Madras High Court
M.Natarajan vs The Executive Director/Review ... on 7 February, 2022
Writ Appeal No.58 of 2022
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 07.02.2022
CORAM :
THE HONOURABLE MR. JUSTICE S.VAIDYANATHAN
AND
THE HONOURABLE MR. JUSTICE MOHAMMED SHAFFIQ
Writ Appeal No.58 of 2022
M.Natarajan ... Appellant
vs.
1. The Executive Director/Review Authority,
Indian Bank, Corporate Office,
254-260, Avvaishanmugam Salai,
Royapettah,
Chennai 600 014.
2. The General Manager/Appellate Authority,
Indian Bank, Corporate Office,
254-260, Avvaishanmugam Salai,
Royapettah,
Chennai 600 014.
3. The Deputy General Manager/
Disciplinary Authority,
Indian Bank, Corporate Office,
254-260, Avvaishanmugam Salai,
Royapettah,
Chennai 600 014. ... Respondents
Writ Appeal filed under Clause 15 of Letters Patent against the order
dated 25.08.2021 passed by this Court in W.P.No.8930 of 2014.
Page No.1 of 8
https://www.mhc.tn.gov.in/judis
Writ Appeal No.58 of 2022
For Appellant : Mr.P.Ganesan
for Mr.K.Maheshwaran
JUDGMENT
(Judgment of the Court delivered by S.VAIDYANATHAN,J.)
The present Writ Appeal has been preferred challenging the order dated
25.08.2021 passed by the learned Single Judge in W.P.No.8930 of 2014.
2. Heard the learned counsel for the Appellant and perused the
material documents available on record.
3. Admitted facts are that, there were certain irregularities in the
transactions of the Respondent Bank, while the Appellant/Writ Petitioner was
working as Branch Manager in Cantonment Branch, Trichy between
24.07.2006 and 30.04.2010. Allegations against the Appellant were that, he
released excess funds beyond his limit; failed to get pre-release audit; pre-
release legal opinion before releasing the loan sanction order; failure to get
loan coverage, equilateral mortgage deeds for the loans advanced and
suppressed the facts to the Head Office. A detailed enquiry was conducted
and the Appellant was taken under the custody of CBI and thereafter,
conditional bail was granted to him on account of serious illness. The
https://www.mhc.tn.gov.in/judis
Writ Appeal No.58 of 2022
Appellant was given sufficient opportunities to appear before the Enquiry
Officer, but, he was protracting the proceedings and did not appear before the
Medical Board and the Enquiry Officer. Hence, the Enquiry Officer set the
Appellant exparte and conducted the enquiry. Having found that, the charges
are proved, the Disciplinary Authority forwarded a copy of the Enquiry
Report to the Appellant and thereafter, the Appellant neither sought for
further opportunity to examine or cross-examine the prosecution witnesses
nor sought for any opportunity to produce defence witnesses.
4. It is seen that, the Appellant was proceeded for the misconducts
falling under Regulation 24 of the Indian Bank Officer Employees' (Conduct)
Regulations, 1976 and breach of Regulation 3(1) of the said Regulations,
which contemplate that, the Officer shall take all possible steps to ensure and
protect the interest of the Bank and discharge duties with utmost integrity,
honesty, devotion and diligence and do nothing which is unbecoming of an
Officer employee.
5. Fact remains that, persons who have availed loan from the
Respondent Bank have been sanctioned excess amount by the Appellant and
the same has not been recovered. Appellant has not taken any steps to
https://www.mhc.tn.gov.in/judis
Writ Appeal No.58 of 2022
protect the interest of the Bank. The main allegation against the Appellant is
that, he had suppressed from the knowledge of the Zonal Officer about the
limits of Rs.25 lakhs having already been sanctioned by him to M/s.Nagi
Enterprises and took over the account of M/s.Nagi Enterprises from SBI,
though the Account was irregular. It is seen that, the action of the Appellant
has resulted in the Respondent Bank facing a huge financial loss with total
dues of Rs.417.72 lakhs outstanding in the account of M/s.Nagi Enterprises
at the time of issuing the penalty order, which is besides the amount
fraudulently transferred from the accounts of M/s.Cethar Vessels Ltd. to the
accounts of M/s.Nagi Enterprises and its partner, amounting to Rs.41.85
lakhs. As it is quite evident that, there is dereliction of duty on the part of the
Appellant, the learned Single Judge has agreed with the findings of the
Enquiry Officer, as confirmed by the Disciplinary Authority.
6. At this juncture, it is worth referring to a decision of the Apex
Court, in the case of Disciplinary Authority-cum-Regional Manager vs.
Nikunja Bihari Patnaik reported in 1996 (9) SCC 69, wherein, it has been
held that, even assuming that, the amount has been recovered, the fact that, it
has been sticky for some time, itself is a sufficient ground not to show any
https://www.mhc.tn.gov.in/judis
Writ Appeal No.58 of 2022
indulgence, moreso, when the employee does not belong to “workmen”
category. For better appreciation, relevant portion of the said judgment is
extracted hereunder:
“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, 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 Inquiry Officer which have been accepted by the
disciplinary authority, and which have not been
disturbed by the High Court, clearly show that in a
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 organisation — 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
https://www.mhc.tn.gov.in/judis
Writ Appeal No.58 of 2022
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 organisation, 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 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 organisation 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
overdrawals allowed by the respondent beyond his
authority have become sticky and irrecoverable.
...”
7. Though, it is the contention of the learned counsel for the
Appellant that, the Appellant has recovered several amounts due to the
https://www.mhc.tn.gov.in/judis
Writ Appeal No.58 of 2022
Respondent Bank, in the case on hand, charges against the Appellant are
proved and it cannot be denied that, the Appellant did not discharge his
duties with diligence. Hence, this Court finds no error in the order passed by
the learned Single Judge, warranting interference by this Court.
Accordingly, the Writ Appeal fails and stands dismissed. No costs.
[S.V.N.,J.] [M.S.Q.,J.]
07.02.2022
Index : Yes/No
Speaking Order : Yes/No
(aeb)
To:
1. The Executive Director/Review Authority,
Indian Bank, Corporate Office,
254-260, Avvaishanmugam Salai,
Royapettah,
Chennai 600 014.
2. The General Manager/Appellate Authority,
Indian Bank, Corporate Office,
254-260, Avvaishanmugam Salai,
Royapettah, Chennai 600 014.
3. The Deputy General Manager/
Disciplinary Authority,
Indian Bank, Corporate Office,
254-260, Avvaishanmugam Salai,
Royapettah, Chennai 600 014.
https://www.mhc.tn.gov.in/judis
Writ Appeal No.58 of 2022
S.VAIDYANATHAN,J.
AND
MOHAMMED SHAFFIQ,J.
(aeb)
Judgment in
Writ Appeal No.58 of 2022
07.02.2022
https://www.mhc.tn.gov.in/judis
