A.S. Navalgund vs Union Bank Of India
2025 Latest Caselaw 4026 Kant

Karnataka High Court

A.S. Navalgund vs Union Bank Of India on 17 February, 2025

Author: M.Nagaprasanna

Bench: M.Nagaprasanna

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                                                              WP No. 70887 of 2012




                                   IN THE HIGH COURT OF KARNATAKA,
                                           DHARWAD BENCH

                              DATED THIS THE 17TH DAY OF FEBRUARY, 2025

                                               BEFORE
                              THE HON'BLE MR. JUSTICE M.NAGAPRASANNA

                               WRIT PETITION NO.70887 OF 2012 (S-DIS)

                      BETWEEN:

                      A.S. NAVALGUND
                      S/O. SHANKAR NARAYAN NAVALGUND,
                      AGE: 59 YEARS, H.NO. PLOT NO. 27,
                      CHIDANAND, CHIDAMBARNAGAR,
                      DHARWAD - 580 004.
                                                                       ...PETITIONER
                      (BY SRI KIRAN JAVALI, SENIOR ADVOCATE FOR
                      SRI V. M. SHEELVANT, ADVOCATE)

                      AND:

                      1.   UNION BANK OF INDIA,
                           REPRESENTED BY THE CHAIRMAN
                           AND MANAGING DIRECTOR 239,
                           VIDHANA BHAVAN MARG,
                           NARIMAN POINT, MUMBAI - 400 021.

Digitally signed by
                      2.   ASSISTANT GENERAL MANAGER (IR),
VISHAL NINGAPPA
PATTIHAL                   UNION BANK OF INDIA, 239,
Location: High
Court of Karnataka,        VIDHANA BHAVAN MARG,
Dharwad Bench,
Dharwad                    NARIMAN POINT, MUMBAI - 400 021.

                      3.   DY. GENERAL MANAGER (HRM),
                           UNION BANK OF INDIA, 239,
                           VIDHANA BHAVAN MARG,
                           NARIMAN POINT, MUMBAI - 400 021.
                                                                     ...RESPONDENTS
                      (BY SRI V.R.DATAR, ADVOCATE FOR R1 AND R2;
                      SRI GIRISH S. HULMANI, ADVOCATE FOR R3)

                           THIS WP IS FILED PRAYING TO ISSUE A WRIT OF CERTIORARI
                      AND QUASH THE ORDER OF DISMISSAL BEARING NO.CO: IRD:
                      4484: 07 DATED 09.08.2007 [ANNEXURE-A] PURSUANCE TO THE
                      ARTICLES OF CHARGE BEARING NO. CO/RID:VIG/266/06DATED
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                                              WP No. 70887 of 2012




10.07.2006 [ANNEXURE-F] AS ILLEGAL AND VOID AB-INITIO. ISSUE
A WRIT OF MANDAMUS OR ANY OTHER APPROPRIATE WRIT, ORDER
OR DIRECTION TO PUT BACK THE PETITIONER INTO SERVICE AND
GRANT ALL ARREARS INCLUDING SERVICE BENEFITS AS A
CONSEQUENTIAL RELIEF AND ETC.,

      THIS PETITION, COMING ON FOR PRELIMINARY HEARING,
THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

                          ORAL ORDER

(PER: THE HON'BLE MR. JUSTICE M.NAGAPRASANNA)

1. The petitioner is before this Court calling in

question an order dated 22.02.2008, by which the

Disciplinary Authority imposes penalty of dismissal from

service and an order dated 05.04.2011, by which the

Appellate Authority confirms the order of the disciplinary

Authority.

2. Heard the learned Senior Counsel Sri.Kiran

Javali appearing for Sri.V.M.Sheelvant and Sri.M.L.Vanti

appearing the petitioner and learned counsel Sri.V.R.Datar

appearing for respondent Nos.1 and 2 and learned counsel

Sri.Girish Hulmani representing the respondent No.3.

3. Facts adumbrated are as follows:

The petitioner joins the services of the

respondent-Bank initially as a clerk-cum-cashier on

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12.09.1977. The averment in the petition is that owing to

his blemishless record of service, the petitioner was

promoted as a manager in middle management grade

scale-2 in June 2002 and at the relevant point in time was

working as a Branch Manager at the SS Front Road Branch

Bijapur. Owing to certain omissions and commissions on

the part of the petitioner, the respondent-Bank places the

petitioner under suspension in terms of its order dated

15.06.2006. Later on 10.07.2006 a charge-sheet comes to

be issued against the petitioner drawing certain articles of

charge, alleging the petitioner to have indulged in

irregularities in sanctioning of loan towards 500 Tractors,

which the Bank alleges that certain amount of

misappropriation has taken place. The petitioner then on

16.08.2006 replies to the said notice. In terms of the

regulations an enquiry officer was appointed to conduct

departmental enquiry against the petitioner, the result of

departmental enquiry was the enquiry officer holds the

petitioner guilty of the offences. Based upon the report of

the enquiry officer, the petitioner was imposed a penalty

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of dismissal from service on 09.08.2007. Against which

the petitioner prefers an appeal and the appeal comes to

be rejected by the Appellate Authority on 26.02.2008. The

Review Petition is said to be pending consideration at the

hands of the Reviewing Authority. The orders of dismissal

from service has driven the petitioner to this Court in the

subject petition.

4. Learned Senior Counsel Sri.Kiran Javali

appearing for the petitioner would takes this Court through

the documents appended to the petition and several

proceedings that have happened in the aftermath of the

imposition of penalty of dismissal from service. Learned

Senior Counsel would contend that when the complaint

was received an enquiry or investigation was directed to

be conducted by an officer of the Bank. He has completely

exonerated the petitioner. On the same circumstance, a

criminal case was also registered. The criminal case ended

in honourable acquittal of the petitioner. The twin

circumstance is now projected contending, that the

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present disciplinary proceedings is after the Bank finding

no fault against the petitioner has also the fact that the

petitioner has now been honorably acquitted by the

concerned Court-CBI Court. He would seek quashment of

the orders impugned and all consequential benefits to flow

through the hands of the petitioner.

5. Learned counsel Sri.Girish Hulmani appearing

for the respondent would vehemently refute the

submission of the learned Senior Counsel contending that

the charges against the petitioner were serious as it was

grant of indiscriminate loan without adequate security to

500 tractors. The loan could not be recovered.

Misappropriation also was the allegation against the

petitioner. In such cases whether there has been acquittal

or otherwise would not have any bearing upon the

departmental enquiry conducted in terms of the

regulations is his submission. He would not dispute the

fact that earlier complaint was looked into and he was

completely exonerated, but that does not mean that

departmental enquiry should not be conducted or the

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conduct of departmental enquiry can be found fault with.

On the said score he would seek to place reliance upon the

judgment of Apex Court in the case of Syndicate Bank v.

B.S.N.Prasad1. To buttress his submission that mere

acquittal in a criminal case would not enure to the benefit

of an employee, who seek quashment of the orders that

are passed pursuant to a departmental enquiry.

6. I have given my anxious consideration to the

submissions made by the respective learned counsels

appearing for the parties and have perused the material

on record.

7. The afore-narrated facts, link in the chain of

events and the dates are not in dispute. It would suffice

that the issue would be narrated from the date on which

the petitioner is placed under suspension. The suspension

comes about owing to several irregularities in the conduct

of loans of the petitioner when he was in Navalagund

Branch as its Branch Manager. Long before the petitioner

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being placed under suspension on 05.06.2006, when the

complaint emerged of the acts of the petitioner in the

Branch an investigation was directed to be conducted. The

result of the investigation which was conducted at the

hands of the Senior Manager therein is as follows:

"Through: The AGM/DGM (SBD)

COMPLAINT AGAINST BRANCH MANAGER, UNION BANK OF INDIA S.S. FRONT ROAD, BRANCH BIJAPUR

The undersigned visited S. S. Front Road, Bijapur Branch from 26.10.2004 to 27.10.2004 to ascertain facts regarding complaint against Branch Manager, S.S. Front Road, Brach Bijapur in respect of tractor advances. My observations are as follows:

BRANCH PROFILE

The subject branch is taken over from erstwhile Belgaum Bank w.e.f. 1.12.1975. The present deposits are Rs.9.65 crores and advances are Rs.21.91 crores. The priority sector advances are Rs. 19.80 crores. The agricultural advances are Rs. 16.65 crores in 371 accounts. The various targets allotted to Branch under deposits/advances are given in Annexure-I. There are 334 tractor accounts with outstanding of Rs.16.33 crores. The branch has 114 accounts under NPA with aggregate outstanding of Rs.0.49 crores, w/w only one account of poultry with outstanding of Rs.1.15 lac is NPA under Agriculture Sector.

The Branch Manager, Mr. A. S. Navalgund, Officer Scale-Il is posted since 19.12.2002

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The 334 tractor accounts are spread over in five Talukas of Bijapur District within radius of 60-65 kms. Out of total 334 tractors financed by the Branch only 3 tractors are SWARAJ Brand while all other are BALWAN Brand. These advances are made under tie-up arrangement with the dealer viz. M/s.Venkatesh Motors, Bijapur in terms of RO, Belgaum letter No.RO/CR/629 dated 5.8.2003 (Annexure-II). The said dealer is one of the reputed client of the said branch maintaining their current account with the said branch for the last 25 years. The branch has their family deposits to the tune of Rs.60.00 lacs. They are dealers in BALWAN range of tractors, Bajaj Minidor, Bajaj Trax and Hero Honda Motor Cycles.

During discussions with the Branch Manager the following information is revealed:

1. The Allmatti Dam is built on river Krishna and a network of canals and sub-canals is spread over in Bijapur District having running length of about 300 kms. Due to this about 19 lac hectares of agriculture land has come under lift irrigation.

The villages of Indi and Sindgi talukas are benefited by this project.

2. The branch has financed to the extent of 60 to 65 kms of the command area which 1959 076 is ratified by Regional Office, Belgaum, vide their letter No.RO/PSAD/1252/04 dated 11.2.2004 (Annexure-III)

3. The tie-up with M/s. Venkatesh Motors, Bijapur is permitted by Regional Office, 5 Belgaum.

4. Additional staff of one Officer has been provided to the Branch to conduct pre-sanction inspections and obtain security document, and to follow up these accounts.

5. The tractors are financed in the cluster of at least 5 to 7 tractors in a village.

6. Under the tie-up arrangement, the dealer assists in identification of borrowers and recovery of

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loans and for creation of Bank's lien on tractor and trolley with RTO authorities.

TRACTOR ACCOUNTS AT THE BRANCH

The undersigned sampled out at random the following 15 accounts for detail study:

1. Account No.30272- Mohanappa Siddanna Poddar Village Choragi; Taluka -Indi. Distance 40 loms

2. Account No.30298 Lagamanna Sangappa Bagali and Suryakant Lagamanna Bagali Village-Nivargi, Taluka -Indi. Distance 40 kms.

3. Account No.30307 Namdev Shankar Lamani, Shamu Shankar Lamani and Walu Shankar Lamani Village Jigajeevanagi: Taluka Indi.

Distance 501 lma.

4. Account No.30311 Dundappa Ramappa Watar Village Danaragi: Taluka - Bijapur. Distance 20 kms.

5. Account No.30326- Basavarak Baganna Ankalagı, Mallappa Gurusiddappa Patil Village Horti; Taluka- Indi. Distance 45 kms.

6. Account No.30333 Beheemangouda Gurubasappa Biradar and Bheembai Bheemangouda Biradar Village Abbihal: Taluka -Basavan Bagewadi. Distance 60 kms.

7. Account No.30338- Shankarawwa Ningappa Biradar and Mudakanna Ningappa Biradar Village Hunshyal: Taluka - Basavan Bagewadi. Distance 60 kms.

8. Account No.30347- Sharanabasapa Kerappa Hanjagi Village - Loni B K; Taluka - Indi. Distance 40 kms.

9. Account No.30360 Mahadev Honnappa Hanigi Village Tikota; Taluka Bijapur. Distance 25 kms.

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10. Account No.30366 Bhimappa Ningappa Padaganur Village Jorapur Peth; Taluka Bijapur. Distance 25 kms.

11. Account No.30372-Hanumantray Basappa Hubballi Village -Keshapur, Taluka -Muddebihal. Distance 60 kms

12. Account No.30383 Bagavva Gurappa Biradar and three others Village Inchageri; Taluka Bijapur. Distance 40 kms

13. Account No.30389 Sahadevappa Kallappa Salavadagi and Shivappa Sahadevappa Salavadagi Village-Handiganur, Taluka - Sindagi. Distance 60 kms.

14. Account No. 30403 Shantappa Goudappa Choudhari Village Hiroor, Taluka -Bijapur. Distance 25 kms.

15. Account No.30418 Shivappa Ishwarappa Gadag and three others Village Sarwad: Taluka Bijapur. Distance 20 kms.

On perusal of all the above files it was observed that the branch has sanctioned these loans under BMDP under tie-up arrangement with M/s.Venkatesh Motors, Bijapur the dealer for Balwan brand of tractors manufactured by M/s Bajaj Tempo Ltd. The branch has carried out pre-sanction inspections. The land holdings and margin stipulations are as per prescribed norms. The original RC books of tractors and trolleys with bank's lien in RTO records are held in respective files. The quotations/bills duly signed by borrowers are well preserved in files. The security documents are also obtained as per requirement. The insurance of tractor and trolley/implements are taken out and original insurance policies with Bank's clause are held in files. The post-sanction inspections are also carried out and such reports are held in files. The advocate's search reports with Land Record Extracts, valuation of agriculture land from approved valuer/village accountant, Non encumbrance certificate from

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Tehsildar, NOC/No Dues of other local Banks etc. are also held in files.

Further, following borrowers at their villages were visited on 27.10.2004 for verification assets created out of Bank's loan:

1. Account No.30176 - Shrishail Gundappa Sajjan, Village Byalihal Taluka Basavanbagewadi;

Distance-40 kms.

2. Account No.30399-S.C.Patil, Village Shekalwadi:

Taluka - Basavanbagewadi; Distance-40 kms.

3. Account No.30344- M.S. Aakalagi, Village -

Kanamadi; Taluka - Bijapur, Distance -15 kms.

4. Account No.30412 S.B.Chimmalagi, Village Wadawadagi: Taluka Basavanbagewadi; Distance-40 kms.

5. Account No.30138-T.P.Rathod, Village -Kesarai Tanda No.2: Taluka Bijapur Distance-25 kms.

6. Account No.30131-M.T. Avati, Village -Tamba;

Taluka - Indi; Distance-40 kms.

7. Account No.30433-LK. Chikagai, Village Tamba, Taluka Indi; Distance - 40 kms.

8. Account No.30267-G.V.Yelakoti, Village - Tamba;

Taluka - Indi: Distance - 40 kms.

9. Account No.30127 H.M.Hipargi, Village Tamba, Taluka Indi; Distance - 40 kms.

10. Account No.30117-AL. Pinjar, Village - Alur, Taluka - Indi;

Distance-40 kms.

11. Account No.30128-S.T.Talwar, Village Kannoli, Taluka - Shidgi; Distance-45 kma.

During inspection the tractors/trolleys/implements were verified and were found to be in order and in working

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condition. The tractors/trolleys were having Banks name board displayed as sticker in local language.

Further, the Regional Head, Belgaum visited S.S.Front Road Branch, Bijapur in June 2004 and personally visited about 43 tractor borrowers to verify the availability of various assets financed by the Bank. In his report dated 18.6.2004 (Annexure-IV) he has certified that his visit was conducted on 18.6.2004 from 9.30 am. to 19.00 p.m. covering total distance of 256 kms and he visited 43 tractor borrowers and found all tractors/trolleys/implements financed by the Bank in order.

As regards various points raised in the complaint, the observations are as follows:

1. Field Inspections are not done: The pre-

sanction inspection reports are available in respective files.

2. Advancing the loan on less holding of land:

The prescribed norms for land holding and margin are adhered to.

3. The Manager never meets the customers:

The pre-sanction inspection report are the evidence of the Manager meeting the customer. Further, the field visits in respect of above mentioned 11 accounts were done with the Branch Manager only.

4. Non Delivery of implements: In respect of 11 visits made to borrowers place the tractor, trolley and implements were found available as per finance made by the Bank.

5. Excess loan amount: The margin stipulation is adhered to and loan limit is correctly calculated. The trailor and implements are supplied by different manufacturers from Hubli

6. Keeping Bank loan original documents in the BALWAN tractor showroom: In all the tractor

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finance accounts the original stamped/executed documents are available in respective files and in custody of Bank/Branch.

7. Keeping guarantors in dark: The guarantee agreement and credit information of guarantor is signed by the guarantors and photograph of the guarantor is also found available which implies that guarantors are aware of the facts.

8. Bank advancing only BALWAN tractors: Out of 334 tractor accounts only 3 tractors are SWARAJ brand while other 331 tractors are BALWAN brand. The finance is under tie-up with M/s. Venkatesh Motors, Bijapur who is approved dealer of BALWAN tractors manufactured by M/s. Bajaj Tempo Limited.

9. Documents are not proper: The branch holds no dues/NOC of other local Banks and our Bank's security documents such as D.P.Note, Letter of Guarantee, Hypothecation Agreement, Mortgage schedule, Form No.28 and 29 signed in blank (TTO/TCA Forms of RTO) etc. are found to be in order.

10. Customers approaching consumer court: The complaint file of the branch is seen and no complaints from tractor customers are observed. Further, the Branch Manager informed that no notice of any case in consumer court is received/pending.

It is therefore evident that the complaint is unfounded and appears to have been made by some staff/dealer/public mischievously with vested interest.

Submitted for information."

8. Upon analysis of the entire spectrum of the

allegations against the petitioner the complaint was said to

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be unfounded and appears to have been made by some

staff or public, mischievously with vested interest against

the petitioner. This finding has become final is an admitted

fact.

9. On the same facts the order of suspension

comes about two years thereafter and a charge-sheet is

drawn against the petitioner. The drawing of the charge-

sheet results in appointment of an enquiry officer to

conduct departmental enquiry against the petitioner. The

enquiry officer holds the petitioner guilty of the allegations

on the following findings:

"Findings of IA:

76.3 The deposition of MW1 vide 76.2 focused both the points of allegation viz., (a) traces of trailer were found carving stones (b) Jowar crop was found in 10 acres of India.

76.4 AO argued that tractor finance can be done to other than irrigated lands also. As already established in the earlier allegation No.3 and similar others, the tie-

up arrangement under discussion conceived to finance and encash the irrigation potentiality of the Upper Krishna Project (UKP) covering the talukas of Indi, Sindagi, B. Bagewadi and Muddebihal which means that the arrangement was not meant for dry land but was tap the irrigated lands coming under the command area of UKP.

I therefore hold this allegation as proved.

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Submission of CSO:

In view of Mex 243 (IC 6149/2.1.2001) and Mex 2181 (IC 6427) the farmers/borrowers are permitted to carry out the commercial work apart from the agricultural work which aspect has been dealt in detail else where and repetition is avoided Hence the allegation is not proved."

10. After the report of the enquiry officer, the

disciplinary authority issues a second show cause notice.

The second show cause notice is replied to by the

petitioner. Notwithstanding the same the petitioner is

imposed penalty of dismissal from service. By an order of

the disciplinary authority dated 09.08.2007. The order

reads as follows:

"In view of the above, the Inquiring Authority has held Shri Navalgund guilty of the following charges and I concur with the same:

• Failure to take all possible steps to ensure and protect the interest of the Bank.

• Failure to discharge his duties with utmost devotion and diligence.

• Failure to discharge his duties with utmost honesty and integrity.

• Acting otherwise than in his best judgement in the performance of his official duties.

His various submissions in this regard do not merit consideration. Looking to the nature/gravity of the

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aforesaid charges/allegations proved against Shri Navalgund, I am of the opinion that ends of justice will be met by imposing on him major penalty of 'Dismissal from the services of the Bank'.

Accordingly, I hereby pass the following order, in exercise of the powers conferred on me under Regulation 7 of the Union Bank of India Officer Employees' (Discipline & Appeal) Regulations, 1976:

ORDER

"The major penalty of 'Dismissal from the services of the Bank with immediate effect' be and is hereby imposed on Shri A.S. Navalgund."

Shri Navalgund is further informed that he will not be entitled for any salary save and except the subsistence allowance drawn by him."

11. The finding against the petitioner in the order,

was failure to take all steps to ensure and protect the

interest in the Bank not conducting due diligence,

performing duties with dishonesty and acting otherwise

than the best judgment in the performance of his official

duties. There is no allegation against the petitioner that he

has misappropriated funds. The account being turned into

NPA is what is projected be the reason for dismissal from

service.

12. Certain analogous proceedings take place. On

the same set of facts criminal proceedings were initiated.

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Therefore the two proceedings emerge from one solitary

fact of the petitioner granting loans and those long loans

becoming sticky. The concerned Court i.e. CBI Court,

which tried the case against the petitioner and acquits the

petitioner in terms of its order dated 28.03.2024. The

order of acquittal and the reasons rendered to acquit the

petitioner, as could be gathered from the order of acquittal

is as follows:

"71. Further, he has also mentioned in the report that presanction inspection reports are available, prescribed forms for land holding and margins are adhered. The Manager has visited the field, all the implements, tractors and trailers were available during visits. There is no excess loan amount. All the original documents were available in the files. The guarantee agreements is available. All the documents are proper and in-order. There are no complaints from the tractor customers and he has specifically noted that the complaint is unfounded and appears to have been made by some staff/dealer/public mischievously with vested interest. Thereafter, it is also endorsed by the DGM to the effect that the complaint is recommended to be closed. Hence, from this document which is the report from Senior Manager of complainant Bank, the prosecution has totally failed to prove all the charges and accused have proved their defence. The accused also produced the judgments at Ex-D-3 to 6 about initiating recovery proceedings against the defaulters and obtained the decree. Hence, from the available evidence as above it is only procedural irregularities by the Manager and staff in obtaining the necessary documents and filing up of all the particulars in the various documents of the loan files. It is also clear that all the loan transactions have been taken place. All the borrowers have applied for the loan which has

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been processed with at various levels on the basis of legal opinion and thereafter as per the tie-up agreement with accused No.2 to 4 that the tractors, trailers and implements have been supplied to all the borrowers. Thereafter, there are some defaulters for which in some of the cases tractors have been seized and proceedings were also initiated in several cases.

72. There is no evidence against accused No.1 to prove the charges. PW-62 in the cross-examination admits the tractors and trailers are registered with RTO, there is no complaint for not receiving implements. All the requirements are complied, there is no malafide intention of accused No.1, as per Ex-D-8 report it is observed that complaint is unfounded and appears to have been made by some staff/dealer/public mischievously with vested interest. P.W-13 admits that there is no bad remark on accused No.1. P.W-4 states as per Ex.P62 and 66 audit objections are complied. P.W-40 admits that all the persons borrowed the loan have purchased the tractor and implements. P.W- 39 legal advisor admits all the opinion are genuine, the evidence of revenue officials is not proved regarding fake documents. There is no violation of rules, there were only procedural irregularities by Accused No.1 for which departmental action is to be held.

73. There is no evidence against accused No.2 to 4 to prove the charges. Accused No.2 to 4 have supplied the tractors on the basis of tie-up arrangements between the Bank and Bajaj tempo. P.W-62 and 65 have clearly admitted that all the borrowers have received tractors after sanctioning of loan and the contents of Ex-D-8 are correct. All the borrowers have turned hostile, all the bank officials are hear-say witnesses. The evidence of revenue officials is not helpful to prove the act of forgery etc. P.W-51 admits there is name of financier in the RC. P.W-62 in his evidence at para No.2, 3 and 5 admits the defence of accused, prosecution failed to prove all the charges. All the borrowers are not examined, the persons who are alleged impersonation are not examined. Prosecution totally failed to prove the charges and prays to acquit accused No.2 to 4.The offence against accused No. 5 to 9 is also not proved, there is no role

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of all the accused and they have not committed any offence.

74. But un-fortunately after registering this case, all the loan files in original have been seized and produced before this Court and hence the Bank could not initiate recovery proceedings against some of the borrowers and they became defaulters. Now the Bank has to take steps for recovery of those loans which have became defaulter. The concerned Bank is directed to take steps to get all the original loan files and other original documents in this case for further action. It is also to be noted that as per the Central Government Scheme huge number of loans have been disbursed for about 300-500 borrowers. Hence, there are some irregularities due to rush of work. There are no ingredients of any of the offence alleged in the charge against any of the accused. Hence, prosecution failed to prove any of the charges. There is no role of accused persons in the entire charges from the evidence of all the material witnesses. Accordingly, I answer points No.1 to 10 in the negative.

75. Point No.11: For the aforesaid discussion, I proceed to pass the following:-

ORDER

Acting under Sec.235(1) Cr.P.C. accused No.1 to 9 are acquitted for the offences punishable under Sec.120-B R/w Sec. 420, 409, 419, 468 and 471 of I.P.C. and under Sec.13(2) R/w.

13(1)(c) & (d) of Prevention of Corruption Act, 1988."

13. The finding is that the prosecution has failed to

prove any of the charges and there was no role of the

accused persons in the entire charges, emerging from the

evidence of all the material witnesses. Therefore it is a

case where, the Court does not render its acquittal on

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benefit of doubt. The Court clearly holds that the petitioner

has been acquitted as the prosecution, had failed to prove

the guilt beyond all the reasonable doubt, and there was

no evidence to prove any charge against the petitioner.

The circumstance now would be whether the order in the

departmental enquiry would get vitiated on account of the

honourable acquittal of the petitioner.

14. Learned counsel for the respondent seeks to

places heavily reliance upon the judgment rendered in the

case of Syndicate Bank v. B.S.N.Prasad supra to contend

that the proceedings conducted in a departmental enquiry

cannot have any bearing even if the employee has been

acquitted in the criminal case. The findings of the Apex

Court are as follows:

22. Thus, there was no factual dispute about the correctness of illegalities and irregularities alleged in the charge sheet. The Investigating Officer was examined as a witness, and 95 documents were produced during the disciplinary inquiry. The respondent made a very detailed cross-examination of the witness. The allegations in the chargesheet were based on documentary evidence which was before the inquiry officer. In view of the respondent's admissions and the fact that documentary evidence was on record, it cannot be said that it was a case of no evidence.

The principles of natural justice were followed during the disciplinary inquiry. The respondent thoroughly cross-

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examined the officer examined as a witness. The respondent did not apply for leading any evidence. Therefore, the finding that the disciplinary inquiry was not fair or was in breach of the principles of natural justice cannot be accepted as correct. The entire premise on which the High Court had interfered is without basis.

23. It is well settled that the exercise of powers by the disciplinary authority is always subject to principles of proportionality and fair play. In the facts of the case, the financial loss caused to the appellant was reimbursed. The respondent, at every stage, fairly accepted his mistakes. The respondent, while replying to the notice and the letters addressed to him by the appellant, repeatedly pointed out that he had to deal with more than 4,800 SKCC accounts during a short period of 60 days. Therefore, he worked under pressure all along. Moreover, he stated that he was in short receipt of crop insurance claims pertaining to 2,500 farmers to the extent of Rs. 50 lakhs. Therefore, the farmers and political leaders pressurized him.

24. The respondent was employed in the appellant bank on 5th August, 1985 and had an unblemished record for more than 21 years till 11th June 2007. We have perused the Syndicate Bank Officer Employees (Discipline and Appeal) Regulations, 1976 (for short "the Disciplinary Regulations"). Under Regulation 4, there is a provision for imposing minor penalties and major penalties. The respondent has already reached the age of superannuation. In our view, the penalty of dismissal was disproportionate to the misconduct established against the respondent and his unblemished career for a long time. However, fact remains that the misconduct alleged and proved against the respondent was of a serious nature considering the fact that a very high standard of conduct is expected from a branch manager of a Bank. Considering the facts of the case, we are of the view that a minor penalty, as provided in Regulation 4(e) of the Disciplinary Regulations, would be appropriate. The penalty will be of reducing the respondent to a lower stage in the time scale of pay for a period of one year, without cumulative effect and not adversely affecting his pension.

15. The Apex Court though observes, as aforesaid,

grants relief to the employee holding that the punishment

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imposed upon the employee was disproportionate and

converts dismissal from service into a minor penalty as

obtaining under the regulations. Therefore the said

judgment would not have any bearing upon the issue in

the lis.

16. What needs to be noticed in the case at hand is,

when the complaint emerged, an enquiry or investigation

is conducted, the investigation completely exonerated the

petitioner. Notwithstanding the same, owing to the

direction or dictate of the vigilance Commission a

departmental enquiry was directed to be conducted, so as

the registration of the criminal case. With these facts what

would become applicable is the judgment of Apex Court in

the case of Ram Lal v. State of Rajasthan,2. The findings

of the Apex Court are as follows:

Effect of acquittal in the criminal proceeding -- Question 2

25. With this above background, if we examine the criminal proceedings the following factual position emerges. The very same witnesses, who were examined in the departmental enquiry were examined in the criminal trial. Jagdish Chandra, Bhawani Singh, Shravan Lal, Raj Singh and Karan Sharma were examined as PW

(2024) 1 SCC 175.

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2, PW 3, PW 6, PW 9 and PW 13 respectively at the criminal trial. Apart from them, eight other witnesses were also examined. The gravamen of the charge in the criminal case was that the appellant had submitted an application for recruitment along with his marksheet and he, by making alteration in his date of birth to reflect the same as 24-4-1972 in place of 21-4-1974, and obtained recruitment to the post of Constable.

26. Though the trial court convicted the appellant under Section 420IPC, the appellate court recorded the following crucial findings while acquitting the appellant:

"...Mainly the present case was based on the documents to this effect whether the date of birth of accused is 21-4-1972 or 21-4-1974. Ext. P-3 is original marksheet, in which, the date of birth of accused has been shown as 21-4-1972 and same has also been proved by the witnesses examined on behalf of the prosecution. Whatever the documents have been produced before the court regarding the date of birth of 21-4-1974 are either the letters of Principal or are duplicate TC or marksheets. Neither the prosecution has produced any such original documents in the subordinate court to this effect that when the admission form of accused was filled, what date of birth was mentioned by the accused in it, what was the date of birth in Roll Register of School, what date of birth was mentioned by accused in the examination form of Secondary, and nor after bringing the original records from the witnesses concerned, same were got proved in the evidence. In these circumstances, this fact becomes doubtful that date of birth of the accused was 21-4-1974, and the accused is entitled to receive its benefit. In the considered opinion of this Court, the conviction made by the learned subordinate court merely on the basis of oral evidence and letters or duplicate documents, is not just and proper. It is justifiable to acquit the accused.

Resultantly, on the basis of aforesaid consideration, the present appeal filed by the appellant-accused is liable to be allowed."

(emphasis supplied)

27. What is important to notice is that the Appellate Judge has clearly recorded that in the document Ext. P-3

-- original marksheet of the 8th standard, the date of birth was clearly shown as 21-4-1972 and the other documents produced by the prosecution were either letters or a duplicate marksheet. No doubt, the Appellate Judge says that it becomes doubtful whether the date of

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birth was 21-4-1974 and that the accused was entitled to receive its benefit. However, what we are supposed to see is the substance of the judgment. A reading of the entire judgment clearly indicates that the appellant was acquitted after full consideration of the prosecution evidence and after noticing that the prosecution has miserably failed to prove the charge (see S. Samuthiram [State of T.N. v. S. Samuthiram, (2013) 1 SCC 598 :

(2013) 1 SCC (Cri) 566 : (2013) 1 SCC (L&S) 229] ).

28. Expressions like "benefit of doubt" and "honourably acquitted", used in judgments are not to be understood as magic incantations. A court of law will not be carried away by the mere use of such terminology. In the present case, the Appellate Judge has recorded that Ext. P-3, the original marksheet carries the date of birth as 21-4-1972 and the same has also been proved by the witnesses examined on behalf of the prosecution. The conclusion that the acquittal in the criminal proceeding was after full consideration of the prosecution evidence and that the prosecution miserably failed to prove the charge can only be arrived at after a reading of the judgment in its entirety. The Court in judicial review is obliged to examine the substance of the judgment and not go by the form of expression used.

29. We are satisfied that the findings of the Appellate Judge in the criminal case clearly indicate that the charge against the appellant was not just, "not proved" -- in fact the charge even stood "disproved" by the very prosecution evidence. As held by this Court, a fact is said to be "disproved" when, after considering the matters before it, the court either believes that it does not exist or considers its non-existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it does not exist. A fact is said to be "not proved" when it is neither "proved" nor "disproved" (see Vijayee Singh v. State of U.P. [Vijayee Singh v. State of U.P., (1990) 3 SCC 190 : 1990 SCC (Cri) 378] ).

30. We are additionally satisfied that in the teeth of the finding of the Appellate Judge, the disciplinary proceedings and the orders passed thereon cannot be allowed to stand. The charges were not just similar but identical and the evidence, witnesses and circumstances were all the same. This is a case where in exercise of our discretion, we quash the orders of the disciplinary authority and the appellate authority as allowing them to

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stand will be unjust, unfair and oppressive. This case is very similar to the situation that arose in G.M. Tank [G.M. Tank v. State of Gujarat, (2006) 5 SCC 446 : 2006 SCC (L&S) 1121] .

31. Apart from the above, one other aspect is to be noted. The enquiry officer's report makes a reference to the appellant passing 10th standard, and to a 10th standard marksheet exhibited as Ext. P-4 referring to the date of birth as 24-7-1974. Jagdish Chandra PW 1 (in the departmental enquiry) clearly deposed that since the appellant was regularly absent from Class 10, his name was struck off and he did not even pass 10th standard. The appellant has also come out with this version before the disciplinary authority, stating that the 10th class certificate of Ram Lal produced before the enquiry officer, is of some other Ram Lal.

32. This issue need not detain us any further because it is not the case of the department that the appellant sought employment based on 10th standard marksheet. It is their positive case that the appellant sought employment on the basis of his 8th standard marksheet. Shravan Lal, PW 4 in the departmental enquiry had also furnished the 10th standard marksheet procured from the Secondary Education Board, Ajmer. In cross-examination, on being asked, he admitted that the appellant was recruited on the basis of 8th standard marksheet, and he admitted that there was no alteration in the 8th standard marksheet.

17. The Apex Court considers the entire spectrum

of the law and holds that when an employee is honorably

acquitted in a criminal case the findings in the

departmental enquiry will have to give way,

notwithstanding the fact that the acquittal comes about at

a later point in time. The finding in the case at hand is

completely in favour of the petitioner in the criminal case

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so registered, as it is an acquittal on merits, and the

circumstance that the petitioner was already enquired into

on the same complaint and completely exonerated would

enure to the benefit of the petitioner.

18. In the case at hand, it is not in dispute that

both the departmental enquiry and criminal case sprang

from the same set of facts. The same evidence was before

both, the evidence or the witnesses examined were all

most common. If this be the case, the judgment relied on

in the case of Syndicate Bank v. B.S.N.Prasad supra would

not become applicable to the facts of case as it becomes

distinguishable.

19. In that light, the petitioner now becomes

entitled to the relief that he has sought for i.e. the

quashment of the order of the penalty imposed upon him.

Learned Senior Counsel has placed reliance upon the

judgment of the Apex Court in the case of Maharashtra

State Road Transport Corporation Vs. Mahadeo Krishna

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Naik3. To buttress his submission with regard to grant of

back wages, when such obliteration would happen there

can be qualm about the principle so laid down by the Apex

Court. The petitioner in the case at hand had been

dismissed in the year 2007, if he were to be in service he

would have retired on attaining the age of superannuation

on 31.05.2013. His terminal benefits are not settled.

Therefore the finding of the Apex Court in the aforesaid

judgments would become applicable to the facts of the

case at hand.

20. For the aforesaid reasons the following

ORDER

(i) The petition is allowed.

(ii) The impugned order dated 09.08.2007 vide

Annexure-A in pursuance to the Articles of

Charge dated 10.07.2006 vide Annexure-F

stands quashed.

2025 SCC OnLine SC 325

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(iii) Therefore the petitioner shall become

entitled to 50% of the back wages from

the year 2007 to 2013 and all terminal

benefits to be calculated from the date of

superannuation taking his service as

complete as if the order of dismissal was

never in existence.

Ordered accordingly.

Sd/-

(M.NAGAPRASANNA) JUDGE

RHR/CT-ASC