In the High Court of Judicature at Madras Dated: 29.01.2008 Coram: The Honourable Mr.Justice ELIPE DHARMA RAO and The Honourable Mr.Justice S.R.SINGHARAVELU Writ Appeal No.572 of 2002 Canara Bank by its General Manager, I.R.Section, Head Office, 112, J.C.Road, Bangalore-2. ..Appellant/Petitioner ..vs.. 1. The Presiding Officer, Industrial Tribunal, Chennai. 2. N.Krishnamoorthy ..Respondents/Respondents Writ Appeal filed under Clause 15 of the Letters Patent, against the Order passed in W.P.No.1313 of 1996 dated 14.12.2001. Petition filed under Article 226 of the constitution of India to issue a writ of Certiorari call for the records of the 1st respondent in I.D.No.33/92 and quash its Award dated 19.9.95. For Appellant : Mr.Karthick for M/s.T.S.Gopalan & Co., For Respondents : Mr.N.G.R.Prasad for M/s.Row & Reddy for R2 JUDGMENT S.R.SINGHARAVELU, J., The writ appeal is directed against the order of the learned single Judge dated 14.12.2001 in W.P.No.1313 of 1996. 2. The case of the appellant/petitioner is that the second https://hcservices.ecourts.gov.in/hcservices/ respondent employee who was working as a Shroff, Uthamapalayam Branch of the Bank was charge sheeted for alleged misconduct within the meaning of Chapter-XI Regulation 3 Clause(I) of the Canara Bank Service Code. The crux of the charge is that the second respondent by making wrongful entries in the record, had caused cash shortage of Rs.50,000/- and had misappropriated the said amount. The criminal complaint which was filed against him ultimately ended in acquittal by order dated 16.12.1988. Subsequently, disciplinary proceedings commenced and charge memo was issued on 31.01.1989. An enquiry was conducted and on the basis of the Enquiry Officer's findings and recommendations, the Deputy General Manager being the Disciplinary Authority dismissed the second respondent from service. Aggrieved by the same, the employee raised a dispute in I.D.No.33 of 1992. Though the Industrial Tribunal, Chennai, by its order dated 19.09.1995, found that the charges were established; however, in the facts and circumstances of the case, the punishment of dismissal was set aside and the management was directed to reinstate him in service without continuity of service and without backwages and imposed a punishment of withholding four increments with cumulative effect. Hence, the bank filed the writ petition to quash the award passed by the Tribunal. 3. After hearing both sides and perusing the records, the learned Judge dismissed the writ petition. Aggrieved by the same, the petitioner bank filed the present appeal. 4. Heard the learned counsel for both sides. 5. The second respondent, by name, Krishnamoorthy was working as a Shroff in the Uthamapalayam Branch of Canara Bank. He was charge sheeted for alleged misconduct. The charge is that the 2nd respondent, by making wrongful entries in the record, had caused cash shortage of Rs.50,000/- and also had misappropriated the same. A criminal complaint filed against him in this regard ended in acquittal by order dated 16.12.1988. Subsequently, disciplinary proceedings commenced and charge memo was issued on 31.01.1989. The Deputy General Manager was the disciplinary authority. He, accepting the Enquiry Officer's reports and findings, had dismissed the second respondent from service. 6. Aggrieved over the same, the second respondent employee raised a dispute in I.A.33 of 1992. Though the Industrial Tribunal, by its order dated 19.09.1995 found that the charges were established, the punishment of dismissal was set aside and the management was directed to reinstate him without continuity of service and without backwages and imposed the punishment of withholding four increments with cumulative effect. 7. After sustaining the charges as proved and imposing punishment of stoppage of four increments with cumulative effect upon setting aside the order of dismissal, the order of the Tribunal was grounded on for the following charges: https://hcservices.ecourts.gov.in/hcservices/ (i) The delinquent belongs to Scheduled Caste; (ii) The bank did not lose anything because he had repaid the amount; (iii) Unemployment in our country; (iv) The delinquent had already suffered mental torture; (v) There will be no chance for him to get another job if he is dismissed on the ground of misappropriation; (vi) Punishment of dismissal at a young age is very severe; (vii) He had unblemished record of service prior to the incident. 8. As against the said award of the Tribunal, the employer Canara Bank has preferred W.P.1313 of 1996 in order to quash the said award dated 19.09.1995. 9. The learned single Judge, while dealing with the above reasons given by the Tribunal, has found that except the last ground No.(vii), all other reasons given by the Tribunal are perverse and unsustainable to justify a person, who is found guilty of misappropriation for being reinstated in service. It was further held that the exercise of discretion by the Tribunal was positively unreasonable. 10. The Tribunal ultimately held, among others, that the order dismissing the employee has to be set aside and the entire proceedings have to be started afresh at the stage of Enquiry Authority giving show cause notice to the delinquent again as regards his recommendations of punishment. Since the proceedings relate to action which was initiated in the year 1987, the learned single Judge thought that no useful purpose would be served by recommencing the proceedings once again after 14 years. Therefore, the learned single Judge found that though the reasons given by the Tribunal for interfering with the quantum of punishment were not proper, yet taking into account the employee had unblemished earlier service, it was held that the bank may use its discretion and post him in any equivalent post which does not involve any sensitive work or handling monetary matters. The following are the reasons given for the above decision taken by the learned single Judge; (I) The Enquiry Officer, apart from rendering his finding, had gone a step further and recommended the punishment of dismissal. (II) Clause 11 of Specific Code of Service provides that in awarding punishment, the authority shall take into account the gravity of the misconduct, previous record of the employee and any other aggravating or extenuating circumstances which may exist. The learned single Judge has found that in this case, there is no dispute about the fact that the disciplinary authority had not complied with this requirement. (III) The observation in (1996)(D) SCC 364 (State Bank of Patiala ..vs.. S.K.Sharam that principles of natural justice https://hcservices.ecourts.gov.in/hcservices/ would assume importance only in the event of prejudice being caused to the party, will not apply to the facts of the present case as the said requirements are embodied in the service conditions nor has the delinquent waived those requirement. While on these above points the order of dismissal suffered, it was held that there is no need for re-enquiry after 14 years from the initiation of the proceedings i.e.1987. Therefore, the learned single Judge directed the employer to post the employee in any equivalent post, which does not involve any sensitive work or handling monetary matters. 11. Mr.Karthick, learned counsel appearing for the appellant bank vehemently contended that honesty is required in its full sense of the term, especially in banking industry and when a Shroff like the 2nd respondent, who is to handle public money was found guilty of the charge of misappropriation to the tune of Rs.50,000/-, it is quite dangerous to reinstate him, especially when both Tribunal as well as the learned single Judge found that factually the misappropriation was proved against the said employee. 12. Mr.N.G.R.Prasad, learned counsel appearing for the 2nd respondent submitted that right from the beginning it is a total denial of the charge of misappropriation. Simply because he has not preferred any proceedings against the award in I.D.No.33 of 1992, he is not estopped from submitting his arguments regarding his case that the charge has not been legally proved against him. 13. So far as the act of misappropriation is concerned, as per the evidence of the management witness one Kannan, the brother of the petitioner, came to the bank on the date of alleged occurrence i.e.26.11.1987, got the amount of Rs.50,000/- and deposited in 'Kshemanidhi cash certificate with Corporation Bank, Namakkal on 30.11.1987. Copy of the said Certificate Ex.M.E.24 was marked in the enquiry proceedings, which was objected to. Relying upon the observation made in 1987(2) L.L.J 404, the arguments advanced on the side of the employee that reliance cannot be placed on copies of fixed deposits and therefore, Ex.M.E.24 is to be eschewed. But the Tribunal held that the original is not in the custody of the issuing bank or that of the employer in this case; when it is found only in the custody of Kannan, the brother of the petitioner, the latter ought to have examined his brother, who would either produce the original or be competent to deny the copy through Ex.ME.24. Therefore, the evidence of Ex.ME.24-the copy of the Nidhi Certificate was accepted. Even accepting that Kannan, the brother had deposited a sum of Rs.50,000/- on 30.11.1987 in the Corporation Bank, Namakkal, unless it is proved that, that money was obtained from the delinquent employee, Krishnamoorthy, then no case of misappropriation will get established. 14. Again, simply because the delinquent has subsequently remitted https://hcservices.ecourts.gov.in/hcservices/ the shortage amount of Rs.50,000/- into the employer Bank, that does not mean that he had admitted the alleged offence of embezzlement. All through the proceedings of the domestic enquiry, he was denying the correctness of the documents and the corrections supplied thereon. Therefore, any attempt on his part in avoiding the criminal proceedings running the risk of being getting arrested by the police on complaint by the employer cannot be labelled as an admission on his part. So, the act of subsequent remittance of the shortage amount may not be taken as an admission on his part. There can also be no conviction in the criminal proceedings based upon admission especially, evidence in proof of the offence is lacking. Even in a case of domestic enquiry, where the theory of preponderance of probability is applied, it is not as if guilt could be admitted based upon which service can be terminated. There should be enough material against the delinquent in proof of the charge levelled against him. Thus, when there is no satisfactory evidence for alleged delivery of amount of Rs.50,000/- by the delinquent to his brother Kannan, the latter's deposit even if proved in Corporation Bank, Namakkal would not constitute the proof of the charge. Similarly, as mentioned earlier the subsequent remittance may not also go against the delinquent. 15. Mr.N.G.R.Prasad, learned counsel pointed out that the charge itself is only for shortage of money and not the charge of misappropriation and submitted that the punishment cannot go beyond the scope of charges. However, emphasis was laid on the point that the charges have not at all been proved; and that under the guise of reappraisal of evidence, this Court cannot become blind in respect of mechanical manner in which the Tribunal has viewed the evidence on record on the side of the management; especially in this case, where the delinquent has left the bank premises at 5.00 PM on 26.11.1987, the date of occurrence, after handing over the amount at collection in cash in the said bank, namely, Rs.2,47,000/-. Subsequently, it was found that there was shortage of Rs.50,000/- and so at about 8.00 PM he was taken from a cinema theatre; in the meantime even according to the evidence on the side of the management, the Manager had supplied correction in Ex.M.E.4 as if it is Rs.2,97,000/-. Ex.M.E.2 debit slip and Ex.M.E.4 receipt for the remittance of the cash to the Currency Chest were said to have been prepared by the Clerk Jayakumar, who was examined as M.W.3. In Ex.M.E.4 there was omission to mention 10 rupee denomination. That was subsequently filled up by the Manager after the currency chest people reported that there was a omission of 10 rupee denomination. Likewise, Ex.M.E.4 receipt for the remittance of the cash to the currency chest prepared by none else than the Clerk Jayakumar also contained the figure of Rs.2,97,000/-, which was written in words as Rs.2,47,000/-. The very same Clerk Jayakumar states that he has written Ex.M.E.2 and 4 only as per Ex.M.E.3 which was the denomination slip prepared by the delinquent; wherein also in figure it is Rs.2,47,000/- and in words it is Rs.2,97,000/-. Who has supplied that correction is not known. In this context, it is to be emphasized that the delinquent https://hcservices.ecourts.gov.in/hcservices/ denied that he supplied such corrections in Ex.M.E.3. Then the question arises as to why the clerk Jayakumar, who claims to have written Ex.M.E.2 and 4 keeping down Ex.M.E.3 which was prepared by delinquent, has not applied his mind about the two set of figures given in Ex.M.E.3. Any normal prudent person in the place of clerk Jayakumar should have immediately brought the correction in Ex.M.E.3 indicating two figures to the Manager, which has not been done so. This would go to probabilise that at the time when clerk Jayakumar received Ex.M.E.3 from the delinquent, it contained no correction; and it get strengthened the fact that two figures in Ex.M.E.4 were not scribed by clerk Jayakumar and he wrote only one figure that was supplied correction by the Manager at the later point of time. Therefore, the origin of Ex.M.E.4 contained only one figure. Inasmuch as it was a replica of Ex.M.E.3 naturallay Ex.M.E.3 should have contained only one figure and that is why no complaint was made by clerk Jayakumar to the Manager at the time of his receipt of Ex.M.E.3. Thus, the probability is that Ex.M.E.3 would be supplied with two figures only at a later point of time and who supplied is still a mystery. 16. Another question that would arise is that although Ex.M.E.2 and 4 were prepared by Clerk Jayakumar and the second figure was supplied by the manager as a correction in Ex.M.E.4, then why should Jayakumar himself make two figures in Ex.M.E.2. Now, the answer made by Jayakumar before the domestic enquiry was that he prepared Ex.M.E.2 and 4 on the basis of rough denomination slip given by the delinquent through Ex.M.15, where mention was made as Rs.2,97,000/-. Ex.M-15 is said to be the payment waste entry. It was claimed to have been at the handwriting of the delinquent. Even though the denial was made by him, no scientific proof is available to show that Ex.M-15 was prepared by delinquent himself. 17. Thus, explanation given on the side of the management was that originally delinquent gave Ex.M.E.3 containing figure of the amount of Rs.2,47,000/-, based upon which Ex.M.E.2 and 4 were prepared by clerk Jayakumar; that subsequently when omission of 10 rupee denomination was found and reported by currency chest people, the manager supplied correction in Ex.M.E.4 as Rs.2,97,000/-; that after finding Ex.M-15 the payment waste entry, wherein the delinquent seems to have made an entry of Rs.2,97,000/-, then the other person in the office have corrected corresponding supply in Ex.M.E.2 also. Now, the whole question that revolves round is as to who has written Ex.M.15, so that it could be copied down in other document like Ex.M.E.2. Even here scientific proof is lacking against the second respondent workman. 18. One more important context is that when a particular amount is tendered by delinquent to the currency chest officials and when they have received the same at 5.00 PM is it proper on their part to tell at 8.00PM and especially when the delinquent had left the premises even at 5.00 PM that there is shortage. It is for them to have verified the https://hcservices.ecourts.gov.in/hcservices/ amount and received from the delinquent. Once they received so, they should not fumble upon the quantum that was received and express it in supplying some corrections in record. Had they put their hands down immediately when receipt of money was made from delinquent and if it was counted in his presence and verified, then one can fix the liability upon the delinquent. When that was not done and some corrections were also admitted in the records regarding the quantum that was received, then they themselves would give a room for any delinquent to say that he has remitted the correct amount and somebody was responsible for the shortage. When this kind of probability comes into picture, it is very difficult to fix the liability on one individual. Before ever a criminal liability is fastened upon an individual, proof is required and even what is contemplated in domestic enquiry is only preponderance of the probability, all the probability should be such that they indicate the guilt of the delinquent and only that the latter. When once the probability goes to indicate somebody else also, then the means in and by which one was squarely fixed cannot be said to be correct. 19. Learned counsel for the appellant bank relied on P.D.Agarwal ..vs.. State Bank of India and others ((2006) 8 SCC 776), wherein it was held that "the validity of the disciplinary proceeding and/or justifiability thereof on the ground of delay or otherwise had never been raised by the appellant before any forum. It was not his case either before the Appellate Authority or before the High Court that by reason of any delay in initiating the disciplinary proceeding he had been prejudiced in any manner whatsoever. It may be true that delay itself may be a ground for arriving at a finding that enquiry proceeding was vitiated in the event it is shown that by reason thereof the delinquent officer has been prejudiced, but no such case was made out". But, in the present case, there was no delay in initiating disciplinary proceedings and, hence, this decision is not applicable to the case on hand. 20. Further, he relied on a judgment in SLP (c) No.14491 of 2001, (UCO Bank, Chandigarh & others ..vs.. Hardev Singh), wherein it was observed as follows: "One expects the higher standards of honesty and integrity. When admittedly small amounts deposited by the bank's customers do not find their way into the coffers of the bank but land up in the pocket of an employee, to say that the charge is not serious or the embezzlement is not intentional would be gross understatement, the least to say. The charge framed was serious and normally punishment of dismissal from service would have been logical course to take. Keeping in view the past service of the respondent and other relevant factors into consideration, the punishment of removal only was imposed. The Bank, in a sense, has been more then considerate towards the respondent because with the punishment of removal https://hcservices.ecourts.gov.in/hcservices/ being imposed pensionary benefits etc.are not denied. The decision of the High Court to direct the reinstatement was uncalled for". 21. Reliance is placed upon the decision Suresh Pathrella ..vs.. Oriental Bank of Commerce (2006-AIR SCW 573-SC), wherein it was held as follows: "....every officer of the bank at all times take all possible steps to protect the interest of the bank and discharge his duties with utmost integrity, devotion and diligence and do nothing which will be unbecoming of a bank officer. It is a case of loss of confidence in the officer by the bank. In such a situation, it would be a futile exercise of judicial review to embark upon the decision of the disciplinary authority removing the officer from service, preceded by an enquiry, and to direct the bank to take back the officer in whom the bank has lost confidence, unless the decision to remove the officer is tainted with malafide, or in violation of principles of natural justice and prejudice to the officer is made out". 22. In the case of Regional Manager, U.P.SRTC..vs.. Hoti Lal (2003) 3 SCC 605, the Supreme Court has held as follows: "If the charged employee holds a position of trust where honesty and integrity are inbuilt requirements of functioning, it would not be proper to deal with the matter leniently. Misconduct in such cases has to be dealt with iron hands. Where the person deals with public money or is engaged in financial transaction or acts in a fiduciary capacity, the highest degree of integrity and trustworthiness is a must and unexceptionable. Judged in that background, conclusions of the Division Bench of the High Court do not appear to be proper. We set aside the same and restore order of the learned single Judge upholding order of dismissal". 23. On the other hand, learned counsel for the second respondent workman relied on Asstt.General Manager, SBI ..vs.. Thomas Jose and another ((2000) 10 SCC 280) wherein it was held that, "A bank deals with public moneys. Misappropriation by an employee of a bank is misappropriation of public moneys and must be treated very differently. Misconduct such as this cannot be treated as lightly as it has been done. We think that the appropriate order should at least have been of reinstatement without back wages plus a direction that the first respondent would not be entitled to any increments for a substantial period with all the cumulative consequences of such an order". https://hcservices.ecourts.gov.in/hcservices/ This decision is applicable to the case on hand in all fours. 24. As stated earlier, the Tribunal has set aside the punishment of dismissal and directed the management to reinstate the second respondent without continuity of service and without backwages and imposed the punishment of withholding four increments with cumulative effect. The learned single Judge, while confirming the order of the Tribunal, has observed that the bank may use its discretion and post him in any equivalent post which does not involve any sensitive work or handling monetary matters. We are in full agreement with the order passed by the learned single Judge. 25. For the foregoing reasons and taking into consideration the decision of the Apex Court in (2000) 10 SCC 280 (cited supra), we are of the considered view that there is no reason to interfere with the order of the learned single Judge. Accordingly, the writ appeal is dismissed. No costs. Sd/ Asst.Registrar /true copy/ Sub Asst.Registrar gl To The Presiding Officer, Industrial Tribunal, Chennai. +1cc to Mr.T.S.Gopalan & Co., Advocate Sr 3944 +1cc to M/s.Row & Reddy, Advocate Sr 3699 CU (CO) km/13.2. Writ Appeal No.572 of 2002 https://hcservices.ecourts.gov.in/hcservices/