Akshaya Kumar Dash vs Odisha Gramya Bank
2025 Latest Caselaw 3938 Ori

Orissa High Court

Akshaya Kumar Dash vs Odisha Gramya Bank on 13 February, 2025

Author: G. Satapathy

Bench: G. Satapathy

     IN THE HIGH COURT OF ORISSA AT CUTTACK
                    W.P.(C) No.8657 of 2010

  (An application under Articles 226 & 227 of the
  Constitution of India)

  Akshaya Kumar Dash                            ...          Petitioner
                                     -versus-

  Odisha Gramya Bank,                           ... Opposite Parties
  Bhubaneswar and others

  For Petitioner                      : Mr. A.K.Mohapatra,
                                        Advocate

  For Opposite Parties                : Mr. K.C.Kanungo,
                                        Advocate

        CORAM:
           HON'BLE MR. JUSTICE G. SATAPATHY

                     DATE OF HEARING :14.11.2024
                     DATE OF JUDGMENT:13.02.2025

G. Satapathy, J.

1. The petitioner by filing this writ petition has

invoked the jurisdiction of this Court under Articles 226

& 227 of the Constitution of India calling in question the

legality of the charge sheets issued to him on

26.09.2003 and 16.06.2004 as well as the consequent

orders passed thereon by OP No.2 on 17.12.2005 and

by the Board of Directors on 29.01.2007.

In essence, the petitioner in this writ

petition has prayed to quash the above two charge

sheets and the consequent orders obtained thereon,

but by the charge sheet No.CH/Vig/74/2003 dated

26.09.2003 under Annexure-9 and the additional

charge sheet No.CH/Vig/54/2004 dated 16.06.2004

under Annexure-11, a Departmental Proceeding was

initiated by OP No.2 against the petitioner for alleged

misconduct committed by him for violation of the

Regulations 17, 19, 21 & 42 of the Puri Gramya

Bank(Officers and Employees) Service Regulation, 2001

(for short the "Regulation") while working as Branch

Manager of Rasulgarh Branch of erstwhile Puri Gramya

Bank, presently ameliorated as Orissa Gramya Bank

and accordingly, in the enquiry in such Departmental

Proceeding, the Enquiring Officer (in short, "EO") found

the charges under Annexure-9 and all the charges of

Annexure-11 except charge No.4 to have been

established against the petitioner. After conclusion of

the enquiry, the petitioner was asked to submit his

representation to the findings of the EO by supplying a

copy of such enquiry report. Accordingly, on

consideration of the findings of the EO together with

the representation of the petitioner, OP No.2 by

concurring the findings of the EO issued a show cause

notice to the petitioner on 17.12.2005 vide Annxure-14

on proposed punishment calling upon the petitioner to

submit his reply/representation within ten days. Upon

consideration of the reply to the show cause as

received from the petitioner, OP No.2 passed the final

order of punishment vide Annxure-17 awarding major

penalty of removal from service which shall not be a

disqualification for future employment and recovery of

Rs.78.42 Lakhs due to him for the loss caused to the

bank.

                            Against   the    aforesaid      order   of     major

          penalty,        the   petitioner   carried   an    appeal      to    the

appellate forum i.e. Board of Director, Puri, Gramya

Bank through Chairman under Annexure-18, but such

appeal of the petitioner was rejected with due

communication to him vide Annxure-19.

2. The undisputed facts involved in this writ

petition as recapitulated in brief are that the petitioner

being duly appointed had entered into service on

15.10.1976 as Field Officer under OP No.2 and he was

accordingly transferred and posted as Manager in the

new Rasulgarh Branch, Bhubaneswar in the District of

Khurda on 15.08.1998 and while working there as such,

he was called to the Head Office on 15.06.2002 for

discussion regarding recovery of debts of the Branch

and for regularization of loan account in terms of the

inspection report dated 13.03.2002 and the petitioner

was directed to regularize the objections pointed in

such inspection. However, OP No.2 by an order dated

25.06.2002 transferred and posted the petitioner in the

area office of the bank and consequently, the petitioner

was relieved from Rasulgarh Branch w.e.f. 02.08.2002,

but as on the date of his relieve, the deposit figure of

the Branch was Rs.4,83,58,367.087 as against the

advance figure of Rs.3,74,78,511.94 and there was no

Non-Performing Account in the Branch.

After the petitioner joined in the new place

of posting, OP No.2 by a letter dated 23.10.2002

deputed the petitioner to Rasulgarh Branch to ensure

recovery of the debt of the Branch, however, there was

no allegation of misconduct or negligence of duty

against the petitioner till then, rather OP No.2

appreciated his contribution towards growth of the

business of the Branch and pursuant of the aforesaid

letter, the petitioner recovered a sum of

Rs.30,57,802/-. While the matter stood thus, OP No.2

by an order passed on 10.03.2003 placed the petitioner

under suspension and deputed Sri R.R.K. Nayak, Sr.

Manager, for inspection of the Branch and Mr. Nayak

accordingly submitted a list of 68 loan accounts with

total loan amount of Rs.48.48 Lakhs by observing

therein that there is complete failure of area office of

the Bank in monitoring and supervising the bank work

due to lack of proper follow up and monitoring by Head

Office. Accordingly, OP No.2 issued charge sheets under

Annexures-9 & 11 against the petitioner for committing

certain omission and commission in contravention of

Regulation Nos.17, 19, 38 and 42 of the Regulation and

in the meantime, OP No.2 also lodged an FIR against

the petitioner with the CBI for criminal misconduct in

terms of Regulation No.42 of the Regulation vide R.C.

No. 15 of 2004 in which CBI after conducting

investigation and finding no criminal intent, submitted a

final report against the petitioner on the ground that

the charge against the petitioner could not be

established and accordingly, the concerned Court

accepted such final report and closed the case, but

Departmental Proceeding was initiated against the

petitioner and pursuant to enquiry conducted in such

Departmental Proceeding, the petitioner was awarded

with major penalty of removal of service and recovery

of Rs.78.42Lakhs which was confirmed in the appeal.

Finding no alternative, the petitioner has approached

this Court in this writ petition praying to quash

Annexures-9, 11, 17 and 19 on the ground that the

same were arbitrary and bad in the law.

3. In the course of hearing of the writ

petition, Mr. A.K. Mohapatra, learned counsel for the

petitioner has submitted that not only the charge sheet

reveal no definite allegation against the petitioner, but

also the acts said to have been committed by the

petitioner has not been substantiated in the domestic

enquiry. It is further submitted that there was complete

failure on the part of the Head Office in proper

monitoring and supervising the Branch and to buttress

his contention, Mr. Mohapatra has drawn attention of

the Court to point Nos.11 to 13 of Annxure-7. It is

further submitted by him that without following the

procedure of Regulation No.42, the charge thereunder

has been considered to have been established by the

Department, but the criminal case as initiated by the

Bank by way of lodging FIR with CBI having been

ended without implicating the petitioner or anyone by

submitting a final report therein, thereby the charge

being in violation of Regulation No.42, it can by no

stretch of imagination be said to have been established

against the petitioner and therefore, such finding of the

EO (E.O.) being unsustainable and without any basis

and evidence, the enquiry report together with penalty

imposed there under vide Annuxre-17 being

unsustainable, is liable to be quashed. It is also

submitted by Mr. Mohapatra that Annexure-B attached

to the further affidavit filed by opposite party itself

discloses that the allegation of criminal misconduct on

the part of the petitioner has not been proved and no

action therein being recommended against the

petitioner, the penalty as imposed so also the charge

sheets filed against him under Annxures-9 & 11 needs

to be quashed. Accordingly, Mr. Mohapatra has prayed

to allow the writ petition by quashing Annexures-9, 11,

17 and 19. In support of his argument, Mr. Mohapatra

has relied upon the decisions in (i) Surath Chandra

Chakravarty vs. State of West Bengal; AIR 1971

SC 752, (ii) U.P. State Road Transport Corporation

& Others vs. Mahesh Kumar Mishra & Others; AIR

2000 SC 1151, (iii) Allahabad Bank vs. Krishna

Narayan Tewari; AIR 2017 SC 330, (iv) G.M. Tank

vs. State of Gujarat & Another; AIR 2006 SC 2129.

Further, Mr. Mohapatra by relying upon the decision in

Nicholas Piramal India Ltd. vs. Hari Singh; AIR

2015 SCW 3159 submits that the penalty of dismissal

of the petitioner from service and recovery of such

huge amount of Rs.78.42 Lakhs, out of which

substantial amount having already been recovered with

remaining meager amount of Rs.4,89,420/- which

includes Rs.2,20,226/- loan sanctioned by Head Office,

is shockingly disproportionate and at best the petitioner

is liable for some minor penalties.

4. In reply to the aforesaid submissions, Mr.

K.C. Kanungo, learned counsel appearing on behalf of

opposite party has submitted that not only the charge

sheets are definite, unambiguous and complete, but

also the misconduct of the petitioner is well established

in the Departmental enquiry and the petitioner having

duly afforded with reasonable opportunity in the

Departmental enquiry, there is no violation of principle

of natural justice. It is further submitted by Mr.

Kanungo that mere casual remarks as stated in point

Nos. 11 to 13 of Annxure-7 would not absolve the

petitioner from the charges of misconduct, especially

when the inspection report therein vide SL Nos. 1 to 10

incriminates the petitioner for the misconduct

committed by him. Further, Mr. Kanungo submitted

that although the CBI has submitted a final report in

the criminal case, but the CBI only conducted

investigation in respect of 51 numbers of loan accounts

and the petitioner's involvement being in large number

of accounts which was subject matter of Disciplinary

Proceeding and the petitioner having found guilty of

those charges, he cannot be exonerated from the

penalty, merely because the criminal misconduct was

not substantiated by the CBI and the petitioner having

admitted the irregularity committed by him in his

representation to OP No.1 vide Annxure-8 itself speaks

in volume and the petitioner cannot escape from the

liability of the punishment, more so when he was

having tainted career with imposition of punishment of

stoppage of one increment way back on 03.07.1997.

Mr. Kanungo has also highlighted that merely because

a person is exonerated in criminal proceeding, he can

still be proceeded in Departmental Proceeding, since

the standard of proof and objective of both the

proceedings are different and therefore, even though

the CBI has not filed any charge sheet against the

petitioner for criminal misconduct, but the opposite

party having found the petitioner to have committed

misconduct by sanctioning loan in clear violation of

Regulations 17 & 19 is liable for penalty for causing a

huge loss to the bank which was firmly established by

the bank in the domestic enquiry. In summing up his

argument, Mr. Kanungo has prayed to dismiss the writ

petition.

5. After having considered the rival

submissions upon perusal of the record, there appears

no dispute about the penalty imposed on the petitioner

for dismissal of service and recovery amount of

Rs.78.42 Lakhs, but the scope of judicial review by the

Courts against the order passed in Departmental

Proceeding is not only very limited, but also is required

to be exercised in exceptional circumstance where the

penalty awarded by the Disciplinary Authority or the

employer is wholly disproportionate and shakes the

conscience of the Court. Law on this score is well

settled and the scope of interference by the High Court

under Article 226 of the Constitution of India in the

matter relating to Disciplinary enquiry has been

clarified in the decision in Government of A.P. vs.

Mohd. Nasrullah Khan; AIR 2006 SC 1214 wherein

the following principle has been laid down by the Apex

Court which reads as under:-

"11. By now it is a well-established principle of law that the High Court exercising power of judicial review under Article 226 of the Constitution does not act as an Appellate Authority. Its jurisdiction is circumscribed and confined to correct errors of law or procedural error, if any, resulting in manifest miscarriage of justice or violation of principles of natural justice. Judicial review is not akin to adjudication on merit by re-appreciating the evidence as an Appellate Authority."

6. It is quite obvious that the role of the High

Court in dealing with the Disciplinary Proceeding in writ

jurisdiction should not be equated with the power of the

Appellate Authority sitting in an appeal over factual

findings in a Disciplinary Proceeding, since the High

Court by no stretch of imagination is expected to act as

an Appellate Court over the factual findings recorded in

a Disciplinary Proceeding. All that the High Court is

required to examine in such cases while exercising writ

jurisdiction is to find out whether there were any errors

of law or procedure resulting in manifest miscarriage of

justice or violation of the principle of natural justice.

True it is that the petitioner in this case had although

borne the initial rigor of criminal case, when OP No.2

lodged an FIR against the petitioner before the CBI, but

on due investigation, CBI having subsequently found no

mens rea on the part of the petitioner submitted a final

report by stating inter alia that allegations of criminal

misconduct on the part of the accused A.K. Dash

(petitioner) are not proved and no action is, therefore,

recommended against Mr. Dash as revealed from

Annexure-B filed by the opposite party in the further

affidavit dated 28.03.2024. Thus, the petitioner was

never sent up to face a criminal trial for committing any

criminal misconduct. Admittedly, the petitioner has

been issued with charge sheets under Annxures-9 & 11

on the ground that he has committed certain omission

and commission in contravention of Regulation

Nos.17,19 & 42 of the Regulation which is punishable

under Regulation 38, but the petitioner was found

guilty of the charges except charge No.4 of Annxure-

11, however, neither it was specifically held by the EO

nor by the Disciplinary Authority that the petitioner is

guilty of Regulation No.42 which describes corrupt

practices. Further, the explanation appended to

Regulation No.42 of the Regulation makes it very clear

that an officer or employee shall be deemed to be guilty

of corrupt practices if he has committed an act of

criminal misconduct as defined in Sections 13, 14, 15 &

16 of the Prevention of Corruption Act, 1988 or he has

acted for an improper purpose or in a corrupt manner

or had exercised or refrained from exercising his

powers with an improper or corrupt motive. Although,

charge sheets under Annexures-9 & 11 contains specific

allegation against the petitioner for not abiding by

Regulation and orders of the bank and not obliging to

promote bank's interest, but no specific allegations

were made therein about petitioner practicing corrupt

practices, much less the findings of the EO which were

agreed by the Disciplinary Authority vide its final order

under Annexure-17 do not disclose any finding against

the petitioner for corrupt practices which in the

circumstance of Annexure-B submitted by the CBI itself

denotes that neither there was any specific charge

against the petitioner for corrupt practice as defined

under Regulation 42 nor was there any evidence

thereon nor any finding arrived at by any of the

authority and thereby, the charge under Regulation 42

cannot be held to be established against the petitioner.

The above observation of the Court cannot be

considered to have been arrived at any appreciation of

evidence or materials on record, but the same having

been found out on a bare perusal of documents which if

left out would definitely manifest a miscarriage of

justice, inasmuch as, the allegation of corruption not

only demonstrates a situation in demolishing the

integrity of an employee, but also makes him liable for

criminal prosecution and penalizing him thereon, but

holding an employee guilty of corrupt practices in

absolute absence of any material or evidence, much

less with no evidence would definitely shake the

conscience of the Court.

7. It is obviously true that even though the

allegation of corrupt practice is not found to have been

established against the delinquent-employee, but the

other charges can still be established against the

delinquent-petitioner for violation of Regulation Nos. 17

& 19 which is punishable under Regulation 38,

inasmuch as merely because the petitioner was found

out to have not committed any criminal misconduct

would not ipso facto render him not liable for other

misconduct committed by him. Law is also well settled

that acquittal/discharge of the delinquent by a criminal

Court shall not incur any disqualification on the part of

an employer to conduct Departmental Proceeding in

accordance with Rules and Regulations since the two

proceedings, either criminal or Departmental, are

entirely different and they operate in different fields

and have different objectives. In Disciplinary

Proceedings, the question is whether the delinquent is

guilty of misconduct which if proved may also incur

removal from service or lesser punishment, whereas

the criminal proceedings operates in a different

sphere/question of proof of action of the delinquent as

a penal offence beyond all reasonable doubt and if such

penal offence is established against the delinquent, it

would incur corporeal/pecuniary punishment. However,

a careful and studied scrutiny of the enquiry report and

other materials placed on record together with the

submission of the delinquent-petitioner to the findings

of the EO, it appears that the learned Disciplinary

Authority has rightly concurred the findings of the EO

except the findings on corrupt practices while issuing

2nd show cause to the delinquent-petitioner on the

proposed punishment, inasmuch as the charge of

corrupt practices has not been substantiated by the

Bank in terms of the Regulation 42 of the Regulations

which is very much clear from the final report accepted

by the Court under Annexure-10. Additionally, the

ingredients as stated in Regulation 42(i)(ii)(iii)&(iv) of

the Regulations together with explanation are not at all

made out by any evidence received in the domestic

enquiry and without any evidence the Disciplinary

Authority has concluded while accepting the enquiry

report to issue 2nd show cause on proposed punishment

that the delinquent-petitioner had adopted corrupt

practice, but the same is without any reference to

Regulation 42 of the Regulations.

8. Be that as it may, it is found from the order

passed by the Disciplinary Authority in issuing 2nd show

cause on proposed punishment that the delinquent-

petitioner in his defence statement had admitted the

facts of sanctioning loans beyond his discretion and in

violation of Bank's prescribed guidelines which was

never denied by the delinquent-petitioner. Further, the

delinquent employee (petitioner) in his 2nd show cause

to the proposed punishment has stated that it is always

difficult to avoid certain minor errors, which are caused

without knowledge in the case of writing/posting and

the charge sheet officer has taken the responsibility of

recovery of the over drawn amount which is a self

admission of fact. It is, therefore, clear that the findings

recorded by the Disciplinary Authority holding the

petitioner guilty of misconduct involving loss to the

Bank appears to be correct and is based on evidence,

but the petitioner although found to be guilty of the

charges for violation of Regulation 17 & 19 of the

Regulations which prescribes the liability of every

officer of the Bank to abide by the Regulations and

orders and obligation to promote the Banks interest,

but the petitioner cannot be held liable for violating

Regulation 42 of the Regulations which finding of the

Disciplinary Authority is unsustainable in the eye of law.

9. The next issue is the magnitude of penalty

in the Disciplinary Proceeding. In this case, the

petitioner has been awarded with following penalties:-

(i) Removal from service which shall not be a disqualification for future employment, and

(ii) Recovery of Rs.78.42 lakhs being the pecuniary loss caused to the Bank from emoluments or such other amounts as may be due.

The aforesaid two penalties are within the

parameters of the Regulation 38 of the Regulations, but

fact remains that the OP-Bank on being requested

informs the Court by way of an affidavit that on

verification, it is found that out of the accounts for

which the petitioner was charge sheeted, 52 accounts

are still outstanding with total outstanding dues of

Rs.24,71,856.15. It is, therefore, very clear that the

petitioner had sanctioned some loans violating the

Bank's guidelines and thereby caused loss to the Bank,

but the petitioner has neither been charged nor found

to have misappropriated any amount and whatever

loan he had sanctioned violating the Bank's guidelines

are in the process of recovery and the pecuniary loss to

the Bank has considerably reduced from Rs.78.42 lakhs

to Rs.24,71,856.15. In the aforesaid situation, this

Court does not find any impropriety in handing over the

first punishment of Removal from Service, but the

penalty of recovery of Rs.78.42 lakhs is quite shocking

and disproportionate, inasmuch as the Bank has not

suffered any loss to that extent and the Bank is in the

process of recovery of unpaid loan amount which at

present Rs.24,71,856.15 which may further reduce in

future and, therefore, the recovery amount as ordered

against the petitioner being disproportionate and

grossly in excess cannot claim the immunity and

remains open for interference under the limited scope

for judicial review. Further, it is not the intention of the

Regulation to get the entire loan amount recovered

from the employee who had sanctioned the same,

unless the same is found to be misappropriated and

swindled off from the Bank, otherwise no Bank

employee would dare to sanction loan to promote the

interest of the Bank in case such employee is held liable

to give recovery for the unrecovered loan amount. In

this case, the petitioner rightly or wrongly had

sanctioned loan in violation of the Bank's guidelines,

but his criminal intent has never been established and

although he is guilty of causing loss to the Bank for

sanctioning loan to different account holder without

following the prescribed procedure, but he having been

sufficiently punished by removal from the service, no

further penalty shall be imposed upon him for recovery

of the unrecovered loan amount as a loss to the Bank,

because the recovery process is on and the Bank might

recover the whole loan amount by the petitioner. Thus,

on a careful analysis of the penalty imposed on the

petitioner in the norm of Bank's Regulation and the

petitioner having already been penalized with a major

penalty of removal from service, this Court considers it

unreasonable to stamp its approval for recovery of

Rs.78.42 lakhs from the petitioner and accordingly,

interferes in the penalty of the petitioner, who is let off

from paying any amount of recovery and his penalty

from the removal of service stands confirmed.

10. In the result, the writ petition stands

dismissed on contest, but no order as to costs.

Consequently, the penalty imposed upon the petitioner

is modified to the extent of only removal from service

which shall not be a disqualification for future

employment.

(G. SATAPATHY) JUDGE

Signed by: KISHORE KUMAR SAHOO

Location: High Court of Orissa Date: 13-Feb-2025 14:18:20 Orissa High Court, Cuttack, Dated the 13th day of January, 2025/Kishore