2014 (9) TMI 40 - SC - Indian Laws

Supreme Court emphasizes procedural fairness in disciplinary actions pre-1990. Communication of reasons crucial.

SP. MALHOTRA Versus PUNJAB NATIONAL BANK & ORS.

The Supreme Court held that a second show cause notice was not required before imposing punishment if done before November 20, 1990. Emphasizing natural ... Suspension of employees - Imposition of punishment - Violation of principle of natural justice - Service of copy of reasons for punishment - Held that:- order of punishment would stand vitiated in case the reasons so recorded by the Disciplinary Authority for dis-agreement with the Enquiry Officer had not been supplied to the delinquent and his explanation had not been sought - whenever the disciplinary authority disagrees with the enquiry authority on any article of charge, then before it records its own findings on such charge, it must record its tentative reasons for such disagreement and give to the delinquent officer an opportunity to represent before it records its findings. The report of the enquiry officer containing its findings will have to be conveyed and the delinquent officer will have an opportunity to persuade the disciplinary authority to accept the favourable conclusion of the enquiry officer. The principles of natural justice, as we have already observed, require the authority which has to take a final decision and can impose a penalty, to give an opportunity to the officer charged of misconduct to file a representation before the disciplinary authority records its findings on the charges framed against the officer - Following decision of Punjab National Bank & Ors. v. Kunj Behari Misra [1998 (8) TMI 594 - Supreme Court of India] - Decided in favour of Appellant. Issues involved:Requirement of issuing a second show cause notice by the Disciplinary Authority before imposing the punishment; Serving the copy of the reasons recorded by the Disciplinary Authority disagreeing with the findings recorded by the Enquiry Officer.Analysis:(a) Requirement of issuing a second show cause notice by the Disciplinary Authority before imposing the punishment:The case involved the issue of whether a second show cause notice was required by the Disciplinary Authority before imposing the punishment. The judgment in Managing Director, ECIL, Hyderabad v. B. Karunakar clarified that there was no requirement of issuing a second show cause notice before the punishment was imposed if it was done prior to November 20, 1990. The appellant argued that the ECIL judgment did not apply, citing Punjab National Bank v. Kunj Behari Misra, where it was held that reasons for disagreement must be communicated to the delinquent. The Supreme Court emphasized the importance of natural justice principles in disciplinary proceedings, ensuring the delinquent has an opportunity to respond before a final decision is made.(b) Serving the copy of the reasons recorded by the Disciplinary Authority disagreeing with the findings recorded by the Enquiry Officer:The second issue in the case was whether the Disciplinary Authority was required to serve the copy of the reasons for disagreement with the Enquiry Officer's findings to the delinquent. The court referred to Kunj Behari Misra case, where it was established that such reasons must be supplied to the delinquent, allowing them to present their explanation before finalizing the punishment. Failure to provide the reasons for disagreement was deemed to vitiate the order of punishment. The court highlighted various cases where this principle was consistently upheld, ensuring procedural fairness in disciplinary actions. The learned Single Judge set aside the punishment order, emphasizing the flawed process and lack of compliance with natural justice principles.In conclusion, the Supreme Court allowed the appeal, setting aside the Division Bench's judgment and restoring the decision of the learned Single Judge. The court reiterated the importance of following natural justice principles, particularly in cases where the Disciplinary Authority disagrees with the Enquiry Officer's findings. The judgment emphasized the need for transparency, communication of reasons for disagreement, and providing the delinquent with an opportunity to respond before imposing any punishment.