1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.2421 of 1994 Shri Sagar Sadashiv Kasture, Officer Scale since removed, Central Bank of India, Aranxeshwar Branch, Pune. ..... Petitioner V/s. 1. Central Bank of India, through its Chairman and Managing Director, having its Central Office at Chandemukhi, Nariman Point, Bombay – 400 021. 2. Regional Manager/Disciplinary Authority, Central Bank of India, Regional Office, Pune, Ravivar Peth, Pune – 2. 3. Zonal Manager/Appellate Authority, Central Bank of India, Zonal Office, Pune – 317, Mahatma Gandhi Road, Pune – 1. ..... Respondents Mr.H.S.Venegavkar, for the petitioner. Mr.S.K.Talsania, Senior Advocate i/by M/s.Sanjay Udeshi & Co., for respondent Nos.1 to 3. CORAM :P.B.MAJMUDAR & R.M.SAVANT, JJ. DATE : 15th June, 2010 ORAL JUDGMENT : (PER P.B.MAJMUDAR, J.) : - 1. By way of this petition filed under Article 226 of the 2 Constitution of India, the petitioner has challenged the order passed by the Disciplinary Authority of the respondent Bank dated 28-08-1993, by which the petitioner is subjected to penalty of removal from the services. However, the said order is not to be treated as disqualification for future employment. The order of the Disciplinary Authority was confirmed by the Appellate Authority of the respondent Bank by an order dated 01-12-1993. 2. The petitioner was initially appointed as a Clerk in the respondent Bank on 05-03-1973 and was working at the relevant time, at Vadgaon Anand Branch of the Bank upto 21-09-1977. The petitioner was subsequently promoted as an Officer (Grade I) in February 1981. The petitioner was subjected to disciplinary proceedings in December 1991. It was alleged that the petitioner while working as Clerk at the said Branch during the period between 05-03-1973 to 21-09-1981, committed misconduct by misusing his position as an employee of the Bank by deriving pecuniary benefits for himself through the loan of Rs.6,500/- which was sanctioned and disbursed on 31-07-1976 in the name of one Manaji Baban Kokane. It is the case of the respondent No.1. that one Mr.Kokane, resident of Ale, Tal. Junnar, Dist. Pune, had submitted an application on 03-07-1976 for availing a loan of Rs.7,000/-. A loan of Rs. 6,500/- was accordingly sanctioned to him and disbursed on 31-07-1976 3 and the pecuniary benefit of the same was enjoyed by the petitioner, as is evident from the credits made in the said loan account. Accordingly, it is alleged that the petitioner misused his position as an employee of the respondent Bank by deriving pecuniary benefit out of the said loan transaction. 3. The petitioner denied the charges levelled against him. The Disciplinary Authority appointed an Inquiry Officer for conduct of the inquiry against the petitioner. The Inquiry Officer recorded the evidence of the petitioner and the other witnesses and submitted his findings, which are at Page 25 (Annexure B) of the paper book. The Inquiry Officer observed that after going through the proceedings of the departmental inquiry and considering the documentary evidence on record, he came to the conclusion that the petitioner had taken Rs.6,000/- from Mr.Kokane, the borrower. After considering the documentary and oral evidence on record, the Inquiry Officer came to the following conclusions : - (1) That Shri S.S.Kasture had taken Rs.6,000/- from Shri M.B.Kokane the borrower, probably when he withdrew the amount of Rs.6,200/-, Rs.6,000/-for a marriage in C.S.O.E.’s house (P.O.Ex.67). There is no documentary evidence that Shri Kasture had taken a loan of Rs.6,500/- sanctioned to Mr.Kokane by the then Branch Manager Shri S.P.Kataria (In fact, he claimed to have sanctioned Rs. 6,000/- only as a loan). D.R.Ex.11 of 21-01-1993. In such a case then why Mr.U.N.Kamble, the then cashier paid Rs. 6,500/- against Rs.6,000/- sanctioned is yet intriguing. 4 2. It is true that Shri Kasture had taken Rs.6,000/- when he was a Clerk, from the Bank’s borrower, which is not permitted under our staff conduct rules, leave aside attracting provision under Officers service rules. 3. In his own confession on page No.120 of the proceedings dated 22.1.1993 he has admitted that he used to purchase clothes from Mr.Kokane, because of the good relations. Mr.Kokane had with all the staff of the Branch at that time. He has also admitted that shri Kasture will refund/repay by Rs.100/- monthly instalment, which he deposited in his (Mr.Kokane’s) loan account. This amount totals comes of Rs.5,750/- 4. If we look for the statements of Mr.Kokane made on various dates, it is seen that he had prayed for a simple rate of interest to his retail trade loan account and even went to the extent of asking for permission upto 50% to 60% (P.O. Exh.68 dated 16.8.1991). It is incredible to believe that such borrower will deposit in cash a sum of Rs.29,643/- on 29.10.1991 (D.R.Ex.10) and immediately request for a non-due certificate (D.R.Ex.2) of 29.10.1991. Here it is noteworthy to examine (D.R.Exh.1) dated 23.1.1985 in which he had stated that he had incurred losses in the business and the debit balance then appearing (i.e. Rs. 14,237.50) was difficult to be paid by Shri Kokane. 5. It is also pertinent to note that nowhere the D.R. Or C.S.O.E. have refused that no pecuniary benefit was derived from Mr.K.B.Kokane. The only difference in version between Mr.Kokane and the C.S.O.E. Is that Mr.Kokane says that Rs.6,000/- was paid in cash while the C.S.O.E. Denies so, but agrees that he purchased some cloth/clothes from him fro which a repayment of Rs.100/- p.m., was assured. 6. It may therefore be a point for arriving at a conclusion that the C.S.O.E., master minded to receive the benefit may be in kind or cash for which he had to pay loan 5 accounts through the withdrawals on the same day and through the M.F. System when he worked at Satara Branch, indicating subscription for cultural club, but actually deducting the instalments for both at Wadgaon-Anand Branch as per oral instructions. 7. It is also true that without necessary influence on the then Branch Manger Shri Kataria, whether Mr.Kasture was then working as a Clerk or an officer, it is immaterial for the sake of exercising the required influence to grant Rs.6,500/- as loan to Mr.M.B.Kokane, out of which he derived the benefit of Rs.6,000/- from the borrower. In fact, from the different versions of Mr.Kasture, Mr.Kokane was not at all in need of the loan for tailoring or Readymade cloth business, but the subsequent events, the intimacy, reveals that the C.S.O.E., was in need of the money and Mr.Kokane posed as a borrower in need for C.S.O.E., with a view to later pay the loan in installments. 8. The M.R.’s attempt to get read and link all the documents 1 to 69 he presented through all his 4 witnesses and trying to establish the simultaneous transactions relationship is to be taken into account seriously, as withdrawals and deposits are of the same dates which obviously creates doubts in anybody’s mind. These have not been challenged by D.R., or C.S.E.O. This therefore, proves beyond doubt the nexus of the transaction or the deal struck by the C.S.O.E., clandestinely with the borrower and the wrong methods he adopted in repayment of the loan. 9. From the statement of account of the borrower, though his signatures have been obtained and manoevred on (D.R.Ex.8 and 10) and withdrawal of Mr.Komane (D.R.Ex. 5,6,7, 8) only on D.R.Exh.of Rs.2,000/- Mr.Kokane did sign the loan slip and D.R.Ex.10 of Rs. 29,643/- of 2.10.1991. 4. In the operative part of the report, the Inquiry Officer came to the conclusion that the petitioner has misused his position to derive 6 pecuniary benefit to the extent of Rs.6,000/- from Bank’s borrower, which is prohibited under the Service Rules. It was also found that the petitioner had deposited in all Rs.5,750/- and Rs.29,643/- for the loan of Rs.6,000/- taken on 31-07-1976 upto 29-10-1991. It was also pointed out that the Bank had not suffered any monetary loss in the said transaction. It was also found that the charge regarding misuse of his position as an employee was proved as also the charge regarding deriving pecuniary benefit. The Disciplinary Authority agreed with the said finding and passed an order of punishment against the petitioner, by which the petitioner was removed from service, but the same was not to be treated as disqualification for future employment. 5. The petitioner against the said order, preferred an Appeal before the Appellate Authority. The same was also dismissed by the Appellate Authority vide order dated 01.12.1993. 6. We have heard the learned counsel for the parties. Learned counsel for the petitioner vehemently submitted that it is not a case in which the Bank had suffered any financial loss. It is also argued that in any case, what is proved against the petitioner is that he had borrowed the amount and had entered into loan transaction with a person who was the borrower of the Bank, which was treated as a misconduct. Learned counsel for the petitioner submitted that though transaction in question 7 had taken place between 1973 to 1976, the disciplinary proceedings were initiated after considerable period i.e. in the year 1991 and therefore, on the said ground the inquiry proceedings are required to be quashed. The learned counsel further submitted that penalty given to the petitioner is disproportionate, as the bank has not suffered any monetary loss. 7. Per contra, the learned counsel appearing for the respondent Bank submitted that the petitioner being an employee of the respondent bank, had committed serious act of misconduct, which is in the nature of financial irregularity. Learned counsel for the respondent Bank further submitted that it is irrefutable that petitioner took a pecuniary benefit from the borrower of the bank and that the petitioner was paying loan installments on behalf of the said borrower in the said loan account by himself and he had stopped making such payments since 1991 when he was transferred from the branch where the said account was being operated. Since the deposits were being made in the said account, the respondent No.1 Bank addressed a letter to the account holder Mr.Kokane, informing him about making necessary payment in his loan account. At the said time, Mr.Kokane, the borrower, informed the Bank that the actual benefit of the loan was availed by the petitioner as the latter wanted a loan of Rs.7,000/- in view of the marriage in his family. It was further stated that the said loan was sanctioned when the regular Branch Manger 8 was on leave. The said statement is made on 06-08-1991, which is evident from Exh.67 of the Disciplinary Inquiry proceedings. 8. Learned counsel for the respondent Bank contended that in the year 1991 when the aforesaid fact came to the knowledge of the respondent Bank, inquiry was initiated against the petitioner and therefore, question of initiating inquiry proceedings at a belated stage does not arise. 9. We have considered the contentions of the learned counsel for the petitioner as well as learned counsel for the respondent Bank and have also gone through the petition as well as order passed by the disciplinary authority as well as the appellate authority. So far as the question about misconduct on the part of the petitioner is concerned, it is required to be noted that the scope of judicial review in such types of cases is very limited, this Court cannot re-appreciate the evidence on record. This Court is not required to examine the evidence on record as if it is an appellate court and it is only required to see whether there was some evidence available on record for reaching the conclusion, which the Disciplinary Authority has reached and/or that there is no evidence worth the name. It is required to be noted that the petitioner was charged in connection with the misuse of his position as an employee of the respondent Bank. From the material on record of the Inquiry proceedings, 9 it cannot be disputed that the petitioner had enjoyed the benefit of loan account, which was disbursed in the name of Mr.Kokane in July 1976. Mr.Kokane had submitted an application on 03-07-1976 for a loan of Rs. 7,000/- and accordingly loan of Rs.6,500/- was sanctioned and disbursed to him on 31-07-1976. The credits made in the said loan account is through the petitioner, on which there is absolutely no dispute. Various credits were made in the said loan account from time to time by the petitioner. 10. The contention of the learned counsel for the petitioner is that since he had bought cloth on credit from the said Kokane, he deposited the amounts from time to time in the said loan account. The Inquiry Officer has considered this aspect. The Inquiry Officer found that the petitioner had taken a loan of Rs.6,000/- from Mr.Kokane, the borrower of the Bank, which fact according to the Inquiry Officer is proved by Exh.67. The conclusion in this regard is drawn by the Inquiry Officer on the basis of voluminous evidence led before him. A detailed conclusion has been arrived at by the Inquiry Officer in this behalf. On the basis of various conclusions drawn by the Inquiry Officer, a finding was recorded that the petitioner had misused his position by taking advantage of pecuniary benefit to the extent of Rs.6,000/- from the bank’s borrower, which is prohibited under the Service Rules of the Bank. It was also 10 established by documentary evidence that the petitioner had made deposits in the said loan account from time to time. The Disciplinary authority has agreed with the findings of the Inquiry officer and ultimately, it is held that the petitioner had derived pecuniary benefit from the borrower of the bank, which is a misconduct under the Service Rules. 11. After going through the conclusion of the Inquiry Officer, it is clearly established that the petitioner had taken pecuniary benefit of amount of Rs.6,000/- from the borrower of the bank and in fact, petitioner himself tried to pay the loan amount from time to time till 1991. But, subsequently, he stopped making such payments. Considering the said aspect, we find great force in the submission of the learned counsel for the respondent Bank that since it was not possible for the petitioner to directly obtain loan from the Bank, the petitioner through Mr.Kokane, managed to see that Mr.Kokane obtains loan in his name, but ultimately, the benefit of loan account had gone to the petitioner. 12. Our attention has been invited to Regulation 15 of the Central Bank of India Officer Employee’s (Conduct) Regulations, 1976, which also includes the supporting staff of the Bank also. It would be expedient to reproduce Regulation 15, which reads as under : - 15. No officer employee shall, in his individual capacity - (i) borrow or permit any member of his family to borrow 11 or otherwise place himself or a member of his family under a pecuniary obligation to a broker or a money lender or a subordinate employee of the bank or any person, association of persons, firms, company or institution, whether incorporated or not, having dealings with the bank; (ii) buy or sell stock, shares or securities of any description without funds to meet the full cost in the case of a purchase of scrips or delivery in the case of a sale; (iii) incur debts at a race meeting; (iv) lend money in private capacity to a constituent of the bank or have personal dealings with such constituent in the purchase or sale of bills of exchange, Government paper or any other securities; and (v) guarantee in his private capacity the pecuniary obligations of another person or agree to indemnity in such capacity another person from loss except with the previous permission of the competent authority. Provided that an officer employee may, give to or accept from a relative or personal friend a purely temporary loan of a small amount free of interest, or operate a credit account with a bonafide tradesman or make an advance of pay to his private employee : Provided further that an officer employee may obtain a loan from a co-operative society of which he is a member or stand as a surety in respect of a loan taken by another member from a co-operative credit society of which he is a member. 13. In this connection, learned counsel for the petitioner contended that these Regulations have come into force in the year 1977 and the loan transaction in question had taken place in the year 1976 and therefore, these Regulations could not be made applicable to the 12 petitioner. Learned counsel for the petitioner further contended that the said Rules can only be made applicable to the Officers and it is not applicable so far as Clerks are concerned, as the petitioner was serving as a Clerk at the relevant time. The applicability of the said rules was challenged by the petitioner by filing Writ Petition No.1461 of 1992 and the Division Bench of this Court rejected the Writ Petition at the admission stage itself, holding that difference in the procedure does not affect the right of the delinquent. The matter was thereafter, carried to the Supreme Court by way of SLP No.9138 of 1992 and by an order dated 17-11-1992 the Supreme Court dismissed the SLP summarily. This fact has been stated in the affidavit-in-reply filed by the respondent Bank and as such, it is not disputed on behalf of the petitioner. Therefore, in so far as employees like the petitioner are concerned, the said Regulations are applicable. 14. So far as the applicability of the Regulations on account of the fact that the loan transaction was took place in 1976, whereas the Regulations came into force in 1977, it is required to be noted that the petitioner has been charged for misconduct and the petitioner was paying the amount on behalf of Mr.Kokane all throughout upto 1991. It is in the year 1991, when the payment was stopped, the respondent bank realized this fact in view of the letter addressed by the borrower Mr.Kokane that 13 the actual beneficiary of the loan was the petitioner. The learned counsel for the respondent Bank submitted that it was in the nature of a recurring wrong which came to the bank’s notice in the year 1991. He further submitted that under the previous Service Rules also, the act of the petitioner could be treated to be a misconduct. In our view, the petitioner who had taken pecuniary benefit of an amount of Rs.6,000/-, acted in the manner which is not befitting a bank employee. In our view, it can be said that the petitioner has failed in performing his duties with honesty and integrity. Even as per the statement of Mr.Kokane, who is a borrower of the bank, who stated that he had not taken loan from the bank, but it was only for the benefit of the petitioner that he approached the bank for availing the loan, as the petitioner wanted money for the purpose of marriage in his family. The said conduct of the petitioner squarely falls under the misconduct, mentioned in Regulation 15(1). Even assuming that Rules of 1977 are not applicable to the petitioner, then also, the case of the petitioner would squarely fall under the residuary clause of an act “unbecoming of a bank employee”, which was even otherwise, treated as misconduct prior to 1977. In view of the above, the submission of the learned counsel for the petitioner that the act of the petitioner did not amount to any misconduct, is required to be rejected. 15. So far as delay in initiating proceedings against the 14 petitioner is concerned, it is required to be noted that the deposits towards repayment in the said loan account was stopped in the year 1991. Since no payment was received by the bank towards the said loan account, respondent bank gave notice to the original borrower, the original borrower ultimately addressed a communication to the respondent Bank stating the factual aspects of the matter and that is how, the respondent Bank came to know about the transaction which took place between the petitioner and the borrower. In such circumstances, it cannot be said that the action of the bank suffers from delay or latches in any manner. One can only say that if the petitioner had continued to make payment, perhaps the misconduct could not have come to light. 16. So far as the quantum of punishment is concerned, in our view, this Court cannot interfere with the same looking to the misconduct proved against the petitioner. In this behalf, learned counsel for the respondent Bank has relied upon a decision of the Supreme Court in the Case of Damoh Panna Sagar Rural Regional Bank and Ors., V/s. Munna Lal Jain, 2005 1 CLR 821. In the said case, employee of a regional bank withdrew an amount of Rs.25,000/- for his personal use. The amount was withdrawn in view of his wife’s health having deteriorated and who required surgical treatment. While upholding the decision of the bank in terminating the employee’s service, the Supreme Court has observed : 15 14. A bank officer is required to exercise higher stands of honesty and integrity. He deals with money of the depositors and the customers. Every officer/employee of the bank is required to take all possible steps to protect the interest of the bank and to discharge his duties with utmost integrity, honesty, devotion and diligence and to do nothing which is unbecoming of a bank officer. Good conduct and discipline are inseparable from the functioning of every officer/employee of the bank. As was observed by this Court in Disciplinary Authority-cum-Regional Manager V. Nikunja Bihari Patnaik, 1996(73) FLR 1252 (SC), it is no defence available to say that there was no loss or profit resulted in case, when the officer/employee acted without authority. The very discipline of an organization more particularly a bank is dependent upon each of its officers and officers acting and operating within their allotted sphere. Acting beyond one’s authority is by itself a breach of discipline and is a misconduct. The charges against the employee were not casual in nature and were serious. These aspects do not appear to have been kept in view by the High Court. 17. During the course of hearing, learned counsel for the respondent Bank submitted that the petitioner was subjected to disciplinary proceedings, whilst holding a higher post for different charges, but since he was removed from the service, those proceedings have lapsed. Be that as it may, in the facts and circumstances of the present case, this Court would not like to interfere with the punishment awarded to the petitioner by the Disciplinary authority. 18. Learned counsel for the petitioner submitted that at the time of removal of the petitioner, the amount which the petitioner was 16 entitled to receive has been paid to him by directly crediting the same in the loan account of the petitioner and nothing is now due and payable to the petitioner. 19. For all the aforesaid reasons, the writ petition is dismissed. Rule is discharged with no order as to costs. ( R.M.SAVANT, J. ) ( P.B.MAJMUDAR, J. )