A three judge bench of the Hon’ble Supreme Court consisiting of Justice Ajay Rastogi for himself, Justice L Nageswara Rao and Justice Hemant Gupta in the case of Deputy General Manager (Appellate Authority) and others vs Ajai Kumar Srivastava has held that in banking business absolute devotion, integrity and honesty is a sine qua non for every bank employee. This was held so while upholding the dismissal of bank employee named Ajai Kumar Srivastava.

“Dissatisfied with the judgment and order dated 13th September, 2018 passed by the Division Bench of the High Court of Allahabad, the instant appeals have been preferred at the instance of the appellant Bank.”

Factual Background

The appellant is a statutory body incorporated and constituted under the State Bank of India Act, 1955. The respondent joined service as a Cashier/Clerk in Mumfordganj Branch Allahabad in 1981. While on duty, a misconduct was committed by him for which he was placed under suspension in the first place by an order and later a chargesheet was served upon him detailing seven charges of misappropriation of funds which he had committed in discharge of his duties as an employee of the Bank.

For the selfsame misappropriation of bank’s money by affording fake credits in his various accounts maintained at the Branch where he was posted, a criminal case was also instituted against him for offences u/Ss. 420, 467, 468, 471 IPC read with Section 120B IPC and Section 13(2) read with Section 13(1)(d) of Prevention of Corruption Act, 1988.

After the chargesheet was served, the respondent delinquent submitted his reply denying all the charges. The enquiry officer was thereafter appointed by the competent authority to hold enquiry in terms of Bipartite Settlement applicable for award staff of Nationalized Bank. The respondent participated in the disciplinary enquiry and the enquiry officer after holding enquiry furnished his report to the disciplinary authority holding that Charge No. 1 was not proved, Charge Nos. 2 to 7 proved against him. In his report it has been noticed that respondent delinquent stated in the course of enquiry that he neither wants to say anything about the prosecution documents nor he wants to ask any question to the presenting officer and did not produce any documentary evidence to substantiate his statement in defence regarding fictitious credits in his account which was the allegation against him for misappropriation of funds of the Bank and the fact remains that all the allegations levelled against the respondent were supported with the documentary evidence duly audited by the Bank.

Observations of the Court

Observations with respect to Judicial Review & its scope

The power of judicial review in the matters of disciplinary inquiries, exercised by the departmental/ appellate authorities discharged by constitutional Courts under Article 226 or Article 32 or Article 136 of the Constitution of India is circumscribed by limits of correcting errors of law or procedural errors leading to manifest injustice or violation of principles of natural justice and it is not akin to adjudication of the case on merits as an appellate authority. [Earlier examined by Supreme Court in State of Tamil Nadu v. T.V. Venugopalan 1994 (6) SCC 302, Government of T.N. & Another v. A. Rajapandian 1995 (1) SCC 216, and B.C. Chaturvedi v. Union of

“It is thus settled that the power of judicial review, of the Constitutional Courts, is an evaluation of the decision making process and not the merits of the decision itself. It is to ensure fairness in treatment and not to ensure fairness of conclusion. The Court/Tribunal may interfere in the proceedings held against the delinquent if it is, in any manner, inconsistent with the rules of natural justice or in violation of the statutory rules prescribing the mode of enquiry or where the conclusion or finding reached by the disciplinary authority if based on no evidence. If the conclusion or finding be such as no reasonable person would have ever reached or where the conclusions upon consideration of the evidence reached by the disciplinary authority is perverse or suffers from patent error on the face of record or based on no evidence at all, a writ of certiorari could be issued. To sum up, the scope of judicial review cannot be extended to the examination of correctness or reasonableness of a decision of authority as a matter of fact.”

When the disciplinary enquiry is conducted for the alleged misconduct against the public servant, the Court is to examine and determine: (i) whether the enquiry was held by the competent authority; (ii) whether rules of natural justice are complied with; (iii) whether the findings or conclusions are based on some evidence and authority has power and jurisdiction to reach finding of fact or conclusion.

The Court observed that it was well settled that where the enquiry officer was not the disciplinary authority, on receiving the report of enquiry, the disciplinary authority may or may not agree with the findings recorded by the former, in case of disagreement, the disciplinary authority has to record the reasons for disagreement and after affording an opportunity of hearing to the delinquent may record his own findings if the evidence available on record be sufficient for such exercise or else to remit the case to the enquiry officer for further enquiry.

“It is true that strict rules of evidence are not applicable to departmental enquiry proceedings. However, the only requirement of law is that the allegation against the delinquent must be established by such evidence acting upon which a reasonable person acting reasonably and with objectivity may arrive at a finding upholding the gravity of the charge against the delinquent employee. It is true that mere conjectures or surmises cannot sustain the finding of guilt even in the departmental enquiry proceedings.”

It was further observed that the Constitutional Court while exercising its jurisdiction of judicial review under Article 226 or Article 136 of the Constitution would not interfere with the findings of fact arrived at in the departmental enquiry proceedings except in a case of malafides or perversity, i.e., where there is no evidence to support a finding or where a finding is such that no man acting reasonably and with objectivity could have arrived at that findings and so long as there is some evidence to support the conclusion arrived at by the departmental authority, the same has to be sustained.

Observations with respect to the factual aspects of the matter

The Court noted that the chargesheet was served upon the respondent delinquent for misappropriation of public funds by affording fake credits in his various accounts maintained at the branch where he was serving during the relevant period. In all, 7 charges were levelled against him of grave misconduct which he had committed in discharge of his official duty and after affording an opportunity of hearing to the respondent delinquent and due compliance of the principles of natural justice, the enquiry officer in his report while dealing with the preliminary objections raised by the respondent delinquent specifically indicated that the details of enquiry report contained 22 pages along with documents produced by the presenting officer marked to establish the allegations/charges levelled against the respondent delinquent who neither produced any document nor witness in his defence. It was further indicated that the respondent stated in the course of enquiry that he neither wants to say anything about the prosecution document nor he wants to ask any question to the presenting officer and never requested to seek permission to defend the representative of his choice.

“The disciplinary/appellate authority was not supposed to pass a judgment however while passing the order dated 24^th July, 1999, the disciplinary authority had taken note of the record of enquiry, including self contained enquiry report and his prima facie opinion which was made available to the respondent employee and after affording reasonable opportunity of hearing and meeting out the written objections raised by the delinquent, expressed its brief reasons in upholding the finding of guilt and penalty of dismissal by its order. That apart, the appeal preferred by the respondent delinquent was examined by the appellate authority as it revealed under para 3 (i) to (viii) in upholding the finding of guilt recorded by the enquiry officer in his report dismissing the respondent employee from service, rejected by order dated 15^th November, 1999. After detailed discussion, we are unable to accept the finding recorded by the High Court under its impugned judgment setting aside the orders passed by the disciplinary/appellate authority which deserves to be set aside.”

Held

Before concluding, the Court emphasized that in banking business absolute devotion, integrity and honesty is a sine qua non for every bank employee. An employee was required to maintain good conduct and discipline and to deal with money of the depositors and the customers. The Court further stated that if it was not observed,

“the confidence of the public/depositors would be impaired. It is for this additional reason, we are of the opinion that the High Court has committed an apparent error in setting aside the order of dismissal of the respondent dated 24^th July, 1999 confirmed in departmental appeal by order dated 15^th November, 1999.”