NAND KISHORE KATYAL Vs. BANK OF INDIA

JUDGEMENT

(1.) The challenge in this writ petition is to the punishment imposed on the petitioner pursuant to disciplinary proceedings which were held against him.

(2.) Briefly stated the facts are that in the year 1973 the petitioner was appointed as the Manager of the newly opened Branch of respondent No. I During his tenure as a Manager of the said branch, he sanctioned a hypothecation loan of Rs. 20,000 on 15th September, 1976 in favour of M/s. Texline Agencies. According to the petitioner, the stock of the said firm at that time was of the value of Rs. 62,057.73. On 5th November, 1976 this account was closed and a fresh pledge account was sanctioned by the petitioner for Rs. 50,000. The case of the petitioner is that at that time M/s Texiine Agencies had stock worth Rs. 79578.00 which was kept in the Bank. On 31st January, 1977 another hypothecation loan of Rs. 20,0001- was sanctioned against the value of the stock in the show room of Texline Agencies which was stated to be worth Rs. 1,05,809.08.

(3.) On the date when the petitioner sanctioned the opening of a pledge account, the respondent-Bank wrote a letter dated 5th November, 1976 to the petitioner. This letter was in relation to the aforesaid hypothecation account which had been opened on 15th September, 1976. In this letter the petitioner was, inter alia, informed that the Reserve Bank had in its latest directives stated that the margin should be 30% whereas the petioner had proposed a margin of 25% only. The petitioner was further told by this letter that instead of obtaining ' quarterly statements he should obtain them monthly. This letter which was received on 11-11-76 in the bank was replied to by the petitioner's letter dated 16th November, 1976. In his letter it was, inter alia, stated that the petitioner had revised the margin at the rate of 30% and that stock statements would be obtained every month and inspection will also be carried out every month. The case of the petitioner is, and this is not disputed, that the petitioner went on leave on 11th November, 1977 and rejoined duty on 24th November, 1977. According to the petitioner, the letter of 16th November, 1976 had been dictated in his absence by another officer of the Bank and with the rush of work and along with other correspondence, the petitioner signed this letter on 24th November, 1976 and the same was despatched to the Regional Manager of the respondent-Bank. According to the petitioner, this letter pertained to the cash credit hypothecation limit dated 15th September, 1975 whereas on that day in fact the cash credit hypothecation limit no longer existed as this account had been converted into a pledge account.