In a significant ruling of State Bank of India & Others Vs Ramadhar Sao, the Supreme Court of India examined a case involving a disciplinary dispute between a bank (the appellant) and its employee (the respondent). The respondent, a class IV employee, had been dismissed from service due to allegations of misconduct, specifically involving bribery and facilitating loans in exchange for illegal gratification. The case saw a progression through the High Court of Patna, culminating in the apex court’s judgment which sought to clarify several legal points surrounding judicial review in disciplinary proceedings.
Background:
The respondent, employed as a messenger in the Bank since 1997, faced serious allegations in 2008. Complaints suggested that he acted as a middleman, accepting bribes for coordinating the sanctioning of loans. In response to these allegations, the Bank issued a show-cause notice, which the respondent failed to satisfactorily answer. Subsequently, a formal charge sheet was issued, detailing his alleged misconduct.
Following a thorough inquiry, the respondent was found guilty of both taking illegal gratification and being absent from duty during a critical period of investigation. As a result, he was initially dismissed from service in 2011. However, the Appellate Authority later reduced the punishment to "removal from service" while also granting him superannuation benefits, acknowledging his personal circumstances.
The respondent, dissatisfied with the Appellate Authority's order, filed a writ petition before the Patna High Court, where the Single Bench ruled in his favor, setting aside the punishment and ordering his reinstatement with back wages. The Bank appealed this decision, and the Division Bench of the High Court upheld the Single Bench’s order.
This led the Bank to file a further appeal in the Supreme Court, challenging the High Court’s decisions and seeking a restoration of the original penalty.
Key Issues Raised:
The Bank’s primary contention was that the High Court had failed to consider the facts and legal principles properly. They argued that the respondent was given adequate opportunity to present his case during the inquiry and that the punishments imposed by the Disciplinary and Appellate Authorities were based on sound evidence.
Additionally, the Bank raised concerns over the High Court's emphasis on the respondent’s low rank and the notion that senior officers involved in the misconduct were not punished. The Bank stressed that the Branch Manager and Field Officer, who were also implicated, had been appropriately penalized.
On the other hand, the respondent’s defense was that, as a Class IV employee, he had no authority to sanction loans and was merely a "scapegoat" in a larger issue of institutional failure. He also pointed to his promotion in 2010 as evidence of his good conduct and work ethic.
Supreme Court’s Analysis and Findings:
The Supreme Court began by reiterating the well-established legal principle that judicial review in disciplinary matters is limited to procedural correctness and the violation of natural justice. It emphasized that the court’s role is not to re-assess the merits of the case, but to ensure that due process was followed.
1. Procedural Integrity:
The Court noted that the respondent was given a fair opportunity to defend himself during the inquiry process, including the right to cross-examine witnesses. The Inquiry Officer’s report was based on the testimonies of multiple witnesses, including customers of the Bank who confirmed that they had paid money to the respondent for facilitating loan sanctions.
2. Role of the Respondent:
The Court addressed the argument that the respondent, being a low-ranking employee, should not bear the brunt of the misconduct. It highlighted that while the respondent did not have the authority to sanction loans, his role as a conduit in facilitating the bribes was sufficiently proven. Moreover, the Court rejected the claim that the Bank had failed to act against higher officials, pointing out that the Branch Manager and Field Officer were also penalized.
3. Disciplinary Authority’s Discretion:
Regarding the argument that the punishment was excessive, the Court referred to established case law, noting that when the disciplinary authority accepts the Inquiry Officer’s findings, it is not obligated to provide detailed reasons for its decision. The Appellate Authority’s reduction of the penalty from dismissal to removal with superannuation benefits demonstrated leniency, which should have been sufficient in the respondent's case.
4. Judicial Overreach:
The Court criticized the Single Bench’s approach of interfering with the findings of the Inquiry Officer and the Disciplinary Authority, especially when there was no violation of natural justice. It further clarified that the standard of proof in departmental proceedings is based on the preponderance of probabilities, not beyond a reasonable doubt.
Conclusion:
The Supreme Court concluded that both the Single Bench and Division Bench of the High Court had erred in their judgments by overlooking the established legal framework surrounding disciplinary proceedings. The Court restored the penalty imposed by the Appellate Authority, which was "removal from service" with superannuation benefits.
This case underscores the limited scope of judicial intervention in matters of disciplinary action, reinforcing that courts should not substitute their judgment for that of the disciplinary authorities unless there are significant procedural flaws or violations of natural justice.
