1. This hearing has been done by video conferencing.
2. The Respondent was an employee of the Union Bank of India (hereinafter, “Bank”). A charge sheet was issued against him on 7 th November, 1994 alleging that loans were issued by him accommodating certain parties which caused losses to the Bank. A show cause notice was issued and, thereafter, the Inquiry Officer was appointed. The report of the Inquiry Officer held the Respondent/employee (hereinafter, “employee”) guilty of the charges levelled against him. Accordingly, the Disciplinary Authority of the Bank vide order dated 21st August, 1998 imposed the major penalty of dismissal on the employee. The relevant extract of the dismissal order passed by the Disciplinary Authority is set out hereinbelow:
“The inquiry record proves that three tractor loans and several crop loans were raised in fictitious names. The complaints of the real persons are on the records denying availment of loans in their names. It further strengthened the allegations that such tractor loans were adjusted within a period of 3 to 4 months after sanction. Had the borrowers so much of funds to repay the Bank loans of Rs. 1,30,000/- to Rs. 1,70,000/- within a period of 3 to 4 months then there was no need for them to avail loans after going through the cumbersome procedure. However, the fact is that such loans were adjusted within 3 to 4 months instead the longer period of say 5 to 7 years generally taken for repayment of such loans. The loan applications/papers had number of irregularities and were not complete in all respects. Before sanctioning such loans had Shri Chaturvedi taken due care as regards establishment of identity of borrowers as also the completion of formalities/papers/documents, the true things would have come to light. However, he did not do so but sanctioned loans in fictitious names in haste without even thinking that the huge funds of the Bank were being put to stake. Considering the vital issue from various angles, I am of the view that Shri Chaturvedi did not discharge his duty with integrity. Once the aspect of integrity is under cloud, such employee cannot be said to be honest and therefore I am of the opinion that he has failed to perform his duties with honesty and integrity.
Considering the nature and gravity of the misconducts proved against Shri Chaturvedi, I am of the opinion that the punishment of dismissal, if imposed on Shri Chaturvedi, would be just and proper. In pursuance of the powers vested in terms of Regulation 7 of the Union Bank of India Officer Employees' (Discipline & Appeal) Regulations, 1976, I pass the following order:
ORDER
Shri D. C. Chaturvedi be and is hereby dismissed from the service of the Bank with immediate effect.”
3. In the appeal filed against the order of the Disciplinary Authority, the Appellate Authority of the Bank also went into the entire record, examined the charges and upheld the penalty imposed. The operative portion of the Appellate Authority’s order dated 30th December, 1999 is set out below:
“I am, therefore, of the opinion that the punishment of dismissal from the services of the Bank with immediate effect imposed on the Appellant by the Disciplinary Authority by holding him guilty of all the charges levelled against him including that of failure to discharge his duties with honesty and integrity is just and proper to meet the ends of justice and I do not find any reason to interfere with the same. Similarly, the contention of the appellant that he should be paid salary for the period of his suspension is not tenable as he has been found guilty of the charges levelled against him and has been punished suitably for the same.
The appeal dated 15.10.98 of Shri D.C. Chaturvedi is therefore rejected.”
4. Thereafter, notice was issued by the Bank for forfeiture of gratuity on 27th June, 2002. The basis of the said notice was that monetary loss was caused to the Bank and, accordingly, as per Section 4(6)(a) of the Payment of Gratuity Act, 1972 (hereinafter, “Act”) it was held that the gratuity amount would be liable to be forfeited. This notice resulted in a direction of forfeiture of the gratuity due to the employee.
5. The employee had, on 15th April, 2016 approached the Controlling Authority under the. The Controlling Authority framed the following four issues for consideration:
i. Whether the delay in filing claim for gratuity can be condoned
ii. Whether the action of forfeiting the amount of gratuity payable to the applicant on account of unquantified loss occurred to the bank 1f not what amount is payable to him
iii. If the gratuity is payable to the applicant, whether it should be paid with interest or not”
6. Thereafter, the Controlling Authority vide order dated 16th May, 2019 held that the delay in filing the claim for gratuity was condoned. On issue number 2, the Controlling Authority passed an order directing the release of the gratuity amount on the presumption that the employee was compulsorily retired from service and held that interest would be payable to the employee. The order of the Controlling Authority dated 16th May, 2019 reads as under:
“Thus the applicant is entitled for payment of gratuity of Rs. 2,12,158/-(Rupees Two Lac Twelve Thousands One Hundred fifty eight only) along with interest @10%per annum. Non-applicant is directed to pay the amount of Rs. 2,12,158/- (Rupees Two Lac Twelve Thousands One Hundred fifty eight only) along-with simple interest @10% per annum on the payable gratuity amount of Rs, 2,12,158/-(Rupees Two Lac Twelve Thousands One Hundred fifty eight only) with effect from 07- 09-1998 to the date on which it is paid to Shri D.C.Chaturvedi (Employee No:-163527) within Thirty days of receipt of this order. As per section 8 of the Payment of Gratuity Act 1972 provided that the amount of interest payable shall in no case exceed the amount of gratuity payable under this Act.”
7. This order was appealed against by the Bank and the Appellate Authority vide impugned order dated 13th July, 2020 merely held that the Controlling Authority has elaborately decided all the issues and no interference is called for. The operative portion of the order of the Appellate Authority reads as under:
“On perusal of relevant records submitted by both the parties along with the records in claim application No. ALC-II//36(21)/2016, I am of the considered opinion that the CA has elaborately dealt with all the issues raised by the Appellant and has decided all the relevant and pertinent issues by applying his mind judiciously by citing the relevant judgments of Hon'ble Delhi High Court in his order. I find no reason to differ with the findings of the CA. The order dated 16.05.2019 of the Controlling Authority is thus confirmed.”
8. The submission of Mr. Arora, ld. Counsel appearing for the Bank is that firstly the Controlling Authority has premised its order on an incorrect basis i.e. that the employee was compulsorily retired. However, in fact, the employee was not compulsorily retired but was dismissed from service and thereafter a show cause notice was issued to the employee on assessing the loss. Thus, it is submitted that there is a fundamental error in the Controlling Authority’s order itself.
9. Mr. Arora, ld. counsel further submits that despite there being such an error, the Appellate Authority has given no reasons for dismissal of the appeal. It has merely recorded the contentions of the parties and rejected the appeal in one paragraph. He submits that such a treatment meted out in an appeal would be completely unsustainable and the appeal ought to be decided on merits after giving proper reasons.
10. On the other hand, Mr. Tripathi, ld. Counsel appearing for the employee with Mr. Dubey, ld. counsel contends that the Controlling Authority has given a very detailed order discussing each and every aspect of the matter. The Appellate Authority has agreed with the reasoning given by the Controlling Authority and thus, the order of the Appellate Authority cannot be held to be unreasoned and without application of mind
11. The Court has perused the impugned orders of the Appellate Authority and the Controlling Authority, as well as the various documents placed on record. The stand of the Bank appears to be justified, inasmuch as the order of the Controlling Authority proceeds on the footing that the employee was compulsorily retired whereas the order of the Disciplinary Authority is clear that he was dismissed from service. The order of dismissal has not been challenged by the employee and has attained finality. The question as to whether gratuity would be liable to be forfeited or not in spite of the dismissal, would be an issue to be determined by the Appellate Authority after perusing the record. Thus, the Appellate Authority ought to have considered the stand of the Bank without being affected by the findings of the Controlling Authority and ought to have taken into consideration, the documents relating to the dismissal, the show cause notice for the forfeiture of the gratuity and the orders passed forfeiting the gratuity etc., Without considering these documents, the appeal could not have been decided without attributing any reasons.
12. After hearing the parties, this Court is convinced that the Appellate Authority ought to take a relook at the appeal filed by the Bank. The amounts, which have been imposed upon the Bank, are stated to have already been deposited before the Appellate Authority. Thus, no prejudice is caused to the employee.
13. Accordingly, the impugned order dated 13th July, 2020 passed by the
14. The writ petition is allowed in the above terms and the matter is remanded back to the Appellate Authority. All pending applications are also disposed of. Considering that the dismissal took place way back in 1998, the Appellate Authority shall endeavour to conclude the proceedings and pass its order by 31st January, 2021.
