K. Chandrasekharan v. North Malabar Gramin Bank and Another

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** ## **THE HONOURABLE MR.JUSTICE P.R.RAMACHANDRA MENON** **MONDAY, THE 3RD DAY OF DECEMBER 2012/12TH AGRAHAYANA 1934** ## **WP(C).No. 1587 of 2012 (W)** **--------------------------** **PETITIONER(S) :** **---------------------** **K.CHANDRASEKHARAN, AGED 60 YEARS,HOUSE NO.I/B KALOOR RESIDENCY KALOOR KADAVANTHRA ROAD NEAR IGNOU REGIONAL CENTRE,KALOOR P.O,ERNAKULAM** **BY ADV. SRI.M.P.SREEKRISHNAN** **RESPONDENT(S) :** **------------------------** ## **1. V.K.SAIGALCHAIRMAN** **NORTH MALABAR GRAMIN BANK NMGB TOWERS PALLIKUNNU KANNUR 670 004** **2. NORTH MALABAR GRAMIN BANK REPRESENTED BY ITS CHAIRMAN NMGB TOWERS, PALLIKUNNU, KANNUR 670 004** **R1 & R2 BY ADV. SRI.DEVAN RAMACHANDRAN R2 BY ADVS. SRI.K.M.ANEESH SRI.ADARSH KUMAR** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 03-12-2012, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **BP** ## **WP(C).No. 1587 of 2012 (W)** ## **APPENDIX** ## **PETITIONER(S) EXHIBITS** **EXT.P1THE TRUE COPY OF THE MEMO DATED 14.09.2011 ISSUED BY THE 1ST RESPONDENT.** - **EXT.P2THE TRUE COPY OF THE COMMUNICATION DATED 21.9.2011 ISSUED BY THE PETITIONER.** - **EXT.P3THE TRUE COPY OF THE COMMUNICATION ISSUED BY THE 1ST RESPONDENT DATED 19.12.2011** - **EXT.P4THE TRUE COPY OF THE RELEVANT PORTION OF THE OFFICE NOTE DATED 12.3.2010** - **EXT.P5THE TRUE COPY OF THE COMMUNICATION DATED 16.2.2009 BY THE PETITIONER TO THE BRANCH MANAGER.** - **EXT.P6THE TRUE COPY OF THE COMMUNICATION DATED 6.4.2010 BY THE PETITIONER TO THE BRANCH MANAGER.** - **EXT.P7THE TRUE COPY OF THE COMMUNICATION DATED 20.1.2012 ISSUED BY THE 2ND REPSONDENT.** - **EXT.P10: COPY OF THE PROCEEDING DATED 11/10/2011 NUMBERED AS 8170/E.NO.55/OD/PAIRD/2011.** **EXT.P11: COPY OF THE EXPLANATION DATED 1/12/2011 OF THE PETITIONER'S WIFE** **EXT.P12: COPY OF THE PROCEEDINGS DATED 24/9/2012 OF THE 1ST RESPONDENT EXT.P13: COPY OF THE REPLY DATED 16/10/2012 OF PETITIONER'S WIFE.** **RESPONDENT'S EXHIBITS NIL.** **//TRUE COPY//** ## **P.A. TO JUDGE** ## **BP** ## **P.R. RAMACHANDRA MENON, J.** .............................................................................. **W.P. © No.1587 OF 2012** ......................................................................... **Dated this the 3[rd] December, 2012** ## **J U D G M E N T** Ext. P1 charge sheet issued to the petitioner, who is a senior level officer in the respondent Bank, is the subject matter of challenge. 2. Normally, by virtue of the settled position of law, there cannot be any interference by this Court invoking the discretionary jurisdiction under Article 226 of the Constitution of India at the stage of issuance of a charge sheet in respect of the disciplinary proceedings. Exemption can be drawn in exceptional circumstances when the specific instances pointed out cannot constitute any misconduct at all or when it amounts to a clear instance of malafides or such other situations as explained by the Apex Court in **Union of India Vs. Upendra Singh [(1994) 3 SCC 357]** and **State of Punjab Vs. V.K. Khanna and Ors. (JT 2000 (Suppl) SC 349)** , whether this case falls in line as one **W.P. © No.1587 OF 2012** **2** among the exceptional few, is the question. 3. In view of the specific averments raised in the writ petition against the Chairman of the Bank, impleaded in his personal capacity and the sequence of events leading to Ext. P1 charge sheet issued just 'two weeks' prior to the date of retirement, coupled with such relevant circumstances, the writ petition was admitted on 19.01.2012 also granting interim stay of all further proceedings pursuant to Ext. P1. 4. The second respondent has filed a statement dated 21.01.2012 pointing out that the petitioner is liable to be proceeded against, in view of the misconducts committed by him, as to the wilful insubordination in respect of the orders passed by the Chairman (to have the relevant matter placed for consideration of the Board) and that he has caused serious loss to the Bank, by not taking any proper steps for finalization of the concerned 'OTS' proposal received from the Kannur branch of the Bank. When the matter was brought up for further consideration, at the instance of the Bank, after considering the materials on record, this Court, as per interim order dated **W.P. © No.1587 OF 2012** **3** 01.02.2012, held that no sufficient ground was made out to vacate the interim order dated 19.01.2012. Considering the request made by the learned counsel for the respondent Bank for granting time to file a detailed counter affidavit, the same was granted also enabling them to produce the relevant documents in support of their contentions. The case was adjourned several times, despite which, no counter affidavit has been filed so far. 5. The petitioner joined in the service of the Bank in April 1997, as Manager and was promoted as Area Manager in the year 1983. Thereafter, he was given further promotion as Senior Manager in the year 2010. According to the petitioner, he has an unblemished track record of nearly 34 years and his service records are excellent. While the petitioner was working as Senior Manager of the Recovery Department in the Head Office at Kannur from 01.07.2008 to 06.11.2008 and while holding office in some other capacity during the subsequent period, there occurred some instances which attracted the ill-will and hatred of the first respondent, who was the Chairman of the Bank. Ext. P1 charge memo was issued to the petitioner in June **4** ## **W.P. © No.1587 OF 2012** 2011 and later, punishment was imposed reducing the pay by two stages, which however came to be intercepted by the Board/Appellate Authority. The petitioner was continuing in service as above; but just about 'two weeks' prior to his retirement on 31.09.2011, he was served with charge memo dated 14.09.2011, alleging certain lapses on his part with regard to settlement of an 'OTS' claim and also as to some acts amounting to insubordination. 6. On receipt of Ext. P1, the petitioner submitted Ext. P2 explanation on 21.09.2011, though he was not given the normal period of 14 days to submit his explanation, as per the relevant Rules. After holding that the explanation offered by the petitioner was not satisfactory, the petitioner was served with Ext P3 communication dated 19.12.2011, as to the decision taken to conduct a domestic enquiry in respect of the charges levelled against the petitioner. According to the petitioner, the respondents identified a person by name 'Janardhanan' to act as the Presenting Officer of the Bank, who in fact had sanctioned the loan at the relevant period and had forwarded the 'OTS' proposal **W.P. © No.1587 OF 2012** **5** with recommendation, in his capacity as the 'Area Manager', with an ulterior motive. The petitioner contends that there was absolutely no lapse or misdeed on the part of the petitioner in any manner at any point of time and that, it was only by virtue of the timely interference made by him, that necessary 'Notes' were put up by the higher authorities and the Bank could realize a substantial extent of the due amount, from the defaulters, much higher than the amount of the 'OTS' proposed. **7** . The case of the petitioner is mainly on two grounds. First one is that, the instances mentioned in Ext.P1 charge sheet do not constitute any misconduct at all and hence, it is not liable to be, proceeded against. The second one is that, the instance of 'malafides' is writ large on the face of the proceedings and the Chairman of the second respondent Bank, impleaded in his personal capacity as the first respondent, is required to answer the same. By virtue of the course pursued by the respondents in arbitrarily placing the petitioner on the dock by issuing Ext.P1 charge sheet, on the eve of his retirement, it is stated that he was virtually prevented from having the retirement benefits **W.P. © No.1587 OF 2012** **6** released and was made to suffer quite a lot. 8. The learned counsel appearing for the respondents submits with reference to the statement dated 21/01/2012 filed before this Court that, no interference of this Court is called for at the stage of issuance of charge sheet. Referring to the facts and circumstances noted in Ext.P1, it is stated that there is wilful insubordination on the part of the petitioner, which has to be elicited in the course of enquiry. The learned counsel submits that, though the petitioner has crossed the age of superannuation on 30.09.2011, by virtue of 'Regulation 45' of the North Malabar Gramin Bank (Officers and Employees) Service Regulations 2010, it is open for the Bank to proceed with the disciplinary proceedings, till the same is taken to a logical conclusion by passing final orders. Reliance is sought to be placed on the decision rendered by the Apex Court in **Ramesh Chandra Sharma v. Punjab National Bank and another** (2007 (9) SCC 15 ) in this regard. The learned counsel further submits that, the plea of malafides raised by the petitioner is also not liable to be entertained and that interference may be warranted **W.P. © No.1587 OF 2012** **7** only in exceptional circumstances as made clear by the Apex Court, where specific instances of malafides are pleaded and substantiated. It is also stated that, the first respondent is in no way connected with the issue, as both the orders dated 09.09.2009 and 12.03.2010 (as given in Ext.P1 charge sheet) were passed by the former Chairman and not by the first respondent. Inspite of the specific orders passed by the Chairman on 9.9.2009, (to place the matter before the Board and to examine the accountability of the concerned Manager/Officer, for not having known that the mortgaged property was sold) it was not properly acted upon by the petitioner. On the other hand, the petitioner put up another 'Note' on 12.03.2010 i.e. nearly seven months later, leading to the second order passed by the Chairman, directing to file proceedings under the SARFAESI Act; to start action to fix accountability against the concerned staff and to file execution petition. 9. To have a meticulous analysis of the facts and figures, it is necessary to have a glance at the charges levelled against the petitioner vide Ext.P1, which are extracted below: **8** ## **W.P. © No.1587 OF 2012** _1) That you have not acted pro actively on the OTS proposal submitted by the branch even though the branch had reported full details/facts of the case such as closure of activity/shop due to business failure, disposal of mortgaged property, poor financial condition of the borrower, remittance of Rs. 255,000/on 31/03/2009 in suspense account as settlement offer under OTS. You also did not timely initiate any other alternate mode of recovery including legal action. Instead, you kept the file unattended for long. The circumstance indicate that you have willfully allowed to drag the matter and acted with prejudice not to consider the proposal for your own reasons. You have also not informed the fate of the OTS proposal to the branch inspite of the matter being taken up by the branch repeatedly. That you have caused to suffer huge pecuniary loss to the Bank as recovery of the dues under the account is now at stake. That you have not acted positively in the matter with diligence but displayed wilful negligence and acted detrimental to the interest of the Bank._ _2. That you have not placed the OTS proposal before the Hon'ble Board and did not examine accountability of the Manager/Officer_ **9** ## **W.P. © No.1587 OF 2012** _concerned, as ordered by the then Chairman vide the office Note No.172/RLD/ONG/09 dated 24.08.2009 put up by you in the matter._ _3. That you have disrespected, disregarded and disobeyed the lawful orders of the Chairman._ _4. That you have unauthorisedly withheld action on the file and thereby superseded the orders of higher authority which amounts to insubordination._ _5. That your above action amounts to serious dereliction of duty and you have failed to discharge your official duties honestly, diligently, efficiently as expected of a responsible officer heading the Department._ _6. That you have acted beyond the official powers vested on you and prejudicial to the interest of the Bank. You have caused to suffer huge pecuniary loss to the Bank and caused to damage the reputation of the Bank among its customers and constituents._ _You have thereby violated Regulation No.18 & 20 of North Malabar Gramin Bank ( Officers & Employees) Service Regulations 2010 which is a misconduct warranting major penalty.”_ 10. The case of the petitioner is that, there was serious **10** ## **W.P. © No.1587 OF 2012** default in respect of the loan availed by M/s. Mudra Agencies, on the strength of the immovable property given in mortgage. Later, the Kannur Branch of the respondent Bank put forth an 'OTS' proposal for granting sanction to have it settled for Rs. 2.5 lakhs. This was vide letter dated 22.12.2008 sent by the Kannur Main Branch. In response, the petitioner informed the Senior Branch Manager of the Kannur Branch vide Ext.P5 reply dated 16.02.2009 that the settlement offered was not reasonable and hence not acceptable. It was also observed that the mortgaged property was alienated and hence there was an instance of cheating as well, and as such, the Bank had to initiate legal action against the parties. 11. To examine the scope and sustainability of the charges, it is better to extract the contents of Ext.P5 letter written by the petitioner, which reads as follows : _“ We refer to your subject settlement proposal and with regard to the same we have to inform you that the offer is not reasonable and hence not acceptable to us._ _Further, you have reported the disposal of the mortgaged property. The action of the mortgagor is_ **11** ## **W.P. © No.1587 OF 2012** _being a cheating the bank you have to initiate legal action against the parties. Hence a compromise settlement with a huge sacrifice, without protecting the interest of the bank cannot be considered._ _So you are advised to contact a standing lawyer, apprise the matter to him and request him to serve suitable Lawyer Notice to the mortgagor as well as the purchaser of the mortgaged property to their present address immediately. The developments shall be reported to us in time._ _Meantime you are also advised to submit us the copy of the E.Cs. Of the mortgaged property, obtained after sanctioning the credit facility.”_ 12. In the course of further proceedings, the petitioner informed the Kannur Branch that the OTS proposal could not be entertained. But thereafter, it appears that the Branch took up the matter with the Head Office further, through the Area Manager and the communications and correspondences are seen referred to in Ext.P1 charge sheet. The petitioner put up an 'Office Note' dated 24.08.2009 to the General Manager in the following terms : _“ The Branch Manager may be advised to collect the details of the persons to whom, property was transferred and also the present_ **12** ## **W.P. © No.1587 OF 2012** _occupant of the property, like name, address etc._ _The matter may be entrusted to our inspection department for finding out the lapses, if any, on the part of the branch officials in servicing the account, resulting in the alienation of the property.”_ 13. The General Manager in turn placed the same for consideration of the Chairman, who passed orders thereon on 9.9.2009 in the following terms _“ 1. Place before the Board._ _2. Examine the accountability of the_ _concerned Manager/Officer for having not known that the property was sold on filing the suit.”_ 14. It is brought out that there was a further instance of seeking for approval of OTS; for which a lesser amount was quoted from the Branch, when the petitioner put up 'Ext.P4 Note' on 12.03.2010, which reads as follows : _“1. Since the amount to be waived is Rs.541381/- it is within the powers of the Hon'ble Board._ _2. The effective rate of return is - 0.15% - very low._ _3. The mortgaged property was_ **13** ## **W.P. © No.1587 OF 2012** _alienated during the year 2002 itself ( the year in which loan was sanctioned). However branch noted the same only recently. So there is prima facie negligence on the part of the branch._ _4) Suit filed by us against the parties for recovering the dues has been decreed on 3.3.10._ _5)There are two sureties in the loan. Branch has reported that both the sureties are having sufficient net worth._ _We have vide ON No.172/RLD/ONG/09 dated 24.8.09 taken up the matter with the Chairman through General Manager. It was decided then to place the matter before the Hon'ble Board and also for examining the accountability aspect on the concerned Manager/official._ _Legal advice in this regard was also sought from two lawyers. The lawyers opined that the transactions of transferring the property is invalid and hence we can proceed for attachment and sale of the property. They also opined that without taking action for attachment and sale of the mortgaged assets, it won't be proper to fix financial accountability on the officials as they can challenge the same in a court of law._ **14** ## **W.P. © No.1587 OF 2012** _Besides, though the sureties are credit worthy persons with sufficient attachable assets, before filing EP against them the mortgaged property has to be proceeded against._ _In view of the above aspects we may not consider OTS in its present form. We may invoke action under the provisions of SARFAESI Act for possession and sale of the mortgaged property. If the dues are not recovered by the above action EP may be filed against the sureties. Thereafter, if the amount is not realised in full the matter of fixing financial accountability on the concerned official may be examined._ _Put up to Chairman through General Manager for orders.”_ 15. The General Manager of the Bank caused the same to be placed before the Chairman, who passed an order thereon in the following manner : 1. File under SARFAESI 2. Start action to fix accountability against concerned staff. 3. File E.P. also. ## 16. It was accordingly, that the petitioner communicated the position to the Branch Manager vide Ext.P6 dated 6.4.2010, **15** ## **W.P. © No.1587 OF 2012** referring to the proceedings to be taken under the SARFAESI Act and also instructing to file Execution Petition (in response to the letter dated 9.3.2010 sent by the Branch). 17. The specific case of the petitioner is that the petitioner was never agreeable to have the OTS sanctioned for a sum of Rs. 2.5 lakhs, more so, when the civil suit filed against the defaulters had already been decreed and further, when the sureties were having sufficient means to discharge the entire liability. That apart, it was a case, where the property mortgaged was caused to be sold by the mortgagor virtually cheating the Bank. It is also the contention of the petitioner that, the property was actually situated outside the jurisdiction of the Bank, which ought not to have been accepted as security by the Bank. The fact that the property had been clandestinely sold came to the knowledge of the Bank only much later and in the said circumstance, it was necessary to take appropriate action against the Manager/Officials concerned. This in turn was put up by the petitioner as per the detailed 'Note', which was considered and forwarded by the General Manager, leading to the orders passed **16** ## **W.P. © No.1587 OF 2012** by the Chairman for appropriate action. This virtually vindicates the course and proceedings pursued by the petitioner. 18. With reference to the contents of **Ground B** , the learned counsel for the petitioner asserts that, in the course of proceedings, a sum of Rs. 2,54,623/- came to be deposited by the brother of the borrower, which is lying in a suspense account. Pursuant to further action against the sureties and also in view of the element of cheating involved in causing the mortgaged property to be sold without notice, arrest warrant was issued to the co-obligants, virtually driving them to come for a settlement and it was accordingly, that a sum of Rs. 50,000/- was deposited on 12.01.2011, seeking for further time for settlement. The learned counsel also submits that, during the course of further proceedings, the sureties caused to satisfy a total sum of Rs. 6.5 lakhs against the loan account (which liability was initially sought to be settled for just Rs.2.5 lakhs under OTS). It is in respect of the said OTS proposal of Rs. 2.5 lakhs, that the insinuation has been made against the petitioner as per Ext.P1 charge sheet, to the effect that the petitioner had not acted properly or diligently **W.P. © No.1587 OF 2012** **17** and has caused loss to the Bank, which cannot be nothing but a paradox. 19. With regard to the exact nature of the charges as per Ext.P1, the following two circumstances are sought to be highlighted by the respondents 1. Insubordination of the orders passed by the Chairman 2. Because of the delay in causing the OTS proposal to be dealt with properly, which has resulted loss to the Bank. 20. The orders passed by the Chairman pursuant to the 'Note' put up by the petitioner have already been extracted. Right from the beginning, the petitioner was of the stand that the OTS proposal to have the loan account closed for Rs. 2.5 lakhs was not liable to be accepted, as it was prejudicial to the rights and interests of the Bank. The observation made by the petitioner appears to have been accepted by the higher authorities, which led to the order dated 09.09.2009 passed by the Chairman, to place the matter before the Board and to examine the accountability of the Manager/Officer for not having known that **18** ## **W.P. © No.1587 OF 2012** the property was sold and thereafter, when it was ordered to proceed under the SARFAESI Act; to start action to fix the accountability of the concerned staff and to file Execution Petition. It is in respect of this order, that the petitioner has allegedly violated the same resulting in loss caused to the Bank. In what way the petitioner has violated the orders passed by the Chairman and in what way the petitioner has contributed to any loss allegedly suffered by the Bank, is not known from Ext.P1 or from the materials on record. Of course there is a contention for the Bank that this is a matter which has to be considered in the disciplinary proceedings. But whether the petitioner should be compelled, to suffer the ordeal and hardships, is the question. 21. The respondents have not filed any counter affidavit, despite the several adjournments given, but for a statement dated 21/01/2012. **19** ## **W.P. © No.1587 OF 2012** 22. With regard to the plea of 'malafides', the petitioner has raised some specific allegations against the first respondent, who admittedly joined duty as the Chairman on 20.5.2010 and continued in office till 20.10.2012. The instances of malafides as projected by the petitioner are as follows : 23. The first instance is with reference to the loan of Rs. 2.05 Crores granted to one George Joseph and the instructions stated as given by the first respondent to proceed under the SARFAESI Act, when the petitioner had to point out that, unless the loan account was declared as 'NPA', no such proceeding could be pursued. This according to the petitioner was to the chagrin of the first respondent. 24. The second instance is with reference to a Circular dated 26.03.2011, whereby the first respondent instructed all concerned; particularly the Branch Managers for filing reports showing the particulars of the Non Performing Accounts to the minimum possible extent, allegedly to project the image of the Bank in a better light. It is also stated in the writ petition that the petitioner was telephonically contacted by the first **20** ## **W.P. © No.1587 OF 2012** respondent, but it was not acceded to by the petitioner in view of the adverse remarks already made by the NABARD and for such other reasons. The petitioner also contends that the first respondent had called the petitioner over telephone and told him that he had cheated the Bank and was also maintaining animosity with the petitioner in connection with the leave applied for by the petitioner. It is stated that the petitioner was caused to be examined by the Medical Board again, inspite of availability of a certificate issued by the same Medical Board, certifying the genuineness of the illness. The petitioner further contends that, he was also harassed by having his wife, who is working in the same Bank, transferred on four occasions within a span of one year. It is also stated that, in a meeting of the Managers of the Bank of Kasargod Region ( when the petitioner was working as the Regional Manager of Kasargod District ), the first respondent had ridiculed that the petitioner's Region was very poor with regard to the Insurance business, which was sought to be rebutted then and there, with reference to the actual facts and circumstances; at the cost of inviting wrath of the first **21** ## **W.P. © No.1587 OF 2012** respondent. With regard to the earlier instance as to issuance of charge sheet dated 28.6.2011, leading to the punishment imposed on the petitioner, it was intercepted by the Board, in appeal. The learned counsel for the respondents, though tried to contend that the first respondent was not there in the picture, it has been conceded that the first respondent assumed office of the Chairman on 20.05.2010 and continued till 20.05.2012. The specific instances of malafides referred to by the petitioner are during the said period from 20.05.2010 to 20.05.2012. The fact remains that, inspite of several opportunities granted by this Court, the first respondent has not come forward to file any counter affidavit regarding the above specific averments. The statement dated 21/01/2012 has been filed only on behalf of the second respondent, wherein also, no specific denial is there. 25. Considering the necessity to have filed counter affidavit with regard to the factual circumstances, forming the basis of the charge and also in view of the specific plea of 'malafides', it is felt necessary to go through the proceedings sheet as well. As mentioned already, the writ petition was admitted, granting **22** ## **W.P. © No.1587 OF 2012** interim stay on 19.01.2012. After filing the statement dated 21.01.2012, the respondents sought to vacate the interim order, when the following order was passed by this Court on 01.02.2012: _“Having heard the counsel for the petitioner as well as the counsel for the respondents at length and having perused the statement filed on behalf of the second respondent, I am not satisfied that any grounds have been made out to vacate the interim order that has been passed on 19.1.2012. The counsel for the respondents seeks time to file a detailed counter-affidavit and to produce documents that are necessary to support the contentions of the respondents. Two weeks time is sought for the above purpose. Two weeks time is granted. “_ 26. The matter came up for further consideration on 17.02.2012, when the respondents sought for three weeks' time to file counter affidavit. On 05.03.2012, the respondents sought for further time to file counter affidavit, when a positive direction was given by this Court to file counter affidavit before **23** ## **W.P. © No.1587 OF 2012** 12.03.2012. Thereafter, the matter came up for consideration on 15.03.2012, when the respondents sought for still more time to file counter affidavit and the case was adjourned to 22.03.2012. On 22.03.2012, the following interim order was passed: _“Counsel for the respondents seeks 2 weeks further time to file counter affidavit. The prayer is opposed by the counsel for the petitioner. I notice that a number of chances have been given for filing counter affidavit. File counter affidavit positively within 2 weeks. Post after 2 weeks. Interim order is extended until further orders. ”_ The writ petition came to be posted before the Bench on several occasions thereafter, ie.. 10.04.2012, 06.06.2012, 19.09.2012, 23.11.2012, 26.11.2012, 27.11.2012, 28.11.2012 and finally today, i.e. 03.12.2012. Still the respondents have not chosen to file any counter affidavit. 27. With regard to the question of sustainability of the disciplinary proceedings, to be continued even after the date of superannuation of the petitioner from the service, on **24** ## **W.P. © No.1587 OF 2012** 30.09.2011, the learned Counsel for the respondents submits that there cannot be any bar in proceeding further, in view of Regulation 45 of the North Malabar Gramin Bank (Officers and Employees) Service Regulations, 2010, which reads as follows: _“45. Disciplinary proceedings after retirement:-_ _(1) An officer or employee who is under suspension on a charge of misconduct and who attains the age of superannuation, shall be deemed to be in service even after the age of superannuation for the specific purpose of continuation and conclusion of the disciplinary proceedings and issue of final orders thereon._ _(2) The officer or employee who is under suspension shall not be eligible for any subsistence allowance for the period beyond the date of superannuation._ _(3) The officer or employee against whom disciplinary proceeding has been initiated shall cease to be in service on the date of superannuation but the disciplinary proceeding shall continue as if he was in service until the proceedings are concluded and final order is passed in respect thereof._ _(4) The officer or employee against whom disciplinary proceedings has been_ **25** ## **W.P. © No.1587 OF 2012** _initiated shall not receive any pay and/or allowances after the date of superannuation and also not be entitled for the payment of retirement benefits till the proceeding is completed and final order is passed thereon except his own contribution to Contributory Provident Fund (CPF)._ _Explanation: For the purposes of this regulation, the normal retirement benefits such as encashment of privilege leave and Gratuity may be withheld till the completion of the disciplinary proceedings and passing of final order by the Competent Authority and the release of benefits shall be as per the final order of the Competent Authority.”_ 28. The legal position stands settled by virtue of the law declared by the Apex Court in [ **(2007)9 SCC 15] (cited supra)** , whereby it has been held that, if there is a provision in the relevant Conduct Rules to enable the disciplinary authority to inflict punishment even after the date of superannuation, such a course would stand justified. The learned Counsel for the petitioner also fairly brought it to the notice of this Court that, in a subsequent verdict passed by the Apex Court ( three member **26** ## **W.P. © No.1587 OF 2012** Bench) in _**State Bank of India vs. Ram Lal Bhaskar and another**_ [ **(2011)10 SCC 249]** , the same proposition has been explained further. As such, there cannot be any grievance in this regard as to the further course and events, if disciplinary proceedings are still to be pursued. But the question is, whether such an exercise should be permitted by this Court, in view of the particular facts and circumstances. 29. As discussed already, the case put forth against the petitioner as per Ext.P1 is with reference to the 'OTS' proposal made by the Branch, to have the loan settled for a sum of Rs.2.5. Lakhs and the alleged lapse on the part of the petitioner in not implementing the orders passed by the Chairman, thus amounting to alleged insubordination. With reference to the pleadings and materials on record, this Court has already observed that the stand taken by the petitioner on receipt of the proposal sent by the Branch was that, the OTS offer for a sum of Rs. 2.5. lakhs as recommended by the Branch was not acceptable, being far below the reasonable extent, whereas the loan was secured in view of the assets possessed by the **W.P. © No.1587 OF 2012** **27** sureties. The disposal of the property by the Mortgagor without knowledge of the Bank was also highlighted by the petitioner suggesting appropriate proceedings by way of legal action. The factual position as to the obtaining of a decree in favour of the Bank was also pointed out. The petitioner further brought to the notice of the General Manager of the Bank and in turn to the Chairman as well, that appropriate action is required to be taken against the concerned official for fixing liability and it was in the said circumstance, that the matter was ordered to be placed before the Board as per the order dated 09.09.2009 passed by the Chairman. It was thereafter, that the concerned Branch mooted another proposal, that too, for a much lesser extent and this was duly replied by the petitioner pointing out that the same ' ' was not acceptable. The petitioner also put up a Note dated 12.03.2010 giving all the facts and figures, which was placed for consideration of the General Manager, who brought it to the notice of the Chairman, thus leading to the 'second order' passed by the Chairman directing to proceed with further steps under the SARFAESI Act; to fix the accountability of the officer **W.P. © No.1587 OF 2012** **28** concerned and to file E.P. Thus, the proceedings taken by the petitioner have virtually contributed to the orders passed by the Chairman, for taking appropriates steps to safeguard the interests of the Bank, instead of agreeing for the proposal to have the loan account closed for a meagre sum of Rs.2.5 lakhs. This Court also records the submission made by the learned Counsel for the petitioner with reference to 'Ground 'B' and other relevant aspects pointed out, that in furtherance to the steps caused to be taken, including issuance of warrant against the sureties, they have come forward and the loan account has been closed, repaying a sum of Rs. 6.5 lakhs. Thus, the Bank has been benefited by nearly 'four' lakhs rupees more than the proposed 'OTS' amount of Rs.2.5 lakhs, which was sought to be sanctioned by the Branch and in respect of which proposal, the petitioner had been booked, alleging insubordination and loss to the Bank. 30. The version of the respondents, as put forth in Ext.P1, (more so, when the factual particulars have not been sought to be controverted by filing any counter affidavit, despite granting **W.P. © No.1587 OF 2012** **29** several opportunities), does not appear to be palatable to this Court. With regard to the plea of malafides also, this Court is of the firm view that, what has been pleaded by the petitioner with reference to the specific instances in the writ petition have never been sought to be rebutted by the first respondent Chairman, who was very much holding the office of the Chairman of the second respondent Bank from 01.07.2008 to 06.11.2010. The first respondent has paid only scant regards to the process of this Court and has not taken any effort to rebut the specific averments. The nature and extent of the pleadings raised by the petitioner having not been rebutted by the first respondent, the burden has not been shifted back to the shoulders of the petitioner, to substantiate the plea any further. This Court finds that the respondents have failed to bring the actual facts and figures, if it is something else, to the proper notice of this Court. 31. In the above circumstance, this Court finds that Ext.P1 charge sheet issued to the petitioner on the eve of his retirement, i.e. on 14.09.2012, alleging insubordination and also **30** ## **W.P. © No.1587 OF 2012** causing alleged loss to the Bank is not correct or sustainable either on facts or in law and it is not liable to be proceeded with, any further. Ext.P1 charge sheet is set aside accordingly. The respondent Bank is directed to disburse the service benefits to the petitioner at the earliest, at any rate, within one month from the date of receipt of a copy of the judgment, failing which, interest shall be paid at the rate of 9% per annum. The writ petition is allowed. This Court reluctantly refrains from awarding cost . ## **P.R. RAMACHANDRA MENON, JUDGE.** ## kmd/sv/lk **The following corrections are made in the judgment dated 03/12/2012 in W.P.(C)No. 1587/2012:** **The period of time “01.07.2008 to 06.11.2008” occurring in the 8[th] line of paragraph 5(page 3) is corrected and substituted as “01.07.2008 to 06.11.2010”. Word and figure “June 2011” occurring in the 5[th] sentence of paragraph 5 are corrected and substituted as “September 2011”.** **Date “20.05.2012” occurring in line 3 of page 21 is corrected and substituted “20.10.2012”.** **The period of time “20.05.2010 to 20.05.2012” occurring in the 5[th] line of page is corrected and substituted as “20.05.2010 to 20.10.2012. The period of time “01.07.2008 to 06.11.2010” occurring in the 2[nd] and 3[rd] lines of page 29 is corrected** **31** ## **W.P. © No.1587 OF 2012** **and substituted as “20.05.2010 to 20.10.2012”. Date “14.09.2012” occurring in the 3[rd] line of paragraph 31 (page 29) is corrected and substituted as “14.09.2011”. vide order dated 06/02/2013 in I.A.1650/2013.** **Sd/- Registrar (Judicial)**