Service Matter – once there is no financial difference and the role is practically identical, why the respondents hesitated themselves to convert the punishment inflicted on the appellant from one of “removal from service which shall not be disqualification for future employment” to “compulsory retirement.” The only aspect is the nature of punishment which appears to tar the appellant more than the other two officers without any financial implication for the respondent-Bank.


Hon’ble Mr. Justice Sanjiv Khanna

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 4037 OF 2019
[Arising out of SLP(C) No.16555 of 2018]
NARESH CHANDRA BHARDWAJ ….APPELLANT
Versus
BANK OF INDIA & ORS. ….RESPONDENTS
J U D G M E N T
SANJAY KISHAN KAUL, J.

  1. Leave granted.
  2. The appellant was employed with respondent No.1/Bank of India
    (for short ‘Bank’) as Scale II Officer when he sanctioned three loans
    while posted at the Lal Bangla Branch of the Bank at Kanpur. The
    appellant was also the recommending authority for two loans at Harsh
    Nagar Branch, once again, at Kanpur. These loans were ultimately
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    classified as Non-Performing Assets (‘NPAs’) and the process of granting
    these loans was scrutinised by the Bank when various procedural
    abnormalities were found, which were likely to cause a loss to the Bank
    of Rs.70.32 lakh.
  3. In pursuance of the disciplinary proceedings initiated the appellant
    was visited with the major penalty of removal from service which shall
    not be disqualification for future employment upon the appellant. The
    endeavour of the appellant to assail the proceedings visiting him with
    these adverse consequences have throughout been unsuccessful including
    vide impugned order dated 25.10.2017.
  4. On 4.7.2018 the only aspect which persuaded this Court to issue
    notice was with respect to the quantum of penalty. This was on the basis
    of the submission advanced by learned counsel for the appellant that
    there were two other cases of officers, one Mr. R.K. Mishra and other Mr.
    V.K. Srivastava where also similar losses had been caused on account of
    the same party and they had been visited with the punishment of
    compulsory retirement. In effect the appellant sought that on parity he
    should be also visited only with the punishment of compulsory
    retirement.
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  5. On the respondents entering appearance, learned counsel for the
    respondent sought to obtain instructions whether the punishment could be
    so altered to compulsory retirement on parity with the other two
    delinquent employees. A counter affidavit has been filed in this behalf
    which opposes the request made on behalf of the appellant. That is the
    limited contour of controversy we have to examine in the present case.
  6. It is trite to say that the domain of the courts on the issue of
    quantum of punishment is very limited. It is the disciplinary authority or
    the appellate authority, which decides the nature of punishment keeping
    in mind the seriousness of the misconduct committed. This would not
    imply that if the punishment is so disproportionate that it shocks the
    conscience of the court the courts are denuded of the authority to
    interfere with the same. Normally even in such cases it may be
    appropriate to remit the matter back for consideration by the
    disciplinary/appellate authority. However, one other cause for
    interference can be where the plea raised is of parity in punishment but
    then the pre-requisite would be that the parity has to be in the nature of
    charges made and held against the delinquent employee and the conduct
    of the employee post the incident. It is the latter aspect which is sought
    3
    to be advanced by learned counsel for the appellant by relying upon the
    judgment in Rajendra Yadav v. State of Madhya Pradesh & Ors.1
    On
    this very aspect learned counsel for the respondents drew out attention to
    a subsequent judgment in Lucknow Kshetriya Gramin Bank (Now
    Allahabad, Uttar Pradesh Gramin Bank) & Anr. v. Rajendra Singh2
    which had taken note of the earlier judgment referred to aforesaid.
  7. There is really no difference in the proposition, which is sought to
    be propounded except that in the latter judgment the principles have been
    succinctly summarised in the last paragraph of the judgment, which read
    as under:
    “19. The principles discussed above can be summed up and
    summarized as follows:
    19.1. When charge(s) of misconduct is proved in an enquiry the
    quantum of punishment to be imposed in a particular case is
    essentially the domain of the departmental authorities.
    19.2. The Courts cannot assume the function of
    disciplinary/departmental authorities and to decide the quantum of
    punishment and nature of penalty to be awarded, as this function is
    exclusively within the jurisdiction of the competent authority.
    19.3. Limited judicial review is available to interfere with the
    punishment imposed by the disciplinary authority, only in cases
    where such penalty is found to be shocking to the conscience of
    1 (2013) 3 SCC 73
    2 (2013) 12 SCC 372
    4
    the Court.
    19.4. Even in such a case when the punishment is set aside as
    shockingly disproportionate to the nature of charges framed against
    the delinquent employee, the appropriate course of action is to
    remit the matter back to the disciplinary authority or the appellate
    authority with direction to pass appropriate order of penalty. The
    Court by itself cannot mandate as to what should be the penalty in
    such a case.
    19.5. The only exception to the principle stated in para (d) above,
    would be in those cases where the co-delinquent is awarded lesser
    punishment by the disciplinary authority even when the charges of
    misconduct was identical or the co-delinquent was foisted with
    more serious charges. This would be on the Doctrine of Equality
    when it is found that the concerned employee and the codelinquent are equally placed. However, there has to be a complete
    parity between the two, not only in respect of nature of charge but
    subsequent conduct as well after the service of charge sheet in the
    two cases. If co-delinquent accepts the charges, indicating remorse
    with unqualified apology lesser punishment to him would be
    justifiable.”
    (emphasis supplied)
  8. The principle, thus, culled out is that remitting a matter on the
    issue of quantum of punishment would be as set out in para 19.5
    aforesaid, i.e., where a co-delinquent is awarded lesser punishment by
    the disciplinary authority even when the charges of misconduct were
    identical or the co-delinquent was foisted with more serious charges.
    This is based on the principle of equality but then there has to be an
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    absolute parity.
  9. We now proceed to analyse the facts of the present case in the
    contours of the aforesaid principles.
  10. If we look to the case of the other two officers, the likely loss to
    the Bank was assessed in the range of about Rs.77.70 lakh in the case
    of Mr. R.K. Mishra and Rs.39.74 lakh in the case of Mr. V.K.
    Srivastava. The amount is, at least, not very different from one as in
    the case of Mr. R.K. Mishra. However, what is more important is the
    role performed. Mr. R.K. Mishra and Mr. V.K. Srivastava were both
    the sanctioning authorities in respect of the loans in questions and
    there were four loans each involved in the case of both the officers. In
    the case of the appellant, he was the sanctioning authority in three
    loans while he was the recommending authority in two loans.
  11. In order to appreciate this aspect, we would first refer to the
    findings on the charges against the appellant. It is noteworthy that no
    mala fide was proved. It was found that one Mr. Vikram Dixit alias
    Mr. Vinny Sondhi was the key person who is a cheat and has
    defrauded many organisations by proving his identity through
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    different identity cards acquired by him fraudulently. Third important
    aspect is that the approved advocates and valuers submitted a report
    which was relied upon by the Bank officials. These actually appear to
    be a common thread in all the three cases.
  12. Now turning to the recommendations of the Chief Vigilance
    Officer dated 20.8.2009, it would be relevant to reproduce para 6.2,
    which reads as under:
    “6.2 The DA has recommended imposition of the major penalty
    of “Compulsory Retirement” on all the three Officers. On
    perusal of the records, we find that S/Shri V.K. Srivastava and
    R.K. Mishra are P.F. optees and Shri N.C. Bhardwaj is a
    pension optee. Earlier, we had proposed “Removal from
    Service” in respect of all the three Officer, looking to the fact
    that in case compulsory retirement is imposed on Shri
    Bhardwaj, he would be entitled for compulsory retirement
    person. Looking to the seriousness of the acts of misconduct
    committed by Shri Bhardwaj, we feel that “Removal from
    Service” should be the appropriate penalty in his case. It is so
    because apart from his involvement as recommending authority
    in 2 cases at Harsh Nagar Branch, he had sanctioned 3 more
    loans from Lal Bangla Branch to accommodate the same party
    i.e., Shri Vikram Dixit.”
  13. A reading of the aforesaid shows that while earlier the proposal
    was for removal from service for all the three officers, in respect of
    other two officers it was converted into compulsory retirement while
    7
    not doing so in the case of the appellant. The rationale is stated to be
    the seriousness of the acts of misconduct of the appellant and the fact
    that he was the recommending authority in two cases and the
    sanctioning authority in three other cases. However, the real reason
    comes out from the earlier part of the paragraph, which is that while
    the other two officers were provident fund optees, the appellant was a
    pension optee. It is, however, not explained in any of the pleadings
    before us as to what is the financial ramification in respect of the two
    options and as to whether the appellant would get a greater financial
    benefit by reason of being a pension optee.
  14. It is difficult for us to accept that there is any difference in the
    conduct of the three officers as would justify this differentiation in
    punishment. The most important fact in this behalf to notice is that as
    per the counter affidavit submitted by the respondents, in their own
    wisdom they have agreed to grant compassionate allowance to the
    appellant, which is 2/3rd of the full pension as would be payable to
    him had the punishment of removal from service not been imposed on
    him. What is also important to note is that it is further submitted in
    the same paragraph 8.2 that even if the punishment is modified to
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    compulsory retirement the appellant would receive 2/3rd of the full
    pension which is equivalent to the 2/3rd of the full pension as received
    for compassionate allowance. The appellant has been given the
    maximum benefit under Regulations 31 & 33 of the Pension
    Regulations 1995 dealing with compassionate allowance.
    “8.2. ……It is further submitted that even in case a punishment of
    “Removal from service” is imposed upon the Petitioner is modified
    to that of “Compulsory Retirement”, he would receive 2/3rd of the
    Full Pension, which is equivalent to the 2/3rd of Full Pension which
    he is receiving at present as a “Compassionate Allowance.””
  15. We fail to appreciate that once there is no financial difference
    and the role is practically identical, why the respondents hesitated
    themselves to convert the punishment inflicted on the appellant from
    one of “removal from service which shall not be disqualification for
    future employment” to “compulsory retirement.” The only aspect is
    the nature of punishment which appears to tar the appellant more than
    the other two officers without any financial implication for the
    respondent-Bank.
  16. In the aforesaid facts & circumstances, we are, thus, inclined to
    accept the plea of the appellant to convert his punishment in terms
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    aforesaid to one of “compulsory retirement.”
  17. The appeal is accordingly allowed leaving the parties to bear
    their own costs.
    ………………………………J.
    [Sanjay Kishan Kaul]
    ..….….…………………….J.
    [Indira Banerjee]
    New Delhi.
    April 22, 2019.
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