IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 24/04/2003
CORAM
THE HONOURABLE MR.JUSTICE V.S.SIRPURKAR
AND
THE HONOURABLE MR.JUSTICE C.NAGAPPAN
WRIT APPEAL NO.300 OF 1998 AND WRIT APPEAL NO.843 OF 1998
A.Silveira ... Appellant in W.A.
No.300/1998 and
respondent in
W.A.No.843/1998
-Vs-
1. Managing Director,
Indian Overseas Bank,
Central Office,
762, Anna Salai,
Chennai-600 002.
2. General Manager,
Indian Overseas Bank,
Central Office,
762, Anna Salai,
Chennai-600 002.
3. K.Balasubramaniam,
12/12, Subaragh, Shenoy Road,
Nungambakkam, Chennai-600 034.
4. R.Ramachandran,
121, Sterling Road,
Nungambakkam, Chennai-600 034. … Respondents in W.A.
No.300/98 &
Appellants in
W.A.No.843/1998
Writ Appeals under Clause 15 of Letters Patent against the
order of the learned Single Judge in W.P.No.17347 of 1994, dated 11.12.1997.
F!or Appellant in W.A.300/98 and ::: Mr.K.Chandru, respondent in Senior Counsel for W.A.843/1998 Mr.K.Kannan ^For Respondents in W.A.300/98 and ::: Mr.N.G.R.Prasad appellants in W.A.843/1998 :COMMON JUDGMENT C.NAGAPPAN,J
Both the writ appeals are directed against the order of the
learned single Judge, dated 11.12.1997, in W.P.No.17347 of 1994.
2. The writ petitioner is the appellant in W.A.No.300 of
1998. Respondents 1 to 4 in the writ petition are the appellants in
W.A.No.843 of 1998.
3. The writ petitioner joined the services of the first
respondent Bank as an unpaid probationary clerk in 1944 and reached the
position of Deputy General Manager at the Central Office, Madras and was due
to retire on superannuation on 29.2.1988. On 27.2.1988, the petitioner was
served with a letter from the third respondent placing him under suspension in
terms of Regulation 12(1)(a) of the Indian Overseas Bank Officer Employees’
Conduct and Discipline & Appeal Regulations, 1976 on the ground that enquiry
into the charges levelled against him on 15.2.1986 was contemplated. On the
same day, the petitioner was served with another letter from the General
Manager intimating him that in view of the suspension order, he is not
permitted to retire by virtue of the provisions of Regulation 20(3)(c). The
charge sheet, dated 15.2.1986, related to certain acts of commission and
omission alleged to have been committed by the petitioner as ‘the Chief,
International Division, Central Office, during the period 1978-1982’. At that
time, the petitioner was Assistant General Manager in the matter of Drawing
Arrangement of Rupee Accounts extended to International Finance and Exchange
Corporation (IFEC), Doha and Arabian Exchange and Financial Organisation
(AEFO), Doha and on account of the failure of those companies, there was loss
to the Bank. Originally an Inspection Committee was
specially constituted by the Board on 7.1.1983 to analyse the circumstances
which resulted in the loss and identify the Operational/Executive Officials of
the Bank on whom responsibilities could be fixed for the loss and according to
the petitioner, the Committee attributed the losses only to the then
supervision and control systems in force and did not fix the responsibility on
any single individual. Five other Public Sector Banks in India suffered
similar losses in respect of the very same companies. The petitioner has
further stated that not withstanding the Committee’s Report, a show cause
notice, dated 22.7.1983, was issued to the petitioner calling his explanation
for the alleged irregularities/lapses observed in the Drawing Arrangements of
IFEC, Doha and AEFO, Doha. The petitioner in his reply, dated 14.10.1983,
refuted the allegations and pointed out the steps taken by him at every stage
to protect the interest of the Bank. No action was taken against the
petitioner for 2-1/2 years after the receipt of his reply and the charge sheet
was served on 27.2.1986 and then the petitioner was suspended. The petitioner
filed independent writ petitions challenging the suspension order and the
charge memo. The disciplinary authority passed final order, dated 19.10.1992,
dismissing the petitioner from service. The petitioner filed an appeal, dated
4.5.1993, to the Managing Director, who is the appellate authority and he, by
his order, dated 25.1.1994, set aside the order of dismissal and imposed the
penalty of removal from service. Challenging the same, the petitioner filed
writ petition No.17347 of 1994 for issuance of a writ of certiorari to quash
the orders of Respondents 1 and 2, dated 25.1.1994 and 19.10.1992.
4. The respondents in their counter contended that the
petitioner was suspended for gross irregularities committed by him while he
was functioning as Assistant General Manager/Deputy General Manager of
International Division at Central Office handling foreign exchange
transactions in respect of rupee drawing arrangements with IFEC, Doha and
AEFO, Doha and the Bank sustained loss about Rs.5.50 crores. He was served
with a charge sheet, dated 15.2.1986 and since he was due for retirement on
29.2.1988, he was placed und er suspension on 27.2.1988 for the purpose of
completing the enquiry. It is further stated in the counter that the
disciplinary authority conducted the enquiry as per rules and proposed the
punishment of dismissal and the petitioner was given an opportunity to show
cause against the punishment and thereupon order of dismissal, dated
19.10.1992, was passed. The petitioner filed an appeal to the appellate
authority and a personal hearing was given to the petitioner and the appellate
authority reduced the punishment of dismissal into one of removal from
service. In view of reduction in penalty, all the terminal benefits due to
the petitioner amounting to Rs.6,77,848.69 was released to the petitioner on
20.4 .1994. Disciplinary proceedings were conducted in an impartial manner as
per rules and the allegations levelled by the petitioner are devoid of merit.
5. The writ petitioner in his reply affidavit contended that
he alone is not wholly responsible for the administration of the International
Division and both the authorities never considered this ground and the
petitioner had been made a scapegoat.
6. The learned single Judge concluded that the orders of
disciplinary authority and appellate authority are liable to be quashed and
allowed the writ petition in part and held that the petitioner is entitled to
all the terminal benefits as if he is retired on superannuation, but all of
them are restricted to 50% alone and he is also entitled to 50% of the pension
only. The learned Judge further held that it is open to the Bank to conduct a
fresh enquiry into the matter against all the persons involved, in accordance
with law.
7. Aggrieved by the above order, the petitioner as well as
the respondents have preferred independent writ appeals.
8. The order is assailed by both the appellants before us on
the main ground that the learned Single Judge has no jurisdiction in granting
only 50% of the terminal benefits, including pension to the writ petitioner.
The observation of the learned Single Judge that it is open to the Bank
Management to conduct fresh enquiry into the matter against all the persons
involved in loss is also questioned. The learned Single Judge has concluded
that both the order of disciplinary authority and that of the appellate
authority were liable to be quashed and allowed the writ petition in part, but
has granted only 50% of terminal benefits, including pension payable to the
writ petitioner.
9. The learned senior counsel appearing for the appellants/
respondents in the writ petition, contended that the learned Judge, having
held that the writ petitioner is one among the persons who have caused loss to
the bank, erred in quashing the orders of both the authorities removing the
petitioner from service. It is well settled that in a departmental enquiry
the High Court has no jurisdiction to go into the truth of the
allegations/charges except in a case where they are based on no evidence or
where they are perverse. Under Article 226 of the Constitution, it is the
power of judicial review and the High Court only examines the procedural
correctness of the decision making process. For this reason, the order of the
learned Single Judge insofar as it goes into or discusses the truth and
correctness of the charges is unsustainable in law.
10. Judicial Review, generally speaking, is not directed
against a decision, but is directed against a decision making process. In the
present case, on a perusal of records, we are satisfied about the procedural
correctness of the decision making process. The charges cannot be termed as
perverse and the Inquiring Authority as well as the Appellate Authority have
granted due opportunity to the writ petitioner and complied with the
principles of natural justice.
11. There is also material in support of the charges, which is
apparent from the evidence let in. All that could have been done by the
learned single Judge is to find out asto whether there is material on record
to prove the charges and if the material is there, there is no question of
interfering with the enquiry. In the present case, the learned single Judge
had erred in going into the merits of the matter on facts as if he was an
appellate Court. The Enquiring Authority and the Appellate Authority had
considered the matter in proper perspective and came to the conclusion that
the charges stood proved and this conclusion reached by them cannot be
assailed. Further, the learned single Judge could not have ordered a
re-enquiry in the matter and he had no jurisdiction to bring down the terminal
benefits including pension to fifty per cent and those findings are liable to
be set aside.
12. The learned senior counsel appearing for the
appellant/writ petitioner submitted that the writ petitioner had put in 44
years of unblemished service and he always had the interest of the Bank in
mind while discharging his duties and he did not have any dishonest intention
to cause loss to the Bank and he was not himself benefited and he alone cannot
be blamed for the loss and as on today he is 75 years old and sought for
reduction of punishment from removal from service to compulsory retirement in
which case the retirement benefits can accrue to him. The learned senior
counsel relied on some rulings of the Apex Court to show that this Court has
ample power to reduce the punishment. The learned senior counsel for the
appellants/respondents in the writ petition contended that though the
disciplinary authority imposed the penalty of dismissal from service, the
appellate authority took a lenient view and reduced the punishment of
dismissal into one of removal from service and no further compassion need be
shown to the writ petitioner.
13. On the question whether this Court itself can reduce
punishment or has to leave the same with the disciplinary authority, the
following judgments of the Apex Court are relevant.
(i) In the case of RANJIT THAKUR vs. UNION OF INDIA AND
OTHERS – ((1987) 4 SCC 611, at page 620, the Apex Court has held as follows.
“Judicial review generally speaking, is not directed against a
decision, but is directed against the “decision-making process”. The question
of the choice and quantum of punishment is within the jurisdiction and
discretion of the court-martial. But the sentence has to suit the offence and
the offender. It should not be vindictive or unduly harsh. It should not be
so disproportionate to the offence as to shock the conscience and amount in
itself to conclusive evidence of bias. The doctrine of proportionality, as
part of the concept of judicial review, would ensure that even on an aspect
which is, otherwise, within the exclusive province of the court-martial, if
the decision of the court even as to sentence is an outrageous defiance of
logic, then the sentence would not be immune from correction. Irrationality
and perversity are recognised grounds of judicial review.”
(ii) In the case of B.C.CHATHURVEDI vs. UNION OF INDIA AND
OTHERS-((1995) 6 SCC 749, at page 762, it has been held as follows.
“The High Court/Tribunal, while exercising the power of judicial
review, cannot normally substitute its own conclusion on penalty and impose
some other penalty. If the punishment imposed by the disciplinary authority
or the appellate authority shocks the conscience of the High Court/Tribunal it
would appropriately mould the relief, either directing the
disciplinary/appellate authority to reconsider the penalty imposed, or to
shorten the litigation, it may itself, in exceptional and rare cases, impose
appropriate punishment with cogent reasons in support thereof.”
iii) A Division Bench of this Court, to which one of us is a party
(V.S.Sirpurkar, J), while deciding the case in W.P.No.92 of 1998 (A.Ramaswamy
v. State of Tamil Nadu, represented by the Secretary to Government and two
others) on 8.10.2001, has held as follows:-
It has to be considered now whether the case on hand can be said to be an
exceptional or rare case for reduction of penalty by this Court itself,
instead of sending the matter to the disciplinary or the appellate authority
to reconsider the penalty imposed already. There is a single instance of
proof of receipt of Rs.5,000/- from a friend on the promise of getting her
selected for the Teacher’s post. Though the plea of the delinquent/petitioner
that the amount was received by way of loan to meet the emergency situation
towards the treatment of his father was not believed by the disciplinary
authority, still the fact that there was no denial of the receipt of the
amount by the petitioner, has to be taken into consideration while imposing
penalty. The second aspect is that he repaid the amount together with
interest. The third and the most important one is that he had put in 33 years
of unblemished service and on the verge of the retirement, this unfortunate
incident has taken place.
Considering the above situations, we are of the view that the plea of the
learned senior counsel to reduce the penalty from that of removal from service
to that of compulsory retirement can be accepted.”
14. It has to be considered now whether the case on hand can
be said to be exceptional or rare case for reduction of penalty by this Court
itself instead of remitting the matter back to the disciplinary authority to
reconsider the penalty.
15. The Bank has suffered a loss to the tune of Rs.5.50
crores in the matter of drawing arrangement of Rupee accounts extended to
IFEC, Doha and AEFO, Doha during the period 1978-82 and the writ petitioner
was the Chief of the International Division, Central Office of the Bank at
that time and the Committee which was specifically constituted on 7.1.1983 to
enquire into and to analyse the circumstances which resulted in the loss and
to identify the Operational/ Executive Officials of the Bank on whom
responsibility could be fixed for the loss, in its report, dated 15.3.1983,
had attributed the losses only to the then supervision and control systems in
force and did not find proper to fix the responsibility on any single
individual for the flaws of the procedure and the system. It is also admitted
fact that the collapse of Gulf Exchange Companies resulted in the loss to the
respondents Bank as well as five other Nationalised Banks. The Inquiring
Authority in its findings under Charge No.2 has stated that there was laxity
at branch level and also at the central office level and the charge sheeted
officer alone may not be held accountable. From the above findings, it is
clear that besides the writ petitioner other officers were also concerned with
the running of the account and the question of joint liability cannot be
brushed aside.
16. The writ petitioner joined as an unpaid probationary
clerk in 1 944 and rose to the position of Deputy General Manager and he had
blemishless long service. It is not alleged that the petitioner had any
dishonest intention to cause loss to the Bank and it is also not the case that
the petitioner was himself benefited in the transaction. The learned senior
counsel for the appellants/ respondents Bank fairly admits that no fraud or
dishonesty was alleged against the petitioner. As on today, the writ
petitioner is said to be 75 years old.
17. Considering the circumstances of the case, we are of the
view that the plea of the learned senior counsel appearing for him, to reduce
the penalty from that of removal from service to that of compulsory retirement
can be accepted. Since both the penalties are major penalties under
Regulation 4 of the Indian Overseas Bank Officer Employees’ Conduct and
Discipline & Appeal Regulations, 1976, we consider it not necessary to remit
the matter to the disciplinary authority for considering the question of
penalty with a view to shorten the litigation. Since the penalty of removal
from service imposed on the petitioner appears to be disproportionate and not
commensurate with the act of delinquency of the petitioner, we propose to
modify the penalty of removal from service into one of compulsory retirement.
18. In the result, the order of the learned Single Judge is
set aside and the penalty of removal from service imposed on the petitioner by
the appellate authority stands modified to that of compulsory retirement and
the writ appeals are disposed of accordingly. No costs.
Index: Yes.
Internet:Yes.
gb.
To:
1. Managing Director,
Indian Overseas Bank,
Central Office,
762, Anna Salai,
Chennai-600 002.
2. General Manager,
Indian Overseas Bank,
Central Office,
762, Anna Salai,
Chennai-600 002.