Punjab-Haryana High Court
B.R.Mehta vs Union Of India And Others on 20 December, 2022
LPA No. 934 of 2022 -1-
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
LPA No.934 of 2022
Date of Reserve: 09.11.2022
Date of Pronouncement: 20.12.22
B.R. Mehta ... Appellant
Versus
Union of India and another ... Respondents
CORAM: HON'BLE MR. JUSTICE RAVI SHANKER JHA, CHIEF JUSTICE
HON'BLE MR. JUSTICE ARUN PALLI, JUDGE
Present: Mr. Suman Jain, Advocate, and
Mr. Rishab Jain, Advocate,
for the appellant.
Mr. Prateek Mahajan, Advocate, and
Ms. Prerna Malhotra, Advocate,
for respondent No.2
****
ARUN PALLI, J.
This is an intra-court appeal, under Clause X of the Letters
Patent, against an order and judgment dated 05.07.2022, vide which the writ
petition preferred by the appellant, assailing the charge-sheet dated
08.01.2008 (P-4), as also the order dated 03.07.2010 (P-11), whereby, a
penalty of censure and recovery of Rs.3,93,583/- was imposed upon him, has
since been dismissed.
The facts that are required to be noticed are limited.
The appellant was employed with the Life Insurance
Corporation of India (for short, 'LIC'). He was, from 09.06.1999 to
30.04.2002, posted as Area Manager in Life Insurance Corporation Housing
Finance Limited, a subsidiary of LIC, (for short, 'LIC-HFL'). During this
period, he approved a housing project (GSB Apartments) of a private
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builder/developer. And sanctioned/approved 20 individual loans and
disbursed the loan amount. For a dispute arose between the two promoters
and partners of the group, the project was abandoned. Resultantly, the
loanees defaulted in repaying the loan, causing financial loss to the LIC-
HFL. Upon examining the matter, the authorities found that the appellant
had committed en masse irregularities and had, thus, violated the specific
instructions of LIC-HFL and the procedure laid down in the Provisional
Manual. Accordingly, a charge-sheet dated 08.01.2008 was served upon the
appellant for breach of Regulations 21 and 24 read with Regulation 39(1) of
the LIC of India (Staff) Regulations, 1960, (for short, '1960 Regulations').
In essence, the charges against him were that in some of the loans that he
had sanctioned, it was discovered that 'salary certificates' of the loanees
did not mention 'compulsory recoveries', which was in violation of
LICHFL/RG.Ho(3A)/Circular No. 68, dated 21.05.1993. And, in certain
other sanctioned loans, there was no individual Panel Valuer's Report and
Staff Inspection Report. For the appellant denied the charges leveled against
him, the competent authority ordered enquiry into the matter. Per the enquiry
report dated 20.04.2009, submitted by the Enquiry Officer, the appellant was
found guilty of charges No.2 and 4, whereas, charges Nos.1,3,5 and 6 were
found to have been partially proved. The appellant was served with a copy
of the enquiry report and was afforded an opportunity to submit his
objections thereto. Upon considering the findings recorded by the Enquiry
Officer, as also the reply submitted by the appellant, the competent authority
issued him a show cause notice dated 21.04.2010, proposing to impose
penalty of censure and recovery of Rs.3,93,583/-, in terms of the 1960
Regulations. The appellant submitted a reply dated 07.05.2010 to the said
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notice, whereupon, the disciplinary authority, having found him guilty, vide
order dated 03.07.2010, confirmed the proposed punishment. Aggrieved by
the said order, the appellant preferred an appeal under Regulation 46 of the
1960 Regulations, which too was dismissed by the appellate authority, vide
order dated 11.02.2011. This is how, the appellant had approached this
Court, vide a writ petition, referred to above.
Learned counsel for the appellant has merely reiterated the
submissions that were advanced before the learned Single Judge: he submits
that the appellant had strictly followed the procedure laid down by the LIC
for advancing loans and there was no deviation or irregularity involved in
the process. Further, he asserts that the charge against the appellant that
while granting individual loans, he failed to obtain Panel Valuer's Report,
Staff Inspection Report, Title Investigation Report was apparently
misconceived, as all such reports were duly drawn/prepared and placed in
the master file, which might have been misplaced by the office subsequently.
It is urged that regular audits were carried out every year, but none of the
audit reports even remotely referred to any such discrepancy. He also
submits that even though one Charanjit Singh was also found guilty of the
same charges, but, he was only awarded the punishment of censure.
Whereas, recovery of Rs.3,93,583/- was caused from the appellant. Thus, the
approach of the authorities against the appellant was apparently
discriminatory.
We have heard learned counsel for the parties and perused the
record.
The position of law is settled that ordinarily the Writ Court,
while exercising its power of judicial review, would not interfere with the
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disciplinary proceedings, except when a statutory rule/regulation is violated;
or principles of natural justice are not complied with; or the conclusion
arrived at by the Disciplinary Authority is palpably perverse; or the
punishment inflicted upon the delinquent is shockingly disproportionate to
the gravity of charges. Ex facie, as indicated above, such is not the case in
the matter at hand. No such grievance was/is made by the appellant either.
Records show that upon analysis of the material on record, the authorities
conclusively concluded that in some sanctioned loans, the 'salary
certificate' of the loanees did not mention 'compulsory recoveries', which
was in violation of Circular No.68 dated 21.05.1993. Likewise, in certain
other cases, the loan was sanctioned and disbursed without obtaining
individual Panel Valuer's Report, Staff Inspection Report, Title
Investigation Report from Panel Advocate and approval of borrower's
title to the property, which was a serious breach of the prescribed
procedure. Resultantly, a loss of Rs.13,98,073.73/- was caused to the
respondent-LIC. The case set out by the respondent-LIC has been that if the
appellant had followed the procedure envisaged in the Provisional Manual
and the guidelines reflected in the circulars, the evaluation and inspection of
the properties would have revealed that those were still incomplete. Hence,
the loan amount would have been released only to the extent the actual
construction was carried out by the promoters, to avert/contain the loss.
The argument that the appellant had duly complied with the
procedure for advancing loans and there were no irregularities involved, as
all such reports were duly prepared and placed in the master file, lacks
conviction and cannot be countenanced either. The specific stand set out by
the authorities, which remained unrebutted for lack of any conclusive
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material to the contrary, has been that master file is prepared where
approved project finance status is granted to a project. However, no such
approval was accorded to the GSB project. Further, nothing was brought on
record either to show, if any such master file was ever created or maintained.
Not just that, even the individual loan files created to advance individual
loans would not refer to any such master file.
Likewise, the plea that all the default cases arising during the
course of the year were duly examined and audited, but no such discrepancy
and/or deficiency in the documents was ever detected or pointed out by the
Auditors, in the successive years, would also not advance the case of the
appellant. The authorities, in paragraph 7 of its return, had clarified that
Audit Team had observed irregularities during regular audits of area office
for the year 2003-04 and the same were also pointed out in the report dated
20/21.02.2006, submitted by the Deputy General Manager (Audit), Housing
Finance Limited. Even otherwise, the essence of the alleged misconduct or
charges against the appellant was/is: whether he sanctioned and disbursed
loans in apparent breach/violation of the specific instructions/circulars and
the settled procedure laid down in the Provisional Manual. Thus, even if it is
assumed that during subsequent audits, no such discrepancy was pointed out,
that would not absolve the appellant of the charges.
Needless to assert that this Court would not sit in appeal against
the decision of the Disciplinary Authority, affirmed in appeal. Or even judge
sufficiency or insufficiency in the evidence/material, on the basis of which
the authorities concluded that the charges leveled against the appellant were
proved. Unless, as indicated earlier, the conclusions recorded are patently
perverse or it was a case of no evidence. It would be apposite, at this stage,
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to even refer to the decision of the Supreme Court in Union of India and
others Vs. Subrata Nath (Civil Appeal Nos.7939-7940 of 2022, decided on
23.11.2022), in which an earlier decision of the Supreme Court in State
Bank of Bikaner and Jaipur Vs. Nemi Chand Nalwaya (2011) 4 SCC 584,
was referred to, wherein it was held:
"17. In State Bank of Bikaner and Jaipur v. Nemi Chand
Nalwaya (2011) 4 SCC 584 , a two Judge Bench of this Court
held as below :
"7. It is now well settled that the courts will not act as
an appellate court and reassess the evidence led in the
domestic enquiry, nor interfere on the ground that
another view is possible on the material on record. If the
enquiry has been fairly and properly held and the
findings are based on evidence, the question of
adequacy of the evidence or the reliable nature of the
evidence will not be grounds for interfering with the
findings in departmental enquiries. Therefore, courts
will not interfere with findings of fact recorded in
departmental enquiries, except where such findings are
based on no evidence or where they are clearly perverse.
The test to find out perversity is to see whether a
tribunal acting reasonably could have arrived at such
conclusion or finding, on the material on record. The
courts will however interfere with the findings in
disciplinary matters, if principles of natural justice or
statutory regulations have been violated or if the order
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is found to be arbitrary, capricious, mala fide or based
on extraneous considerations. (Vide B.C. Chaturvedi v.
Union of India (1995) 6 SCC 749, Union of India v. G.
Ganayutham, (1997) 7 SCC 463, Bank of India v.
Degala Suryanarayana, (1999) 5 SCC 762, and High
Court of Judicature at Bombay v. Shashikant S. Patil,
(2000) 1 SCC 416)."
In so far as the argument that approach of the authorities was
discriminatory, for another employee, namely, Charanjit Singh, who suffered
similar charges, was let off by only imposing a penalty of censure and no
recovery was ordered against him, the same is also untenable. As observed
by the learned Single Judge, said Charanjit Singh happened to be the Deputy
Manager and was subordinate to the appellant, who was the Area Manager,
and was entrusted with the responsibility to ensure strict compliance and
implementation of the Procedure. Thus, he could hardly draw any parity
with Charanjit Singh, who was awarded suitable punishment commensurate
to the charges that were proved against him.
Further, it was owing to the gross irregularities committed by
the appellant and violation of relevant instructions and procedure laid down
in the Provisional Manual, LIC suffered a loss of Rs.13,98,073.73/- of
which, Rs.3,93,583/- were ascribed to the appellant. Thus, in the given
circumstances, as observed by the learned Single Judge, the punishment
imposed upon the appellant could not be termed as unduly harsh or
disproportionate to the gravity of charges.
Not because it would have any decisive bearing on merits, but
during the hearing and upon being asked, learned counsel for the appellant
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informed the Court that the appellant had since retired and even the
recoveries had already been effected.
In the wake of the above, we are dissuaded to interfere with the
impugned order and judgment rendered by the learned Single Judge. The
appeal being bereft of merit is accordingly dismissed.
(RAVI SHANKER JHA) (ARUN PALLI)
CHIEF JUSTICE JUDGE
20.12.22
AK Sharma
Whether speaking / reasoned: YES
Whether Reportable: YES/NO
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