V. Ambarish Rao S/O V Krishna Rao vs The Deputy General Manager, P And A
2021 Latest Caselaw 474 Kant

                               -1-

         IN THE HIGH COURT OF KARNATAKA
                 DHARWAD BENCH
     DATED THIS THE 8TH DAY OF JANUARY 2021
                           PRESENT
        THE HON'BLE MR. JUSTICE G.NARENDAR
                              AND
         THE HON'BLE MR. JUSTICE M.I.ARUN
          Writ Appeal No.100630/2015 (S-DIS)
       C/w. Writ appeal No.100901/2015 (S-DIS)

IN W.A.No.100630/2015:
Between:
1.     The Deputy General Manager P&A
       and Disciplinary Authority,
       The Management of Syndicate Bank,
       H.O. Manipal, Industrial Relations
       Division, Manipal-576104, Dist.: Udupi.
2.     The General Manager P&A
       and Appellate Authority,
       The Management of Syndicate Bank,
       H.O. Manipal, Manipal-576104
       Dist.: Udupi.                              ... Appellants
(By Shri S.R. Kamalacharan, Advocate
 for Sundaraswamy & Ramdas Ass.)

And:
V. Ambarish Rao, Son of Sri V. Krishna Rao,
Aged about 65 years,
Residing at C/o.: V. Shashidhar Rao,
No.43, Sri-rajat, Rajdhani Colony,
Gokul Road, Hubli-580 030.                       ... Respondent
(By Shri Ravi Hegde, Advocate)

      This writ appeal is filed u/s.4 of the Karnataka High Court
Act, 1961, praying to allow this writ appeal and set aside the
                                -2-

final order dated 07.08.2015, passed by the learned Single Judge
in W.P.No.63053/2009 (S-DIS) and consequently dismiss the
writ petition.

IN W.A.No.100901/2015:
Between:
V. Ambarish Rao, S/o. V. Krishna Rao,
Aged about 64 years,
Residing at C/o.: V. Shashidhar Rao,
No.43, Sri-rajat, Rajdhani Colony,
Gokul Road, Pin-580 030.                           ... Appellant
(By Shri Ravi Hegde, Advocate)

And:
1.     The Deputy General Manager, P&A,
       and Disciplinary Authority,
       The Mgt., of Syndicate Bank,
       H.O. Manipal, Industrial Relations
       Division, Manipal, 576104, Dist.: Udupi.
2.     The General Manager P&A
       & Appellate Authority,
       The Management of Syndicate Bank,
       Head Office, Manipal, Dist.: Udupi,
       Pin-576104.                                Respondents
(By Shri S.R. Kamalacharan, Advocate
 for Sundaraswamy & Ramdas Ass.)

      This writ appeal is filed u/s.4 of the Karnataka High Court
Act, 1961, praying to: A. set aside the order of the learned
Single Judge passed in W.P.No.63053/2009 (S-DIS), dated
07.08.2015 insofar as denial of full back wages to the appellant
and allow the appeal; B. consequent upon allowing the appeal
issue direction to the respondents to pay all the arrears of salary
and settle the terminal benefits as directed by the learned Single
Judge.

      These appeals coming on for hearing having been heard
and reserved on 10.11.2020 for judgment and coming on for
pronouncement of judgment this day, M.I.Arun, J., delivered the
following:
                                  -3-

                         JUDGMENT

1. Aggrieved by the order passed in

W.P.No.63053/2009, dated 7th August 2015, the petitioner

therein has preferred W.A.No.100901/2015 and the

respondents therein have preferred W.A.No.100630/2015.

2. For the sake of convenience, the parties would

be referred to as per their status in the writ petition.

3. The petitioner joined the services of respondent-

Bank in the year 1969 as a Clerk. He was promoted from

time to time and his services were appreciated throughout

the decades. He was however placed under suspension by

an order dated 08.04.2006 on certain allegations, which

according to the petitioner are false and motivated. A

charge sheet was subsequently issued alleging that he had

failed to follow various Guidelines while providing certain

discounts and in discounting cheques, he has exceeded his

powers; that while granting loans he has exceeded his

powers and had permitted persons to open accounts

without proper identification and that they were identified

by members of the staff of the Bank. It was also alleged

that he had failed to follow norms while sanctioning loans in

respect of purchase of tractors. The main allegation was

that he had allowed certain loan accounts to turn into Non

Performing Assets. These allegations, according to the

petitioner, were misconceived, incorrect and baseless and

were at the instance of a Superior Officer who was initially

placed towards him.

4. According to the petitioner, charge sheet was

issued at the instance of one Vijayprabhu, who was an

officer in the Regional Office with whom the petitioner was

not on good terms and the charges were apparently

concocted. The petitioner had issued a point by point reply

to the charge sheet denying the allegations and he had also

explained that he could not be held responsible for any

account being termed as a Non-Performing Account and

further that the account holders therein still had time to

repay the loan amounts and it could not be prematurely

termed as a Non-Performing Asset. Any financial

transactions as well as the target of recovery, fixed for the

petitioner had been exceeded repeatedly and the amount of

profit accruing to his employer was increased during his

tenure, as was apparent on the face of it, and hence, the

allegations were merely to victimize the petitioner for acts,

which could not be termed as misconduct and in the face of

the petitioner having been repeatedly congratulated for his

meritorious service by the Management, the only inevitable

conclusion one can infer is that the proceedings are vitiated

by malafides.

5. Inspite of the reply, the Management appointed

one Mr. M.Venkatesh Mehendale as an Enquiry Officer. In

the enquiry, the petitioner was found guilty of the charges.

Thereafter, the report was sent to the petitioner calling for

his explanation. He had replied to the same pointing out

that it was contrary to facts and material on record and bad

in law and could not be accepted. It was also pointed out

that charges leveled against him do not constitute a mis-

conduct under the relevant regulations. Thereafter, the

disciplinary authority was pleased to pass an order of

dismissal, against which an appeal had been preferred

before the appellate authority, which also concurred with

the disciplinary authority. Hence, the petitioner preferred

the writ petition.

6. In the writ petition, the learned Single Judge

came to the conclusion that the Regulations of the Bank are

incomplete insofar as the alleged acts of misconduct alleged

against the petitioner are not even prescribed as acts of

misconduct under the Regulations. There is no guidance as

to which of the acts of misconduct would attract major

penalties and which of the act of misconduct would attract

minor penalties. That there was only minor irregularity on

the part of the petitioner and that the punishment imposed

on him was disproportionate. The Bank is not put to any

loss or prejudice due to the actions of the petitioner. On the

contrary, the learned Single Judge, found that businesses

and profits of the Branch had increased manifold. For the

aforesaid reasons, the learned Single Judge set aside the

order of dismissal of the petitioner. However, as the

petitioner had already reached the age of superannuation,

the Bank was directed to provide him all terminal benefits

including the pension, if any, but was pleased to deny him

the back wages.

7. Aggrieved by the denial of back wages, the

petitioner has preferred an appeal. Aggrieved by the setting

aside of the order of dismissal and directing the Bank to

provide him all terminal benefits including the pension, the

respondents have preferred the appeal.

8. It is contention of the respondent - Bank that

the learned Single Judge erred in coming to the conclusion

that the acts complained of against the petitioner are not

prescribed as misconduct under the Regulations. In this

regard, our attention is drawn to Regulation Nos.3(1) and

24 of Syndicate Bank Officer Employees' (Conduct)

Regulations, 1976, they read as under:

"3. General :

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 an officer employee.

24. Acts of Misconduct :

A breach of any of the provisions of these Regulations shall be deemed to constitute a 'Misconduct' punishable under the Syndicate Bank Officer Employees' (Discipline and Appeal) Regulations, 1976.

9. Annexure-A to the writ petition is articles of

charges issued to the petitioner by the respondent. The

same reads as under:

"ARTICLES OF CHARGES

That you were working as Branch Manager at Byadgi branch since 23.07.2001 until you were placed under suspension on 17.04.2006 vide Proceedings/ order dated 08.04.2006. while working in your position as such, you abused your official position and extended credit facilities to certain parties in blatant violation of Bank's lending norms, without proper pre-sanction appraisal of the credit proposals, without ensuring end utilization of the loan proceeds without proper post sanction follow up and thereby unduly accommodated the parties concerned by exposing Bank's funds to the tune of Rs.68.90 lakhs and interest thereon to the risk of loss. In the process you also committed various other irregularities.

The details of the above and in the irregularities committed by you are more fully described in the Statement of Imputations of misconduct on your part appended herebelow.

By your above acts you failed to take all possible steps at all times to ensure and protect the interest of the Bank and discharge your duties with utmost

integrity, honesty, devotion and diligence and acted in a manner unbecoming of an officer employee and thereby contravened Reg.No.3(1) read with Regulation 24 of Syndicate Bank Officer Employees' (Conduct) Regulations 1976.

STATEMENT OF IMPUTATION OF MISCONDUCT ON YOUR PART

That you were working as Branch Manager at Byadgi branch since 23.07.2001 until you were placed under suspension on 17.04.2006 vide Proceedings/ Order dated 08.04.2006. While working in your position as such, you extended credit facilities to certain parties.

Following circumstances appear on record in the above matter:

I. In the matter of credit facilities extended to Sri Mukul Rai.

On 15.7.2003, SB account no.18858 was opened with the branch in the name of Sri Mukul Rai with the introduction of Sri Uday Kumar Shetty, clerk, Byadgi branch. Address proof and photograph of the account holder were not placed on record. Sri Mukul Rai is reportedly a close relative of Sri Uday Kumar Shetty.

On 18.9.2003, Jewel Loan of Rs.24,000/- was sanction to Sri Mukul Rai, vide JL 17/03, to be closed in lump sum on or before 18.9.2004. The loan application and documents were filled up by Sri Uday Kumar Shetty, even though he was not working in advance department.

On 8.9.2004, a loan of Rs.2.00 lakh was sanctioned and released to Sri Mukul Rai, vide OSL 2004 0164, for the purpose of establishing a hotel in the name and style of M/s Hotel Renuka Prasad, near Bus Stand, Byadgi, Sri K Ramappa, an employee of Dr Ambedkar College, Sidenur, who is reportedly a close friend of Sri Uday Kuar Shetty, has joined the loan transaction as co-obligant. The loan application and documents were filled up by Sri Uday Kumar Shetty,

- 10 -

even though he was not working in advances department.

Presently the hotel is closed. Loan account has become NPA with Shadow balance of Rs.2,21,255/- as on 1.8.2006.

The Jewel Loan is also not repaid and has become NPA with shadow balance of Rs.36,271/-.

II. In the matter of credit facility extended to Sri Deepak Shetty.

On 23.11.2005, SB account no.30999 was opened with the branch in the name of Sri Deepak Shetty with the introduction of Sri Uday Kuamr Shetty, clerk, Byadgi branch. Address proof was not placed on record, Sri Deepak Shetty is reportedly related to Sri Uday Kumar Shetty.

On 25.11.2005, a loan of Rs.2.00 lakh was sanction to Sri Deepak Shetty, with Sri Mukul Rai as co- obligant, to run a Bar and Restaurant at Ranebennur which is about 18 km away from Byadgi branch and the branch of the bank at Ranebennur is very near to the given business address. No Objection Certificate/ No Due Certificate from Ranebennur branch is not on record. The licence for the Bar and Restaurant is in the name of Sri P D Kalal. The loan application and documents were filled up by Sri Uday Kumar Shetty even though he was not working advances department.

Sri Uday Kumar Shetty vide his letter dated 26.10.2006 has undertaken to help recovery of the loan.

III. In the matter of credit facilities extended to Sri Viswanatha Shetty, Prop. Raghaavendra Bhavana.

On 24.2.2005, current account no.50028 was opened with the branch in the name of Sri Viswanath Shetty, Prop. Raghavednra Bhavana, with the introduction of Sri Udaya Kumar Shetty, Clerk, Byadgi branch.

- 11 -

On 28.2.2005, TOD of Rs.1,00,000/- was allowed to the party in the current account. On 18.5.2005, further TOD of Rs.50,000/- was allowed.

On 27.5.2005, Other Secured Loan of Rs.2,00,000/- was arranged to the party with Sri Mukul Rai as co- obligant and the proceedings were adjusted to clear the TOD in current account. The loan application and document were filled up by Sri Uday Kumar Shetty even though he was not working in the advances department.

IV. In the matter of credit facility extended to Sri Ajay N Chinnikatti.

On 23.2.2005, current account no.50026 was opened with the branch in the name of Sri Ajay N Chinnikatti with the introduction of Sri Uday Kumar Shetty, Clerk, Byadgi branch.

On 26.2.2005, TOD of Rs.1,50,000/- was allowed to the party in the current account. On 4.3.2005 further TOD was allowed up to Rs.1,80,000/-.

On 5.3.2005, a loan of Rs.1,50,000/- was arranged to the party with Sri Mukul Rai as co-obligant vide DL GEN 30/05 and the proceeds were adjusted to TOD I current account. The loan application and documents were filled up by Sri Uday Kumar Shetty, even though he was not working in the advances department.

On 5.12.2005, and 2.3.2006, Sri Uday Kumar Shetty received Rs.3,000/- and Rs.20,000/- from the above current account through cheques no.443408 and 443410 respectively. On 29.3.2006, Sri Shetty deposited a sum of Rs.18,000/- to the current account to regularize the debit balance. The credit slop, OG-73, is in the handwriting of Sri Uday Kumar Shetty.

V. In the matter of credit facilities extended to M/s Manjunatha Traders, Prop. Sri Hanumanthappa F. Hullali.

- 12 -

On 21.12.2004, current account no.40159 was opened with the branch in the name of M/s Manjunatha Traders, Prop. Sri Hanumanthappa F. Hullali.

On 30.12.2004 TOD of Rs.1,00,000/- was allowed in the current account. Thereafter TODs were allowed frequently. Approval from Regional Officer is not on record.

On 20.7.2005, a loan of Rs.1,50,000/- was sanctioned to the party with Sri Ramappa as co- obligant, vide DL/RT 75/05 and the proceeds were adjusted to TOD allowed in the current account on 17.3.2005. The loan application and document were filled up by Sri Uday Kumar Shetty, even though he was not working in the advances department.

VI. In the matter of discounting of cheques

(1) Accommodative cheques were discounted to Sri B N Masur, Prop. M/s. Maltesh Cement Moulding Industrial, account no.SOD 50047/2 under following CODs. Exceeding delegated powers and without placing on record approval from the competent authority and all the cheques were dishonoured:

Sl.No.      COD No.     Date               Amount Rs.
01          500/05      23.06.05           4,00,000/-
02          894/05      03.12.05           2,80,000/-
03          087/06      11.02.06           2,50,000/-
04          088/06      11.02.06           2,00,000/-
05          124/06      22.02.206          2,50,000/-

Total exposure of the party was to the tune of Rs.7,00,000/- plus interest.

(2) On 17.02.2006, two cheques for Rs.2,50,000/- each were discounted to Sri T B Malagi vide CDD 113 and 114 and proceeds were credited to SOD 40113/2 of the party. The cheques were returned unpaid on 20.2.2006. the liability is still outstanding apart from

- 13 -

exceeding of Rs.1,62,791/- in SOD account as on 1.8.2006.

(3) Accommodative cheques were discounted to Sri B G Gonemannavar, proprietor of M/s Nagaraj Hardwares, and his associate concerns, under following CDDs, exceeding delegated powers and without placing on record approval from the competent authority and all the cheques were dishonoured:

Sl.No.     COD No.     Date              Amount Rs.
01         086/06      03.02.06          0,70,000/-
02         501/05      24.08.05          1,80,000/-
03         A05/05      26.10.05          4,00,000/-
04         112/06      16.02.06          3,00,000/-

VII. In the matter of sanctioning Tractor loans in the names of Sri Anand N Karjagi and Sri Fakirappa Giriyannavar jointly with others.

(1) on 23.6.2004, SB account no.19822 was opened with the branch in the name of Sri Anand N Karjagi with the introduction of Sri Ramesh C Hulahutti, Tractor Dealer holding current account no.200387.

Sri Anand N Karjagi jointly with Sri Suresh N Karjagi submitted application dated 10.7.2004 for a loan of Rs.4.00 lakh for purchasing Mahindra Shaktiman Tractor and Trailer. The application was signed by Sri Anand N Karjagi only. Sri Maruthi H Talwar and Sri N N Gundenahalli were offered as sureties. The loan application was not signed by Sri N N gundenahalli. The loan amount was altered from Rs.4.00 lakh to Rs.4.50 lakh by you and the alteration was not authenticated by the applicants.

On 16.7.2004 you processed the proposal, recommended and sanctioned Tractor Loan of Rs.4.00 lakh and SKCC loan of Rs.50,000/-. The Tractor Loan was released on 16.7.2004 vide FL/T

- 14 -

78/04. SKCC loan was released on 17.7.2004. Branch created charge on the properties of Sri Anand N Karjagi, Sri Suresh N Karjagi and Sri N N Gundenahalli by submitting Form-3 to Tahsildar's Office, Byadgi. Form-3 executed by Sri N N Gudenahalli was witnessed by Sri N D Hulahutti, partner of tractor dealer firm. Copy of Form-3 received from Tahsildar's office was placed on record. Legal opinion and valuation report of the properties were no placed on record.

The party had produced advance payment receipt no.106 dated 26.5.2004 for Rs.75,000/- issued by the Tractor Dealer. From the Tractor Loan proceeds, sum of Rs.2,92,450/- and Rs.1,26,500/- were rsermitted through pay orders to the suppliers of Tractor and Trailer respectively. Taking into account the advance payment of Rs.75,000/- and remittances made to the dealers, total project cost of Tractor and Trailer was Rs.4,90,940/- as against Invoice cost of Rs.4,58,850/- indicating that sum of Rs.32,100/- was excess remitted to the dealer.

The Tractor and Trailer were not registered with the RTO, Insurance particulars were not placed on record. Stipulated installments are not received and the loan account is overdue.

Sri N N Gudenahalli has lodged a complaint dated 6.5.2006 alleging inter alia that branch has created charge on his land even though he is neither an account holder nor availed any loan or joined as surety to any borrower. Verification ha revealed that age of the complainant is 71 years whereas it is mentioned as 45 years in the Deed of Guarantee; that his signatures in Form-3 and Deed of Guarantee differ; that he is not an account holder at the branch; that he has not signed the loan application etc.

The branch, vide letter dated 14.12.2006, requested the seizure agent M/s Mrathunjaya Investigators, Hubli, to seize the Tractor and Trailer. The seizing agent could not find the Tractor and Trailer.

- 15 -

Since there is no security to fall back upon, bank's funds to the tune of Rs.4.00 lakh with interest thereupon are exposed to risk of loss.

(2) On 5.8.2005, Sri Fakirappa P Giriyannavar jointly with Sri Huchcheppa T Giriyannavar, Sri Hanumappa H Papakkanavar and Smt Hiriyavva G Talwar submitted an application for Tractor Loan with the security of lands measuring 9.91 acres. Simple mortgage of the land was created with Sub Registrar, Byadgi, on 5.8.2005. The Tractor Loan application was processed on 6.8.2005 and a loan of Rs.4.76 lakh was sanctioned.

As per the available records i.e. acceptance letter dated 9.4.2005, Form No.21 - Sale Certificate dated 4.6.2005, Insurance Policy dated 26.5.2005, delivery challan dated 29.4.2005 etc, the borrowers had already taken possession of Swaraj Tractor and Trailer and the same were registered at RTO, Haveri.

On 19.8.2005, SB account No.20865 was opened with the branch in the joint names of the parties, placing on record Residence Certificate issued by Village Accountant as proof of address.

The party had submitted advance payment receipt for Rs.58,200/- and Rs.28,000/- issued by Tractor and Trailer Dealers respectively. The Tractor Loan of R.4.76 lakh was released on27.8.2005 and proceeds were remitted by OD to the supplier. Delivery Note and ASD-13(R) dated 27.08.2005 were placed on record.

As no repayments were forthcoming in the loan, the branch issued notices to the borrowers. In response, one person claiming himself to be Fakeerappa P Giriyannavar came to the branch on 7.12.2006 and submitted a letter stating inter alia that he is Fakeerappa P Giriyannavar; that Sri Huchchappa T Giriyannavar and Smt. Hiriyavva B Talwar are his relatives and both of them have expired long back; that Sri Ramesh H Karjagi with other persons from

- 16 -

other village have availed the loan in their names by producing the land records etc. He has produced a copy of Death Certificates as per which Smt Hiriyavva B Talwar expired on 24.11.1981. He requested the bank to cancel the charge created on the lands.

On 7.12.2006, Sri R H Karjagi came to the bank and submitted a letter confessing that the impersonated Sri H H Papakkanavar and that he availed the loan in the name of Sri Fakirappa P Giriyannavar and others by bringing three other persons to sign as real owner.

On 15.12.2006, branch seized the Tractor and Trailer through Seizure Agents and the same is presently in their custody. Due to pressure from the real owners of the lands, branch informed Tahsildar vide letter dated 8.1.2007 and 11.1.2007 to cancel the charge on the lands of Sri Fakirappa P Giriyannavar, Sri Huchchappa T Giriyannavar and Smt Hiriyavva B Talwar. Branch has filed an FIR with Byadgi Police Station on 26.1.2007.

The approximate realizable value of Tractor and Trailer is Rs.2,85,000/-. The bank is likely to suffer financial loss of Rs.2.75 lakh plus interest thereon.

VIII. In the matter of sanctioning other tractor loans.

You sanctioned 70 to 80 Tractor Loans. Although a separate Manager was available in the branch for looking after credit portfolio, you yourself had prepared appraisal notes, analysed financial parameters etc, recommended and sanctioned the loans.

FL/T 107/04 dated 27.10.2004 for Rs.4,00,000/- was sanctioned to Sri Kalaveerappa Hanumappa Banakar and his three brothers for the purpose of purchasing Mahindra Shaktiman Tractor. The tractor and trailer have not been delivered to the borrowers till date.

- 17 -

FL/T 28/04 for Rs.4,00,000/- was sanctioned to Sri Ramappa Valappa Lamani against his land holding of 4 acres only. Sri Gangappa J Lamani having land holding of 3 acres has been taken as joint borrower. Sri Gangappa J Lamani claims that he is not aware that he is the joint borrower.

FL/T 36/3 for Rs.4,00,000/- was sanctioned to Sri V G Patil. The party has stated that he was forced to sign the loan documents.

IX. In the matter of sanctioning KVIC loans.

Regional Officer, Hubli vide letter dated 17.3.2006, kept in abeyance your sanctioning powers except for Govt sponsored schemes, renewal of limits without encashment discounting of approved cheques.

Between 18.3.2006 and 27.3.2006, you sanctioned following five KVIC loans, against allotted target of one unit:

(1) OSI/SSI/KVIC/26/06 for Rs.9,50,000/- to M/s Chenna Basaveshwara Stone Crusher, Prop. Smt Ratnavva. The loan was released in stages between 18.3.2006 and 21.06.2006 and proceeds were credited to current account no.501123 of the borrower. Pre-condition of specific release to the supplier, for claiming KVIC subsidy, was not complied with KVIC subsidy of Rs.2,90,000/- was received and kept under Fixed Deposit.

(2) OSL/SSI/KVIC/27/06 for Rs.5,00,000/- to M/s Mylarlingeshwar Hollow Bricks Industries, Prop. Sri Somappa Ningappa Ader. The loan was released in stages between 25.3.2006 and 12.4.2006 and proceeds were credited to current account no.50137 of the borrower. Pre-condition of specific release to the supplier, for claiming KVIC subsidy, was not complied with. KVIC subsidy of Rs.1,53,000/- was received and kept under Fixed Deposit.

(3) OSL/SSI/KVIC/28/06 for Rs.9,50,000/- to M/s Anukampa Foot Wear, Prop. Sri Manjunath. The loan

- 18 -

was released in stages between 25.3.2006 and 2.8.2006 and proceeds were credited to current account no.50135 of the borrower. Pre-condition of specific release to the supplier, for claiming KVIC subsidy, was not complied with. KVIC subsidy of Rs.2,90,000/- was received and kept under Fixed Deposit.

(4) OSL/SSI/KVIC/30/06 for Rs.5,00,000/- to M/s Basaveshwar Hollow Bricks Industries, Prop. Sri Basappa. The loan was released in stages between 27.3.2006 and 15.4.2006 and proceeds were credited to current account no.50139 of the borrower. Pre-condition of specific release to the supplier, for claiming KVIC subsidy, was not complied with. KVIC subsidy of Rs.1,53,000/- was received and kept under Fixed Deposit.

(5) OSL/SSI/KVIC/31/06 for Rs.7,00,000/- to M/s Mallesh Industries, Prop. Sri Nimbappa Basappa Masur. The loan was released in stages between 27.3.2006 and 12.4.2006 and proceeds were credited to current account no.50138 of the borrower. Pre-condition of specific release to the supplier, for claiming KVIC subsidy, was not complied with. KVIC subsidy of Rs.2,14,000/- was received and kept under Fixed Deposit.

X. In the matter of extending credit facilities to M/s Nagaraj Brick Industries.

M/s Nagaraj Brick Industries has been enjoying OSL 56/04 dated 27.2.2004, for Rs.7.50 lakh.

On 27.9.2005, OD limit of Rs.9.50 lakh was sanctioned to the party vide SOD 50074. This total liability of the party aggregated to Rs.17.00 lakh and therefore sanctioning powers were exceeded. In the process note sent to RO, Hubli, the existing liability under OSI 56/04 was not mentioned and the sanction was taken note of.

- 19 -

Following irregularities are observed on your part in the above matter.

(A) You facilitated to open SB a/c 18858 in the name of Sri Mukul Rai without proper address and obtained address as C/o Sri Uday Kumar Shetty, Syndicate Bank, Byadgi. You also sanctioned and released an OSL loan for Rs.2.00 lakh on 08.09.2004 without processing and not followed up. No pre-sanction/post sanction follow up was done. The hotel was closed. Though Sri Uday Kumar Shetty, staff has introduced and recommended the loan no action has been taken for recovery through the staff, who is still working in the branch. A jewel loan for Rs.24000/- was also sanctioned without proper address. KYC norms not followed while opening the account and sanctioning the Jewel Loan. No action had been taken to close the Jewel Loan whereas it would have been closed on or before 18.09.2004, and it has been slipped to NPA. The loan documents were filled by Sri Uday Kumar Shetty, even though he was not allotted with Advances Department. The account was introduced by Sri Uday Kumar Shetty.

(B) You sanctioned and released a Loan of Rs.2.00 lakh under OSL 25.11.2005 to Mr.Deepak Shetty, Prop. Durgamba Bar & Restaurant, P & B Road, Ranebennur. While sanctioning the loan you failed to obtain "No Objection Certificate" from our Ranebennur branch. No address proof/ income proof was obtained, Loan has been sanctioned beyond the command area. The loan documents were filled by Sri Uday Kumar Shetty, even though he was not allotted with advances department. No pre- sanction/ post-sanction follow-up was done, as the unit is about 18 k.m. away from the branch. The account was introduced by Sri Uday Kumar Shetty. Mukul Rai was the co-

- 20 -

obligant. Sri Deepak Shetty is the relative of Sri Uday Kumar Shetty.

(C) You also allowed a TOD of Rs.1,50,000/- on 28.02.2005 to CA 50028 of Sri Vishwanath Shetty. The account was opened only on 24.02.2005. Again on 18.5.2005 a TOD of Rs.50,000/- was allowed when the account was still under debit balance. To clear the debit balance in Current account, on OSL loan of Rs.2.00 lakh was sanctioned and released on 27.05.2005. The purpose of the loan is working capital. But a term loan has been sanctioned. The documents were filled by Sri Uday Kumar Shetty, even though he was not allotted with Advances Department. No pre-sanction/ post- sanction follow-up was done. The account was introduced by Sri Uday Kumar Shetty, Mr Mukul Rai was the co-obligant.

(D) You allowed a TOD of Rs.1,50,000/- to Mr. Ajay N Chinnikatti on 26.02.2005 when the account was opened only on 23.02.2005. Again on 04.03.2005 a TOD of Rs.1,80,000/- was allowed. To square off the debit balance in current account, a DL Gen 30/05 for Rs.1.50 lakh was sanctioned and released. Mr.Mukul Rai was the co-obligant. Sums of Rs.3,000/- and Rs.20,000/- were paid to Sri Uday Kumar Shetty from this Current account and on 29.03.2006 Sri Uday Kumar Shety has remitted a sum of Rs.18,000/- to this Current account. The loan documents were filled by Sri Uday Kumar Shetty, even though he was not allotted with advances department, No pre sanction/post sanction follow-up was done.

(E) You sanctioned a TOD of Rs.1,00,000/- on 30.12.2004 to M/s Manjunath Traders Prop. Hanumantappa F Hallali whereas the account was opened only on 21.12.2004. frequent TODs were allowed in this account. To square off the debit balance a DL/RT for Rs.1,50,000/-

- 21 -

was sanctioned 20.07.2005 with Sri Ramappa as co-obligant the loan documents were filled by Sri Uday Kumar Shetty. Even though he was not allotted with advances department. No pre sanction/ post sanction follow up was done.

(F) You allowed number of TODs in current account and exceeding in OD account and not followed up with the customers for recovery. You resorted to sanction Term loan to regularize the debut balances.

(G) In the matter of Cheques Discounted to Sri B N Masur Prop. M/s Maltesh Cement Moulding Industry SOD a/c 50047/2:

(1) You discounted a cheque on 03.12.2005 for Rs.2,80,000/- which was adjusted by cash on 27.03.2006, as the cheque was not honoured. The amount was adjusted with a cheque from M/s Myalaralingeshwar Hallow Brick Industries for Rs.1,50,000/- to whom 2nd release of OSL/KVIC was credited.

(2) again you discounted a cheque of Rs.4,00 lakh on 23.06.2005. The cheque was also returned and adjusted on 25.02.2006 from SOD 50047/2, by allowing a Debit Balance of Rs.1.65 lakh. It is purely an adjustment.

(3) You discounted two cheques totaling to Rs.4.50 lakh (one cheque for Rs.2.50 lakh and another cheque for 2,00 lakh) on 11.02.2006. Both cheques were returned on 14.02.2006.

(4) You discounted two cheques each of Rs.2.50 lakh on 22.02.2006, when the cheques discounted on 11.02.2006 for Rs.4.50 lakh were returned and still outstanding. Thus you exceeded the limit and liabilities for a single borrower was Rs.7.00 lakh. The entire amount has stuck to books.

- 22 -

(H) You discounted two cheques each of Rs. 2.50 lakh on 17.02.2006 to Sri T B Malagi and both the cheques were returned unpaid and stuck to books.

(I) In the matter of cheques discounted to Mr B G Gonemmannavar and his associates concerns:

(1) You discounted a cheque for Rs.70000/- to M/s Nagaraj Hardwares, Prop. Sri B G Gonemmannavar. The cheques was returned unpaid on first presentation on 03.02.2006. You retained the cheque for one month and again presented on 04.03.2006 for payment and the cheque was passed. Thus you retained the discounted cheque for nearly 1 month to accommodate the customer Sri B G Gonemmannavar.

(2) You discounted a cheque for Rs.1,80,000/- on 24.08.2005 to SOD a/c 200333/2 of Sri B G Gonemmannavar. The cheque was returned. But the liabilities were adjusted with interest only on 18.03.2006 by debit to SOD a/c 50074/4. The returned unpaid cheque was retained for more than 5 months.

(3) You discounted a cheque for Rs.4.00 lakh on 26.10.2005 to Mr B G Gonemmannavar which was returned unpaid. The liabilities were adjusted on 28.03.2006 by debit to SOD a/c 50074/4. The returned unpaid cheque was retained for more than 5 months.

(4) You discounted a cheque for Rs3.00 lakh to SOD 50074/3 of M/s Nagaraj Cement Brick Industries, whose proprietor is Mr B G Gonnemmannavar. The amt was returned as the cheque was issued on a closed account and not adjusted till date. You discounted the cheque only to accommodate the party.

- 23 -

You, with malafide intention and to derive pecuniary benefits, discounted cheques beyond your limits/retained and cheques for a longer period till the customer arranged money or discounting one more cheques to square off the existing liability or even allowed TOD to square off.

(J) In the matter of sanctioning Tractor Loans in the name of Sri Anand A Karjagi and Sri Fakirappa P Giriyannavar jointly with other:

(1) you failed to obtain legal opinion for the lands proposed to be mortgaged to confirm whether the persons have right to create mortgage and there wa no existing charge on the lands.

(2) You failed to obtain photographs of the joint borrower Sri Suresh N Karjagi and Co- obligants Sri Maruthi Honnappa Talwar and Sri N N Gundenahalli. The signature of the co- obligant Sri N N Gundenahalli was also not obtained in the application form.

(3) You failed to observe age of Sri N N Gundenahalli while you obtained the signature in Form-3 and deed of Guarantee, as the age gap is only 5 years between the father Sri N N Gundenahalli and son Sri Suresh N Karjagi. You also failed to open Savings Bank A/c of Sri N N Gundenahalli.

(4) You failed to observe the difference in signature of Sri N N Gundenahalli between the one available in Form-3 and others in Deed of Guarantee.

(5) You failed to observe borrowers capacity and sources of funds paid to the tractor dealer as margin money by the borrower. You helped the borrowers to meet the margin money from the bank' funds by arranging SKCC loan of

- 24 -

Rs.50000/- on the next day; and Rs. 32100/- was excess paid to the Dealer.

(6) You failed to get registered the tractor with RTO, Haveri with Bank's hypothecation clause. Vehicle Insurance particulars and Temporary Certificate of the vehicle were also not obtained.

(7) You failed to follow up with the borrower for recovery of the loan and production of the vehicle for Inspection.

(8) You failed to follow the KYC norms while opening SB accounts in the joint names of Sri Fakirappa P Giriyannavar, Sri Huchchappa T Giriyannavar, Sri Hanumanthappa H Papakkanavar & Smt Hiryavva G Talawar. You allowed to open the account with the residence certificate issued by the Village Accountant without any further verification.

(9) You failed to visit the lands and residence of the borrowers while accepting the documents during May 2005 and sent the same for legal opinion to the Advocate.

(10) You sanctioned Tractor Loan of Rs.476000/- to Sri Fakirappa P Giriyannaar to purchase tractor which was already in the possessionof the borrower as per the reords available. Thereby you not only failed to ensure end use but also helped the party to mis-utilise the Bank's fund.

(11) You failed to observe the sources of margin money generated by the borrower and paid to the Dealers when they have submitted case receipt from the dealer.

(12) You failed to get the vehicle registered with RTO with Bank's hypothecation clause and also failed to inspect the vehicle after the delivery.

- 25 -

(13) You sanctioned tractor loans to the persons brought by the Agent Sri Arun Kunte, the Dealer Sri Lingaraj C Bellary and Sri R Hulabutti and derived the pecuniary benefits offered by them.

(14) Even though the Agricultural Advances Departmetn was to be allotted to other officers as per the directions of RO, Hubli, you yourself processed, failed up Mortage Deeds and Form- 3 etc.

(15) you failed to file Police complaint when vehicle of Sri Anand N Karjagi could not be traced out.

(K) In the Matter of other Tractor Loans:

(1) In a very casual manner you sanctioned tractor loans and the advances officer was not at all involved either for processing of loan papers or for verification of the lands etc. No pre-sanction or post-sanctioned visit was done. You failed to appraise the loan application property and many loans were sanctioned by yourself to the parties. In number of cases you failed to obtain RC Books, Insurance Policies and Confirmation of Deliver of Vehicles by the dealer.

(2) You failed to take action against the tractor dealer M/s Vinay Agro Care, Haveri for not delivering the Vehicles to the complainant Sri Kalaveerappa Hanumanthappa Banakar, to whom you sanctioned a tractor loan on 27.10.2004. Instead you indulged in transferring amount from the Current account of M/s Vinay Agro Care to the account of the other partner that too allowing debit balance in the account.

(3) You indulged in adding joint borrower without the knowledge of the borrower to

- 26 -

sanction a tractor loan, when the borrower is not eligible for tractor. Sri Ramappa Valappa Lamani of Chatra was owning only 4 ares of land. To make him eligible for tractor loan you made one Sri Gangappa Lamani with 3 acres of land as joint borrower and sanctioned the tractor loan. You derived pecuniary benefit for doing this.

(4) You pressurized Mr.V G Patil of Theradahalli village to execute documents for tractor loan, if his Farm House Loan was to be sanctioned. You sanctioned a Tractor Loan in the name of Sri V G Patil and the tractor was delivered to Sri B G Gonemmannavar, who is using the tractor for his business.

(L) In the matter of KVIC loans:

(1) You sanctioned and released KVIC loans to the group of borrowers related to Sri B G Gonemmannavar after your sanctioning powers were kept in abeyance by RO Hubli vide their letter dated 22.03.2006 (D-8) and conveyed over phone by the Chief Manager.

(2) You sanctioned OSL/KVIC/27/06 on 25.03.2006 and the proceeds were credited to CA 50137 instead of direct release. The current account was opened on 24.03.2006 only.

(3) You sanctioned OSL/KVIC/30/06 on 27.03.2006 and the proceeds were credited to CA 50139 instead of direct release. The current account was opened on 27.03.2006 only.

(4) You sanctioned OSL/KVIC/31/06 on 27.03.2006 and the proceeds were credited CA 50138 instead of direct release. The current account was opened on 27.03.2006 only.

You sanctioned all these three loans to accommodate Sri B G Gonemanavar, to derive the benefit of margin money received from

- 27 -

KVIC. You failed to ensure end utilization. You failed to verify the authenticity of the vendor from whom they obtained quotations. The vendor M/s Mahalakshmi Enterprises, Motebennur was only an Agent to supply second hand machinery and there is no office functioning in the address provided in the invoice. You failed to issue Pay Order directly to the vendor to ensure supply of machinery. You failed to verify construction of shed etc. as per the project report submitted by the borrowers. The Project report and proforma invoice for all the three units were done by one person except changing the name.

(M) You sanctioned a fresh SOD of Rs.9.50 lakh under SOD 50074 to M/s Nagaraj Brick Industries, on 27.09.2005 when the borrower was already enjoying an OSL (56/04) Rs.7.50 lakh. You failed to inform the total limits enjoyed by the borrower while submitting the process note to RO Hubli for take note. You suppressed the existing OSL of Rs.7.50 lakh and sent only the SOD proposal for take note and it was taken note by RO Hubli. You violated your delegated powers as per Cir 87/04, as per which Branch Manger of Scale II is having power to sanction only up to Rs.15.00 lakh.

(N) Six unadjusted returned CODs amounting to Rs.15.00 lakh, and other unrecovered overdrawals/ exceeding and loans that have slipped into NPA, in all aggregating approximately to Rs.59.64 lakh have stuck to books without adequate security to fall back upon. Thus by your acts of commission and omission you exposed bank's funds to the tune of Rs.59.64 lakh with interest thereon, to the risk of loss.

You shall continue to be under suspension until further orders."

- 28 -

The above charges have been held to be proved after the

enquiry. The contention of the respondent is that once the

charges are proved and the principles of natural justice

have been followed and when the enquiry being fair and

proper, the learned Single Judge ought not to have sat as an

appellate authority over the enquiry report and the decision

of the respondents in accepting the same and terminating

the services of the petitioner. On the said grounds, they

have sought for setting aside the order of the learned Single

Judge.

10. In their support, the respondents relied upon the

decision of the Hon'ble Supreme Court in the case of

Disciplinary Authority-cum-Regional Manager and

others vs. Nikunja Bihari Patnaik reported in (1996) 9

SCC 69, wherein at paragraph Nos.5, 6 and 7 has held as

under:

"5. It may be remembered that Charges Nos.1, 6, 8, and 9 were held to have been established in full while the remaining charges [except charge No.4] were held to be established in part. It is indeed a matter of surprise that inspite of the aforesaid

- 29 -

findings, the High Court came to the opinion that it is not a case of misconduct. Regulation 24 of the Central Bank of India Officer Employees' (Discipline and Appeal) Regulations, 1976 defines the acts of misconduct in the following words:

"24. Acts of misconduct: A breach of any of the provisions of these regulations shall be deemed to constitute a misconduct punishable under the Central Bank of India Officer Employees' (Discipline and Appeal) Regulations, 1976."

6. Regulation 3 of the said Regulations may also be noticed:

"3(1). Every officer employee shall, at all times take all possible steps to ensure and protect the interest of the bank and discharge his duties with utmost integrity, honesty, devotion and diligence and do nothing which is unbecoming of a bank officer.

(2) Every officer employee shall maintain good conduct and discipline and show courtesy and attention to all persons in all transactions and negotiations.

(3) No officer employee shall, in the performance of his official duties or in the exercise of powers conferred on him, act otherwise than in his best judgment except when he is acting under the direction of his official superior.

(4) Every officer employee shall take all possible steps to ensure the integrity and devotion to duty of all persons for the time being under his control and authority."

7. It may be mentioned that in the memorandum of charges, the aforesaid two regulations are said to have been violated by the respondent. Regulation 3 requires every officer/employee of the Bank to take all possible steps to protect the interests of the Bank and to discharge his duties with utmost integrity,

- 30 -

honesty, devotion and diligence and to do nothing which is unbecoming of a Bank officer. It requires the officer/employee to maintain good conduct and discipline and to act to the best of his judgment in performance of his official duties or in exercise of the powers conferred upon him, Breach of Regulation 3 is "misconduct" within the meaning of Regulation 24. The findings of the Enquiry Officer which have been accepted by the disciplinary authority, and which have not been disturbed by the High Court, clearly show that in number of instances the respondent allowed overdrafts or passed cheques involving substantial amounts beyond his authority. True, it is that in some cases, no loss has resulted from such acts. 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 organization - every officer/employee is supposed to act within the limits of his authority. If each officer/ employee is allowed to act beyond his authority, the discipline of the organisation/bank will disappear; the functioning of the Bank would become chaotic and unmanageable. Each officer of the Bank cannot be allowed to carve out his own little empire wherein he dispenses favours and largesse. No organization, more particularly, a Bank can function properly and effectively if its officers and employees do not observe the prescribed norms and discipline. Such indiscipline cannot be condoned on the specious ground that it was not actuated by ulterior motives or by extraneous considerations. The very act of acting beyond authority - that too a course of conduct spread over a sufficiently long period and involving innumerable instances - is by itself a misconduct. Such acts, if permitted, may bring in profit in some cases but they may also lead to huge

- 31 -

losses. Such adventures are not given to the employees of Banks which deal with public funds. If what we hear about the reasons for the collapse of Barings Bank is true, it is attributable to the acts of one of its employees, Nick Leeson, a minor officer stationed at Singapore, who was allowed by his superiors to act far beyond his authority. As mentioned hereinbefore, the very discipline of an organization and more particularly, a Bank is dependent upon each of its employees and officers acting and operating within their allotted sphere. Acting beyond one's authority is by itself a breach of discipline and a breach of Regulation 3. It constitutes misconduct within the meaning of Regulation 24. No further proof of loss is really necessary though as a matter of fact, in this case there are findings that several advances and over-drawals allowed by the respondent beyond his authority have become sticky and irrecoverable. Just because, similar acts have fetched some profit - huge profit, as the High Court characterizes it - they are no less blameworthy. It is wrong to characterize them as errors of judgment. It is not suggested that the respondent being a Class-I officer was not aware of the limits of his authority or of his powers. Indeed, Charge No.9, which has been held established in full is to the effect that inspite of instructions by the Regional Office to stop such practice, the respondent continued to indulge in such acts. The Enquiry Officer has recorded a clear finding that the respondent did flout the said instructions and has thereby committed an act of disobedience of lawful orders. Similarly, Charge No.8, which has also been established in full is to the effect that inspite of reminders, the respondent did not submit "Control Returns" to the Regional Office. We fail to understand how could all this be characterized as errors of judgment and not as misconduct as defined by the regulations. We are of the opinion that the High Court has committed a clear error in holding that the aforesaid conduct of the respondent does not amount to misconduct or that it does not constitute violation of Regulations 3 and 24."

- 32 -

11. They have also relied upon decision in the case

of Praveen Bhatia vs. Union of India reported in AIR

2009 SC 2626, wherein at paragraph No.8, 12, 13 and 14

has held as under:

"8. The range of activities which may amount to acts which are inconsistent with the interest of public service and not befitting the status, position and dignity of a public servant are so varied that it would be impossible for the employer to exhaustively enumerate such acts and treat the categories of misconduct as closed. It has, therefore, to be noted that the word "misconduct" is not capable of precise definition. But at the same time though incapable of precise definition, the word "misconduct" on reflection receives its connotation from the context, the delinquency in performance and its effect on the discipline and the nature of the duty. The act complained of must bear a forbidden quality or character and its ambit has to be construed with reference to the subject-matter and the context wherein the term occurs, having regard to the scope of the statute and the public purpose it seeks to serve.

12. "Misconduct" as stated in Batt's Law of Master and Servant (4th Edition) (at page 63) is "comprised positive acts and not mere neglects or failures." The definition of the word as given in Ballentine's Law Dictionary (148th Edition) is "A transgression of some established and definite rule of action, where no discretion is left except what necessity may demand, it is a violation of definite law, a forbidden act. It differs from carelessness."

13. It may be generally stated that the conduct rules of the Government and public sector corporations constitute a code of permissible acts and behaviour of their servants.

- 33 -

14. The scheme of the Conduct Rules, almost invariably, is to first of all enunciate a general rule of conduct and behaviour followed by specific prohibitions and restrictions. For example, Rule 3 of the Central Civil Services (Conduct) Rules, 1964 which occurs under the heading "General" provides that every Government servant shall at all times:

     (i)      maintain absolute integrity;
     (ii)     maintain devotion to duty; and
     (iii)    do nothing which is unbecoming              of   a
              Government servant."

12. Based on the said judgments, the respondent -

Bank has contended that the acts of the petitioner amounts

to irregularity and misconduct and the Bank as per its

Regulations is entitled to initiate action. That the learned

Single Judge erred in not appreciating the same in the right

perspective and the same is liable to be set aside. They

have further contended that the learned Single Judge was

swayed by the fact that the petitioner had a long

unblemished service in the Bank. It is contended that

irrespective of the previous records, the petitioner is liable

to be punished by dismissal for the proven acts of

misconduct. In this regard, the Bank relied upon the

judgment of the Hon'ble Supreme Court in the case of

Syndicate Bank & Ors. v. Venkatesh Gururao Kuratti

- 34 -

reported in AIR 2006 SC 3542, wherein at paragraph No.22

has held as under:

"22. Lastly, it is contended by the counsel for the respondent, that the respondent has put in 33 years of service and he was dismissed from service just two days prior to the age of superannuation, therefore, this Court may consider the entitlement of pension and gratuity in spite of removal from service. In this connection, learned counsel has cited the decision of this Court in Ganesh Santa Ram Sirur vs. State Bank of India (2005) 1 SCC 13 where Dr.Justice A.R. Lakshmanan speaking for the Bench although upholding the dismissal of the appeal held that in the peculiar facts and circumstances the appellant will be entitled to full pension and gratuity irrespective of his total period of service. In that case the officer had sanctioned loan to his wife. However, having realised the mistake later he tried to salvage the same by not encashing the draft issued in the name of his wife and the draft was not encashed. In those peculiar facts and circumstances since no loss was caused to the bank this Court took that view. The decision in Ganesh Santa Ram Sirur (supra) is distinguishable from the facts of this case. "

13. It is further contended that merely because

specific instances of major and minor misconduct have not

been prescribed entailing the major or minor penalties, it

cannot be held that the action itself is arbitrary or that the

order of punishment is disproportionate. It is also

contended that the acts complained of against the petitioner

pertain to abuse of official position to grant favours to

- 35 -

customers, extending credit facilities in violation of lending

norms, without proper pre-sanction appraisal, without

ensuring end utilization, without proper post sanction follow

up, exceeding powers, and unduly accommodating

customers to the detriment of the interest of the Bank, etc.

Merely because some of these accounts may have been

regularized by the Bank, it does not amount to the

petitioner being absolved of his misconduct. He is liable

irrespective of whether there was any loss caused to the

Bank or not.

14. It is further contended that the scope of judicial

review under Articles 226 of the Constitution of India is

limited. The Hon'ble Apex Court in the case of Union of

India and others v. P.Gunasekaran reported in AIR

2015 SC 545, wherein at paragraph No.13 has held as

under:

"13. Despite the well-settled position, it is painfully disturbing to note that the High Court has acted as an appellate authority in the disciplinary proceedings, re-appreciating even the evidence before the enquiry officer. The finding on Charge No.1 was accepted by the disciplinary authority and was also endorsed by the Central Administrative Tribunal. In disciplinary proceedings, the High Court is not and cannot act as a

- 36 -

second court of first appeal. The High Court, in exercise of its powers under Article 226/227 of the Constitution of India, shall not venture into re-appreciation of the evidence. The High Court can only see whether:

a. the enquiry is held by a competent authority;

b. the enquiry is held according to the procedure prescribed in that behalf;

c. there is violation of the principles of natural justice in conducting the proceedings;

d. the authorities have disabled themselves from reaching a fair conclusion by some considerations extraneous to the evidence and merits of the case;

e. the authorities have allowed themselves to be influenced by irrelevant or extraneous considerations;

f. the conclusion, on the very face of it, is so wholly arbitrary and capricious that no reasonable person could ever have arrived at such conclusion;

g. the disciplinary authority had erroneously failed to admit the admissible and material evidence;

h. the disciplinary authority had erroneously admitted inadmissible evidence which influenced the finding;

i. the finding of fact is based on no evidence.

Under Article 226/227 of the Constitution of India, the High Court shall not:

(i). re-appreciate the evidence;

(ii). interfere with the conclusions in the enquiry, in case the same has been conducted in accordance with law;

(iii). go into the adequacy of the evidence;

(iv). go into the reliability of the evidence;

(v). interfere, if there be some legal evidence on which findings can be based.

- 37 -

(vi). correct the error of fact however grave it may appear to be;

(vii). go into the proportionality of punishment unless it shocks its conscience."

(emphasis supplied)

15. Based on the aforementioned judgment, it is

contended that the act of the learned Single Judge amounts

to re-appreciating the evidence. It is contended that

admittedly the enquiry has been held in accordance with the

procedure established by law and all the principles of

natural justice have been followed. That being the case, the

learned Single Judge ought not to have interfered with the

finding and the recommendations of the enquiry and the

decisions of the disciplinary authority.

16. On the aforementioned grounds, the respondents

have sought for setting aside the order of the learned Single

Judge and dismissal of the writ petition.

17. Per contra, the petitioner has justified the findings

of the learned Single Judge in the writ petition. But has

contended that once the learned Single Judge come to the

conclusion that the actions of the petitioner does not

amount to misconduct as contemplated in the regulations of

- 38 -

the Bank, the learned Single Judge ought to have granted

full back wages. The case of the petitioner is that the

Management made allegations against the petitioner, but

never produced any circular nor office memorandum to

ascertain the violation of the same. No audit report is

placed. It is further contended that there is no allegation of

fraud or misappropriation. The allegations pertains to

violation of circular and lending norms. The subsequent

additional documents placed by the petitioner in the writ

proceedings revealed that many accounts have been settled

and closed and some of them are before the Court. This

itself shows no harm or prejudice to be caused to the Bank.

It is a clear case of victimization and the punishment is

unjustified and disproportionate. It is relevant to note that

a bare perusal of the material relied upon in the enquiry do

not support the charges leveled.

18. We have perused the charge sheet and the

enquiry report. The charges reveal as to how the loans have

been sanctioned by the petitioner. They all pertain to the

- 39 -

manner in which the petitioner has exercised his discretion.

None of the charges reveal as to what circular, the

petitioner has violated while exercising his duty and how it

amounts to misconduct. Further as noticed by the learned

Single Judge that many of the non-performing accounts

have been regularized by the Bank. The Bank is not put to

any prejudice or loss but on the other hand the branch has

enjoyed handsome profits. It is also not the allegation the

alleged violation were for extraneous considerations. The

nature of allegations leveled against the petitioner is mainly

in respect of exercise of his discretion, which might have

occurred due to erroneous exercise of the same. It does

not amount to misconduct. As contended by the petitioner,

there is no allegation of fraud or misappropriation leveled

against him. The learned Single Judge has observed the

action of the petitioner was only a minor irregularity and

has not caused any prejudice or loss to the Bank as

demonstrated by the additional documents produced by the

petitioner. Further, in the Regulations of the Bank, there is

no guidance as to which of the acts of misconduct would

- 40 -

attract major penalties and as to which of the acts of

misconduct would attract minor penalties. Therefore, the

arbitrary exercise of power that is made available to the

disciplinary authority to pick and chose the employees

against whom the major or minor penalties could be

imposed is evident and the present case as observed by the

learned Single Judge is a classic example of such arbitrary

exercise of power. The finding of the enquiry that the

petitioner is guilty of misconduct is clearly perverse. Under

the said circumstance, this Court can always interfere.

19. Under the said circumstances, based on the nature

of allegations made against the petitioner and there being

no allegation of fraud or misappropriation of money and

that the loans accounts have been regular, on facts, we

concur with the learned Single Judge that it does not

warrant major punishment.

20. For the aforementioned reasons, the order of the

learned Single Judge setting aside the termination of the

services of the petitioner is upheld.

- 41 -

21. Similarly, the facts reveal that the petitioner has

not been careful in exercise of his discretion. It reveals an

element of rashness in his approach. On the said ground,

the learned Single Judge is correct in not granting him full

back wages.

22. For the aforementioned reasons, we do not find

any valid ground to interfere with the well reasoned order of

the learned Single Judge and thereby dismiss both the

appeals preferred by the petitioner and the respondents

Bank. The appellants in W.A.No.100630/2015 to release

terminal benefits and pension to the respondent within a

period of two months in accordance with the order passed

in W.P.No.63053/2009.

No order as to costs.

SD/-

JUDGE

SD/-

JUDGE Vnp*