Ram Dhari Vats vs Union Of India (Uoi) And Ors.
2006 Latest Caselaw 2172 Del

JUDGMENT

S. Muralidhar, J.

1. The petitioner was working as an Assistant Manager at the Narela Branch of Syndicate Bank ('Bank'), New Delhi. He was issued a charge sheet on 25.11.1996 for a disciplinary enquiry under Article 6 of the Syndicate Bank Officer Employees (Discipline and Appeal) Regulations, 1996. Broadly, the charge was that the petitioner had abused his official position during his tenure as Manager in the Baghpat Branch of the Bank in Uttar Pradesh between 17.8.88 and 21.5.92 and sanctioned/released six loans amounting to Rs.60,000 in a manner detrimental to the interests of the Bank.

2. The Enquiry Officer in his report dated 6.7.1998 held charge No.1 to be partly proved, charges 2 and 3 not proved and charges 4, 5 and 6 fully proved. The Disciplinary Authority disagreed with the findings of the Enquiry Officer and found all the charges to be proved. By a letter dated 20.10.1988 the Disciplinary Authority enclosed a copy of the report of Enquiry Officer, the tentative view thereon of the Disciplinary Authority and required the petitioner to reply to the same within a specified date. The petitioner replied to this letter. By an order dated 28.11.1988 the disciplinary authority after coming to the conclusion that the petitioner was guilty of all the charges, imposed on the petitioner the penalty of dismissal from service. The petitioner's appeal was dismissed by the Appellate Authority on 10.3.1999. Thereafter, the petitioner filed this writ petition on 1.2.2000 seeking the quashing of the Enquiry Officer's report, the dismissal order and the Order of the Appellate Authority.

3. Mr.Arun Bhardwaj, learned Counsel appearing for the petitioner makes the following submissions:

(a) The very basis of the charge, i.e. the loans had been advanced to non-existent persons, was not only not established during the enquiry but in fact some of the loan borrowers had themselves appeared before the Enquiry Officer and some others had subsequently written to the Bank acknowledging that they had borrowed loans. If this principal charge failed, then all other charges, which were consequential thereto must also failed.

(b) The findings of the Disciplinary Authority, differing with the report of the Enquiry Officer, was perverse and not based on the evidence on record.

(c) The Disciplinary Authority, and the Appellate Authority failed to appreciate that out of the six loans purported to have been sanctioned either to non-existent persons or irregularly by the petitioner, four loans were fully repaid. Therefore, it could not be said that the advancing of these loans was detrimental to the interests of the Bank.

(d) Moreover, the Bank had made a claim with the Delhi State Industrial Development Corporation (DSIDC) in respect of these loans and no such claim could have been made if any of the staff, including the petitioner herein, was found guilty having illegally sanctioned such loan.

(e) Without prejudice to the above submissions, the punishment of dismissal from service was disproportionate and was, in the circumstances of the present case, one that should "shock the judicial conscience.

4. Mr.Jagat Arora, learned Counsel appearing for the respondent submits that the scope of interference by the High Court in exercise of its extraordinary jurisdiction under Article 226 of the Constitution of India, in matters such as these, is narrow and well defined as explained in several decisions of the Hon'ble Supreme Court. Relying on the decisions in Disciplinary Authority-cum-Regional Manager v. Nikunja Bihari Patnaik , he submitted that even where no financial loss was caused to the Bank, if it was proved that the employee as a bank Manager exceeded his authority, the charge of misconduct would stand attracted. He pointed out that even the Enquiry Officer had not fully exonerated the petitioner. On three articles of charge, the Enquiry Officer and the Disciplinary Authority had concurrently held that they stood fully proved. This had been affirmed by the Appellate Authority. In these circumstances, no interference was called for by this Court under Article 226 of the Constitution of India. Even the repayment of loans was only in respect of 4 of the 6 borrowers and that too only partially. He submits that even this was a subsequent occurrence which would not affect the gravity of the charges for which the petitioner had been found guilty. Finally, he submitted that considering that the petitioner was a bank employee holding a managerial position, the charges were serious enough to warrant the punishment of dismissal.

5. Both parties filed written submissions. The petitioner has, along with his written submissions, sought to introduce for the first time two documents which according to the petitioner would go to show that the borrowers had admitted taking loans.

6. The scope of the jurisdiction of the High Court under Article 226 of the Constitution in matters arising from disciplinary enquiries is extremely limited. It is narrower when such findings are concurrent. Unless the findings are shown to be glaringly perverse the High Court under Article 226 will not lightly interfere. What can persuade a Court to interfere is a challenge to the validity of the disciplinary proceedings on grounds of procedure resulting in irreversible prejudice to the charged employee. However, in the present case, the principal submissions of the petitioner centre around the findings of the Enquiry Officer and the Disciplinary Authority which, according to the petitioner, are either based on no evidence or on an improper appreciation of the evidence.

7. The contention arising out of Charge No.1 concerning the identity of the loan borrower may be first considered. This charge has been sub-divided into several other aspects. While one of the aspects concerns the identity of the loan borrower said Raj Kumar, the other is that such a person who was not running any business at all at Baghpat at the relevant point of time. This being one of the main reasons for the grant of the loan, the sanctioning of such loan for business purposes was itself illegal. Therefore, even while the Enquiry Officer found that the charge of giving loan to a non-existent person was not proved against the petitioner, he held that the "charge/allegations of not running of business by the borrower at Baghpat is established." Further, the Enquiry Officer found that the petitioner "failed to furnish the address of the borrower when asked for repeatedly but... produced the borrower as defense witness and the loan is also highly overdue." On the basis of the above evidence the Enquiry Officer concluded: "the borrower was not doing any business at Baghpat."

8. The Disciplinary Authority, after discussing the evidence, came to the conclusion that the charge stood fully proved. The reasons given by the Disciplinary Authority as set out in its letter dater 20.10.1988 to the petitioner are as follows:

In view of the above and also your reluctance to get examined yourself as witness and face the cross examination and also the fact that the allegations such as, antecedents of the parties were not known/nor established while accepting the loan proposal, NOCs from other banks were not placed on record, introducer of the borrower/sureties to the loans have disowned knowledge of the borrowers, no such person lived there/conducted any business during the relevant period and their whereabouts were not known, end use of the loan proceeds were not ensured, not a single monthly installment was received, various letters sent to your by the branch/DO/ZO requesting you to furnish present address of the borrowers were not respond etc., are held as conclusively established during the enquiry, the conclusion arrived by the IA that the two borrowers were existing is not correct, as the documentary, oral and circumstantial evidence establish that the loans were sanctioned/released in the names of persons who did not exist/were not doing any business at Baghpat, for some non-genuine purposes, hence this component of the charge is held as substantially proved.

As already noticed, the Appellate Authority has concurred with the above findings. The conclusion of the Disciplinary Authority in respect of two other charges, where the Enquiry Officer found some part of the charge proved and some others to be not proved, is similar.

9. The petitioner seeks to now introduce two documents to show that five of the borrowers had written letters to the succeeding manager admitting to borrowing loans and, consequently to demonstrate that the identities of these borrowers stood established. In the first place, the attempt at introducing fresh evidence at this stage should not be countenanced. However, even if one were to go by these documents, it must be remembered that the charge is not merely about the identity of the borrowers but the failure on part of the petitioner, as a manager, to verify their creditworthiness and the particulars stated in the loan application before sanctioning the loan. On this aspect the findings of the authorities are concurrently against the petitioner and nothing has been shown to dislodge such findings. This Court does not find anything which could even be remotely construed as perverse in the order of either the Disciplinary Authority or the Appellate Authority warranting interference under Article 226 of the Constitution of India. Therefore, the challenge to the validity of the enquiry proceedings and the orders passed therein should fail.

10. There is also no merit in the submission that the subsequent repayment of such loans by the borrowers, even partially, somehow mitigates the gravity of the charge that the failure of the petitioner to verify the particulars of the borrowers was not in the best interests of the Bank. On a considered view, it does not. The question really is whether at the time of sanctioning the loans, the petitioner had discharged his responsibility as a prudent Bank manager would have. The concurrent finding of fact is that he had not. Also, the mere fact that the Bank approached the DSIDC with claims on the basis of such loans cannot explain away the misconduct of the petitioner in wrongly sanctioning the loans in the first place. Therefore, this Court finds no merit in these submissions of the petitioner.

11. Turning to the question of the quantum of punishment, the law in this regard is fairly well settled. The Hon'ble Supreme Court in B.N. Chaturvedi v. Union of India observed:

[T]he 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.

This has been reiterated in the later decisions of the Hon'ble Supreme Court in Union of India v. G. Ganayutham and Om Kumar v. Union of India (2001) 2 SCC 386.

12. The fact that no loss has been caused to the petitioner is hardly consideration for reducing the quantum of punishment as has been explained by Hon'ble Supreme Court in Disciplinary Authority-cum-Regional Manager v. Nikunja Bihari Patnaik (supra) in the following words:

True, it is that in some cases, no loss has resulted from such act. It is also true that in some other instances such acts have yielded profit to the Bank but it is equally true that in some other instances, the funds of the Bank have been placed in jeopardy; the advances have become sticky and irrecoverable. It is not a single act; it is a course of action spreading over a sufficiently long period and involving a large number of transactions. In the case of a bank- for that matter, in the case of any other organisation-every officer/employee is supposed to act within the limits of his authority. Acting beyond one's authority is by itself a breach of discipline and a breach of Regulation 3. No further proof of loss is really necessary though as a matter of act, in this case there are findings that several advances and overdrawals allowed by the respondent beyond his authority have become sticky and irrecoverable.

13. More recently the Hon'ble Supreme Court in State Bank of India v. Ramesh Dinkar Punde (2006) 6 SCALE 11 observed that where an officer charged is a manager of a bank, he would have to be dealt with on a higher threshold in a matter of imposition of punishment. In that case it was observed as under:

The respondent was a Manager of the Bank and it needs to be emphasised that in the banking business absolute devotion, diligence, integrity and honesty needs to be preserved by every bank employee and in particular the bank officer so that the confidence of the public/depositors is not impaired. It is for this reason that when a bank officer commits misconduct, as in the present case, for his personal ends and against the interest of the bank and the depositors, he must be dealt with iron hands and he does not deserve to be dealt with leniently.

14. On a considered view of the matter, it appears that the punishment in the instant case cannot be termed as disproportionate or one that 'shocks the judicial conscience.' In the circumstances, there is no scope for interfering with the quantum of punishment.

15. Accordingly the writ petition is dismissed.