IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN WEDNESDAY, THE 22ND SEPTEMBER 2010 / 31ST BHADRA 1932 WP(C).No. 31487 of 2003(W) -------------------------- PETITIONER(S): --------------- T.KRISHNAN BHATTATHIRI, E.NO.234, OFFICER, NORTH MALABAR GRAMIN BANK, PERINGATHUR BRANCH, P.O.PERINGATHUR, DIST. KANNUR. BY ADV. SRI.KALEESWARAM RAJ RESPONDENT(S): --------------- 1. THE CHAIRMAN, NORTH MALABAR GRAMIN BANK, HEAD OFFICE, KANNUR. 2. THE APPELLATE AUTHORITY & BOARD OF DIRECTORS, NORTH MALABAR GRAMIN BANK, HEAD OFFICE, P.B.NO.59, KANNUR-670 001. 3. THE NORTH MALABAR GRAMIN BANK, REP. BY ITS CHAIRMAN, HEAD OFFICE, P.O.NO.59, KANNUR-670 001. ADV.SRI.DEVAN RAMACHANDRAN FOR R1 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 22/09/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C).No. 31487/2003. APPENDIX PETITIONER(S)' EXHIBITS P1. COPY OF THE CHARGE SHEET DTD.4TH AUGUST, 2001. P2. COPY OF THE LETTER DTD.22.9.98. P3. COPY OF THE CIRCULAR DTD.24.7.89. P4. COPY OF THE CIRCULAR DTD.24.7.89. P5. COPY OF THE STATEMENT DTD.1.8.01. P6. COPY OF THE REPLY DTD.21.8.01. P7. COPY OF THE LETTER DTD.5.9.01. P8. COPY OF THE ENQUIRY REPORT DTD.19.8.02. P9. COPY OF THE NOTICE DTD.7.2.03. P10. COPY OF THE ORDER OF R1 DTD.22.2.03. P11. COPY OF THE WRITTEN STATEMENT DTD.22.2.03. P12. COPY OF THE CIRCULAR DTD.9.5.95 OF R1. P13. COPY OF THE ORDER OF R1 DTD.10.3.03. P14. COPY OF THE APPEAL PETITION DTD.24.4.03. P15. COPY OF THE ORDER DTD.10TH JUNE, 03. P16. COPY OF THE ORDER DTD.27.6.03. NO. Ext.P17 P18 COPY OF THE DELETION REPORT DTD.3.11.03. P19. COPY OF THE CHARGE SHEET DTD.31.10.03. RESPONDENT(S)' EXHIBITS: R1 COPY OF THE SUSPENSION ORDER DTD.11TH JUNE, 01. R2. COPY OF THE CIRCULAR DTD.3.8.2000. R3. COPY OF THE CIRCULAR DTD.10.10.99. sdk+ ///True copy/// P.A. to Judge S.SIRI JAGAN, J. ================== W.P.(C).No. 31487 of 2003 ================== Dated this the 22nd day of September, 2010 J U D G M E N T The petitioner was a Field Supervisor of the 3rd respondent bank. In 2000, as evidenced by Ext.P2, the petitioner was required to work as Field Supervisor in two banks, viz. Trikannad Branch from Monday to Wednesday and Melparamba Branch form Thursday to Saturday. On 7.8.2000, while he was working at Trikannad branch, since the manager of the Melparamba Branch and the second line officer of that branch were on leave, suddenly, the petitioner was directed through phone to go over to Melparamba Branch to officiate as the manager of that branch. As manager, the petitioner was to sanction jewel loans on the security of gold. In respect of four jewel loans sanctioned by the petitioner, it turned out that the gold given as security was spurious gold. In fact, for a period of over one year, 244 gold loans were sanctioned on the strength of the security of spurious loans, from the bank, out of which, 225 were given by the regular manager and 15 by the second line officer. On detection of this fraud, criminal cases were registered and disciplinary proceedings were initiated against the three officers and jewel appraiser. Although, in respect of the four loans sanctioned by the petitioner the CBI found that it is not necessary to array the petitioner as an accused and he was excluded from the w.p.c.31487/03 2 criminal proceedings, the bank issued Ext.P1 memo of charges to the petitioner alleging two misconducts. The first is that the petitioner accepted spurious ornaments from one Smt.M.Rabiya as security for jewel loans sanctioned to her, in violation of the security norms fixed by the bank for sanctioning of jewel loans and that the petitioner had sanctioned jewel loans to the said party exceeding the per party limit fixed by the head office under the petitioner's discretionary powers for sanctioning jewel loans, while officiating as the manager without obtaining approval from the competent authority for exceeding the per party limit for jewel loans. An enquiry was conducted. The petitioner was found guilty, based on which, the punishment of reduction to the lower grade, namely, to that of Clerical Cadre in the post of Clerk- Cum-Cashier with the basic pay of Rs.5060/- at the 10th stage in the pay scale of Rs.3020-8980, was imposed on the petitioner by the disciplinary authority, by Ext.P13 order. The petitioner filed an appeal and the appellate authority, by Ext.P15 order, reduced the punishment to one of reduction to the lowest scale in the time scale officers with basic pay of Rs.7100/-, ie, at the first stage in the pay scale of Rs.7100-12540, consequent to which, Ext.P16 order of fixation of pay was also issued. The petitioner is challenging Exts.P13, P15 and P16 orders in this writ petition. 2. The petitioner raises two contentions. The first is that the w.p.c.31487/03 3 findings of the enquiry officer are perverse and against the evidence in the enquiry. The second is that the punishment now imposed is shockingly disproportionate to the gravity of the misconducts found to have been committed by the petitioner. According to the petitioner, it was only by a chance that the petitioner was suddenly called to the branch to officiate as the manager without any prior intimation. There was a jewel appraiser in the bank, who had certified the gold to be of acceptable purity and weight, and the petitioner had only gone by his expert advice. According to him, he, as a Field Supervisor, is not well versed in the task of appraising of gold and when he was suddenly asked to officiate as the manager, he had no other go but to go by the expert advice of the jewel appraiser, which only he did. Even then, the enquiry officer perversely entered a finding that the petitioner did it knowingly with dishonest intention, which itself shows perverse nature of the findings of the enquiry officer. 3. As far as the second charge is concerned, the contention of the petitioner is that the petitioner bona fide believed that the manager could sanction loans in excess of the limit prescribed in exceptional cases and obtain ex post facto sanction for the same. He submits that in his evidence he had specifically deposed that the regular manager had instructed him to entertain gold loan proposals even if it exceeds per party limit and also that he would obtain w.p.c.31487/03 4 ratification later. He also deposed that the area manager also told him that the absence of regular manager should not be a hindrance in entertaining gold loan proposals. The petitioner would contend that his evidence has not been challenged in the cross-examination. He would, therefore, submit that even assuming that the petitioner is guilty of any misconduct, that can only be of a very technical nature, which does not deserve the shockingly disproportionate punishment of reduction to the lower stage in the time scale of officers. According to the petitioner, at the relevant time, he was drawing a basic pay of Rs.11200/- which has been reduced to Rs.7100/-, which, in the circumstances of the case, is shockingly disproportionate to the gravity of the misconducts allegedly to have been committed by the petitioner insofar as by the same, benefits of 13-14 years of his service have been wiped off. 4. A counter affidavit has been filed by the respondents to controvert the contentions of the petitioner. According to them, it is the absolute responsibility of the manager to see that the gold offered as security for jewel loans is of appropriate purity and weight. It is submitted that the fact that the jewel appraiser had certified the gold to be of sufficient purity, does not exonerate the manager from confirming the gold of appropriate purity. It is pointed out by the learned counsel for the bank that in the jewel appraisal report, the w.p.c.31487/03 5 purity of the gold has not been specifically mentioned, despite which, the petitioner had sanctioned loans without directing the jewel appraiser to confirm the purity of gold, which would add to the gravity of the misconducts committed by the petitioner. Regarding the second charge, it is submitted that the petitioner has admitted that he had exceeded the per party limit in sanctioning those loans, which he could not have done without obtaining prior sanction from the competent authority. He cannot escape by saying that the regular manager had permitted him to do so with the assurance that he would get ratification of the same later. As the manager, even for a day, it was his duty to see that the rules and regulations of the bank in the matter of sanctioning loans were scrupulously followed, which admittedly the petitioner had failed to. Therefore, according to the counsel for the bank, the petitioner deserves no sympathy or leniency. 5. As regards the proportionality of the punishment, he would contend that taking into account all evidence of the case, the appellate authority had reduced the punishment from reduction to a lower grade in the clerical cadre as Clerk-cum-Cashier to one of reduction to the lowest scale in the time scale of officers. According to the counsel for th bank, that punishment cannot be considered to be shockingly disproportionate to the gravity of the misconducts committed by the petitioner. w.p.c.31487/03 6 6. I have considered the rival contentions in detail. 7. From the pleadings and documents before me, it cannot be disputed that the gold in question was spurious gold. It is also not disputed that the petitioner was called in to officiate as the manager for two days summoning him by a phone call. It is also not disputed that the jewel appraiser had in fact certified the gold to be of sufficient purity and the petitioner was working only as a Field Supervisor at the relevant time. There is nothing on record to show that prior to that date, he had any experience in appraising gold articles. In such circumstances, I do not think that it can be said that the petitioner knowingly accepted spurious gold especially in view of the history of the bank for the past year. 240 gold loans had been given on the strength of security of spurious gold over a period of one year. The former manager, the second line officer and the jewel appraiser were accused in the criminal case charged in respect thereof. The petitioner came into that branch purely by chance for two days. It is further relevant to note that by the effort of the petitioner, the petitioner was able to recoup the amounts due in respect of the four loans granted by him and, as such, in respect of those four loans, ultimately, the bank did not suffer any loss. In view of the above circumstances, I am not inclined to accept the findings of the enquiry officer that the petitioner knowingly accepted spurious gold as security with the intention to w.p.c.31487/03 7 defraud the bank or even to help the borrower. At the most, it can only be termed to be lack of discretion on the part of the petitioner or negligence in his duties. Certainly, as far as the second misconduct is concerned, admittedly the petitioner granted loans in excess of the per party limit fixed by the head office of the bank. The petitioner's contention is that he acted on the advice of the regular manager who assured him that even if the petitioner exceeds the per party limit, he would obtain ratification later. I put a specific question to the learned counsel for the bank as to whether there was such a practice in the bank of getting ex post facto sanction for granting loans in excess of the per party limit prescribed by the head office. The counsel could not give me any satisfactory answer either way in respect thereof. The counsel for the petitioner would assert that there is such a practice followed in the bank. Whatever that be, I am of opinion that the misconducts committed by the petitioner in the particular circumstances in which he did the same, cannot be grievous enough to merit such a drastic reduction in his basic pay from Rs.11200/- to Rs.7100/-. The petitioner would contend that the same would, in fact, wipe off 13 to 14 years of his service. I am satisfied that taking into account the circumstances of the case and the punishment imposed, the punishment is shockingly disproportionate to the gravity of the misconducts committed by the petitioner. Therefore, I am of opinion w.p.c.31487/03 8 that the disciplinary authority should take a second look into the quantum of punishment imposed on the petitioner. To that extent, the impugned orders are quashed. The 1st respondent is directed to reconsider the question of punishment to be imposed on the petitioner for the misconducts committed by him in the light of the observations made above. Orders in this regard shall be passed, as expeditiously as possible, at any rate, within two months from the date of receipt of a certified copy of this judgment, after affording an opportunity of being heard to the petitioner. The writ petition is disposed of as above. Sd/- sdk+ S.SIRI JAGAN, JUDGE ///True copy/// P.A. to Judge