05 Jan 2121

The power of judicial review does not extend to getting in to the merits of the disciplinary proceedings - Supreme Court of India

Case : Deputy General Manager (Appellate Authority) and Others v. Ajai Kumar Srivastava Arising out of SLP(C) No(s). 32067-¬32068 of 2018

Court :

Bench : Justice L. Nageswara Rao, Justice Hemant Gupta, and Justice Ajay Rastogi

Decided on : 05 Jan 2121

Relevant Statutes

State Bank of ndia Act,1955

Sections 120B, 420, 467, 468 and 471 of the Indian Penal Code, 1860

Sections 13(2), 13(1)(d) of the Prevention of Corruption Act, 1988

Brief Facts and Procedural History:

1. The respondent joined service as a Cashier or Clerk in Mumfordganj Branch Allahabad of the Appellant (State Bank of India) on 7th December 1981.

2. While on duty, he was suspended for misconduct by order dated 14th August 1995.

3. A criminal case was instituted against him for offences under Sections 420, 467, 468, 471 read with Section 120B of Indian Penal Code, 1860 and Section 13(2) read with Section 13(1)(d) of Prevention of Corruption Act, 1988.

4. A charge-sheet dated 11 April, 1996 was served upon him detailing seven charges of misappropriation of funds which he had committed in the discharge of his duties as an employee of the Bank.

5. Respondent submitted his reply dated 08th May 1996 denying all the charges.

6. The enquiry officer appointed by the competent authority after holding a disciplinary enquiry in accordance with the procedure prescribed under the Bipartite Settlement applicable for award staff of Nationalized Bank furnished his report dated 22nd May 1999 to the disciplinary authority holding that all the allegations except one were proved against him.

7. All the allegations levelled against the respondent were supported with the documentary evidence duly audited by the Bank. The respondent neither wanted to say anything nor produced any evidence in his defence.

8. The disciplinary authority also found the charge unproved by the enquiry officer to be proved, served the copy of enquiry report dated 29th June 1999 with the prima facie opinion based on the record of enquiry to the respondent calling for his written explanation.

9. The respondent raised vague objections of general nature without the support of any documentary or oral evidence. He asserted that there was no need of disciplinary enquiry when a criminal case was instituted and pending trial or investigation by the CBI and the conclusion of departmental enquiry without awaiting the outcome of the said investigation or trial, caused great prejudice to him. 

10. The disciplinary authority revisited the record of enquiry and confirmed the penalty of dismissal from service by its order dated 24th July 1999.

11. The respondent preferred a departmental appeal against his dismissal from service. He still made general objections which were ambiguous and without any foundation. The appellate authority held that appeal had no merit and the punishment being commensurate to the charges levelled against him, confirmed the punishment of dismissal.

12. The respondent through a writ petition challenged the decision of the appellate authority before the High Court of Allahabad.

13. The single Judge of the High Court found the disagreement of the appellate authority with the enquiry officer about one charge caused great prejudice and that apart, the disciplinary/appellate authority has passed a nonspeaking order which violates the principles of natural justice.

14. The Division Bench of the High Court affirmed view expressed by the Single Judge.

15. The appellant challenged this decision before the Supreme Court.

16. Besides, in the criminal case instituted against the respondent for the aforesaid offences he was held guilty and convicted by the learned Court of Special Judge, Central Bureau of Investigation (CBI) Court by a judgment dated 31st May 2019 and sentenced to 10-year rigorous imprisonment with fine and in default to undergo imprisonment of 3 months.

Issue of the Case

Whether the High Court was competent to set aside the order of dismissal passed by the appellate authority?

Observations of the Court:

1. The disciplinary authority after due application of mind recorded its finding in upholding the finding of fact recorded by the enquiry officer in his report including the note of disagreement in reference to one charge and holding it to be proved.

2. The appellate authority took note of the objections raised by the respondent and dealt with them separately.

3. 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 limited to correcting errors of law or procedural errors leading to manifest injustice or violation of principles of natural justice and it does not extend to adjudication of the case on merits or reappreciation of evidence as an appellate authority, as affirmed in B. C. Chaturvedi v. Union of India and Others [1995 (6) SCC 749]. The three-Judge Bench of the Supreme Court in Pravin Kumar v. Union of India and Others [2020 (9) SCC 471 supports the same. This is meant to ensure fairness in treatment and not to ensure fairness of conclusion. Interference is permissible if there is a 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.

4. Where the enquiry officer is not the disciplinary authority, on receiving the report of the 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 it may record its findings or to remit the case to the enquiry officer for further enquiry.

5. Strict rules of evidence do not apply 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.

6. In the present case, the disciplinary authority on receiving the report of the enquiry, it was not in agreement with the finding recorded by the enquiry officer, was under an obligation to record its reasons of disagreement and call upon the delinquent for his explanation in the first place before recording his finding of guilt and undisputedly the procedure as prescribed by law was not followed and that has caused prejudice to the respondent and indeed it was in violation of the principles of natural justice. We are of the considered view that so far as the finding of guilt recorded by the disciplinary authority in reference to Charge No. 1 is concerned, that could not be held to be justified in holding him guilty.

7. But if the order of dismissal was based on the findings of that one charge alone, it would have been possible for the Court to declare the order of dismissal illegal but on the finding of guilt recorded by the Enquiry Officer in reference to the rest of the charges and confirmed by the disciplinary/appellate authority was not liable to interfere and those findings established the guilt of grave delinquency. The interference of the High Court with the order of penalty of dismissal inflicted upon the respondent was an apparent error. The judgment of the Constitution Bench of the Supreme Court in State of Orissa and Others v. Bidyabhushan Mohapatra [AIR 1963 SC 779] supports the same.

8. In Sawarn Singh and Another v. State of Punjab and Others [AIR 1976 SC 232], it was observed that “where the order of a domestic tribunal refers to several grounds, some relevant and existent, and others irrelevant and nonexistent, the order will be sustained if the Court is satisfied that the authority would have passed the order based on the relevant and existing grounds, and the exclusion of irrelevant or non-existing grounds could not have affected the ultimate decision”.

9. Even after the charges have been proved, and justify the imposition of penalty, the Court may not exercise its power of judicial review.

10. It is not true that the order passed by the disciplinary/appellate authority was a nonspeaking order passed with non-application of mind. Though the disciplinary/appellate authority was not supposed to pass a judgment, however, the disciplinary authority/appellate had taken note of the record of enquiry, afforded a reasonable opportunity of hearing and dealt with the written objections raised by the respondent, and expressed its brief reasons in upholding the finding of guilt and penalty of dismissal.

11. Besides, in the banking business, absolute devotion, integrity and honesty is sine qua non (necessary condition) for every bank employee. It requires the employee to maintain good conduct and discipline and he deals with the money of the depositors and the customers.

The Decision Held by the Court:

The Honourable Supreme Court allowed the appeals and set aside the judgement of the Division Bench of the High Court.

Click here to view/download the judgement >