishment will remain.  That, however,  would  not  mean
that the direction of the High  Court  to  the  appellant  to  consider  the
respondent for promotion should be sustained.

19.         We have also been informed that the  respondent  was  considered
for promotion once again in the  year  2005,  and  not  found  fit  for  the
promotion.  Thus, the bank had considered the respondent after the  impugned
judgment which was in favour of the respondent.  We  are  not  concerned  as
such with this subsequent consideration, but this is only to point out  that
the bank had not declined to consider him.  We are of course concerned  with
the direction in the impugned judgment to consider him once  again,  on  the
basis of the material prior to the judgment.  Inasmuch as the record of  the
respondent was not satisfactory, in our view, there was no occasion for  the
High Court to give any such direction on the  footing  that  the  respondent
was denied the consideration only because  he  had  suffered  a  punishment.
That inference was not called for.
20.         In the  circumstances,  we  allow  this  appeal  only  in  part.
Whereas the  judgment  and  order  of  the  High  Court  setting  aside  the
punishment will remain, the direction to consider  him  for  promotion,  and
give him benefits on that footing will  have  to  be  set  aside,  which  we
hereby direct.  The respondent will however get  the  monetary  benefits  on
the footing that the said punishment is quashed.

21.         Appeal is, therefore, allowed in part as  above.   Parties  will
bear their own costs.

                                       …………..…………………..J.
                                       [  H.L. Gokhale  ]





                                                     ………………………………J.
                                       [ J. Chelameswar ]
New Delhi
Dated : February  26, 2014






































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