2022 (2) TMI 1417 - SC - Indian Laws

Supreme Court reverses order setting aside employee penalty for cash handling negligence and theft loss

SC allowed appeal challenging HC's interference in disciplinary proceedings. Respondent employee was suspended for alleged negligence in cash handling ... Suspension order - alleged negligence on the part of the respondent delinquent in handling the keys in inappropriate manner resulted into theft/loss of cash from the cash safe - HELD THAT:- The power of judicial review in the matters of disciplinary inquiries, exercised by the departmental/appellate authorities discharged by constitutional courts under Article 226 or Article 136 of the Constitution of India is well circumscribed by limits of correcting errors of law or procedural errors leading to manifest injustice or violation of principles of natural justice and it is not akin to adjudication of the case on merits as an appellate authority which has earlier been examined by this Court in B.C. Chaturvedi Vs. Union of India and Others [1995 (11) TMI 379 - SUPREME COURT]; H.P. STATE ELECTRICITY BOARD LTD. VERSUS MAHESH DAHIYA [2016 (11) TMI 1749 - SUPREME COURT] and recently by a three­ Judge Bench of this Court (of which one of us is a member) in DEPUTY GENERAL MANAGER (APPELLATE AUTHORITY) AND ORS. VERSUS AJAI KUMAR SRIVASTAVA [2021 (1) TMI 1312 - SUPREME COURT]. Adverting to the facts of the instant case, the Division Bench has proceeded on the premise that the responsibility was of the Branch Manager along with the Assistant Manager(Cash). Hence, the respondent could not have been held responsible for the lapses of those officers and proceeding on the said foundation, set aside the penalty inflicted upon the respondent delinquent but the record of enquiry clearly manifests that it was a factual error being committed by the High Court while setting aside the domestic inquiry and the consequential punishment inflicted upon the respondent delinquent. The High Court has exceeded in its jurisdiction while interfering with the disciplinary proceedings initiated against the respondent delinquent and being unsustainable deserves to be set aside - Appeal allowed. Issues Involved:1. Validity of the inquiry proceedings and consequential punishment.2. Responsibility of the respondent delinquent for the theft incident.3. Compliance with principles of natural justice and procedural fairness.4. Role and findings of the disciplinary and appellate authorities.5. Judicial review of disciplinary proceedings by the High Court.Detailed Analysis:1. Validity of the Inquiry Proceedings and Consequential Punishment:The Supreme Court examined the validity of the inquiry proceedings and the consequential punishment inflicted upon the respondent delinquent. The inquiry officer conducted the departmental inquiry as per the procedure prescribed under the UCO Bank Officers Employees (Discipline & Appeal) Regulations, 1976. The inquiry officer found charge nos. 1, 3, and 4 proved against the respondent delinquent, while charge nos. 2 and 5 were not proved. The disciplinary authority concurred with the findings of the inquiry officer and imposed the penalty of dismissal from service with disqualification for future employment. The appellate authority, upon revisiting the record, exonerated the respondent from charge no. 3 but upheld charge nos. 1 and 4, modifying the punishment to compulsory retirement and reduction in basic pay by two stages.2. Responsibility of the Respondent Delinquent for the Theft Incident:The respondent delinquent was serving as an Assistant Manager and was one of the joint custodians of cash at the Sewla Branch when the theft occurred on 10th/11th November 1999. The inquiry officer found that the respondent failed to take precautionary steps as per the bank's guidelines, resulting in the theft/loss of cash. The findings were based on documentary evidence, and the disciplinary and appellate authorities upheld these findings. The High Court erroneously concluded that the responsibility lay with the Branch Manager and Assistant Manager (Cash), not the respondent delinquent.3. Compliance with Principles of Natural Justice and Procedural Fairness:The Supreme Court noted that the inquiry was conducted in compliance with the principles of natural justice. The respondent was given an opportunity to present his case, and the relevant documents were made available to him, except those confidential in nature, which he was allowed to inspect. The respondent's allegations of bias and non-supply of documents were found to be unsubstantiated and did not demonstrate any prejudice caused to him.4. Role and Findings of the Disciplinary and Appellate Authorities:The disciplinary authority, after considering the inquiry officer's report and providing the respondent an opportunity to be heard, imposed the penalty of dismissal. The appellate authority, upon re-evaluating the evidence, modified the penalty to compulsory retirement and reduction in pay. Both authorities provided cogent reasons for their decisions, and their findings were based on substantial evidence. The High Court failed to adequately consider these findings and the documentary evidence supporting them.5. Judicial Review of Disciplinary Proceedings by the High Court:The Supreme Court emphasized that the power of judicial review in disciplinary matters is limited to correcting errors of law or procedural errors leading to manifest injustice or violation of natural justice principles. The High Court exceeded its jurisdiction by interfering with the findings of fact and the disciplinary proceedings, which were conducted in accordance with the prescribed procedures and supported by evidence. The Supreme Court set aside the High Court's judgment, reinstating the disciplinary and appellate authorities' decisions.Conclusion:The Supreme Court allowed the appeal, quashing the High Court's judgment and upholding the disciplinary and appellate authorities' findings and the modified punishment imposed on the respondent delinquent. The Court reiterated the limited scope of judicial review in disciplinary matters and the necessity of adhering to procedural fairness and natural justice principles.