IN THE HIGH COURT OF JUDICATURE AT PATNA Civil Writ Jurisdiction Case No.18715 of 2010 Bishnu Ram, s/o- Late Shambhu Ram, r/o- Krishnakunj, Kalirakha, June Pokhar, at and P.O.- Deoghar, District- Deoghar. ….. Petitioner Versus 1. UCO Bank through General Manager, Personnel Services Department, UCO Bank Head Office, Salt Lake, Kolkata. 2. General Manager, Personnel Services Department, UCO Bank Head Office, Salt Lake, Kolkata. 3. Assistant General Manager, UCO Bank, Zonal Office, Central Jail Road, Jawaripur, Bhagalpur. …. Respondents For the petitioner : Mr. Chitranjan Sinha, Sr. Advocate Mr. Sidhartha Prasad, Advocate For the Bank : Mrs. Nilu Agrawal, Advocate. 10 30.08.2011 Petitioner was serving as Branch Manager of Shambhuganj Branch of the United Commercial Bank (for short “the respondent Bank”) between 2004-08. He was transferred therefrom in June, 2008 and posted at Mesra Branch of the respondent Bank on 17.6.2009. On 7.7.2009, he was served with statement of allegation/articles of charge relating to gross violation of lending norms of the respondent Bank in sanctioning and disbursement of different types of loans/advances during his posting as Branch Manager, Shambhuganj Branch. Petitioner submitted his reply thereto on 24.7.2009 (Annexure-2). This was followed by a departmental enquiry in which he participated. In the meantime, on 31.7.2009, he superannuated from the service of respondent Bank. On completion of enquiry proceeding, the enquiry report was submitted in which two of the charges/allegations were found fully proved. Rest seven charges were found partially proved. The Disciplinary Authority on a consideration of the materials on record passed an order on 25.3.2010 (Annexure-3) whereby the petitioner was inflicted punishment of dismissal from service. Petitioner filed 2 appeal thereagainst(Annexure-4). The Appellate Authority of the respondent Bank by an order dated 4.10.2010 (Annexure-5) dismissed the appeal and affirmed the order passed by the Disciplinary Authority. Aforesaid order(s) passed by the Disciplinary Authority (Annexure-3) as well as the order dated 4.10.2010 (Annexure-5) passed by the Appellate Authority dismissing the appeal have been impugned by the petitioner in the present writ proceeding. Learned counsel, appearing in support of the application, criticized the order passed by the Disciplinary Authority on the ground that the documents exhibited on behalf of the management of the respondent Bank were not duly proved. The petitioner was not served with the enquiry report as also the second show cause notice enabling him to submit his explanation on the findings of the enquiry report. In the submission of learned counsel, the order passed by the Disciplinary Authority is, thus, fit to be interfered with and quashed. He relies in this regard on (2009) 2 SCC 570 (Roop Singh Negi vs. Punjab National Bank) and (1993) 4 SCC 727 (Managing Director, ECIL vs. b. Karunakar). The appellate order dated 4.10.2010 has been criticized on the ground that it is cryptic and does not set out reasons for not accepting the issues/points raised in the Memo of appeal. It has been contended that the Appellate Authority was exercising quasi judicial power and as such he was required to consider all the points raised in the Memo of appeal and assign reasons for not accepting them. In order to highlight the 3 requirements of law in the matter of consideration of appeal in departmental proceeding, the petitioner has placed reliance on the following judgments: (i) 2005 (3) P.L.J.C. 104 (SC) (Andhra Bank vs. Official Liquidator), and (ii) 2006 4 S.C.C. 713 (Narinder Mohan Arya vs. United India Insurance Co. Ltd) (paragraphs 33, and 36). It has also been contended that the punishment imposed on him is dis-proportionate to the gravity of charge(s) for which the proceeding was initiated. Per contra, learned counsel for the respondent Bank supported the impugned orders. It has been contended that the charges precisely relate to commissions and omissions in reckless financing under different schemes violating the Bank guidelines inasmuch as most of the advances made by the petitioner were found irregular, potential and/or non-performing assets. In substance, they relate to highly improper and irregular documentation in respect of the advances/loans disbursed to the beneficiaries. The audit report relating to the period of his posting as Branch Manager (2004-08) found and detected that during the said period, advances/loans worth Rs. 8 crores were disbursed out of which loans worth Rs. 05 crores (approx.) were found to be suffering from serious deficiencies in the matter of documentation relating to those advances as a result whereof those account(s) financed by the petitioner were found potential N.P.A. and/or Non- 4 Performing Assets. Learned counsel, referring to the Departmental Proceeding Report (DPR) (Annexure-B to the supplementary counter affidavit) submitted that in view of the contents of the DPR and the enquiry report (Annexure-A to the counter affidavit), it would appear that no prejudice has been caused to the petitioner as all the relevant documents were produced and made part of the Enquiry Report as Managements Exibits Nos. 1 to 110. Petitioner was given adequate opportunity to peruse the same and to summon any defence witness which was refused. The defence representative of the petitioner took a stand that the petitioner/delinquent would rely on those documents in order to put up his defence. In the submission of the petitioner, if no prejudice is caused much less serious prejudice then merely because enquiry report was not made available to the delinquent/petitioner affording him an opportunity to submit second show cause would not vitiate the proceeding and the order passed thereon. Learned counsel highlights that the petitioner was a senior officer serving the Bank in the capacity of Branch Manager. Ignorance of the relevant circulars/guidelines issued by the respondent Bank/National Bank for Agriculture and Rural Development (NABARD) cannot be a ground particularly in view of the stand taken by the defence representative in the enquiry proceeding. In this connection, she also relies on E.C.L. versus B. Karunakar (supra) as also on Union of India versus Alok Kumar (2010) 5 S.C.C. 349. In course of submission, learned counsel for the petitioner, 5 based on pleadings made in the rejoinder/reply to the counter affidavit, contended that there is no provision under the UCO Bank Officers, Employees (Discipline and Appeal) Regulation, 1976 (for short “ the Regulation”) particularly those contained in Regulation 4 thereof for imposition of penalty of dismissal from service after superannuation of the delinquent (petitioner). In reply, learned counsel for the respondents, relying on Annexure-C and Annexure-D to the supplementary counter affidavit contends that the orders contained in Annexure-C and the Regulation (as amended) do permit imposition of such penalty in case an employee during the pendency of the proceeding superannuates from service. I have heard the parties at great length and perused the relevant pleadings on record. Petitioner, while serving as Branch Manager during the period 2004-08 had made several advances under different schemes. The articles of charge/charge-sheet pertained to gross misuse of his lending power and violation of the norms/guidelines fixed by the Bank in the matter of financing under diverse schemes including UCO Hirak Jayanti Scheme, Cash Credit Account, M.S.T.P. scheme, UCO Shelter Scheme and UCO Shopper Scheme They, thus, relate to his integrity, honesty, devotion and diligence in discharge of his duties as the Branch Manager of the Branch under the respondent Bank. Petitioner was given an opportunity to submit his reply on the charge-sheet. The said opportunity was utilized as would appear from Annexure-2. The respondent Bank whereafter initiated a proceeding in which 6 he participated. On request, defence representative (DR) was also provided to the petitioner. Since the charges pertained to commission of gross defiance of the Bank’s norms/guidelines in the matter of financing under different schemes, the respondent Bank exhibited altogether 110 documents as Management Exhibits. All these documents were exhibited in presence of the petitioner and/or his defence representative. The enquiry proceeding was conducted almost on day to day basis in presence of the petitioner. Petitioner was given more than adequate opportunity to submit his list of documents/papers for his defence. On close scrutiny of the DPR (Annexure-B to the supplementary counter affidavit), it appears that the respondent Bank conducted the proceeding in a fair manner. The petitioner was given adequate opportunity to produce evidence (either documentary or oral) in order to make home his defence, if any. This Court is tempted to extract hereinbelow the following portion of enquiry report (Annexure-B to the supplementary counter affidavit): “ I have submitted sufficient evidence to prove the charge & allegation levelled against Shri B. Ram, C.S.O. and is enough to prove the charges. All the charges 1 to 9 stand proved. I would like to produce Sr. Manager, B/O, Shambhuganj as witness for verification of evidences procured from B/O Shambhuganj tomorrow. The C.S.O. and D.R. told that there is no need to produce the above witness of Sr. Manager of Shambhuganj Br.. So,, the E.O. told that the D.O. told the D.O. that there is no need to produce witness for the above mentioned purpose now. A corrigendum of statement of allegation and articles of charges dt. 7.7.09 issued to Shri Bishnu Ram, C.S.O. issued by the Asst. General manager (Disciplinary Authority) was received today. The E.O. asked the D.R. to submit his list of documents/papers on his evidence for his defence. 7 The D.R. told that he would not submit any document/paper as his evidence for his defence. I utilize the documents/papers submitted by the P.O. as his evidences for my defence wherever required.” The enquiry report is Annexure-A. It appears that all the relevant documents on which the respondent Bank placed reliance in order to demonstrate gross defiance of the norms and guidelines of the Bank in the matter of loan/advance under different schemes were brought on record by the Presenting Officer. I have already noticed the charges mainly pertained to reckless financing violating the Bank guidelines whereby most of the accounts financed by the delinquent petitioner was/were found irregular, potential N.P.A. or N.P.A. They, thus, essentially pertained to deficient documentations which resulted in the bank declaring major part(s) of such financing made by the petitioner as potential N.P.A. or N.P.A. Counsel for the respondents Bank took the Court through the enquiry report to show that on each charge, the defence representative was given an opportunity to submit any document/paper as his evidence to which a stand was taken that the documents/papers produced on record by the respondent Bank would be utilized by the delinquent for his defence. On perusal of the DPR (Annexure-B to the supplementary counter affidavit) as also the enquiry report (Annexure-A to the counter affidavit), this Court, taking into account the fact that the petitioner was a senior responsible officer of the Bank and was cognizant of all those documents/circulars/guidelines, finds no infirmity in the enquiry report rendering it unsustainable in law. The submissioni 8 of the petitioner that the documents/exhibits were not duly proved and brought on record seems to be an argument having no leg to stand. No parallel , in such matter can be drawn between a criminal proceeding and a departmental proceeding. The Court has only to see and satisfy whether the delinquent had the knowledge of those requirements in the matter of financing issued by the respondent Bank and the NABARD. Relevant documents indicating abnormal deficiencies in documentation for the purpose of such financing were made part of the records. The submission of the petitioner that the enquiry proceeding as well as the enquiry report would stand vitiated on the said count, in my view, is not sustainable in law. Another ground of attack is that non-supply of enquiry report to the petitioner has caused prejudice to him. Law, in this regard, has been well settled by a recent judgment of the Apex Court in the case of Union of India versus Alok Kumar (supra) wherein a distinction has been drawn between the apprehended prejudice and the de facto prejudice. The Court, while exercising power of judicial review in such matter, has to interfere only if the petitioner/delinquent is able to demonstrate a de facto prejudice. I have already found on perusal of the DPR (Annexure-B to the supplementary counter affidavit) and the enquiry report (Annexure- A to the counter affidavit) that the charges have been held proved (some of them partially) by bringing on record the relevant documentation got prepared by the petitioner as Branch Manager as also the relevant circulars/guidelines of the Bank. Those 9 documents were brought on record in presence of the petitioner and/or his defence representative whereafter he was given an opportunity to adduce oral/documentary evidence. The petitioner took a stand that no oral evidence was deemed necessary in the matter and that he would make his submissions based on the documents on record of the proceeding. In order to buttress the view taken by me that, considering the allegation, the documents brought on record were to be considered in order to find or hold that charges have been proved or not. I deem it apposite to extract some portion(s) of DPR (Annexure-B to the supplementary counter affidavit) by way of example. They are as follows: “Shopper Scheme. I proceed my submission a/c wise as under Ganesh Mehtar. He was sanctioned/disbursed Rs. 30,000=00 on 14.2.2007 under UCO Shopper Scheme. On the a/c following discrepancies are observed here under. As per H.O. circular No. CHO/ADV/04/05-06 dt. 22.4.05 marked as ME/02 Pre Sanction Visit Report (PSVR) is essential in sanctioning all the loan a/cs irrespective of the Scheme. But in this case, since it was not prepared and hence it is not on record as it is evident from ME-92. Further as per income certificate issued by C.O. Shambhuganj, it appears that the annual income of borrower Rs. 60,000=00 from service. But this fact is no where in the main application form (Me8) Several particulars of the appl. form from Sl. No. 2 to 10 is left blank. Purpose of the scheme is not mention on the application form. The appl. is undated and unsigned by the borrower. As per Scheme, personal guarantee of a person other than the applicant (acceptable to the bank) is required……..” “Charge & allegation No. 4 Shri B. Ram C.S.O. in gross misuse of his lending power violated all set norms of Bank while financing to the under noted borrowers under UCO Shelter Scheme. I am a/c wise as under. Mithilesh Chandra Jha & Meena Devi. They were sanctioned Rs.. 3.50 lacs on 8.8.06 under UCO 10 shelter. The irregularities are as follows. In main appl. form requirement and sources of fund and details of loan requested for are almost blank. Only amt. A loan is written there and guarantee portion on same appl. form is also blank. Since the guarantor portion is blank, we can not ascertain annual income of the guarantor.” It is thus found that there are/were relevant materials on record to come to a conclusion based thereon. Adequacy or reliability of these evidence/material cannot be gone into by a writ Court invoking its power of judicial review I, now, dwell upon another submission of the petitioner that under the relevant Regulation, the punishment of dismissal from service could not have been imposed on the petitioner after his superannuation. A stand has been taken that relevant Regulation of the respondent Bank does not permit such imposition. The respondents have taken a stand that by a communication dated 22.7.2009 (Annexure-C to the supplementary counter affidavit), the petitioner was informed in advance that he will be allowed to superannuate from the services of the Bank with effect from the date of superannuation (1.8.2009) but the disciplinary proceeding will continue as if he was still in service until completion of the proceeding and passing final orders thereon. Relying on the amended provisions of the Regulation as contained in 20(3)(iii), it has been contended that the Regulation provides continuation of such departmental proceeding until final orders are passed thereon by the competent authority. Regulation 20(3)(iii) reads as under: “20(3)(iii) The officer against whom disciplinary proceedings have been initiated will cease to be in 11 service on the date of superannuation but the disciplinary proceedings will continue as if he was in service until the proceedings are concluded and final order is passed in respect thereof. The concerned officer will not receive any pay and/or allowance after the date of superannuation. He will also not be entitled for the payment of retirement benefit till the proceedings are completed and final order is passed thereon except his own contributions to CPF” It thus appears that the Regulation governing the case of the petitioner does provide continuance of such proceeding and as such the submission of the petitioner is fit to be rejected. The contention of the petitioner that, punishment imposed is disproportionate to the gravity of charge, is also not sustainable in law since it is not the case that such punishment/penalty is not permissible under the relevant Regulation. Court in such matter cannot sit in appeal. It is for the authority under the relevant provision of law to consider and decide. Adverting to the next submission of the petitioner that the appellate order (Annexure-5) is bad in law since it does not set out reasons for not accepting the issues of law and fact raised therein. Learned counsel for the petitioner has highlighted in this regard that assigning reasons in support of the order is necessary in order to obviate arbitrariness. It is all the more necessary when the order is subject to scrutiny, when challenged, by a superior Court. Learned counsel for the petitioner has referred to and relied on the judgment of the Supreme Court in the case of Narinder Mohan Arya vs. United India Insurance Co. Ltd (supra). Petitioner has placed reliance on paragraph Nos. 33, 34 and 35 which read as under: 12 “33. An appellate order if it is in agreement with that of the disciplinary authority may not be a speaking order but the authority passing the same must show that there had been proper application of mind on his part as regards the compliance with the requirements of law while exercising his jurisdiction under Rule 37 of the Rules. 34. In Aparel Export Promotion Council v. A.K. Chopra which has heavily been relied upon by Mr. Gupta, this Court stated : (SCC p. 770, para 16) “16. The High Court appears to have overlooked the settled position that in departmental proceedings, the disciplinary authority is the sole judge of facts and in case an appeal is presented to the Appellate Authority, the Appellate Authority has also the power/and jurisdiction to reappreciate the evidence and come to its own conclusion, on facts, being the sole fact- finding authorities.” 35. The Appellate Authority, therefore, could not ignore to exercise the said power.“ It is the stand of the petitioner that the Appellate Authority after reciting the charges and the findings recorded thereon by the Disciplinary Authority has recorded that the delinquent had only requested for reducing the punishment awarded to him on the ground that the same was not commensurate with the charges pertaining to procedural lapses. Having said so, the respondent Appellate Authority, after recording the fact that the petitioner was a responsible officer heading the Branch and, therefore, the acts of commission and omission on his part was required to be dealt with firmly, rejected the appeal and upheld the order passed by the Disciplinary Authority. Learned counsel for the petitioner drawing attention of the Court to the Memo of Appeal (Annexure-4) submitted that issues relating to the finding(s) of fact recorded by the Disciplinary Authority under Charge Nos. 2 and 5 besides 13 other charges were also raised. On perusal of the Memo of Appeal, it appears that diverse issues of fact and law touching the consideration and finding of fact by the Disciplinary Authority were also raised. Relying on the averments made in the reply to the counter affidavit, it is contended, with reference to Charge No. 5, that loanees were State Government employees(salaried) who were advanced personal loans which are treated as secured loans by the respondent Bank. It is contended that the petitioner had raised those issues when possessed with the order of the disciplinary authority (Annexure-3) dealing with the enquiry report, in extenso, and as such, in all fairness, the respondent Appellate Authority was required to consider those issues of fact and law by a reasoned order which has not been done in the present case. Learned counsel for the respondent Bank, on the other hand, submitted that the appellate order was an order affirming the order of the Disciplinary Authority and as such, considering the contents thereof, it can be said that the same is a reasoned order, as in case of affirmation, the Appellate Authority is not required to assign, in detail, the reasons on each and every point raised in the Memo of Appeal. It appears from perusal of the Memo of Appeal that the petitioner questioned the findings recorded by the Enquiry Officer with reference to the charges, particularly, Charge No. 5 on certain grounds. It is to be kept in mind that the Enquiry Officer found charge Nos. 2 and 5 fully proved whereas other charges were found partially proved and the disciplinary authority quoted these findings in detail in his order (Annexure-3). Considering the 14 contents of the DPR (Annexure-B) as also the Enquiry Report (Annexure-A), I have already found that the non-supply of the enquiry report has not caused any prejudice to the petitioner. However, the delinquent while in possession of order of punishment (Annexure-3) quoting all relevant findings of the Enquiry Officer filed an appeal raising diverse issues of fact and law then the Appellate Authority is/was required to consider all those issues/points while deciding the appeal. At this stage, it is germane to notice the submission of the petitioner that punishment imposed on him, considering the allegation/charges is wholly disproportionate and/or excessive as the main charge(s) relate to advancements which is/are treated as secured loans by the respondent Bank. The Supreme Court in the case of Union Bank of India vs. Vishwa Mohan [(1998) 4 SCC 310] after considering several judgments including MD, ECIL versus K. Karunakar (supra) took the view that if the statutory appeal is filed by a delinquent and he had an opportunity to assail the contents of enquiry report then any defect in the decision making process would stand rectified. On a close perusal of the appellate order, in the backdrop of those facts, it appears that the same does not measure up to the requirement of law and thus requires interference. Accordingly, this Court sets aside the appellate order dated 4.10.2010 (Annexure-5) and remit the matter back to the respondent Appellate Authority to pass fresh order in accordance with law. Since the matter now goes on remand to the Appellate 15 Authority, the petitioner is granted liberty to supplement his Memo of Appeal by filing additional grounds, if any, within four weeks. The respondent Appellate Authority shall thereafter, ,reconsider the appeal and additional grounds of appeal filed, if any, and dispose of the same as quickly as possible in accordance with law. There shall be no order as to costs. pkj ( Kishore K. Mandal, J.)