2025 INSC 744 REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.7039 OF 2025

(arising out of Special Leave Petition (C) No.26933 of 2019)

A.M. Kulshrestha … Appellant

v.

Union Bank of India and Ors. ... Respondents

J U D G M E N T

ABHAY S. OKA, J.

Leave granted.

1.This appeal is directed against the judgment and order

dated 20

th

September, 2019 passed by the Division Bench of

the High Court of Allahabad affirming the order of the

Learned Single Judge dated 26

th

July, 2019, whereby the Writ

Petition preferred by the appellant seeking quashing of the

charge sheet served on him pursuant to disciplinary

proceedings was dismissed.

FACTUAL ASPECTS

2.The appellant was an employee of the Union Bank of

India (hereinafter referred to as “The Respondent Bank”),

where he served for approximately 34 years from 1984 to

2018. He was promoted to the post of Deputy General

Manager in 2016 and was due to retire on 30

th

June, 2019.

Civil Appeal @ SLP 26933 of 2019 Page 1 of 18

3.The Respondent Bank vide order dated 21

st

August,

2018, suspended the appellant pending further disciplinary

action, alleging that the appellant, in his prior role as the

Regional Head, Meerut, had adopted a very casual approach

while sanctioning credit proposals in 16 accounts submitted

by Mid-corporate Ghaziabad Branch. It was alleged that he

sanctioned huge limits to newly incorporated firms without

ensuring proper due diligence by the branch or processing

officers. On 18

th

January, 2019, after approximately 6 months

of the suspension order, a show cause notice was issued to

the appellant, asking him to show cause as to why

disciplinary action should not be initiated against him. On

27

th

March, 2019, another show cause notice was issued to

the appellant incorporating the same omissions and

commissions as alleged in the previous show cause notice,

but in relation to other parties. The appellant made multiple

representations to the Respondent Bank, requesting it to

revoke his suspension. However, the same was of no avail.

4.The appellant preferred Civil Misc. Writ Petition No.

6976 of 2019 before the Hon’ble High Court of Allahabad

against Order dated 21

st

August, 2018. The General Manager

of the Respondent Bank (hereinafter referred to as, “General

Manager”) submitted personal affidavit dated 23

rd

May, 2019

before the Hon’ble High Court justifying the delay in issuing

the charge sheet as attributable to the matter being referred

to the Central Vigilance Commission (hereinafter referred to

as, “the CVC”) in terms of Regulation 19 of the Union of India

Civil Appeal @ SLP 26933 of 2019 Page 2 of 18

Officer Employees’ (Discipline & Appeal) Regulations, 1976

(hereinafter referred to as, “1976 Regulations”). The relevant

extract of the General Manager’s affidavit is as follows:

“32. That, the IAC has viewed/regarded

the case of 16 officials, including that of

appellant, as a Vigilance case.

33. That since the appellant being an

Executive in TEGS-VI and as also the

matter Involving other

executive/officials, making it a

composite case, in terms of Regulation

19 of Union Bank of India Officers

Employee's (Discipline and Appeal)

Regulations, 1976 and guidelines of the

Central Vigilance Commission as

circulated vide Circular NO. 07/04/15

dated 27.04.2015 (ANNEXURE CA - 4)

the matter has been sent to the central

Vigilance Commission for first stage

advice.

34. That accordingly a request has been

sent to Central Vigilance Officer (CVO)

of the Bank to forward the matter on

23.04.2019 to Central Vigilance

Commission (CVC) seeking their first

stage. The advice of CVC is still

awaited.”

The Disciplinary Authority/Executive Director of the

Respondent Bank (hereinafter referred to as, “Executive

Director”) submitted personal affidavit dated 13

th

June, 2019

before the High Court, inter alia, stating that the matter was

Civil Appeal @ SLP 26933 of 2019 Page 3 of 18

referred to the CVC, and the charge sheet would be issued to

the appellant on receipt of the CVC’s advice. The relevant

extract of the Executive Director’s affidavit is as follows:

“27. That on receipt of the advice of

CVC, the respondent bank shall be

soon issuing Articles of

Charge/Chargesheet to the appellant

along with other concerned officials who

are found to be involved in the matter”

(emphasis added)

On 18

th

June, 2019, the respondent-Bank served an ante-

dated charge sheet of 10

th

June, 2019, to the appellant, in

relation to the allegations levied in the show-cause notices.

However, this charge sheet was served without receiving the

CVC’s advice.

5.Learned Single Judge of the High Court by Order dated

20

th

June, 2019 quashed Order dated 21

st

August, 2018 on

the ground that continuing the suspension of the appellant

since 21

st

August 2018 without even initiating or serving

charge sheet for almost a year and that too at the fag end of

the career of the appellant is wholly arbitrary and illegal. At

the same time, the High Court granted liberty to the

Respondent Bank to initiate any further proceedings that it

may deem fit. Accordingly, the Executive Director issued a

letter dated 28

th

June, 2019 to the appellant, stating that the

disciplinary proceedings against him will continue and that

Civil Appeal @ SLP 26933 of 2019 Page 4 of 18

he would not receive any pay, allowance or retiral benefits for

the period till the completion of the disciplinary proceedings.

6.The appellant preferred Civil Misc. Writ Petition No.

10800 of 2019 before the Hon’ble High Court of Allahabad

seeking quashing of the charge sheet dated 10

th

June, 2019

on the ground that the charge sheet was served without

seeking the advice of the CVC, which violated the mandatory

requirement under Regulation 19 of the 1976 Regulations.

The appellant also sought a direction to the Respondent Bank

to consider his case for payment of pension under the Union

Bank of India Employees’ Pension Regulation, 1995 and to

pay the pension to the Appellant along with consequential

relief.

7.The learned Single Judge by his judgement and order

dated 26

th

July, 2019 dismissed the Writ Petition holding that

no ground was made out to quash the charge sheet and

directed the appellant to cooperate in the enquiry. The

appellant challenged the said Order by filing Special Appeal

No. 963 of 2019. The Division Bench by impugned Judgement

and Order dated 20

th

September, 2019 dismissed the appeal,

holding that it was not necessary to seek the CVC’s advice

before issuing the charge sheet.

RELEVANT PROVISIONS

8.The issues involved in this appeal require consideration

of Regulation 19 of the 1976 Regulations, which reads as

follows:

Civil Appeal @ SLP 26933 of 2019 Page 5 of 18

“Regulation 19. Consultation with

Central Vigilance Commission: The

Bank shall consult the Central

Vigilance Commission wherever

necessary, in respect of all

disciplinary cases having a vigilance

angle”

The regulation requires the Respondent Bank to consult the

CVC in respect of all disciplinary cases with a vigilance angle,

wherever deemed necessary. The language of the rule

stipulates a mandatory consultation obligation by the usage of

the word ‘shall’, and at the same time grants the Respondent

Bank a degree of discretion by limiting the consultation to

‘wherever necessary’. A question may arise whether the said

provision is mandatory or directory.

SUBMISSIONS

Submissions on behalf of the Appellant

9.The learned senior counsel appearing for the appellant

submitted that Regulation 19 of the 1976 Regulations, by

using the words ‘shall consult’, imposes a mandatory

requirement on the Respondent Bank to seek the CVC’s

advice in all complaints involving allegations of corruption,

before issuance of a charge sheet to an employee. In support

of this contention, learned senior counsel referred to CVC’s

Circular No. 99/VGL/66 dated 28

th

September, 2000, Circular

No. 24/4/04 dated 15

th

April, 2004 and Circular No.

Civil Appeal @ SLP 26933 of 2019 Page 6 of 18

07/04/15 dated 27

th

April, 2015. The relevant extracts of the

circulars are reproduced herein:

Circular No. 99/VGL/66 dated 28th

September, 2000

“3. The Commission, at present, is

being consulted at two stages in

disciplinary proceedings, i.e. first

stage advice is obtained on the

investigation report before issue of the

charge sheet, and second stage advice

is obtained either on receipt of reply

to the charge sheet or on receipt of

inquiry report.”

Circular No. 24/4/04 dated 15th

April, 2004

“3. It is clarified that

investigation/inquiry reports on the

complaints/cases arising out of audit

and inspection, etc, involving a

vigilance angle will have to be referred

to the Commission for advice even if

the competent authority in the bank

decides to close the case, if any of the

officer involved is of the level for

whom the Commission's advice is

required.”

Circular No. 07/04/15 dated 27

th

April, 2015

“As per the existing scheme for

consultation with the Commission,

the CVOs of the Ministries /

Departments and all other

Civil Appeal @ SLP 26933 of 2019 Page 7 of 18

organisations are required to seek the

Commission’s first stage advice after

obtaining the tentative views of

Disciplinary Authorities (DAs) on the

reports of the preliminary inquiry /

investigation of all complaints

involving allegation(s) of corruption or

improper motive; or if the alleged

facts prima-facie indicate an element

of vigilance angle which are registered

in the Vigilance Complaint Register

involving Category-A officers (i.e., All

India Service Officers serving in

connection with the affairs of the

Union, Group-A officers of the Central

Govt. and the levels and categories of

officers of CPSUs, Public Sector

Banks, Insurance companies,

Financial Institutions, Societies and

other local authorities as notified by

the Government u/s 8(2) of CVC Act,

2003) before the competent authority

takes a final decision in the matter.

Such references also include cases

wherein the allegations on inquiry do

not prima facie indicate any vigilance

overtone / angle / corruption.

On a review of the scheme of

consultation with the Commission

and to expedite the processes of

vigilance administration in the

Ministries/Departments/Organisatio

ns, it has been decided that,

henceforth after inquiry /

investigation by the CVO in

Civil Appeal @ SLP 26933 of 2019 Page 8 of 18

complaints / matters relating to

Category-A officers as well as

composite cases wherein, Category-B

officers are also involved, if the

allegations, on inquiry do not indicate

prima facie vigilance angle /

corruption and relate to purely non-

vigilance / administrative lapses, the

case would be decided by the CVO

and the DA concerned of the public

servant at the level of Ministry /

Department / Organisation

concerned. The CVO's reports

recommending administrative /

disciplinary action in non-

vigilance /administrative lapses

would, therefore, be submitted to the

DA and if the DA agrees to the

recommendations of the CVO, the

case would be finalised at the level of

the Ministry/ Department/

Organisation concerned. In all such

matters, no reference would be

required to be made to the Commission

seeking its first stage advice. However,

in case there is a difference of opinion

between the CVO and the DA as to

the presence of vigilance angle, the

matter as also enquiry reports on

complaints having vigilance angle

though unsubstantiated would

continue to be referred to the

Commission for first stage advice. The

provisions of the Vigilance Manual

and the Special Chapter on Vigilance

Management in Public Sector

Civil Appeal @ SLP 26933 of 2019 Page 9 of 18

Enterprises, Public Sector Banks and

Insurance Companies would stand

amended to this extant.”

(underline supplied)

Relying on the circulars mentioned above, the learned senior

counsel submitted that consultation with the CVC is a

necessary pre-requisite for initiating disciplinary proceedings

against an employee.

10.The learned senior counsel also drew attention to

Section 8(1)(h) of the Central Vigilance Commission Act, 2003,

wherein the CVC has been bestowed the function and power

to exercise superintendence over the vigilance administration

of the various Ministries of the Central Government or

Corporations established by or under any Central Act,

Government companies, societies and local authorities owned

or controlled by that Government. Attention was also drawn

to Clause 7.9.1 of the CVC’s Vigilance Manual, 2017, whereby

Central Vigilance Officers of the Ministries/Departments and

all other organisations are required to seek the Commission’s

first stage advice after obtaining the tentative views of

Disciplinary Authorities on the reports of the preliminary

inquiry/investigation of all complaints involving allegation(s)

of corruption or improper motive; or if the alleged facts prima-

facie indicate an element of vigilance angle.

11.Lastly, the learned senior counsel referred to affidavits

dated 23

rd

May, 2019 and 13

th

June, 2019, filed by the

General Manager and the Executive Director, respectively,

Civil Appeal @ SLP 26933 of 2019 Page 10 of 18

before the Hon'ble High Court in Civil Misc. Writ Petition No.

6976 of 2019. Learned senior counsel stated that

Respondents vide these two affidavits have admitted that the

proceedings initiated against the appellant have a vigilance

angle and therefore the case has been referred to the CVC for

their advice in terms of Regulation 19 of the 1976

Regulations. Thus, the Respondents are now estopped from

seeking to initiate unilateral disciplinary proceedings against

the appellant without obtaining the CVC’s first-stage advice.

Submissions on behalf of the Respondents

12.The learned counsel appearing for the Respondents

submitted that as per Clause 7.9.1 of the CVC’s Manual, the

Commission's first stage advice is required to be sought

‘before the competent authority takes a final decision in the

matter’. Learned counsel contends that the presentation of a

charge sheet would not amount to taking the final decision in

the matter, but would rather only amount to initiation of the

disciplinary proceedings, and therefore, the charge sheet

cannot be vitiated for not taking the CVC’s advice.

13.The learned counsel further submitted that the

Respondent Bank had sought the CVC’s first-stage advice via

their letter dated 17th May 2019; however, they received the

CVC’s response on 21st June 2019. The advice was taken as

a matter of abundant caution. The learned counsel contended

that the Rules or Regulations must not be interpreted in a

manner that stalls or delays the disciplinary process until

receipt of the advice from the CVC. The disciplinary

Civil Appeal @ SLP 26933 of 2019 Page 11 of 18

proceedings against the delinquents cannot be frustrated

solely on account of the CVC's inaction. Learned counsel also

submitted that the pendency of vigilance proceedings does not

bar the internal disciplinary proceedings by the Respondent

Bank against an employee, and accordingly, the Respondent

Bank could issue the charge sheet.

14.Lastly, the learned counsel submitted that it was

incorrect to suggest that the Respondents have taken two

contradictory and inconsistent stands in the two rounds of

litigation before the Hon'ble High Court. Learned counsel

denied that the charge sheet was prepared hastily and that

the same was ante-dated and served only by email on account

of any mala fide reasons, extraneous consideration, or

personal bias. Moreover, learned counsel submitted that no

prejudice was caused to the appellant on account of the

serving of the charge sheet and the continuation of

disciplinary proceedings against him.

CONSIDERATION OF SUBMISSIONS

15.In the present case, factual aspects are very relevant.

Material factual aspects set out in a chronology are as under:-

a.The appellant was employed with the respondent Union

Bank of India from the year 1984;

b.In the year 2016, he was promoted to the post of Deputy

General Manager;

Civil Appeal @ SLP 26933 of 2019 Page 12 of 18

c.On 30

th

June 2019, the appellant was to be

superannuated;

d.The appellant had a blemishless record till 21

st

August

2018, when the Bank suspended him. The allegation

against the appellant was that, as the Regional Head at

Meerut, he adopted a very casual approach while

sanctioning credit proposals in 16 accounts sent by the

Mid-corporate Ghaziabad branch. It is alleged that the

appellant sanctioned huge limits to newly incorporated

firms without ensuring proper diligence by the

branch/processing officers;

e.On 18

th

January 2019 and 27

th

March 2019, two show

cause notices were served upon the appellant, calling

upon him to show cause why a disciplinary action

should not be initiated against him;

f.As the representations made by the appellant for

revoking suspension were not considered, the appellant

filed a writ petition before the Hon’ble High Court of

Allahabad to challenge the order of suspension. In the

said writ petition, the General Manager filed his affidavit

justifying the delay in issuing the charge sheet, stating

that the matter was referred to the CVC for first-stage

advice, but the advice was not received. He relied upon

Regulation 19 of the 1976 Regulations. In the same writ

petition, another affidavit dated 13

th

June 2019 was filed

by the Executive Director stating that on receipt of

Civil Appeal @ SLP 26933 of 2019 Page 13 of 18

advice from the CVC, Articles of charge/charge sheet

will be issued to the appellant;

g.By the order dated 20

th

June 2019, the High Court

quashed the order of suspension dated 21

st

August 2018

on the ground that continuing the suspension of the

appellant from 21

st

August 2018 without even initiating

or serving a charge sheet for almost a year was arbitrary

and illegal. However, liberty was reserved to the Bank to

initiate further proceedings; and

h.On 18

th

June 2016, without waiting for the CVC advice,

a charge sheet dated 10

th

June 2019 was served upon

the appellant. Thereafter, by a letter dated 28th June

2019, the Executive Director informed the appellant that

the disciplinary proceedings against him would

continue, and he would not receive any pay, allowances,

or retiral benefits until the completion of the

proceedings.

16.Regulation 19 of the 1976 Regulations stipulates that

the Bank shall consult the CVC, wherever necessary, in

respect of disciplinary cases having a vigilance angle. A

reading of the regulation makes it clear that in cases where

the Respondent Bank deems that the consultation is

necessary due to the case having a vigilance angle, the

Respondent Bank is required to seek the advice of the CVC.

Therefore, while the learned counsel has argued the question

of whether consultation with the CVC is mandatory or

Civil Appeal @ SLP 26933 of 2019 Page 14 of 18

discretionary, in the facts of this case, it is not necessary for

us to delve into the said question. The reason is that the

Respondent Bank has itself acknowledged that the case had a

vigilance angle and consultation with the CVC is necessary,

and therefore, the Respondent Bank had sought the opinion

of the CVC.

17.We have already quoted the relevant parts of the

Circulars dated 28

th

September 2000, 15

th

April 2004 and 27

th

April 2015 issued by the CVC. As can be seen from the

Circulars, the CVC is being consulted at two stages for its

advice. The first stage advice is sought before the issuance of

the charge sheet, and the second stage advice is either on

receipt of the reply to the charge sheet or on receipt of the

enquiry report. As can be seen from the affidavit dated 23rd

May 2019, filed by the General Manager of the Bank, the first

stage advice of the CVC has been sought. The affidavit dated

13

th

June 2019 filed by the Executive Director also clearly

states that on the receipt of the advice of the CVC, the Bank

shall issue a charge sheet to the appellant. As stated earlier,

within five days of filing the said affidavit, the charge sheet

dated 10

th

June 2019 was served upon the appellant. This

was done without receiving the first stage advice from the

CVC.

18. In its counter-affidavit, the Respondent Bank has

admitted that the CVC’s first-stage advice was sought on 17

th

May 2019. Notably, the advice was sought from the CVC nine

Civil Appeal @ SLP 26933 of 2019 Page 15 of 18

months after the suspension order. In fact, on 18

th

January

2019 and 27

th

March 2019, show-cause notices were issued to

the appellant, calling upon him to show cause why

disciplinary action should not be initiated against him.

19.Thus, the respondent-Bank accepted that Regulation 19

of the 1976 Regulations was applicable and therefore, first-

stage advice of the CVC was sought. Even before getting the

first stage advice, on 10

th

June 2019, the charge sheet was

kept ready which was served upon the appellant on 18

th

June

2019. In this case, the Respondent Bank itself accepted the

necessity of seeking first-stage advice from the CVC.

Therefore, it was not open for the Bank to serve the charge

sheet without receiving and considering the first stage advice

by the CVC.

20.As stated earlier, only ten months before the date of

superannuation, an order of suspension was served upon the

appellant. This was done after 34 years of unblemished

service. Although it was necessary to take the first stage

advice of the CVC, the advice was sought only as late as on

17

th

May 2019. Twelve days before reaching the age of

superannuation, a charge sheet was served upon the

appellant, without receiving and considering the CVC’s

advice. This was despite the specific statement made by the

Executive Director in the earlier petition on oath, which stated

that the charge sheet would only be served upon receipt of

advice from the CVC.

Civil Appeal @ SLP 26933 of 2019 Page 16 of 18

21.Once, the first stage advice of the CVC was called, it was

the duty of the respondent-Bank to consider the advice and

then take a decision to serve the chargesheet. Thus, the

actions of the respondent-Bank are mala fide and arbitrary.

The appellant was sought to be victimised at the fag end of

his unblemished career of 34 years.

22.The High Court committed a gross error by holding that

Regulation 19 of the 1976 Regulations was not mandatory.

This issue was irrelevant, as the Bank had itself

acknowledged that in the facts of the case, it was necessary to

seek first-stage advice from the CVC. It is also pertinent to

note that no record was placed in the High Court to indicate

that the CVC report had been received.

23.Now, at this stage, it will be unjust to allow the

respondent-Bank to resume disciplinary proceedings. Almost

six years have passed since the superannuation of the

Appellant.

24.Though the appellant will be entitled to all retiral

benefits, he shall not be entitled to any back wages.

CONCLUSION

25.Accordingly, the disciplinary proceedings, including the

charge sheet dated 10

th

June 2019, are hereby quashed and

set aside. Although the appellant shall not be entitled to back

wages and allowances, the Respondent Bank shall release all

retirement benefits admissible on the basis that the appellant

Civil Appeal @ SLP 26933 of 2019 Page 17 of 18

has superannuated as of 30

th

June 2019. The amount of

retirement benefits due to the appellant in accordance with

the law, shall be paid to the appellant within three months

from today. The appeal is allowed on the above terms.

..……....…….………………J.

(Abhay S. Oka)

………….……………………J.

(Augustine George Masih)

New Delhi;

May 20, 2025.

Civil Appeal @ SLP 26933 of 2019 Page 18 of 18