Case: Gen. Manager, Punjab &amp; Sind Bank &amp; Others Vs. Daya Singh

2. As stated above, the respondent was working as a Manager of the appellants Branch (earlier an extension counter) at Guru Nanak Girls Degree College, Sunder Nagar, Kanpur. In a vigilance inspection, it was found on 8th of March, 1999 that some 20 loans to the tune of Rs.16.48 lacs were disbursed to some persons against FDRs though the FDRs were in the names of altogether different persons. It was also seen that the withdrawals which were allowed, were far in excess over the amounts in the FDRs. All those entries were in theOn 9th of March, 1999, when the Zonal Manager, Lucknow, telephonically made further inquiries with the respondent, immediately thereafter, the respondent left the Branch by leaving behind a letter of voluntary retirement dated 9th March, 1999 without handing over the charge of the articles and documents of the Branch to anybody else. He did not report for duty any time thereafter, although a telegram was sent to him on 11th March, 1999 that he should join immediately. He was, therefore, suspended on 12th March, 1999. An FIR was lodged on 13th March, 1999 and the respondent was arrested along with the Cashier Mr. K.P. Singh.The appellant Bank issued ato the respondent containing the following charges: (i) He sanctioned demand loan against twentyFDRs amounting Rs.16.48 Lac to the fictitious persons. Thus he has misappropriated Rs.16.48 lac by way of sanctioning demand loans againstFDRs without any security. (ii) He has left the Branch on 9th March, 1999 without handing over the charge of articles and documents of Branch. (iii) He has left his station of posting without authorization, and he is absconding from the services since 09.03.1999. (iv)He stands a guarantor to the loan sanctioned to M/s Mark Tubes, at Branch Office Gurgaon. The loan was sanctioned against his surety for which he has not obtained prior permission from the competent authority. The account turned into NPA account and he has not made sincere efforts to ensure the recovery of this loan amount, and (v) He has taken guarantee of his wife named Mrs. Satvinder Kaur who has taken a loan from Bank of India, Tilak Nagar, Newin the name of M/s Paper Products. He has never sought a permission from competent authority for standing as guarantor. The inquiry could not start earlier since the respondent was in judicial custody till December, 2001. Thereafter, aDuring the inquiry, relevant documents were produced through the concerned officers. The material produced before the inquiry officer with respect to charge No.1 was that some 20 fictitious loans were sanctioned againstFDRs. A chart to that effect has been produced before us as well as photo copies of the documents which were placed before the inquiry officer. Thus in this compilation at page 21, there is a photo copy of a page of loan register which shows at serial number 54, an advance of a loan of Rs.75000/to one Rajinder Kaur against FDR Nos.115/86 and 116/86. In this very compilation at page No.54, there is photocopy of a page of the FDR ledger wherein the FDR Nos.115 and 116 are recorded. The FDR No.115 is worth of Rs.10000/and No.116 of worth of Rs.2500/only. FDR No.115 in the name of one Nand Kumar whereas FDR No.116 is in the name of one Hardeep Satija. Thus as can be seen, whereas the amounts in the two FDRs were only Rs.12500/together, the loan advanced was Rs.75000/and that too to a third party one Rajinder Kaur in whose name either of the FDRs do not stand. The above referred two extracts of the ledger are brought on record during the inquiry as Management Exhibits, MEXThese amounts are stated to have been handed over to the respondent by the Cashier of the Bank one K.P. Singh on 18 occasions and by one Mr. Dixit on two occasions. Mr. K.P. Singh has deposed during the departmental inquiry. He has proved the above referred two extracts. He has stated that the respondent used to ask him to get such cash as against FDRs and he used to make the cash available to him. Thus in all 20 ledger entries were brought on record and exhibited showing the withdrawals permitted to some persons and the ledger entries showing the names of altogether different persons in whose names the FDRs stood and also that the FDR amounts were for less than the amount allowed to be withdrawn. The inquiry officer has dealt with this material on record in the following words in his report: "Presenting officer relied on MEXMEX BI to 10; MEX C1 to 20, MEF F1 to 20 and MEXto 20. These are the documents showing all the entries by CSO in his own handwriting. The presenting officer also brought in MW1 to prove payments made to CSO by MW1 through Exhibits marked MEX C1 to C4; MEX7; MEX0. Through exhibits MEX B1 to B10 presented that there were no records through which FDRs kept as security could be proved. P.O. in his plea brought in MEXAlthough, the respondent participated in the inquiry and filed his reply therein as well as a detailed counter in this Court, there is no explanation whatsoever as to how these 20 persons were given the loans when the FDRs were not in their names and also why the loan amount is far exceeding the amount that was deposited. The only submission of the respondent was that when earlier inspections were carried out, no such allegation was made. He submitted that he had increased the business at the extension counter at the College and that is how it had become a Branch, yet his work was not being appreciated. However, no particulars were given to pin point any mala fides. Besides, all these entries were in hisand there was no explanation in that behalf. As far as the deposition of Mr. K.P. Singh is concerned, it was sought to be contended that bank officers had stood surety for his bail and, therefore, his evidence should not be accepted. That obviously could not be, in view of the documentary evidence, which was in his ownand which showed that the loan advances were far more than the amounts in the FDRs and they were given to persons other than those in whose names, the FDRs were issued.The inquiry officer, therefore, concluded in his report as follows: Assessment of evidence of presenting officers and CSO weighs heavily on P.O. side. He has produced the documents as available in the branch and proved that advances made were having incomplete details on each documents. The C.S.O. has based himself on premises and has nothing to present in his defence. On going through both written and oral evidence before me, I posed queries before CSO, whether he can produce any evidence of FDRs from Bank records. The answer was negative and evasive. Further query was raised whether the borrowers could be produced to prove his contention. The reply again was negative. Hence evaluating the document before me and other relevant evidence, I am of the opinion that charge number 1 based on allegations 1 to 20 stands proved.Similarly, with respect to the charges Nos.2 and 3 of his going away from the branch on 9th March, 1999 without handing over charge and absconding thereafter, the only submission forthcoming was that when the Zonal Manager talked to him, he felt reprimanded and, therefore, he sent his letter of V.R.S. There was however no explanation as to how he could walk away without handing over the change and why he did not turn up even though he was given a telegram to join on the duty.As far as the charge number 4 and 5 are concerned, it was alleged against him that he has stood guarantor firstly for a company in one case and then for his wife which was done without the permission from the competent authority. The only defence of the respondent was that there was no harm to the bank in this, and if necessary the amount be adjusted from his retirement benefit or otherwise after reinstatement by regular installments. This was no explanation and this was against the service rules and hence the inquiry officer held that the charges were proved.After considering the inquiry report, the Zonal Manager who was the disciplinary authority came to the conclusion that the respondent has committed misconduct under Clause 3(1) and 15(v) read with Regulation No.24 of the Punjab & Sind Bank Officers Employees (Conduct) Regulations 1981. He concurred with the findings of the inquiry officer. Therefore, by the order dated 6th June, 2003, he imposed the penalty of dismissal from service alongwith recovery of pecuniary loss under Punjab and Sind Bank officer/employees (Discipline and appeal) Regulation 1997. That order has been subsequently confirmed in the internal appeal and in review.As stated above, all these three orders were challenged in the above writ petition in the High Court, and have come to be set aside. It was contended on behalf of the respondent that the report submitted against him by the inquiry officer was too sketchy and it did not contain any reasons in support of the findings arrived at by the inquiry officer. The High Court accepted that submission. It held that the inquiry officer merely stated in his report that. certain documents in support of each of the charges were presented and also that the submissions of the petitioner in reply were not tenable and therefore, the charges stood proved. The High Court held that the documents produced were neither detailed nor their nature was explained. It further held that there was no discussion and much less any analysis of the evidence presented. The Court held that no specific finding has been recorded on the basis of the evidence to establish the guilt of the respondent. The absence of good reason was held to be in breach of the principles of natural justice. Therefore, the order was set aside.

Court's reasoning:
16. In view of what is stated above, it is very clear that the Bank had taken the necessary steps to establish the misconduct before the inquiry officer. The relevant documents including ledger entries were produced through the concerned witnesses. The respondent fully participated in the inquiry. He had no explanation to offer during the course of the inquiry or any time thereafter. When all the relevant entries were in thehandwriting of therespondent, the Bank did not think it necessary to call the borrowers. In fact, as the inquiry officer states, the respondent should have produced the borrowers if he wanted to contend anything against the documentary evidence produced by the Bank. In the circumstances, the conclusions arrived at by the inquiry officer as stated above could not have been held as without any evidence in support. The High Court has clearly erred in holding that the documents produced were neither detailed nor their nature was explained.We are rather amazed at the manner in which the High Court has dealt with the material on record. The Inquiry Officer is an officer of a Bank. He was considering the material which has placed before him and thereafter, he has come to the conclusion that the misconduct is established. He was concerned with a serious charge of unexplained withdrawals of huge amounts by a Branch Manager in the name of fictitious persons. Once the necessary material was placed on record and when theofficer had no explanation to offer, the Inquiry Officer could not have taken any other view. The order of a bank officer may not be written in the manner in which a judicial officer would write. Yet what one has to see is whether the order is sufficiently clear and contains the reasons in justification for the conclusion arrived at. The High Court has ignored this aspect. Absence of reasons in a disciplinary order would amount to denial of natural justice to theemployee. But the present case was certainly not one of that category. Once the charges were found to have been established, the High Court had no reason to interfere in the decision. Even though there was sufficient documentary evidence on record, the High Court has chosen to hold that the findings of the Inquiry Officer were perverse. A perverse finding is one which is based on no evidence or one that no reasonable person would arrive at. This has been held by this Court long back in Triveni Rubber & Plastics vs. CCE AIR 1994 SC 1341 . Unless it is found that some relevant evidence has not been considered or that certain inadmissible material has been taken into consideration the finding cannot be said to be perverse. The legal position in this behalf has been recently reiterated in Arulvelu and Another vs. State Represented by the Public Prosecutor and Another (2009) 10 SCC 206. The decision of the High Court cannot therefore be sustained.In a number of cases including State Bank of India vs. Bela Bagchi (supra) this Court has held that a bank employee has to exercise a higher degree of honesty and integrity. He is concerned with the deposits of the customers of the Bank and he cannot permit the deposits to be tinkered with in any manner. In Damoh Panna Sagar Rural Regional Banks case (supra) the Manager of a Bank who had indulged in unauthorized withdrawals, subsequently returned the amount with interest. Yet this Court has held that this conduct of unauthorized withdrawals amounted to a serious misconduct. Same is the case in the present matter. There was a clear documentary evidence on record in thehandwriting of therespondent which established his role in the withdrawal of huge amounts for fictitious persons. The ledger entries clearly showed that whereas the FDRs were in one name, the withdrawals were shown in the name of altogether different persons and they were far in excess over the amounts of FDRs. The respondent had no explanation and, therefore, it had to be held that the respondent had misappropriated the amount. Inspite of a well reasoned order by the Inquiry Officer, the High Court has interfered therein by calling the same as sketchy. The High Court has completely overlooked the role of the bank manager as expected by this Court in the aforesaid judgments.