THE HON’BLE SRI JUSTICE NOOTY RAMAMOHANA RAO W.P.NO.7127 OF 2006 ORDER: The writ petitioner, who has been inflicted with the punishment of removal from service with superannuation benefits while working as a Senior Assistant with the State Bank of India, calls in question the legality and validity of the said order of punishment imposed by the Disciplinary Authority as confirmed by the Appellate Authority, in this writ petition. The writ petitioner was initially recruited as a Clerk- cum-Cashier to the service of the State Bank of India (henceforth referred to as ‘the Bank’) on 11-05-1987. During the year 2004, he was promoted as a Senior Assistant. At the relevant point of time, he was working at the Ponduru Branch of the Bank in Srikakulam District of Andhra Pradesh. He was initially placed under suspension by an order passed on 01-09-2004 alleging his involvement in certain acts of misconduct. The Disciplinary Authority has charge-sheeted the writ petitioner on 11-05-2005. Two counts of charges, which read as under, have been framed against him:- “ I. You had, with a fraudulent intention and to defraud the Bank, had received the amounts tendered at Teller counter by the account holders, issued counterfoils under your signature, entered in the relative pass books in your own handwriting, initialed in their pass books, returned the same to the respective account holders, not accounted for in the Branch books, misappropriated the cash so received and derived pecuniary benefit to yourself. The following are the examples : a) It is reported that on 03.08.04 Smt. Chintakayala Satyavathi tendered before you Rs.2,770/- in cash at the teller counter for credit into her S.B.Account No.01190085449. You made a credit entry in the relative pass book in your own hand writing, initialed the resultant balance thereon, returned the pass book containing the credit entry and the amount so received was not accounted for in the Branch books. b) It is also reported that on 05.08.04 Shri. Dunna Nagaraju tendered before you Rs.5,000/- in cash at the teller counter for credit into her S.B.Account No. 01190056336. You had issued a counterfoil for the amount deposited under your signature, made a credit entry in the relative pass book in your own hand writing, initialed the resultant balance thereon, returned the pass book containing the credit entry and the amount so received was not accounted for in the Branch books. II. You had borrowed money and placed yourself in a pecuniary obligation to outsiders in contravention of the Rules of Conduct governing your services. E.g., you had borrowed certain amount from M/s Mahakali Finance Corporation and failed to repay the amount so borrowed. As a result our Ponduru Branch received an Order dt.02.11.2004 from the Honourable Court of the Junior Civil Judge at Gajapathinagaram in E.P.No. 77/2004 arising out of O.S.No.65/2005 attaching your salary payable at the Branch.” Since, the writ petitioner had denied the charges leveled against him, an Enquiry Officer has been appointed for conducting an Oral Enquiry. The writ petitioner has been permitted to avail the services of one of the Assistant General Secretaries of the Union of employees of the Bank as his defense representative. During the course of inquiry, though six witnesses have been cited, only five of them have been examined. In all 23 exhibits have been exhibited, but however, one of them – Ex.P-18, has been disallowed as it has no bearing directly on the charges. The Branch Manager and Cash Officer of the Branch have been examined as PWs. 1 and 3. Smt. Chintakayala Sathyavathi, who complained that the writ petitioner had fraudulently made a credit entry of Rs.2,770/- in the passbook relating to her S.B.Account No.01190085449, has been examined as PW-6. Similarly, Smt. Aruna Kumari and her husband Sri Dunna Nagaraju, have been examined as PWs. 4 and 5, to establish the second limb of the first charge. The Enquiry Officer has submitted his report to the Disciplinary Authority on 03-09-2005. According to the Enquiry Officer, the first limb of that part of Charge No.1(a), relating to tendering cash of Rs.2,770/- by Smt. Chintakayala Sathyavathi, has not been held established. But, the subsequent limb of Charge No.1(a) relating to making an incorrect credit entry in her passbook by the charge-sheeted employee, has been held as established. The Enquiry Officer has also held the second limb of the first charge, namely, 1(b) as well as Charge No.2, as held established. The report of the Enquiry Officer together with one set of the Enquiry Proceedings, have been enclosed and supplied by the Disciplinary Authority to the writ petitioner, through his letter dated 23-09-2005. The Disciplinary Authority has indicated that he was in agreement with the findings of the Enquiry Officer in respect of Charge / Allegation Nos. 1(b) and 2 and that he proposed to disagree with the findings of the Enquiry Officer with regard to Charge / Allegation No.1(a) is concerned. He has assigned reasons therein as to why he comes to the conclusion that even Charge No.1(a) is liable to be held as established. The Disciplinary Authority called upon the writ petitioner to offer his submissions in the matter so as to enable the Disciplinary Authority to take a final view. The writ petitioner has drawn a detailed explanation on 29-10-2005 and submitted the same. After considering this explanation, the Disciplinary Authority had concluded that both the limbs of Charge No.I and Charge No.II are held established and consequently arrived at a tentative conclusion that the writ petitioner deserves to be inflicted with the punishment of removal from service with superannuation benefits. The Disciplinary Authority has further observed that the charge-sheeted employee may appear before him within seven days from the date of receipt of a communication to that effect, to show cause personally as to why the punishment should not be inflicted on him. According to the writ petitioner he tried unsuccessfully to secure the appointment of the Disciplinary Authority on two different occasions by visiting his office on 02-12-2005 and 03-12-2005, but on the both days, the writ petitioner was informed by the staff concerned that the Disciplinary Authority / 1st respondent is otherwise busy. However, the Disciplinary Authority concluded the entire matter by passing orders on 20-12-2005, inflicting the punishment of removal from service with superannuation benefits, duly observing that the petitioner has failed to avail the opportunity provided to him. The writ petitioner had drawn an Appeal against the same and submitted it on 25-01-2006, which was considered by the Appellate Authority and through his orders dated 02-03-2006 rejected it duly confirming the punishment imposed against the writ petitioner. Hence, this writ petition. I have heard the learned counsel for the writ petitioner, who has mainly attacked the impugned order of removal from service on the ground that it was passed in violation of the principles of natural justice, inasmuch as, an opportunity of hearing has been unjustly denied to the writ petitioner. The learned counsel has feebly attempted to project the order passed by the Disciplinary Authority as a result of perverse findings on the charges leveled against the writ petitioner. The specific acts of allegation thrown against the writ petitioner are fairly grave. They touch upon his integrity. To bring home the two limbs of Charge No.1, the Bank has taken care to examine the complainants as Pws. 4, 5 and 6. PW-6, Smt. Chintakayala Satyavathi, has specifically asserted that she has withdrawn a sum of Rs.6,770/- on 03-08-2004 from a S.B. Account of hers and from out of these proceeds she sought for depositing a sum of Rs.2,770/- to the credit of another S.B.Account of hers maintained with the same Bank. Therefore, the Disciplinary Authority had rightly disagreed with the findings of the Enquiry Officer as the said PW-6 is liable to be treated to have tendered a sum of Rs.2,770/- from out of Rs.6,770/- withdrawn by her from another account. When once a withdrawal slip proposing to withdraw a sum of Rs.6,770/- and simultaneously, a Pay-in-slip, seeking to deposit / credit another account with a sum of Rs.2,770/-, are tendered, all that is needed to be done by the Teller counter incharge is, to tender such a customer a sum of Rs.4,000/- only, instead of paying Rs.6,770/- and then collecting back Rs.2,770/- from such a customer. Therefore, the finding recorded by the Disciplinary Authority disagreeing with the Enquiry Officer’s finding cannot be characterized as a perverse finding. Insofar as the second limb of allegation is concerned, the discrepancies pointed out by the writ petitioner in the depositions made by PWs. 4 and 5 are so insignificant that they did not have any impact upon the main allegation relating to deposit of Rs.5,000/- sought for on 05-08-2004 by them, which amount though received by the petitioner was not brought into the books of account of the Bank. Therefore, very rightly both the Enquiry Officer as well as the Disciplinary Authority had concluded that Charge No.1(b) as held established against the writ petitioner. With regard to the second charge, it was hardly disputed or debated by the charge-sheeted employee. His defense was that, his borrowing money from a private agency to meet an urgent personal requirement of his cannot be characterized as a major misconduct. In my opinion, hardly anything turns around this aspect of the matter as the fact remains that the charge-sheeted employee did not dispute his borrowing money from a private agency and not repaying in time the said money to the said agency, inviting an Order of attachment of his salary by a competent Civil Court. However, the contention canvassed by the learned counsel for the writ petitioner, which deserves serious consideration is, that the Disciplinary Authority having provided an opportunity of hearing through his show cause notice dated 21-11-2005, has failed to provide the same actually, but proceeded to pass the impugned order on 20-12-2005 inflicting the punishment of removal on him and hence, principles of natural justice are grossly violated. The learned counsel for the writ petitioner has placed reliance upon the judgments rendered by the Supreme Court in UNION OF INDIA AND ANOTHER v. M/S. JESUS SALES CORPORATION[1], STATE BANK OF PATIALA AND OTHERS v. S.K. SHARMA[2], YOGINATH D. BAGDE v. STATE OF MAHARASHTRA AND ANOTHER[3] and STATE OF MAHARASHTRA AND OTHERS v. JALGAON MUNICIPAL COUNCIL AND OTHERS[4], in support of his contention that an opportunity of hearing, which is denied because the Disciplinary Authority was said to be busy, vitiates the impugned order of punishment imposed against the writ petitioner. Per contra, Sri E. Madan Mohan Rao, learned Standing Counsel for the respondent Bank submits that the charge-sheeted employee is only entitled for a reasonable opportunity to defend himself and that an opportunity of hearing does not mean a physical act of hearing the charge-sheeted employee, but it merely requires an opportunity to be provided for the charge- sheeted employee to show cause and put forth his objections, if any. The Disciplinary Authority, proceeds the argument of the learned Standing Counsel for the Bank, having given him an opportunity on 21-11-2005, has waited for a reasonable period of time and then passed the order on 20-12-2005, since the writ petitioner has neither availed the opportunity of hearing by soliciting any specific date of hearing in writing from the Disciplinary Authority nor by submitting his explanation to the proposed punishment. Therefore, the learned Standing Counsel would submit that the opportunity provided to the writ petitioner has not been availed by him and, therefore, it is not necessary to implore that a physical act of hearing is required to be undertaken by the Disciplinary Authority. The learned Standing Counsel would submit that the writ petitioner has not been able to demonstrate as to how the denial of the hearing by the Disciplinary Authority at the stage of inflicting the punishment has caused him any prejudice. He, therefore, contends that it is not enough for the writ petitioner to plead that there was a violation of the principles of natural justice, but he must also establish the resultant prejudice that is caused to him in the process. Further, the respondents have stoutly disputed the factual assertions of the writ petitioner in the following manner in Paragraph No.9 of their counter-affidavit, for which there was no reply filed: “ 9. With regard to the allegations in para 8 of the affidavit it is respectfully submitted that the tentative punishment order dated 21-11-2005 was conveyed to the petitioner granting him seven days time from the date of receipt of the order for appearing before the disciplinary authority would be construed that he had nothing to state in this regard and the orders would be issued making the proposed punishment absolute. The petitioner acknowledged the said order served on him by the Branch Manager, Ponduru on 26-11-2005 and did not send any communication either to the disciplinary directly or through the Branch Manager, Ponduru, regarding his willingness to avail the opportunity of personal hearing. However, the disciplinary authority confirmed the proposed punishment after about one month on 20-12-2005.” Principles of natural justice have, now, been recognized as forming an integral part of the concept of ‘reasonable opportunity’ required to be provided to every employee, who is likely to be visited with a grave punishment, which can impact him very adversely. But, at the same time, the principles of natural justice are not liable to be reduced to a straight jacket formula. They are flexible enough to be rationally and realistically applied to the prevailing fact situation. Drawing the contours broadly with regard to the applicability of the principles of natural justice, this is what the Supreme Court has pointed out in CHAIRMAN, BOARD OF MINING EXAMINATION AND CHIEF INSPECTOR OF MINES v. RAMJEE[5]. “Natural justice is no unruly horse, no lurking land mine, nor a judicial cure-all. If fairness is shown by the decision-maker to the man proceeded against, the form, features and the fundamentals of such essential processual propriety being conditioned by the facts and circumstances of each situation, no breach of natural justice can be complained of. Unnatural expansion of natural justice without reference to the administrative realities and other factors of a given case, can be exasperating. We can neither be financial nor fanatical but should be flexible yet firm in this jurisdiction. No man shall be hit below the belt - that is the conscience of the matter.” Subsequently, the Supreme Court has also pointed out that holding out a reasonable opportunity of hearing does not mean an act of physical hearing, but it implies of providing an opportunity to the person charged to explain his conduct and establish his defense before an adverse order is passed against him. In Paragraph No.5 of the judgment rendered by the Supreme Court in M/S. JESUS SALES CORPORATION case cited (1 supra), relied upon by the learned counsel for the writ petitioner, it is held in the following manner: “5. The High Court has primarily considered the question as to whether denying an opportunity to the appellant to be heard before his prayer to dispense with the deposit of the penalty is rejected, violates and contravenes the principles of natural justice. In that connection several judgments of this Court have been referred. It need not be pointed out that under different situations and conditions the requirement of compliance of the principle of natural justice vary. The Courts cannot insist that under all circumstances and under different statutory provisions personal hearings have to be afforded to the persons concerned. If this principle of affording personal hearing is extended whenever statutory authorities are vested with the power to exercise discretion in connection with statutory appeals, it shall lead to chaotic conditions. Many statutory appeals and applications are disposed of by the competent authorities who have been vested with powers to dispose of the same. Such authorities which shall be deemed to be quasi-judicial authorities are expected to apply their judicial mind over the grievances made by the appellant or applicants concerned, but it cannot be held that before dismissing such appeals or applications the appellants or the applicants, as the case may be. When principles of natural justice require an opportunity to be heard before an adverse order is passed on any appeal or application, it does not in all circumstances mean a personal hearing. The requirement is complied with by affording an opportunity to the person concerned to present his case before such quasi-judicial authority who is expected to apply his judicial mind to the issues involved. Of course, if in his own discretion if he requires the appellant or the applicant to be heard because of special facts and circumstances of the case, then certainly it is always open to such authority to decide the appeal or the application only after affording a personal hearing.” (Emphasis is mine) Further, the Supreme Court in S.K. SHARMA case cited (2 supra) has pointed out that every violation of the service regulation need not be viewed as vitiating the entire exercise. The employee was also required to demonstrate the prejudice that has been caused to him due to such violation. It will be highly useful to note how this theory have been jurisprudentially evolved and settled. It is held as follows: “10. …......... In the circumstances, it is possible to say that there has been a substantial compliance with the aforesaid subclause (iii) in the facts and circumstances of the case, though not a full compliance. This, in turn, raises the question whether each and every violation of rules or regulations governing the enquiry automatically vitiates the enquiry and the punishment awarded or whether the test of substantial compliance can be invoked in cases of such violation and whether the issue has to be examined from the point of view of prejudice. So far as the position obtaining under the Code of Civil Procedure and Code of Criminal Procedure is concerned, there are specific provisions thereunder providing for such situation. There is Section 99 of the Code of Civil Procedure and Chapter 35 of the Code of Criminal Procedure. Section 99 C.P.C. says, 'no decree shall be reversed or substantially varied nor shall any case be remanded in appeal on account of any misjoinder or non-joinder of parties or causes of action or any error, defect or irregularity in any proceedings in the suit, not affecting the merits of the case or the jurisdiction of Court." Section 465 (1) of the Criminal Procedure Code, which occurs in Chapter 35 similarly provides that "subject to the provisions hereinbefore contained, no finding, sentence or order passed by a Court of competent jurisdiction shall be reversed or altered by a Court of appeal, confirmation or revision on account of any error, omission or irregularity in the complaint, summons, warrant, proclamation, order, judgment or other proceedings before or during trial or in any enquiry or other proceeding under this Code or any error or irregularity in any sanction for the prosecution unless in the opinion of the Court a failure of justice has in fact been occasioned thereby. 11. It is not brought to our notice that the State Bank of Patiala (Officers') Service Regulation contains provision corresponding to Section 99 C. P. C. or Section 465 Cr. P. C. Does it mean that any and every violation of the regulations renders the enquiry and the punishment voidorwhether the principle underlying Section 99 C. P. C. and Section 465 Cr. P. C. is applicable in the case of disciplinary proceedings as well. In our opinion, the test in such cases should be one of prejudice, as would be later explained in this judgment. But this statement is subject to a rider. The regulations may contain substantive provisions, e.g., who is the authority competent to impose a particular punishment on a particular employee/ officer. Such provisions must be strictly complied with. But there may be any number of procedural provisions which stand on a different footing. We must hasten to add that even among procedural provisions, there may be some provisions which are of a fundamental nature in the case of which the theory of substantial compliance may not be applicable. For example, take a case where a rule expressly provides that the delinquent officer/employee shall be given an opportunity to produce evidence/ material in support of his case after the close of evidence of the other side. If no such opportunity is given at all in spite of a request therefor, it will be difficult to say that the enquiry is not vitiated. But in respect of many procedural provisions, it would be possible to apply the theory of substantial compliance or the test of prejudice, as the case may be. 16. We must, however, make it clear that it may be difficult to find uniformity in the large number of decided cases in United Kingdom. For Example, take the decision of the House of Lords in Malloch v. Aberdeen Corporation, (1971) 2 All ER 1278. It was a case where the concerned statute mandated that no resolution of a school board for the dismissal of a certificated teacher was to be valid unless notice of the motion for dismissal was sent to the teacher not less than three weeks previous to the meeting. And, further that the resolution for the dismissal was not to be valid unless agreed to by the majority of the full members of the board. The teacher concerned, Malloch, was informed more than three weeks in advance. But his written request for an opportunity to submit counter representations was not granted and though he was present at the decisive meeting, he was not permitted to state his case. The Court held that the statutory requirement of three weeks' notice before the decision was taken, conferred and implied right to be heard. It was not done. By the notice dated March 19, 1969, the service of the teacher was terminated with effect from April 24, 1969. The House of Lords held that the concerned teacher was denied by the education authority, which employed him, the hearing to which he was entitled. It was further found that the hearing to be afforded would not be a useless formality, as there was an arguable case for the teacher. Nonetheless, it was observed by Lord Reid (at p. 1283) : "..............it was argued that to have afforded a hearing to the appellant before dismissing him would have been a useless formality because whatever he might have said could have made no difference. If that could be clearly demonstrated it might be a good answer. Lord Guest (at p. 1291) not only agreed with the above statement but also applied the test of prejudice. He observed : "A great many arguments might have been put forward but if none of them had any chance of success then I can see no good reason why the respondents should have given the appellant a hearing, nor can I see that he was prejudiced in any way." Lord Wilberforce too stated the principle in the following words (at p. 1294) : "The appellant has first to show that his position was such that he had, in principle, a right to make representations before a decision against him was taken. But to show this is not necessarily enough, unless he can also show that if admitted to state his case he had a case of substance to make. A breach of procedure, whether called a failure of natural justice, or an essential administrative fault cannot give him a remedy in the Courts, unless behind it there is something of substance which has been lost by the failure. The Court does not act in vain." 17. In R. v. Secretary of State for Transport, exparte Gwent County Council, (1987) 1 All ER 161, the Court of Appeal too applied the test of prejudice in a case of enhancement of toll charges over a bridge. The Act provided for a public hearing before effecting increase. Dealing with a complaint of