G.M.(OPERATIONS) S.B.I. & ANR. Vs. R.PERIYASAMY : Supreme Court - Article 226 of the Constitution of India
Supreme Court of India
CIVIL APPEAL No.10942 OF 2014 [Arising out of SLP (Civil) No. 4648 of 2008] Judgment Date: Dec 10, 2014
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL No.10942 OF 2014
[Arising out of SLP (Civil) No. 4648 of 2008]
G.M. (OPERATIONS) S.B.I & ANR. .. APPELLANT(S)
VERSUS
R. PERIYASAMY ..RESPONDENT(S)
JUDGMENT
S. A. BOBDE, J.
Leave granted.
2. The appellant, General Manager of the State Bank of India has
preferred this appeal against the Judgment and Final Order dated 30.08.2007
passed by the High Court of Judicature at Madras in Writ Appeal No. of 2375
of 1999. By the impugned Judgment the High Court dismissed the
appellant's Writ Appeal and confirmed the finding and Judgment of the
learned Single Judge by which the respondent's Writ Petition was allowed
and the orders dismissing him from service were set aside.
3. The respondent - Periyasamy, was serving as a Permanent Cash
Officer at the Dharmapuri Branch of the State Bank of India in 1986. In a
departmental enquiry, he was charged with being accountable for a shortage
detected in the currency chest in his joint custody along with one Ganesan.
By the second charge, he was charged with not adhering to the laid down
instructions regarding currency chest transactions and for committing
lapses in the maintenance of the currency chest register. By the third
charge, he was charged with excessive outside borrowings in violation of
Rule 41(i) of the State Bank of India (Supervising Staff) Service Rules.
4. An enquiry was duly conducted. The charged officer, the respondent,
was given an opportunity to defend himself and an Inquiry Report dated
03.11.1986 was submitted to the disciplinary authority. The disciplinary
authority considered the entire report and after discussing the same came
to the conclusion that there was a preponderance of the probability that
the respondent had been surreptitiously removing currency notes from the
chest over a period of time, the shortage being Rs. 1,25,000/-. The
disciplinary authority also took note of the fact that he was lending money
to others, even without a pro-note indicating that he had large amounts of
cash. The disciplinary authority, therefore, recommended the dismissal of
the respondent from the service of the Bank in terms of Rule 49(h) of the
State Bank of India (Supervising Staff) Rules by an order dated 27th July,
1989. Thereafter, the Chief General Manager considered the Inquiry Report
and the recommendation of the disciplinary authority and concurred with the
views of the disciplinary authority. Against the dismissal, the respondent
preferred an appeal under the Service Rules of the Bank. However, the
appeal was also turned down by the order dated 14.05.1990. Against the said
orders, the respondent preferred a Writ Petition before the Madras High
Court. As observed earlier, the learned Single Judge allowed the petition
and the Division Bench dismissed the appeal against the petition. Hence,
the Bank has preferred this appeal.
5. While the respondent was working as a Cash Officer, at the
Dharmapuri Branch with Ganesan, the branch-accountant, as a joint
custodian, the Branch inspection took place between 20.02.1986 to
05.04.1986. The respondent had been working as the Cash Officer from
16.11.1985. Certain irregularities were found in the inspection. As a
result of the irregularities, instructions were given to follow the dual
locking system for the storage bins where cash was stored and for the
dividing doors with effect from 05.04.1986. On that very night, the
respondent met with an accident. The strong room keys which were supposed
to be in the physical possession of the respondent were found in his
Cupboard in the Branch. From 07.04.1986 to 09.04.1986, one Swaminathan
officiated as the Cash Officer. From 10.04.1986 to 11.04.1986, one N
Krishnan officiated as the Cash Officer. From 12.04.1986 to 17.04.1986,
again, Shri Swaminathan officiated as the Cash Officer. According to the
appellant, there was no transfer of notes from the operative bins of the
bank to the storage bins and there was no cash withdrawal from the storage
bins between 05.04.1986 to 14.04.1986. On 15.4.1986, a cash shortage of
Rs.40,000/- was noticed by the officiating Cash Officer. Therefore, the
verification of the entire currency chest was conducted, which showed a
total cash shortage of Rs.1,25,000/-. An internal investigation
was conducted wherein it was found that the shortage in cash had taken
place between 16.11.1985 and 05.04.1986 when the respondent and Ganesan
were joint custodians. Show cause notices were issued to the respondent
and Ganesan. Apparently, the other joint custodian, Ganesan has also been
punished but he has not challenged his punishment. In the reply to the
show cause notice, the respondent admitted various lapses on his part
regarding the maintenance of the currency chest books. In particular, the
respondent stated in his reply that perhaps the shortage of Rs. 1,25,000/-
escaped his attention due to various reasons and was thus unfortunate. The
respondent sought permission to peruse the relevant books and registers at
the Dharmapuri branch and was allowed to do so. The Inquiring Officer
eventually submitted a report and held the respondent guilty of charges as
stated earlier. The following are the important features of the Inquiry
Report:
a) When the branch inspection was concluded on 05.04.1986, it was noticed
that during the tenure of the respondent as the permanent Cash Officer of
the Branch, several currency storage bins inside the branch strong-room
were not locked with dual pad locks and some were kept open when they were
not being operated upon.
b) Shortages were detected in the note bundles by the respondent. Upon
further inspection, shortages in three more sections from the bundles last
handled by the respondent, were also discovered.
c) The two employees, who acted as Cash Officers after the charged
officials, i.e. the respondent and Ganesan exited on 05.04.1985, had
performed their duties, during the period 05.04.1986 to 14.04.1986 when the
storage strong room was locked with dual pad locks and they had functioned
in the presence of the permanent Accountant of the Branch.
d) Unlike in the case of acting Cash Officers, when the respondent used to
function as Cash Officer, the Accountant Shri Ganesan was in the habit of
leaving him alone inside the Strong Room while he attended to his desk work
outside. The significance of this last finding is that the shortages were
found to have occurred between 16.11.1985 to 5.4.1986 when the respondent
worked as the Cash Officer of the Branch and not from 05.04.1986 to
15.04.1986, when others had acted as Cash Officers for the reasons stated
hereinbefore. The respondent was also convicted of the other two
relatively minor charges.
6. The learned Single Judge, at the instance of the respondent,
went into the entire matter in tedious detail. The Single Judge considered
the entire evidence, even reproduced it in parts, and upon re-appreciation
of the evidence, virtually disagreed with the findings of facts recorded by
the Inquiry Officer and set aside the respondent's dismissal.
7. Shri Vikas Singh, the learned senior counsel for the appellant
submitted that both, the learned Single Judge as well as the Division
Bench, in confirming the order, have violated the well settled parameters
of the scope of the Jurisdiction of the High Court under Article 226 of the
Constitution of India in such matters. Shri Singh submitted that the High
Court embarked on the unusual and unwarranted exercise of re-appreciating
the evidence and reversed the well considered findings of fact recorded by
the Inquiry Officer. The learned counsel for the appellant brought to our
notice the very first decision, which authoritatively settled the law on
this point in the State of Andhra Pradesh and others vs. Shri Rama Rao[1],
where this Court observed as follows:
"This report was considered by the authority competent to impose punishment
and a provisional conclusion that the respondent merited punishment of
dismissal for the charges held established by the report was recorded. A
copy of the report of the Enquiry Officer was sent to the respondent and he
was called upon to submit his representation against the action proposed to
be taken in regard to him. The respondent submitted his representation
which was considered by the Deputy Inspector General of Police, Northern
Range, Waltair. That Officer referred to the evidence of witnesses for the
State about the arrest of Durgalu on March 5, 1954, and the handing over of
Durgalu to the respondent on the same day. He observed that the evidence of
Durgalu that after he was arrested on March 5: 1954, he had made good his
escape and was again arrested on March 8, 1954, could not be accepted.
Holding that the charge against the respondent was serious and had on the
evidence been adequately proved, in his view the only punishment which the
respondent deserved was of dismissal from the police force."
8. In State Bank of Bikaner and Jaipur Vs. Nemi Chand Nalwaya[2],
this Court observed as follows:-
"7. It is now well settled that the courts will not act as an appellate
court and reassess the evidence led in the domestic enquiry, nor interfere
on the ground that another view is possible on the material on record. If
the enquiry has been fairly and properly held and the findings are based on
evidence, the question of adequacy of the evidence or the reliable nature
of the evidence will not be grounds for interfering with the findings in
departmental enquiries. Therefore, courts will not interfere with findings
of fact recorded in departmental enquiries, except where such findings are
based on no evidence or where they are clearly perverse. The test to find
out perversity is to see whether a tribunal acting reasonably could have
arrived at such conclusion or finding, on the material on record. The
courts will however interfere with the findings in disciplinary matters, if
principles of natural justice or statutory regulations have been violated
or if the order is found to be arbitrary, capricious, mala fide or based on
extraneous considerations. (Vide B.C. Chaturvedi v. Union of India : (1995)
6 SCC 749, Union of India v. G. Ganayutham : (1997) 7 SCC 463, Bank of
India v. Degala Suryanarayana : (1999) 5 SCC 76 and High Court of
Judicature at Bombay v. ShashiKant S Patil (2000) 1 SCC 416)."
It is not necessary to multiply authorities on this point.
Suffice it to say that the law is well settled in this regard.
9. It is not really necessary to deal with the judgment of the
learned Single Judge since that has merged with the judgment of the
Division Bench. However, some observations are necessary. The learned
Single Judge committed an error in approaching the issue by asking whether
the findings have been arrived on acceptable evidence or not and coming to
the conclusion that there was no acceptable evidence, and that in any case
the evidence was not sufficient. In doing so, the learned Single Judge
lost sight of the fact that the permissible enquiry was whether there is no
evidence on which the enquiry officer could have arrived at the findings or
whether there was any perversity in the findings. Whether the evidence was
acceptable or not, was a wrong question, unless it raised a question of
admissibility. Also, the learned Single Judge was not entitled to go into
the question of the adequacy of evidence and come to the conclusion that
the evidence was not sufficient to hold the respondent guilty.
10. It is interesting to note that the learned Single Judge went to
the extent of observing that the concept of preponderance of probabilities
is alien to domestic enquiries. On the contrary, it is well known that the
standard of proof that must be employed in domestic enquiries is in fact
that of the preponderance of probabilities. In Union of India Vs. Sardar
Bahadur[3], this Court held that a disciplinary proceeding is not a
criminal trial and thus, the standard of proof required is that of
preponderance of probabilities and not proof beyond reasonable doubt. This
view was upheld by this Court in State Bank of India & ors. Vs. Ramesh
Dinkar Punde[4]. More recently, in State Bank of India Vs. Narendra Kumar
Pandey[5], this Court observed that a disciplinary authority is expected to
prove the charges leveled against a bank-officer on the preponderance of
probabilities and not on proof beyond reasonable doubt. Further, in Union
Bank of India Vs. Vishwa Mohan[6], this Court was confronted with a case
which was similar to the present one. The respondent therein was also a
bank employee, who was unable to demonstrate to the Court as to how
prejudice had been caused to him due to non-supply of the inquiry
authorities report/findings in his case. This Court held that in the
banking business absolute devotion, diligence, integrity and honesty needs
to be preserved by every bank employee and in particular the bank officer.
If this were not to be observed, the Court held that the confidence of the
public/depositors would be impaired. Thus in that case the Court set-aside
the order of the High Court and upheld the dismissal of the bank employee,
rejecting the ground that any prejudice had been caused to him on account
of non-furnishing of the inquiry report/findings to him.
While dealing with the question as to whether a person with
doubtful integrity ought to be allowed to work in a Government Department,
this Court in Commissioner of Police New Delhi & Anr. Vs. Mehar Singh[7],
held that while the standard of proof in a criminal case is proof beyond
all reasonable doubt, the proof in a departmental proceeding is merely the
preponderance of probabilities. The Court observed that quite often
criminal cases end in acquittal because witnesses turn hostile and
therefore, such acquittals are not acquittals on merit. An acquittal based
on benefit of doubt would not stand on par with a clean acquittal on merit
after a full-fledged trial, where there is no indication of the witnesses
being won over. The long standing view on this subject was settled by this
Court in R.P. Kapur Vs. Union of India[8], whereby it was held that a
departmental proceeding can proceed even though a person is acquitted when
the acquittal is other than honourable. We are in agreement with this
view.
In administrative law, it is a settled principle that the onus of
proof rests upon the party alleging the invalidity of an order[9]. In other
words, there is a presumption that the decision or executive order is
properly and validly made, a presumption expressed in the maxim omnia
praesumuntur rite esse acta which means 'all things are presumed to be done
in due form[10].'
11. The Division Bench, in appeal, apparently found it fit to rely
on an additional affidavit filed for the first time by the respondent in
his Writ Petition, referring to the letter dated 30.12.1987 by which the
respondent is purported to have sought the production of certain documents.
It is not disputed that the respondent had not at any stage earlier made
any grievance that he had written a letter dated 30.12.1987 calling upon
the bank to produce certain documents for his perusal and which was denied.
It is further not in dispute that there is no record of the bank having
received the letter and there is no proof for it. The bank has denied
receiving the letter and according to the bank they had received a letter
dated 28.12.1987 and they had replied by their letter dated 14.01.1988. In
their reply, there was no reference to the letter dated 30.12.1987 because
they had not received it. We find that in the absence of proof that any
such letter demanding certain documents was received by the bank, it was
not permissible for the High Court to proceed to draw an inference that
there was a failure of natural justice in the bank having denied certain
documents. Thus it may be said, that an administrative authority such as
the Appellant, cannot be put to proof of the facts or conditions on which
the validity of its order must depend, unless the Respondent can produce
evidence which will shift the burden of proof on the shoulders of the
Appellant. How much evidence is required for this purpose will always
depend on the nature of that particular case. In Potato Marketing Board v.
Merricks[11], it was held that if an order has an apparent fault on the
face of it, the burden is easily transferred. However, if the grounds of
attack are bad-faith or unreasonableness, the Plaintiff's task is heavier.
12. On the question of shortage of money, the Division Bench
merely upheld the findings of the learned Single Judge that there was no
clinching evidence in support of the charges. The Division Bench approved
the findings of the Single Judge that the inquiry report that the shortage
of cash occurred only between 16.11.1985 and 05.04.1986, when the
respondent was a joint custodian, was based on surmise and conjecture. The
Division Bench did not care to advert to the evidence. That evidence
rightly relied on by the enquiry officer which established that the
shortage did occur between 16.11.1985 and 05.04.1986. In fact the inquiring
officer has given cogent reasons for rendering the findings that the
shortage could not have occurred after 05.04.1986 upto the discovery of
15.04.1986, when two acting cashiers had functioned. Moreover, the
observation that there is no clinching evidence in support of the charges
is another way of saying that the evidence is insufficient or inadequate,
which is not permissible. It bears repetition that sufficiency or adequacy
of evidence is not the ground on which the findings of facts may be set-
aside by the High Court under Article 226. The justification offered by
the Division Bench that the learned Single Judge had to undertake the
exercise of analysing the findings of the enquiry officer because the
appellants had deprived the respondent of his livelihood is wholly
untenable. A transgression of jurisdiction cannot be justified on the
ground of consequences, as has been done. Moreover, the reliance by the
Division Bench on Mathura Prasad Vs. Union of India & Ors.[12] is entirely
misplaced, since that case arose in an entirely different set of
circumstances. We also find it difficult to understand the justification
offered by the Division Bench that there was no failure on the part of the
respondent to observe utmost devotion to duty because the case was not one
of misappropriation but only of a shortage of money. The Division Bench
has itself stated the main reason why its order cannot be upheld in the
following words, "on reappreciation of the entire material placed on
record, we do not find any reason to interfere with the well considered and
merited order passed by the learned Single Judge."
13. We accordingly set-aside the impugned order and dismiss the
writ petition of the respondent.
14. Having regard to the circumstances of the case, we find it
appropriate to direct the appellant to pay an adhoc sum of Rs.3,00,000/- to
the respondent who has retired long ago and has drawn pension of which he
will be deprived hereafter. Appeal disposed off as allowed.
..................................J.
[J. CHELAMESWAR]
.....................................J.
[S.A. BOBDE]
New Delhi,
December 10, 2014