Indian Overseas Bank vs M. P. Sadanandan

Mohammed Nias.C.P., J.

The Indian Overseas Bank and its officials are challenging the judgment of the learned single Judge in WP(C)No.15508 of 2013 dated 30.11.2021 allowing the writ petition filed by the respondent / writ petitioner modifying the punishment of removal from service to compulsory retirement.

The brief facts leading to the writ appeal are as follows:-

The writ petitioner joined the service of the first respondent Bank on 12.12.1990 as Messenger and was later promoted as Clerk from 01.12.2004. While he was working at the Pathanamthitta Branch of the Bank, he was sanctioned an overdraft facility with CC Account No.1109 as applicable to the bank staff with a limit of 2.24 lakh and his salary was being credited to the said account. He was also issued with an ATM card for withdrawals from the said account. The writ petitioner was later transferred to Adoor branch of the bank on 20.10.2009, where he joined on 21.10.2009. Following his transfer, CC Account No.1109 maintained at the Pathanamthitta branch along with the outstanding balance was transferred to Adoor branch only on 04.02.2010. As on 04.02.2010, there was a debit balance of Rs.2,25,4789.61/- in CC Account No.1109, which was transferred to the new CC Account No.1154 opened at the Adoor branch. The bank alleged that the writ petitioner having been transferred from one branch to the other, was dis-entitled to operate the old CC account and was expected to surrender the ATM card issued for the old account and apply for a new ATM card to operate the new account in the transferred station. It is the bank's further contention that by an inadvertent oversight on the part of certain bank officials in the Pathanamthitta branch, the Master account in the computer system was not closed as a result of which the salary up to March 2010 was also credited in the old CC Account No.1109 at the Pathanamthitta branch. The bank's allegation is that the writ petitioner was in the know of things and took advantage of the lapse on the part of the bank staff at the Pathanamthitta branch in not transferring the account held there, to operate both the CC Accounts simultaneously. The bank further alleged that the old account was operated with the ATM card issued on that account and the new account was operated without any ATM card. The bank alleged that the writ petitioner had withdrawn an amount of Rs.2.31 lakh from the old account at Pathanamthitta branch during 21.03.2010 to 30.09.2010 and also withdrew Rs.2.21 lakh from the new CC Account No.1154 of the Adoor branch running a total outstanding balance of 4.51 lakh as on 30.09.2010 as against the sanctioned limit of Rs.2.24 lakh by fraudulently operating both the accounts.

The Bank on coming to know about the same issued Ext.P2 notice instructing him to close the outstanding dues in CC Account of the Pathanamthitta branch on or before 28.02.2011 and to submit his explanation for the improper drawings from the said account on or before 29.11.2011. The writ petitioner responded by Ext.P3 and the bank holding that the explanation was unacceptable, the employee was placed under suspension from 18.03.2011 by Ext.P4 order pending initiation of the disciplinary proceedings. Later, Ext.P5 charge-sheet dated 21.10.2021 was issued alleging misconduct under clause 5(d) and 5(j) of the Memorandum of Settlement dated 10.04.2002 between the bank and its workmen. An enquiry was conducted, in which the workman conceded that his son had withdrawn the amount using the ATM card issued at the Pathanamthitta branch. He also addressed Ext.P8 letter to the Bank reiterating that the money was withdrawn by his son and that he was prepared to pay back the amount. The disciplinary authority held that the charges levelled against the writ petitioner were proved and accordingly imposed a punishment of dismissal without notice, by Ext.P10 order, in terms of clause 6(a) of the Memorandum of Settlement noted above which was confirmed in appeal by Ext.P12 order. These orders were challenged by the writ petitioner.

The writ petitioner had contended that it was the obligation on the part of the bank to transfer the overdraft account including the master account to the transferee branch (Adoor branch) immediately on his transfer. That was not done and that account was continued to be maintained and the salary of the writ petitioner for the subsequent months was being credited to the Pathanamthimtta branch, and therefore, the petitioner was using the ATM card for operations in respect to CC Account No.1109. It is only on 04.02.2010, without informing the petitioner that the bank transferred the debit balance to the Adoor branch and even while doing so the officials concerned of the bank did not close the Master account which was contrary to the mandatory provisions and even after the transfer of the balance amount in the account, the salary of the next two months was also credited in the old account. Further it is contended that it was only on 21.01.2011, when the petitioner received Ext.P2 that he became aware of the withdrawals from the account. The writ petitioner also contended that the enquiry officer and the disciplinary authority were one and the same and the same has resulted in biased findings against him resulting in grave miscarriage of justice. Punishment awarded was contended to be grossly disproportionate. The petitioner also pointed out that in the criminal case instituted on the same incident as CC No.116 of 2012 before the Court of the Chief Judicial Magistrate, Pathanamthitta, on the basis of Crime No.453 of 2011 of Pathanamthitta Police Station on a complaint filed by the bank alleging offences punishable under Sections 420 and 409 of the Indian Penal Code, the writ petitioner was acquitted by judgment dated 14.09.2018.

The learned single Judge, who considered the matter found against the contention of the writ petitioner that the charges were vague. The learned single Judge considered the contentions of the writ petitioner including one based on the acquittal of the criminal case registered on the basis of the same allegation and that the management could not have taken the factum of acquittal into consideration because it came only on 22.09.2018, whereas, the dismissal order was dated 30.06.2012 (Ext.P10). The learned single Judge found that the materials on record clearly showed that it was the son of the writ petitioner who misused the ATM card and withdrew amounts over the sanctioned limit. Though, there is negligence on the part of the writ petitioner, the learned single Judge found that in the absence of specific material as to whether the petitioner was a privy to the misuse by the son, and that the case cannot be seen as one of the serious cases of misappropriation, also reckoning that the petitioner has put in service more than 19 years of service and that he was a middle level staff leading a normal life and that no misconduct was alleged against him earlier, a slight lenient view was liable to be taken.

Accordingly, taking all these into account, the learned single Judge substituted the punishment of dismissal to that of compulsory retirement and directing that the suspension period will remain as such and that the writ petitioner will be entitled to all the service benefits as in the case of a compulsory retirement and the bank was directed to quantify the amounts payable to the petitioner less the amount illegally withdrawn using the ATM card and the balance to be paid within a period of three months, and accordingly, allowed the writ petition to the said extent.

Heard Sri.Leo George and Sri.K.N.Sasidharan Nair, the learned counsel for the appellants and Sri.V.Sajith Kumar, the learned counsel for the respondent.

The learned counsel for the appellants submits that the finding that the punishment imposed is disproportionate cannot be justified as the writ petitioner being an employee of the bank was obliged to maintain a higher degree of trust and the bank had lost confidence in him. It is the further argument that even assuming that the punishment was shockingly disproportionate and the punishment interfered with, then the matter should have been relegated to the disciplinary authorities to consider the question of punishment rather than this Court varying the punishment. Reliance is also placed on the judgment of Supreme Court in Chief Executive Officer, Krishna District Co-operative Central Bank Limited and another v. K.Hanumantha Rao and another [(2017) 2 SCC 528] in support of his contentions.

The learned counsel for the respondent however argued on the basis of the facts pleaded in the writ petition that there was serious failure/lapse on the part of the employees in both the branches which led to the situation. The writ petitioner had already offered to pay the excess drawings beyond the limit by Ext.P8 letter. The learned counsel argued that the criminal case initiated on the basis of the same allegations also ended in an acquittal. The learned counsel further argues that the petitioner had put in more than 19 years of unblemished service and he had no intent at all to fraudulently use the account or indulge in any kind of misappropriation.

Having heard the learned counsel on either side and perusing the records, we are of the definite view that the judgment of the learned single Judge calls for no interference for the reasons to follow. It is pertinent to note that the officers of the bank working in the Pathanamthitta branch did not close the account or transfer the same to the Adoor branch and the salary was also being credited to the Pathanamthitta branch even after his transfer to the Adoor branch. The Bank has transferred the balance remaining in the Pathanamthitta Account CC No.1109 to Adoor branch only on 04.02.2010 without closing the Master account and the salaries of the subsequent months were also credited to the account of the Pathanamthitta branch. Since salaries were credited to the account maintained at Pathanamthitta branch, the writ petitioner cannot be fully blamed for using the ATM card issued from that branch, particularly, when the bank remitted the salary till April 2010 in the old account and from that date the petitioner was operating the said account only. Undersuch circumstances, the petitioner cannot be awarded a punishment like the one granted in the instant case. At any rate, we do not have any doubt that the capital/maximum punishment of dismissal from service was not warranted in the face of the allegations made against the writ petitioner. It is also significant to note that the officials at the Pathanamthitta branch who had the responsibility for closing the Master account at the Pathanamthitta branch did not do so and no serious action was taken against them except administering a warning, thus putting the entire blame on the writ petitioner. The learned single Judge also found that there was nothing on record to show that the writ petitioner was privy to his son using the ATM card in the circumstances mentioned above.

The judgment cited on behalf of the appellant, was a case where there was failure to discharge legitimate duties of supervision leading to huge misappropriation which was admitted by the delinquent therein, leading to a misappropriation to the tune of Rs.46,87,950.10/-. It was in such a case that the interference by the High Court on the question of punishment was held to be bad by the Supreme Court, particularly, when the delinquent had practically admitted the charges of lack of supervision. It is trite that the award of punishment in cases where it is grossly in excess to the allegation remains open for interference under the limited scope of judicial review. It is not that such punishment awarded in excess to the allegations, has an immunity from challenge. In the instant case we have no doubt whatsoever that the punishment is so disproportionate that it shocks judicial conscience.

With respect to the argument of the learned counsel for the bank that even if the court found that the punishment is disproportionate, the matter should have been remitted back to the disciplinary authorities, the same was not possible in the instant case as the employee had attained the age of superannuation as early as on 30.06.2012. The punishment imposed in the present case is totally irrational, outrageous and in defiance of logic. It is also very pertinent that the petitioner was chosen for the harshest punishment while the officials at the Pathanamthitta branch who were equally guilty for dereliction of duties were let off with just a warning. The punishment being harsh, the learned single Judge was fully justified in interfering with the the same. We also find that the disciplinary authority in the instant case while imposing punishment has not acted in accordance with the principles of proportionality or with any fairness in action. It has not considered whether the action of the petitioner had a financial effect and societal implication that required the maximum punishment. The standards for dealing with grave offences like corruption, misappropriation and gross indiscipline and the standards for determining the punishment, in cases of the instant nature are different (See in this connection the judgment of the Supreme Court in Pravin Kumar v. Union of India and ors., (JT 2020 (9) SC 408). For the reasons which we have given above and on the basis of the findings arrived at by the learned single Judge, we find ourselves unable to accept the contentions raised on behalf of the appellant Bank .

The writ appeal fails and is accordingly dismissed.