U RAJENDRA BHAT Vs. CHAIRMAN AND MANAGING DIRECTOR ANDHRA BANK CENTRAL OFFICE SULTAN BAZAAR HYDERABAD

JUDGEMENT

(1.) THE principal point that falls for determination in this writ petition is the question as to whether the termination from service of the petitioner who was at the relevant time working as manager of the gandhinagar branch of the andhra bank by Order dated 29-8-1984 on the ground that the management has lost confidence in him can pass legal scrutiny. Whereas situations may arise in appropriate cases wherein a contract of service can be repudiated by the employer with due notice on the ground that the management has lost confidence in an employee, the real issue at dispute in this case is as to whether this ground is available in cases where specific misconduct has been alleged and the Order of termination on this ground is being used as a camouflage for the non-holding of disciplinary proceedings. In other words, the subtle point that is canvassed in justification of the action is that if an employee has misconducted himself and has thereby forfeited the confidence of the employer that the discretion vests with the management insofar as either disciplinary proceedings can be held which would culminate in an Order of punishment or the management can adopt the more humane line of terminating the employee's services simpliciter. As far as the last course of action is concerned, the argument proceeds on the footing that it is certainly more to the advantage of the employee, whereas the challenge to the action is principally on the ground that since the termination of service is one of the major penalties, that if there is a background or an allegation of misconduct and no enquiry is held, that the action can never pass judicial scrutiny insofar as it would be tantamount to a flagrant violation of the rules of natural justice. I need to elaborate here that the challenge to such an Order in the present petition proceeds on the footing that the petitioner has been divested of his employment without following the procedure prescribed by law and that consequently, the action is ipso facto bad. The ground of loss of confidence according to the petitioner is only a smoke-screen for a patent illegality.

(2.) THE brief facts that are relevant for the determination of the issues herein and which are virtually undisputed are as follows:- the petitioner was working as manager of the gandhinagar branch, bangalore, of the andhra bank limited and was served with a charge-sheet dated 11-7-1984 whereby it was also directed that he was placed under suspension pending enquiry into some of the charges. The allegations were that the petitioner had purchased cheques of a particular concern by the name of M/s. Srinidhi enterprises which had a regular c. d. a/c. No. 1467 with the bank and which cheques were subsequently dishonoured thus causing loss to the bank. The allegation was that the petitioner had colluded with the account holders in these transactions. According to the petitioner, he lodged his protest by letter dated 16-7-1984 and he also pointed out that he had taken action against the account holders by lodging a. Complaint with the police. It is his allegation that at the instance of the 4th respondent who is the general manager, and some other officers, that charge was forcibly takenover from him by breaking open the desk of the petitioner and removing important correspondence documents etc. , in his absence. Certain correspondence ensued in the course of which the petitioner asked for various documents and the petitioner also complained to some of the top authorities such as the governor of the reserve bank, the union finance minister, c. b. i, the prime minister at Delhi etc. It is the allegation of the petitioner that the action was mala fide and motivated at the instance of certain officials and that there were no irregularities or illegalities as far as his conduct was concerned. On 30-8-1984, the petitioner submitted his reply to the charge-sheet and he pointed out that he had always acted in consonance with the interest of the institution and requested for holding of an enquiry in Order to prove his bona fides. On 31-8-1984, the petitioner was served with a copy of the Order dated 29-8-1984 informing him that his services are terminated with immediate effect as the management has lost confidence in him. Strangely enough, on the same day he received another letter dated 25-8-1984 stating that he had been given time to reply to the charges till 3-9-1984.

(3.) ANOTHER circumstance which the petitioner relies on heavilyis the fact that he was the deputy general secretary of the andhra bank officers union and that he had been very active in that organisation. He states that on 1-8-1984, the association issued a circular cautioning the various managers and officers of the branches against the designs of higher officers who force their subordinates to carry out oral instructions in normal business transactions and how the subordinate officers were thereafter made scape-goats when the irregular transactions came to be detected. The petitioner has challenged the Order of termination on the ground that it could not have been passed under any circumstances other than after the holding of an enquiry and that the ground given for his termination namely loss of confidence is sham and unenforceable. The petitioner has also sought the quashing of regulation 4, explanation (ix) which reads as follows:-it is his submission that this particular regulation is unconstitutional and is liable to be struck down.