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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.