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PETITIONER:

ALLAHABAD BANK

Vs.

RESPONDENT:

PREM NARAIN PANDE & ORS.

DATE OF JUDGMENT19/10/1995

BENCH:

MAJMUDAR S.B. (J)

BENCH:

MAJMUDAR S.B. (J)

JEEVAN REDDY, B.P. (J)

CITATION:

1996 AIR 492 1995 SCC (6) 634

JT 1995 (7) 419 1995 SCALE (6)76

ACT:

HEADNOTE:

JUDGMENT:

J U D G E M E N T

S.B. Majmudar, J.

The appellant-bank by special leave has brought in

challenge the order passed by the Lucknow Bench of the

Allahabad High Court in Writ Petition No.3841 of 1986

decided on 30th July 1993. The respondent no.1 was the writ

petitioner before the High Court. The short question

involved in this appeal is as to whether the Assistant

General Manager of the Patna Division of the appellant-bank

was entitled to pass the penalty order against respondent

no.1.

In order to appreciate the nature of the controversy

between the parties it is necessary to note a few background

facts.

Background facts

----------------

Respondent No.1 was serving in the appellant-bank in

the Junior Management Scale I while posted in the regional

office of the appellant-bank at Lucknow. He was served with

a charge-sheet dated 24th August 1983 containing charges of

misconduct as Manager of the Palia Kalan Branch of the

Allahabad Bank, District Lakhimpur Kheri during the period

from April 1979 to December 1980.

The chargesheet was served on the respondent no.1 by

the Deputy General Manager of the Bank working at the

Central Zone, Lucknow. The said disciplinary authority

appointed Shri B.B. Shesh as Enquiry Officer to enquire into

the charges of misconduct. The said appointment was made

the Deputy General Manager on 19th December 1983. It appears

that the disciplinary proceedings continued for quite some

time and in the meantime on 15th July 1985 the respondent

no.1-employee was transferred from Lucknow to Ranchi, Bihar.

Respondent NO.1 unsuccessfully challenged his transfer order

before the High Court. His writ petition was ultimately not

pressed. The enquiry was completed on 24th February 1986.

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The Enquiry Officer submitted his report together with the

records of the enquiry proceedings and other documents to

the Disciplinary Aurhotiry.

It appears that after transfer of Respondent NO.1 to

Ranchi branch of the bank, the Assistant General Manager,

Zonal Office, Allahabad Bank, Patna Zone took over as the

Disciplinary Authority in respect of the pending enquiry

against respondent no.1. On 20th March 1986 the Assistant

General Manager informed the respondent no.1-officer that he

has been nominated by the competent authority to act as the

Disciplinary Authority in respect of the enquiry against

him.

That after considering the report of the Enquiry

Officer and record of the proceedings, the Assistant General

Manager, Zonal Office, Patna, passed an order dated 21st

March 1986 dismissing the respondent no.1 from service of

the bank in terms of Regulation No.4 of the Allahabad Bank

(Discipline and Appeal) Regulations, 1976 [hereinafter

referred to as `the Regulations'].

Respondent no.1 challenged the said order of dismissal

by filling a writ petition in Allahabad High Court, Lucknow

Bench. In the said writ petition respondent no.1 raised

various contentions for challenging the impugned order. One

of the contentions canvassed before the High Court by

respondent no.1 was to the effect that when disciplinary

proceedings were initiated against him by the Dy. General

Manager, Central Zone, Lucknow, the Asstt. General Manager,

Zonal Office, Patna had no authority or jurisdiction to pass

the impugned dismissal order and it was the Disciplinary

Authority which initiated the proceedings which was

competent to pass the final order of penalty, if any. The

appellant-bank resisted the petition and contended amongst

others that as per the Regulations the Assistant General

Manager, Zonal Office, Patna was fully competent as a

Disciplinary Authority to pass the impugned dismissal order.

The High Court took the view that respondent no.7, the

Assistant General Manager, Patna Zone, Patna was not

competent to pass the impugned order of dismissal. Only on

this short ground the writ petition was allowed. The High

Court did not, therefore, go into the other contentions

canvassed by respondent no.1 against the impugned order of

dismissal. The High Court accordingly set aside the order

dated 21st March 1986 as contained in Annexure 29 to the

writ petition. It is the aforesaid order of the High Court

which has brought the appellant-bank to this Court being

aggrieved by the same.

Rival Contentions

-----------------

Shri Sanghi, learned senior counsel for the appellant-

bank contended that the High Court had patently erred in law

in voiding the impugned order of respondent no.7 on the

ground that he was not competent to pass the said order.

That the relevant regulations of the bank were not properly

appreciated by the High Court. That there was nothing in the

Regulations to suggest that once a Disciplinary Authority

had initiated the proceedings by serving a chargesheet and

appointing an Enquiry Officer against the delinquent officer

the proceedings cannot be transferred to another equally

competent Disciplinary Authority as per the Regulations.

That there was no question of parallel proceedings being

conducted by two Deisciplinary Authorities at a given point

of time. That the High Court has wrongly assumed that that

would be the situation if the appellant-bank's contention

was accepted. The High Court had equally erred in assuming

that under the Regulations the respondent no.1 would lose

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right of appeal if the disciplinary proceedings initiated by

the Deputy General Manager got decided ultimately by the

Assistant General Manager as appeal would otherwise lie

against the order of the Assistant General Manager to the

Deputy General Manager. That in such an eventuality,

submitted learned senior counsel, the appeal may be

entertained by still higher authority, namely, the General

Manager and that such an eventuality had still not occurred

and it was not the contention of respondent no.1 that his

right of appeal had not whittled down under the Regulations.

It was, therefore, contended that the decision rendered by

the High Court was required to be set aside.

Shri Verma, learned senior counsel for respondent no.1-

employee, who is the only contesting party, on the other

hand submitted that once the disciplinary proceedings were

initiated by Deputy General Manager they had to be carried

to their logical end by the same Authority and that abruptly

in midstream after the enquiry report was submitted

proceedings could not have been transferred to Assistant

General Manager. In any case, submitted learned senior

counsel for respondent no.1, there was nothing on the record

to indicate that the competent authority had ordered

continuation of these disciplinary proceedings by Assistant

General Manager though initially they were started by the

Dy. General Manager. It was further contended that

respondent no.1 came to know for the first time that the

Disciplinary Authority had been changed only on 20th March

1986 and before he could make any representation to that

Authority almost simultaneously on the next day, that is,

21st March 1986 the impugned order was passed. It was

ultimately submitted by Shri Verma, learned senior counsel

for respondent no.1 that on the scheme of the Regulations

the oroder of the High Court was perfectly justified and

well sustained.

Our conclusion and reasons thereof

----------------------------------

We have carefully considered these rival contentions.

We have reached the conclusion that High Court has taken too

narrow a view of the controversy posed before it and has set

aside the dismissal order on too hyper-technical a view

which is not well sustained on the scheme of the

Regulations.

We will, therefore, proceed to consider the scheme of

the Regulations which governs the controversy between the

parties. The Regulations of 1976 have been framed by the

appellant-bank in exercise of powers conferred by Section 19

of the Banking Companies (Acquisition and Transfer of

Undertakings) Act, 1970. The Regulations are framed in

consultation with the Reserve Bank and with previous

sanction of the Central Government. Regulation 3 contains

definitions. It has been laid down therein that in these

regulations, unless the context otherwise requires.

`Appellate Authority' means the authority specified in the

Schedule to dispose of appeals; `Competent Authority' means

the authority appointed by the Board for the purpose of

these regulations; and `Disciplinary Authority' means the

authority specified in the Schedule which is competent to

impose on an officer employee any of the penalties specified

in regulation 4. Regulation 4 deals with penalties. It

provides for imposition on any officer employee for act of

misconduct or for any other good or sufficient reason

amongst others major penalty of dismissal which shall

ordinarily be disqualification for future employment. It is

not in dispute between the parties that respondent no.1 at

the relevant time was officer employee who was in Junior

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Management Scale I. It is also not in dispute that he was

imposed a penalty by way of dismissal from service.

Regulation 5 deals with authority to institute disciplinary

proceedings and impose penalties. Sub-regulation (1) thereof

lays down that the Managing Director or any other authority

empowered by him by general or special order may institute

or direct the Disciplinary Authority to institute

disciplinary proceedings against an officer employee of the

bank. It has also been mentioned therein that the Chairman &

Managing Director vide order dated 11th May 1979 has

authorised Deputy General Managers in terms of Rule 5(1) of

the said Regulation to take disciplinary action against

officers in Grade III and above as also to impose on them

Minor and/or Major Penalties as under :

Minor Penalties :

i) Censure

ii) Recovery from pay of the whole or

part of any pecuniary loss caused by the

Officer to the Bank by negligence or

breach of orders.

iii) Withholding of increaments of pay.

Major Penalties :

i) Stoppage of one or more increament

(s)

ii) Reduction to a lower stage in the

grade of the officer or to a lower

grade.

iii) Compulsory retirement.

iv) Termination of service.

v) Dismissal from service.

The order of the Chairman & Managing Director dated 11th May

1979 as per sub-regulation (1) of Regulation 5 was further

amended on 15th December 1980 to the following effect :

"In addition to the Schedule to

Allahabad Bank Officer Employees'

(Discipline & Appeal) Regulations, 1976,

and in furtherance to may order dated

1st July, 1977, as well as 11th May,

1979, I do hereby authorise Deputy

General Managers and Assistant General

Managers in terms of Rule 5(1) of the

said Regulations to take disciplinary

action against officer in Grade III,

Grade II and Grade I (Corresponding to

Scale I, Scale II and Scale III

respectively of Allahabad Bank Officers

Service Regulations, 1979) and also to

impose on them Minor and/or Major

Penalties as under :-

Minor Penalties :

a) ... ...

b) ... ...

c) ... ...

d) ... ...

Major Penalties :

a) ... ...

b) ... ...

c) ... ...

d) Dismissal which shall ordinarily be a

disqualification for future employment."

Sub-regulation (2) of Regulation 5 lays down that the

Disciplinary Authority may himself institute disciplinary

proceedings. As per Regulation 6 sub-regulation (2)

`whenever the Disciplinary Authority is of the opinion that

there are grounds for enquiring into the truth of any

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imputation of misconduct or misbehaviour against an officer

employee, it may itself enquire into, or appoint any other

public servant (hereinafter referred to as the enquiring

authority) to inquire into the truth thereof.' As per sub-

regulation (3) of Regulation 6, `where it is proposes to

hold an inquiry, the Disciplinary Authority shall frame

definite and distinct charges on the basis of the

allegations against the officer employee and the articles of

charge, together with a statement of the allegations, on

which they are based, shall be communicated in writing to

the officer employee, who shall be required to submit within

such time as may be specified by the Disciplinary Authority

(not exceeding 15 days), or within such extended time as may

be granted by the said Authority, a written statement of his

defence.' As per sub-regulation 21(ii) of Regulation 6 after

completion of the inquiry ` the inquiring authority, where

it is not itself the Disciplinary Authority, shall forward

to the Disciplinary authority the records of inquiry which

shall include -

(a) the report of the inquiry prepared

by it under Clause (i);

(b) the written statement of defence, if

any, submitted by the officer employee

referred to in Sub-regulation (15);

(c) the oral and documentary evidence

produced in the course of the inquiry;

(d) written briefs referred to in sub-

regulation (18), if any, and

(e) the orders, if any, made by the

Disciplinary Authority and the Inquiring

Authority in regard to the inquiry.'

Then follows Regulation 7 which deals with `Action on the

inquiry report'. Sub-regulation (3) of Regulation 7 provides

that `if the Disciplinary Authority, having regard to its

findings on all or any of the articles of charge, is of the

opinion that any of the penalties specified in Regulation 4

should be imposed on the officer employee it shall,

notwithstanding anything contained in Regulation 8, make an

order imposing such penalty.'

We may now turn to the Schedule to the Regulations. We

have already noted the definition of Disciplinary Authority

as found in Definition Clause (g) of Regulation 3. The

Disciplinary Authority which can impose penalties specified

in Regulation 4 are those which are specified in the

Schedule. The relevant amended Schedule to the Regulations

lays down that for Officers Scale I to III the Disciplinary

Authority is Deputy General Manager/Assistant General

Manager, the Appellate Authority is Deputy General

Manager/General Manager and the Reviewing Authority is

Chairman & Managing director. It becomes, therefore, clear

that both the Dy. General Manager as well as the Asstt.

General Manager are disciplinary authorities who can

initiate proceedings against the officer like respondent

no.1 who is in Scale I and who canals pass the final penalty

order. It is of course true as rightly contended by learned

senior counsel Shri Verma that there cannot be two parallel

simultaneous proceedings before the two disciplinary

authorities, namely, Dy. General Manager and Assistant

General Manager. However, there is nothing in the

Regulations to suggest as the High Court has with respect

wrongly assumed that once a competent disciplinary

authority, namely, Dy. General Manager has initiated

disciplinary proceedings by framing charges and appointing

Enquiry Officer as per Regulation 6 sub-regulation (3), it

is only that Disciplinary Authority, namely, the Dy. General

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Manager who must necessarity complete the proceedings till

they are terminated and final orders are passed under

Regulation 7. It may also be noted at this stage that there

was nothing on the record of the High Court in the writ

petition to suggest that it was the Chairman & Managing

Director who had directed the Dy. General Manager to

institute disciplinary proceedings against the respondent

no.1. On the contrary as provided by sub-regulation (2) of

Regulation 5 any competent authority can himself institute

disciplinary proceedings. Even otherwise Regulation 5(1) as

further amended don 15th December 1980 shows that there is a

general authorisation given by the Chairman & Managing

Director to all the Dy. General Managers and Asstt. General

Managers in terms of Rule 5(1) of the Regulations to take

disciplinary action against officers in Scale I like

respondent no.1 and has also authorised them to impose on

them minor and major penalties including the major penalty

of dismissal. Therefore, authorisation both to Dy. General

Manager as well as Asstt. General Manager to act as

disciplinary authorities for initiating departmental

enquiries against Scale I officers as per Regulation 6(3) as

well as to pass appropriate penalty orders under Regulation

7 is already granted by general order of the Managing

Director as seen from the amended Regulation 5(1) dated 15th

December 1980. It is, of course, true that in the present

case the Dy. General Manager, Lucknow Division, initiated

the disciplinary proceedings as Disciplinary Authority under

Regulation 6(3) by framing charges and appointing the

Enquiry Officer. The enquiry was completed by him but before

the stage of Regulation 7 was reached the Enquiry Officer's

report as per Regulation 6 sub-regulation 21(ii) came to be

sent to another equally competent Disciplinary Authority,

namely, Asstt. General Manager, Patna Branch, Beyond that

stage, when Regulation 7 was to operate, it was only the

Asstt. General Manager who remained the sole Disciplinary

Authority in the field on account of transfer of these

disciplinary proceedings from initial Disciplinary

Authority, namely, Dy. General Manager to Assistant General

Manager who was an equally competent disciplinary authority.

With respect the High Court has wrongly assumed that this is

likely to result in two conflicting orders of two equally

competent authorities. Such a situation would never arise

for the simple reason that for one disciplinary enquiry

against a concerned officer at a given point of time there

would be only one disciplinary authority. But that would not

mean that the entire gamut of the departmental enquiry

against the officer must be conducted from beginning to end

by only one disciplinary authority and one competent

disciplinary authority which initiated the proceedings

cannot get changed in midstream by another equally competent

disciplinary authority. As we have seen earlier the amended

Schedule clearly shows that for officers like respondent

no.1 in Scale I both the Dy. General Manager and the Asstt.

General Manager are equally competent to act as disciplinary

authorities. Under Regulation 6 such a competent

disciplinary authority can initiate proceedings. He can

appoint an Enquiry Officer but for exigency of service and

requirements of administration if final action at the stage

of Regulation 7 is to be taken by any other equally

competent disciplinary authority like Asstt. General Manager

it cannot be said that both the competent authorities are

simultaneously acting at the same point of time in the

departmental enquiry against the officer. In our view the

High Court has also erred in taking the view that such a

change of disciplinary authority before completion of the

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enquiry would whittle down the right of appeal available to

the concerned delinquent. Firstly such a situation has still

not arisen in the present case as it is not the contention

of respondent no.1 that his right of appeal under the

Regulations against the impugned order has been adversely

affected. In fact he has not filed any appeal against the

impugned order of dismissal but he straightaway went to the

High Court challenging the same. But even that apart, if the

Dy. General Manager has initiated the disciplinary

proceedings against the delinquent officer as per Regulation

6 sub-regulation (3) and if at the stage of passing final

orders he is substituted by another equally competent

disciplinary authority like Asstt. General Manager, then in

such a case, the penalty order though passed by Asstt.

General Manager will have a linkage with the initiation of

the disciplinary proceedings by the Dy. General Manager as

disciplinary authority and in such an eventuality the appeal

would lie to the General Manager who is also one of the

appellate authorities as mentioned in the amended Schedule

and in either case the Reviewing Authority against the

appellate authority will remain the same, namely, the

Chairman & Managing Director. Consequently it cannot be held

as assumed by the High Court that under the Regulations it

is the disciplinary authority which initiates the

proceedings as per Regulation 6 sub-regulation (3) that has

necessarily to complete the proceedings till the stage of

Regulation 7 and it is that very authority which must pass

the final orders of penalty. Consequently the decision of

the High Court voiding the impugned order of dismissal on

this short ground cannot be sustained.

We may also mention here that the submission of learned

senior counsel for respondent no.1 that he did not get

adequate opportunity against the proposed action baed on the

enquiry report before the changed disciplinary authority,

namely, respondent no.7 is a contention which has nothing to

do with the competence of respondent no.7 as the

disciplinary authority to pass impugned order of dismissal

under Regulation 7. The contention about absence of

reasonable opportunity to make such a representation before

the new disciplinary authority has not been gone into by the

High Court. Therefore, it cannot be considered by us at this

stage. We, however make it clear that as the High Court has

allowed the writ petition only on the short ground about the

competence of respondent no.7 to pass the impugned order of

dismissal and as we disagree with the said view of the High

Court and as the High Court has not gone into other

contentions canvassed by learned counsel for respondent no.1

for challenging the impugned order it will also be open to

respondent no.1 to challenge the impugned order of dismissal

on the ground of non-availability of reasonable opportunity

for putting forward his defence before the ultimate

disciplinary authority, as the proceedings will have to be

remanded to the High Court for a fresh decision on merits on

other contentions that may be open for respondent no.1,

which of course will be decided by the High Court in

accordance with law after hearing all concerned.

In the result this appeal succeeds and is allowed. The

order of the High Court is quashed and set aside. Writ

Petition No.3841 of 1986 is restored to the file of the High

Court for decision on merits on remaining contentions which

may be canvassed by respondent no.1 against the impugned

order of dismissal. As respondent no.1 is out of service

since 21st March 1986 and as pending this appeal the order

of the High Court was stayed by this Court we request the

High Court to make it convenient to dispose of the remanded

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proceedings in the aforesaid writ petition at its earliest

convenience and preferably within six months from the

receipt of the writ of this order at its end. In the facts

and circumstances of the case there shall be no order as to

costs.