STATE BANK OF INDIA Vs. T J PAUL

JUDGEMENT

(1.) Heard Mr. P. G. Parameswara Panicker for the appellants and Mr. K. Balakrishnan for the respondent. The above Writ Appeal was filed against the Judgment in O. P. 10222/91 on the file of this Court. The State Bank of India is the appellant. The respondent filed the Original Petition praying for issue of a writ, of certiorari quashing Ext. P - 14 and P - 20 orders passed by the disciplinary authority and the appellate authority in the disciplinary action taken against him. The respondent was an Officer of the erstwhile Bank of Cochin which was later on amalgamated with the State Bank of India with effect from 26th August 1'985. Before the amalgamation moratorium had been declared by the Reserve Bank of India on the Bank of Cochin on 27th April 1985. While serving as the Manager of the Madras main branch of the Bank of Cochin the respondent granted certain loans and gave accommodation to several borrowers which according to the bank is beyond his powers and without prior sanction or subsequent ratification from the head office of the Bank of Cochin. The loan so granted were beyond his powers and in violation of the orders. Charges were framed against him by the erstwhile Bank of Cochin under Ext. P - 6. Annexure to Ext. P - 6 memo of charges contained the details regarding the several accounts to which the charge related. He was also placed under suspension pending enquiry. The respondent submitted his explanation, which was found not satisfactory and hence an enquiry was conducted by an Advocate of this court who submitted his report under Ext. P - 10 dated 3rd August 1985. The Enquiry Officer found that charges enumerated in items 1, 5, 7, 8, 9, 10, 12, 12(a), (b), 13, 14, 15, 16, 17 (b), 18, 19,20, 21, 22, 24, 25 (a) were not proved. With reference to items 2, 3, 4, 6, 9, 12 (c), 14, 17 (a], 23 (c), (d), (e), (f), (h), (j), (l), (n) it was found that there was no sanction or subsequent ratification from the head office. The Enquiry Officer however opined that no reasonable man will be able to conclude that in connection with the said transaction the respondent acted with vested interest and with intention to cause willful damage and financial loss to the Bank and that he might have allowed the transaction with good intention of promoting the business of the bank and with the bona fide belief that the transaction would be ratified. The Enquiry Officer has further found that as regards item 23 (e, f, h, j, n) in annexure to the memo of charges the respondent had failed to take sufficient security and is guilty of gross negligence and has acted in violation of head office instructions. In the penultimate paragraph the Enquiry Officer states that with reference to item No. 25 of the charge sheet, advances were granted to 19 parties and that the respondent was instrumental in recovering substantial amounts from the respective parties and if he had not been suspended abruptly he would have been able to persuade the parties concerned to remit more amounts. The Enquiry Officer finds fault with the management for depriving the respondent by suspending him.

(2.) The report of the enquiry was submitted to the Bank of Cochin. But the disciplinary action against the respondent has not been concluded before the amalgamation and hence the State Bank of India as the transferee Bank had to complete the enquiry by proceeding from the stage it had reached. The disciplinary authority of the State Bank of India continued the proceedings. The disciplinary authority is the Chief General Manager, Local Head Office, State Bank of India, Chennai after considering all aspects of the case issued Ext. P - 12 order provisionally proposing to impose punishment of dismissal from service on the respondent and calling upon him to show cause against the same. The respondent submitted Ext. P - 13 explanation. He was also given personal hearing. By Ext. P - 14 order dated 20th March 1986, the disciplinary authority imposed the punishment of dismissal from service on the respondent. The respondent filed Ext. P - 15 against the order Ext. P - 14 of the disciplinary authority to the appellate authority. In continuation of the appeal he also submitted Ext. P - 15 representation. The appellate authority dismissed the appeal initially by Ext. P - 17 order which was set aside by this court by Judgment dated 28th February 1991 and the appellate authority was directed to pass fresh orders after hearing the respondent. The respondent was heard by the appellate authority and the appellate authority had considered the grounds urged by the appellant in the appeal and the subsequent representation, passed order Ext. P - 20 imposing the punishment of removal from service on the respondent. The said order was challenged by the respondent in the present Original Petition. The Original Petition was filed to quash Ext. P - 14 and P - 20 orders and for a mandamus directing the management to reinstate the respondent in service with continuity of service and back wages and for cost. The Original Petition was resisted by the appellant bank by filing a detailed counter affidavit.

(3.) In para 11 of the counter affidavit it is stated that the action taken against the respondent was for granting of loans irregularly in excess of his discretionary powers, for violating instructions and directions in the matter of granting loans and this is on the basis of records. The contentions raised by the respondent in this writ petition is without any force and the appellate authority after going through all the relevant records modified the punishment imposed earlier and the reduction in punishment would indicate that the appellate authority had carefully gone through the records and examined the same independently and therefore the findings in Ext. P - 20 is based on sufficient and relevant materials. The respondent filed a reply affidavit reiterating the submissions made in his affidavit filed in the O.P. and in the reply affidavit he submitted that among the 13 advances enumerated, serial Nos. 4, 6, 8 and 10 were found to be irregular by the Enquiry Officer in the sense that there were not sufficient security for those advances. They are items 23 (d), (l), (h) and (j) in the charge sheet. These four items altogether involves only 3.98 lakhs of rupees. Item 13 in Para.4 which is item 23 (n) in the charge sheet is already closed. Further even the management did not have a case that the said account was not properly secured. So the other allegations of irregularities and computing the total amounts involved as Rs. 44.71 lakhs was an incorrect statement made knowing them to be not true. In para 7 of the reply affidavit it is further averred that the appellate authority even after remand by this court did not consider the various points urged by him and . that the alleged misconduct was committed by him, the Bank of Cochin service code Ext. P - 11 was applicable to the respondent and according to the said code the violation of head office instruction is only a minor misconduct but in the case on hand the original as well as the appellate authorities punished the respondent in the light of the State Bank of India service rules which rules were made applicable to the erstwhile staff of the Bank of Cochin only with effect from 1st April 1987. Along with his reply affidavit the respondent filed Exts. P - 21 and P - 22.