K.S. Maya Devi v. Deputy General Manager, State Bank of Travancore

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE ANTONY DOMINIC & THE HONOURABLE MR. JUSTICE DAMA SESHADRI NAIDU TUESDAY, THE 18TH DAY OF JULY 2017/27TH ASHADHA, 1939 ## WA.No. 1728 of 2015 () IN WP(C).30526/2008 -------------------------------------------- AGAINST THE ORDER/JUDGMENT IN WP(C) 30526/2008 of HIGH COURT OF KERALA DATED 23-01-2015 ## APPELLANT(S)/WRIT PETITIONER: -------------------------------------- K.S.MAYA DEVI, NAVASREE 34/1042, F, CHANDRATHIL ROAD, EDAPPALLY P.O., KOCHI. BY ADV. SRI.ADARSH KUMAR SRI.BIJU VARGHESE ABRAHAM SRI.DILEEP CHANDRAN SRI.M.R.SARIN SRI.M.R.SASITH RESPONDENT(S)/RESPONDENT IN W.P.: --------------------------------------------- THE DEPUTY GENERAL MANAGER, STATE BANK OF TRAVANCORE, ZONAL OFFICE, ERNAKULAM, COCHIN -11. ## R BY SRI.P.RAMAKRISHNAN THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 18-07-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: 'CR' ANTONY DOMINIC & DAMA SESHADRI NAIDU, JJ. ------------------------------------------W.A. No. 1728 of 2015 ( ) -----------------------------------------Dated this the 18[th] day of July 2017 ## JUDGMENT Dama Seshadri Naidu,J. Back Ground: Appellant Maya Devi was working as a Head Cashier in a branch of the respondent Bank: State Bank of Travancore. In October, 2000, Maya Devi wanted to go on leave. When she was handing over the charge to another employee, Maya Devi's cash balance showed a shortage. To have the shortage confirmed, another official counted the money in Maya Devi's custody and found that `45,500/- was short. As the Head Cashier—Maya Devi—and the Deputy Manager are the joint custodians, they made good the loss. Yet the Bank initiated disciplinary proceedings against both the employees. We confine to the proceedings vis-à-vis only Maya Devi. 2. Not satisfied with the explanation given by Maya Devi, the Bank appointed an Enquiry Officer, who upon enquiry, submitted a report. Acting on the report, the disciplinary authority had found -2- W.A. No. 1728/2015 charges of major misconduct proved against Maya Devi and recommended for her summary dismissal. Aggrieved, Maya Devi took an inter-departmental appeal, in which the punishment was modified to that of compulsory retirement: to be discharged with all superannuation benefits. Further aggrieved, Maya Devi raised an industrial dispute before the Central Government Industrial Tribunal, Ernakulam in I.D. No. 191 of 2006. 3. Through an award, dated 25.03.2008, the Industrial Tribunal has upheld the punishment imposed on Maya Devi and refused to interfere. Further aggrieved, Maya Devi filed W.P.(C) No. 30526 of 2008, which a learned single Judge of this Court dismissed through a judgment dated 23.01.2015. That is why Maya Devi is before us in . this intra-court appeal Submissions: 4. In the above factual backdrop, Sri Adarsh Kumar, the learned counsel for the appellant, has strenuously contended that the enquiry has been perfunctory, and the findings are unsustainable. Drawing our attention to the facts, he has also submitted that though as may as -3- W.A. No. 1728/2015 five charges have been framed against Maya Devi, not even one could be established. He has also submitted there has never been an allegation of misappropriation; the entire allegation, in fact, concerns only the alleged negligence. Taking us to the defence set up by Maya Devi, Sri Kumar has submitted that even the Enquiry Officer has found that all along there had been shortage of cash—even before Maya Devi became the Head Cashier. Just because Maya Devi made good the loss, he furhter contends, it could not be concluded that she was negligent. 5. On the findings of the Enquiry Officer, Sri Kumar would contend that all findings are in Maya Devi's favour, save the solitary one that she neglected to handle the cash. At any rate, he would further contend that the punishment inflicted on Maya Devi is grossly disproportionate. Sri Kumar, to support his contentions, has relied on Narinder Mohan Arya v. United India Insurance Company Limited and others[1] . As to the manner of enquiry and the perfunctory findings said to have been rendered by the Enquiry Officer, he has 1(2006) 4 SCC 713 -4- W.A. No. 1728/2015 placed reliance on G.V. Aswathanarayana v. Central Bank of India[2] , Ramani v. Karuvatta S. Co-Op. Society[3] , Sawai Singh v. State of Rajasthan[4] and Natavarbhai S. Makwana v. Union Bank of India and others[5] . 6. Per contra, Sri P. Ramakrishnan, the learned Standing Counsel for the respondent Bank, has submitted that in the face of Maya Devi's admission that there was a cash shortage, it requires little reasoning that she had been negligent in discharging her duties. He has also submitted that the very fact she has made good the loss speaks volumes about her negligence. He has taken us through the findings rendered by the Enquiry Officer to emphasize that the shortage of cash is not by oversight—and not even by any bona fide mistake. 7. To put it differently, Sri Ramakrishnan contends that when the shortage was pointed out by another employee, Maya Devi, who 2ILR 2003 Kar 3066 31993(2) KLT 681 4(1986) 3 SCC 454 5(1985) II LLJ 296 Guj -5- W.A. No. 1728/2015 counted the money, falsely persisted that there was no discrepancy. Then the Manager was compelled to count the money himself. All along, Maya Devi has tried, according to Sri Ramakrishnan, to evade the responsibility. 8. Sri Ramakrishnan has also submitted that the Bank has framed five charges and found the appellant guilty of most of them. He has also submitted that the enquiry report may not have been articulate. But it has addressed all the issues. At any rate, when Maya Devi raised an industrial dispute, further contends Sri Ramakrishnan, she has never questioned the enquiry, by that letting the bank lose an opportunity to lead evidence if necessary. 9. Before the Labour Court, Maya Devi has never questioned the procedure adopted by the Enquiry Officer. Nor has she alleged any violation of principles of natural justice, contends Sri Ramakrishnan. According to him, she only raised the issues on merits, and the industrial Tribunal has examined them threadbare. After having a fair hearing, Maya Devi cannot be heard now saying that she has been prejudiced. -6- W.A. No. 1728/2015 10. Sri Ramakrishnan has also pointed out that the enquiry commenced in 2000 and, after a lapse of 17 years, it is difficult for the Bank to lead any evidence afresh, much less secure the records after a long lapse of time. He has further submitted that the Tribunal has also examined the proportionality of punishment in exercise of its powers under Section 11A of the Industrial Disputes Act (“the ID Act”) 11. Eventually, Sri Ramakrishnan, for the respondent Bank, has also drawn our attention to the Enquiry Officer's findings on the employer’s loss of confidence over its employee. He has stressed that the negligence concerns shortage of money in a financial institution. In the backdrop of the explanation given by Maya Devi and her devious efforts to pass the buck by denying any responsibility, she is not worthy of the trust the Bank has reposed on her, and her discharge with all superannuation benefits cannot be found fault with. Nor can it be said to be grossly disproportionate. -7- W.A. No. 1728/2015 12. To support his contentions, Sri Ramakrishnan has relied on Tripura Gramin Bank and others v. Tarit Baran Roy and another[6] , Regional Manager, U.P. SRTC, ERAWAH and others v. Hoti Lal and another[7] Divisional Controller, KSRTC (NWKRTC) v. A.T. Mane[8] State Bank of India and another v. Bela Bagchi and others[9] Om Prakash Mann v. Director of Education (Basic) and others[10] and A.P. SRTC v. . Raghuda Siva Sankar Prasad[11] 13. Heard Sri Adarsh Kumar, the learned counsel for the appellant, and Sri P. Ramakrishnan, the learned Standing Counsel for the respondent Bank, besides perusing the record. Issues: 14. In this industrial dispute, the bipartite settlement enlists the instances of gross misconduct. Maya Devi was charged with one such 6(2001) 10 SCC 70 7(2003) 3 SCC 605 8(2005(3 SCC 254 9(2005) 7 SCC 435 10(2006) 7 SCC 558 11(2007) 1 SCC 222 -8- W.A. No. 1728/2015 misconduct. After a departmental enquiry, she was found to have been guilty of a gross misconduct: involving or likely to involve the Bank in serious loss. She was discharged from service with terminal benefits. Now the issues to be decided are thses: (1) Has Maya Devi been given adequate opportunity to defend herself? (2) Are there any procedural irregularities going to the root of the disciplinary proceedings? (3) Has the charge been established against Maya Devi? (4) Is the punishment imposed on her shockingly disproportionate? Analysis: 15. Indeed, in this appeal, to reiterate, we do not desire—nor is it permissible—to re-appreciate the the evidence on record. But we could examine whether Maya Devi has been deprived of an opportunity to defend herself, or whether there are any gross procedural irregularities striking at the root of the findings. That apart, we may as well examine the proportionality of punishment inflicted on the appellant. -9- W.A. No. 1728/2015 Issue No.3: Has the charge been established against Maya Devi? ## 16. We may examine the charges framed against Maya Devi: 1.On 23.10.2000, while you were holding charge as Head Cashier of the Branch shortage in cash was detected and accordingly the Bank caused verification of the entire cash held by the branch in your presence. The verification revealed shortage in cash/excess in cash with a net shortage of `45,510/- . . . . 2.Owning responsibility individually you remitted a sum of `25,010/- on 28.10.2000 and owning responsibility as joint custodian a sum of `10,250/- on 28.10.2000. 3.The verification also revealed the following discrepancies in the cash held in the currency chest of the Branch. [tabulates the shortage denomination-wise] 4. As Head Cashier of the Branch it has been your duty to maintain accuracy and safe custody of the cash held by the Branch at all times and hence you are liable to be proceeded against for the unauthorised action on your part which resulted in loss to the Bank. 5. You issued cheque No. 544007 dated 12.10.2000 for `10,000/drawn on your SB account with our Edappally Branch without keeping sufficient balance in the account.” 17. These charges must be examined in the backdrop of the provisions in the bipartite settlement providing for both the gross misconduct and the minor misconduct. Clause 19.5 reads: -10- W.A. No. 1728/2015 “19.5(d) wilful damage or attempt to cause damage to the property of the Bank or any of its customers. 19.5(e) wilful insubordination or disobedience of any lawful and reasonable order of the management. 19.5(j) gross negligence involving or likely to involve the Bank in serious loss.” 18. Leaving aside the minor charges, we may focus on what is said to be Maya Devi’s gross negligence. On facts, as has been discussed threadbare by the Industrial Tribunal, there was a shortage of `45,500/-. And Maya Devi along with the Assistant Manager was constrained to make the loss good. In fact, Maya Devi has not readily agreed there had been any shortage. This made the other officials of the Bank count the money in her presence and establish the shortage. Though the Bank has never alleged that Maya Devi has misappropriated the amounts, the fact, nevertheless, remains that huge discrepancy in the cash balance maintained by her has been unearthed accidentally. 19. Although money-shortage was evident, Maya Devi tried to maintain, in fact insisted, that the cash balance was in order and that -11- W.A. No. 1728/2015 she should leave as an autorickshaw had been waiting! Maya Devi being the Head Cashier, the Bank, her employer, naturally expects from Maya Devi a more mature response than her insisting that she should immediately leave for an auto-rikshaw was waiting. And that was in the backdrop of substantial amount missing from her custody. 20. Clause 19.5(d) of the Bipartite settlement speaks of wilful damage or attempt to cause damage to the Bank's property or any of its customers. Further, Clause 19.5 (j) concerns gross negligence involving or likely to involve the Bank in serious loss. 21. From clause 19.5 (d) we discern that the major misconduct concerns not only wilful damage caused but also wilful damage that may have been attempted to be caused. Here, Maya Devi, the Head Cashier, exhibited gross negligence, and it almost resulted in loss to the bank, had it not been for Maya Devi herself and another employee making good the loss. Further examined, clause 19.5 (J) deals with another aspect of major misconduct: involving or likely to involve the Bank in serious loss. Undetected, Maya Devi’s conduct had all the -12- W.A. No. 1728/2015 potential of involving the bank in serious loss. On either count, we must hold, Maya Devi’s major misconduct stands established. 22. We do accept that the enquiry report is somewhat inarticulate. But, at the same time, Maya Devi has never objected before the Industrial Tribunal. On merits, whatever the contentions she has raised were effectively, and exhaustively, answered by the Industrial Tribunal; and it was after a thorough examination of the evidence on record. To that extent, we do not propose to hold that there is any perversity of findings. Issue Nos.1 & 2: Has Maya Devi been given adequate opportunity to defend herself? Are there any procedural irregularities that go to the root of the disciplinary proceedings? 23. We will combine both the issues as the factual and the legal background for them is common. Maya Devi alleges that the bank prepared the charge memo mechanically, violating the bipartite settlement. According to Maya Devi, the Enquiry Officer on the very -13- W.A. No. 1728/2015 first sitting marked the documents behind her back. She also alleges that she had never been given access to the original documents. So she sums up that the enquiry grossly violated the principles of natural justice. 24. We cannot be oblivious to the fact that we are judicially reviewing—in a writ of certiorari—a Tribunal's decision. First, the issue concerns disciplinary proceedings in a financial establishment; second, the Tribunal—a competent adjudicatory body—exercised its appellate power over the employer’s decision in disciplinary proceedings. To sum up, the jurisdictional interference at this stage, we must say, is extremely limited. 25. Often, the employer may have made out a strong case on the merits, but it may have been, at the same time, found wanting on the procedural front. All its exercise as a disciplinary authority may, then, comes a cropper. To obviate such an eventuality, where the legality of enquiry is challenged, the management may desire to play it safe, and plead before the Tribunal that if the enquiry is found to be -14- W.A. No. 1728/2015 vitiated, it be given an opportunity to justify its action by adducing evidence. 26. It can be seen that, despite the statute being laconic on this procedural safeguard, the Courts, in the course of time, have evolved the necessary judicial principles to ensure fairness on the processional front. Four of the pioneering judicial pronouncements on this aspect are Delhi Cloth & General Mills Co. Ludh Budh Singh[12] , Workmen of Firestone Tyre & Rubber Co. of India Pvt. Ltd. v. Management,[13] Cooper Engineering Ltd. v. P.P. Mundhe[14] and Shankar Chakravariti v. Britania Bisuit Company Ltd.[15] 27. But cardinal is the requirement that there ought to have been an issue raised by the employee about the validity of the domestic enquiry. Absent a plea to that effect, the employer has no obligation to ask the Tribunal for an opportunity to lead evidence, afresh. Undeniably, before the Tribunal, Maya Devi, has not questioned the enquiry. 12AIR 1972 SC 1031 13(1973) 1 SCC 813 14(1975) 2 SCC 661 15(1979) 3 SCC 71 -15- W.A. No. 1728/2015 28. As rightly contended by the Bank, after a lapse of close to two decades, it is well-nigh impossible for the employer to put the clock back and unearth everything afresh: produce records, secure witnesses, and lead fresh evidence before the Tribunal. Even the impugned judgment before us rendered by the learned single Judge is exhaustive and meticulous, too. And interference in disciplinary proceedings cannot be for mere asking. Clichetic it may sound if we observe that an employer must have play in the joints—sufficient leeway—while its deciding on the shortcomings of an employee. The issue before us has already been judicially tested twice before it reached us: the Industrial Tribunal examined the issue on appeal, and later a learned single Judge of this Court also reviewed that decision. In a writ appeal, the adjudicatory ambit of a service dispute is severely constricted. Issue No.4: Is the punishment imposed on Maya Devi grossly disproportionate? -16- W.A. No. 1728/2015 29. Proportionality is a fertile legal principle, protean in form and nebulous as a norm. A profusion of precedents has highlighted various shades of this principle. But one unchanging underpinning of the entire judicial discussion is that proportionality is not a pure legal principle or precept capable of being viewed in isolation; its application to a case depends on the facts and circumstances of that case. 30. The proportionality of punishment—whether a punishment is shockingly disproportionate to the established misconduct—depends on myriad factors: the nature of business or activity carried on by the employer, the nature of duties discharged by the employee, the position occupied by the employee in the organisation, the nature of the allegations faced by the employee—just to be illustrative. 31. Here, the employer is a bank—a financial institution. Rectitude in behaviour and fidelity in conduct are sine qua non. Loss or its absence to the employer cannot be the sole determining factor in guiding the gravity of misconduct. Given the organisational sensitivity and the reputation the Bank needs to keep up, sometimes -17- W.A. No. 1728/2015 the employee's shortcomings expose the employer to grave dangers, though the misconduct alleged may have been, in other circumstances, a mere peccadillo. We cannot overstate the financial discipline required to be maintained by a bank employee—a cashier, at that. The employee in a bank is entrusted with, at times, astronomical sums of money, and she deals with them in a fiduciary capacity. Faith and confidence being the cornerstones of the employer-employee relationship in a financial institution, loss of confidence will drastically affect and alter that relationship. It is the final nail. 32. Loss of confidence matters the most, but not the loss of money. Sympathy and generosity, according to the Supreme Court in Raghuda Siva Sankar Prasad, cannot be a permissible factor in disciplinary proceedings. In such cases as loss of faith, misplaced sympathy cannot be a guiding factor for the Court to interfere with the quantum of the punishment. Precedents: 33. We will examine the precedents cited at the Bar. -18- W.A. No. 1728/2015 In Sawai Singh the Supreme Court’s decision turns entirely on facts. The Court, after examining the charges and the procedure adopted in the enquiry, has observed that charges framed against the appellant were vague; it was difficult for any accused to meet the charges fairly. Evidence adduced, the Court further observed, was perfunctory and did not at all bring home the guilt of the accused. So, it eventually held that given the expert evidence, the denied opportunities to the accused to cross examine, and the conflicting evidence, the Courts should not have sustained the finding of the appellant’s guilt. 34. An insured person sued the insurer for loss of goods; the insurer contested the claim: that the cover note was ante-dated. The civil court rejected the insurer’s defence and decreed the suit. The insurer acted on the decree and paid the insured amount. Then, it initiated disciplinary proceedings against its employee who issued the cover note. 35. In that context, Narinder Mohan Arya, after referring to various decisions holding the field by then, observed that (1) the -19- W.A. No. 1728/2015 Enquiry Officer is not permitted to collect any material from outside sources during the enquiry; (2) in a domestic enquiry fairness in the procedure is a part of the principles of natural justice; (3) exercise of discretionary power involves two elements: (i) objective and (ii) subjective. And the existence of an objective element is a condition precedent for exercising the subjective element; (4) the concept of fair play in action should form the basis of an enquiry; (5) the Enquiry Officer is not permitted to travel beyond the charges; and (6) suspicion or presumption cannot replace proof even in a domestic enquiry. Here, regrettably, Maya Devi established none of those shortcomings. 36. In Ramani, a single Judge of this Court has held that the purpose of framing a charge is to bring to the notice of the delinquent, with reasonable certainty, the facts constituting the misconduct alleged to have been committed by her. This is not a technical requirement. Since the delinquent must meet the charge, she must know in clear, intelligible language, what she is accused off. The -20- W.A. No. 1728/2015 absence of a reasonably certain charge, robs the inquiry of its substance. Such an inquiry with the "charges" is vitiated. 37. Again, we must say, the charges framed against Maya Devi are clear. Further more, Maya Devi has never claimed, until now, that the charges are vague. 38. Tarit Baran Roy holds that in disciplinary matters a High Court cannot re-appreciate evidence. Hoti Lal eloquently observes that the Court or Tribunal while dealing with the quantum of punishment must record reasons why the punishment does not accord with the proven charges. On facts, the Supreme Court has observed that the High Court has given no reasons whatsoever why it considered the punishment disproportionate. It is not only the amount involved but also the mental set up, the duty performed, and similar other relevant circumstances that go into the decision-making process of a forum to conclude whether the punishment is proportionate or disproportionate. If the charged employee holds a position of trust where honesty and integrity are inbuilt requirements of functioning, it would not be proper to deal with the matter leniently. Misconduct in -21- W.A. No. 1728/2015 such cases must be dealt with iron hands. Where the person deals with public money, or engages herself in a financial transaction, or acts in a fiduciary capacity, highest integrity and utmost trust-worthiness are unexceptionable—a must. 39. A.T. Mane and Bela Bagchi, too, echoes the same legal principle. On the question of principles of natural justice, Om Prakash Mann observes that the doctrines of principle of natural justice is not an embodied Rule. It cannot be applied as a straight jacket formula. To sustain the complaint of violation of the principle of natural justice, one must establish that he has been prejudiced by non-observance of principle of natural justice. In the end, because of the above discussion, we conclude that the judgment impugned does not call for any interference. We, accordingly, dismiss the appeal. ANTONY DOMINIC, JUDGE. DAMA SESHADRI NAIDU, JUDGE. rv W.A. No. 1728/2015 -22-