D.C. Aggarwal (Dead) By Lrs vs State Bank Of India And Another

The appellants are the legal representatives of one D.C. Aggarwal, an erstwhile employee of the respondentState Bank of India, who have brought these appeals claiming: (a) the benefits of an extension in service of the said D.C. Aggarwal up to the age of sixty years; and (b) the benefits arising out of notional promotion which ought to have been granted to the said employee, etc. For the purpose of convenience, the said D.C. Aggarwal shall be referred to as "the appellant" in the course of our judgment.

Background to the Promotion Issue The appellant joined the respondent-bank as Probationary Officer on 15.1.1960. He got repeated promotions during the period 1960-1980, reaching all the way to Top Executive Grade Scale VI (hereinafter "TEGS VI") as a Deputy General Manager on 27.7.1980. On 4.1.1981, the appellant was posted as Deputy General Manager of the respondent-bank at Chandigarh and was put in charge of the respondent-bank's branches in the State of Haryana and in the Union Territory of Chandigarh. On 8.7.1981, the appellant's explanation was called for in respect of some irregularities pertaining to his work. He gave an explanation, which was not acceptable to the respondent-bank and on 11.7.1981, he was placed under suspension. The respondent- bank conducted an inquiry and the investigating officials held an ex- parte inquiry. The appellant challenged the investigation and the matter ultimately landed up in this Court. This Court disposed of the matter by a direction that the Central Vigilance Commission appoint an inquiry officer who would re-open the inquiry from the stage it was closed. Further directions were given so as to enable the parties to lead evidence and to ensure that the inquiry was conducted expeditiously.

The inquiry was conducted by one A.K. Rastogi, a senior IAS officer, who submitted his report on 30.5.1985 by which he exonerated the appellant of most of the major charges; and put on record that most of the charges were fabricated and were intended to denigrate the conduct of the appellant as a senior and responsible official of the bank. The report of A.K. Rastogi was considered by the Central Vigilance Commission, which, however, disagreed with his findings and found the charges proved against the appellant. It recommended that, at the very least, the appellant be removed from service. The Disciplinary Authority of the respondent-bank, through an elaborate order, agreed with the findings of the Central Vigilance Commission, except with regard to the recommendation on the quantum of punishment. It found that the recommended punishment of removal from service, was too harsh and instead imposed the punishment of demotion by two grades on the appellant. Consequently, the appellant was relegated to Middle Management Scale IV, virtually resulting in the forfeiture of almost more than a decade's service of the appellant. This order was confirmed by the executive committee of the respondent-bank on 4.11.1987. The appellant joined the demoted post of Secretary, Banking Services Recruitment Board, Chandigarh, though under protest. Within twenty-six days, he was transferred to Bhopal. He, however, did not join the post at Bhopal on the ground that it was against the rule for officers of Middle Management Grade Scale to be transferred out of the circle. After about six months, the transfer of the appellant was cancelled and he was permitted to join in the demoted post as Officer on Special Duty, Zonal Office, Chandigarh. A departmental appeal carried by the appellant against the order of the penalty imposed on him, was dismissed.

During the aforesaid period, the appellant was not considered for promotion to the post of General Manager (TEGS VII) on 1.8.1984, 20.2.1986, 8.6.1987, 1.8.1988, 24.4.1989 and 3.2.1992. Also, the appellant's case was not considered under the "sealed cover procedure" pending finalisation of the departmental proceedings. On 17.4.1989, the appellant moved a Civil Writ Petition No.15874/1989 challenging his order of demotion before the Punjab and Haryana High Court. The learned Single Judge allowed the writ petition and granted him the relief sought for. A Letters Patent Appeal No. 553/1991 carried by the respondent-bank was dismissed by the Division Bench of the High Court. The respondent-bank moved this Court by filing Special Leave Petition No. 10198/1991. This Court dismissed the appeal by holding that the appellant had been prejudiced in the matter of his defence; it was held:

Consequent to the aforesaid Order, on 7.11.1992, the appellant was transferred to Hyderabad as Deputy General Manager, but he refused to join there as a matter of protest and remained absent without leave. Subsequently, the appellant's posting in Hyderabad was cancelled and he was posted at Chandigarh once again and he retired with effect from 10.9.1993 after working as Deputy General Manager.

However, when the appellant was still in service, on 28.12.1992, the appellant was given a fresh showcause notice for an inquiry against him. The appellant challenged the fresh show cause notice by filing Contempt Petition No.1098/92 before the High Court in which two Managing Directors of the respondent-bank V. Mahadevan and P.V. Subba Rao were made respondents. The said respondents challenged the initiation of the contempt proceedings against them, before this Court, by Special Leave Petition Nos. 1707-08/1993. Leave was granted therein and Civil Appeal Nos. 1017- 18/1993 was disposed of by this Court with the following three directions :

Pursuant to the directions issued by this Court, the General Manager (Operations) Chandigarh issued a letter dated 26.8.1993 calling upon the appellant to attend an interview so as to adjudge his suitability for promotion to TEG Scale VII (General Manager's Post). The appellant appeared before the Interview Committee on 1.9.1993. The Committee awarded him only 25.7% marks as a result of which he was informed by a letter dated 8.9.1993 that his claim for promotion was rejected as he was found unsuitable by the Interview Committee. The appellant made a representation thereagainst to the Chairman of the respondent-bank. He also approached this Court by a Contempt Petition No. 324/1993 in Civil Appeal No. 4017-18/1993 for initiation of contempt proceedings against the respondent-bank and its officers. This Contempt Petition was withdrawn on 17.9.1993 with liberty to move the High Court for appropriate relief. The appellant thereupon filed Civil Writ Petition No.15245/1993 before the High Court by which he impugned the action of the respondent-bank in not granting him the promotion he sought. He also claimed therein salary from November 1992 to 16.6.1993, which was denied to him on the ground that he had failed to report to Hyderabad where he had been posted and had remained absent without leave.

The appellant's Writ Petition No. 15245/1993 was allowed on the ground that, under the policy applicable to the appellant's case, an interview by the Departmental Promotion Committee was not envisaged and that his claim for promotion had to be decided by an informal interview by the Managing Director and some other officers. The Single Judge also held that it could not be said that the appellant had been absenting himself from 8.11.1992 to 16.6.1993 as his posting at Hyderabad was unfair and had been cancelled. Thus, his claim for salary was allowed. The respondent-bank challenged the learned Single Judge's judgment by filing Letters Patent Appeal No. 364/1998 in which the appellant also filed cross-objections.

Background to the Extension Issue During the pendency of the litigation between the appellant and the respondent-bank, the appellant was granted extension in service from 10.3.1991 to 9.9.1993 i.e. upto the age of fifty-eight years by a letter dated 9.9.1993. He was also informed that the Review Committee had not recommended further extension of his service in terms of Rule 15 of the State Bank of India Service Rules; as a result of which, the appellant would retire on attaining the age of superannuation with effect from 10.9.1993. The appellant preferred an appeal before the Chairman of the respondent-bank, which was turned down. Thereafter, he filed Civil Writ Petition No.12062 of 1993, which was also dismissed by the Division Bench on 5.10.1993. He then carried Special Leave Petition 17752/1993 to this Court. Leave was granted therein and the resultant Civil Appeal No. 1609/1994 was allowed on 11.3.1994. This Court disposed of the appeal by the following operative order:

The respondent-bank filed I.A. No. 3/1994 for clarification of the aforesaid order on the ground that the Chairman and Managing Director is the Appellate Authority and as a consequence, he could not deal with the Committee to consider the case for extension of the appellant. It was pointed out that the appellant had made serious allegations against several senior officers, as a result of which, they could not be nominated as members of the Review Committee. Accordingly, in pursuance of the time bound directions of this Court, the Executive Body of the respondent-bank decided on 27.5.1994 to formally constitute a three-member committee comprising S. Doreswamy, Chairman-cum-Managing Director, Central Bank of India as its Chairman/Competent Authority, and the two other members were R. Vishwanathan, Deputy Managing Director (Commercial Banking) and G. Kathuria, Deputy Manager Director (Treasury and Investments Management). The three-member Review Committee would consider and decide the claim of the appellant for extension of his term in accordance with the rules. It was also made clear in the order of this Court that it was not open to the parties to challenge the constitution of the Committee in any further proceedings. It was also directed that, the Committee be constituted within two weeks and thereafter the Competent Authority take a decision within two weeks.

R. Vishwanathan and G. Kathuria held two meetings on 6.6.1994 and 9.6.1994 and on 16.6.1994 recommended to the Chairman/Competent Authority that it was not in the interest of the respondent-bank to extend the services of the appellant beyond the age of fifty-eight years. The Chairman accepted the recommendation on the very same day. All the three members of the Committee met on 16.6.1994, and recorded the minutes of the proceedings making a recommendation against granting an extension of service to the appellant. The appellant once again challenged this by way of Contempt Petition No. 4/1995 which was dismissed as withdrawn with liberty to impugn it by appropriate proceedings.

The appellant filed Civil Writ Petition No. 5567/1995 challenging the decision of the respondent-bank not to grant an extension to him. The learned Single Judge was of the view that the Committee was biased against the appellant on account of his history of previous litigation; that other officers who were not as competent as the appellant had been granted extensions up to the age of sixty years and thus, there was discrimination against the appellant. Consequently, the learned Single Judge interfered and set aside the recommendation and held that the action of the Review Committee and the Competent Authority was arbitrary. Thus, the writ petition was allowed and the relevant orders were quashed. The respondent- bank challenged the said judgment of the learned Single Judge in Letters Patent Appeal No.81/1999 in which the cross-objections were also filed by the appellant.

The Interview Committee noted that the appellant had been under suspension from 21.7.1981 to 12.11.1987 and his service upto 21.7.1981 only had to be taken into consideration for appraisal of the past performance of the appellant in the same manner as had been done for other eligible officers. Considering the case of the appellant on each of the relevant dates, the Committee found that although the appellant had obtained 60% marks for "performance appraisal", his performance at the interview was very poor as he had obtained only 25.7% marks. Thus, on each of the relevant dates, the Committee was of the view that his case could not be considered for promotion to TEGS VII. The High Court rightly points out that, whatever might have been the assessment of the appellant on the basis of an informal interview conducted under the promotion policy prior to 1982, he was now required to undergo a structured and formal interview before a Committee which would adjudge him on the basis of indicia as prescribed in the 1984 policy. We can hardly find fault with the Committee for its decision in rejecting the claim of the appellant for promotion to TEGS VII, which undoubtedly, is a grade at the highest level requiring extreme responsibility on the part of the officer concerned.

The Division Bench of the High Court by its impugned judgment dated 9.3.1999 referred commonly to the Letter Patent Appeals in the Promotion and Extension matters. It allowed both the appeals and set aside the judgments of the learned Single Judge by holding that the action of the respondent-bank was not liable to be interfered with on any ground. Hence this appeal.

If the bank considers that the continuance of services of an officer is desirable in the interest of the bank, it may allow him to continue beyond the age of superannuation. If the bank considers that the service of the officer is not required beyond the age of superannuation, that is the end of the matter. Further, non-extension of service is no reflection on the calibre of the officer and it carries no stigma.

In the result, we find no substance in both the appeals. The impugned judgment of the High Court is unexceptionable. Consequently, the appeals before us are hereby dismissed. In the circumstances of the case, there shall be no order as to costs.