Supreme Court of India
State Bank Of India vs Navin Kumar Sinha on 19 November, 2024
Author: Abhay S. Oka
Bench: Abhay S. Oka
2024 INSC 874 REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 1279 OF 2024
STATE BANK OF INDIA & ORS. APPELLANT(S)
VERSUS
NAVIN KUMAR SINHA RESPONDENT(S)
JUDGMENT
UJJAL BHUYAN, J.
Heard learned counsel for the parties.
2. This appeal by special leave is directed against the
judgment and order dated 11.02.2020 passed by a Division
Bench of the High Court of Jharkhand at Ranchi (briefly ‘the High
Court’ hereinafter) in LPA No. 505 of 2016. Appellants are the
State Bank of India and its officers.
2.1. Respondent, an officer of the State Bank of India (SBI),
was subjected to a disciplinary proceeding following which the
penalty of dismissal from service was imposed on him.
Signature Not Verified
Digitally signed by
ARJUN BISHT
Date: 2024.11.19
13:46:33 IST
Reason:
Departmental appeal filed by the respondent against the
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dismissal order was rejected by the appellate authority; so also
the petition for review. Respondent filed a writ petition before the
High Court challenging the order of penalty as upheld by the
appellate authority and the reviewing authority. Learned Single
Judge allowed the writ petition and set aside the order of penalty
on the ground that the disciplinary proceeding was initiated after
superannuation of the respondent including the extended period
of service. Therefore, such disciplinary proceeding was held to be
void ab initio and the consequential order of penalty set aside with
a further direction to the appellants to pay the retiral and other
dues of the respondent.
2.2. Appeal filed by the appellants was also dismissed by a
Division Bench of the High Court. Against such dismissal of the
letters patent appeal, Special Leave Petition (C) No. 11413 of 2020
was filed by the appellants. This Court by order dated 16.10.2020
had issued notice. As an interim measure, it was directed that the
contempt proceedings stated to have been initiated by the
respondent against the appellants before the High Court be
deferred. The matter was finally heard on 23.01.2024 when leave
was granted.
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3. Before proceeding further, it would be appropriate to
briefly encapsulate the relevant facts so as to have a proper
perspective of the lis.
4. Respondent was appointed as clerk typist in the SBI on
08.06.1973. He was promoted from time to time. On completion
of 30 years of service, respondent was due to superannuate on
26.12.2003 as per the State Bank of India Officers’
(Determination of Terms and Conditions of Service) Order, 1979.
4.1. However, by order dated 05.08.2003 issued by the
competent authority, respondent was given extension of service
from 27.12.2003 to 01.10.2010.
5. On 18.08.2009, a notice was issued to the respondent
by the appellant SBI calling for his explanation as to why
disciplinary action should not be initiated against him for
violating instructions of SBI. The allegations highlighted in the
notice mostly pertained to sanctioning of loans by the respondent
in favour of his relatives in deviation of banking norms and
missing of documents related to sanctioning of the loans.
6. On 21.08.2009, respondent was placed under
suspension.
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7. Respondent submitted reply dated 27.10.2009 to the
notice dated 18.08.2009. However, it appears that the
disciplinary authority did not accept such reply of the respondent.
7.1. Thereafter on 18.03.2011, appellants decided to
initiate disciplinary proceeding against the respondent in terms
of Rule 68(1) of the State Bank of India Officers’ Service Rules,
1992 (for short ‘the Service Rules’ hereinafter). Deputy General
Manager (Operations and Credit), NW-II, Jharkhand acting as the
disciplinary authority issued show cause notice dated 18.03.2011
enclosing therewith articles of charges supported by a statement
of allegations and a list of documents on the basis of which the
charges were framed. The charges were the same as the
allegations in the previous notice issued on 18.08.2009.
Respondent was called upon to submit his written statement of
defence within the prescribed period. It may be mentioned that
the disciplinary authority had appointed an enquiry authority to
conduct the enquiry against the respondent. On 29.11.2011,
respondent submitted his defence brief denying all the allegations
totalling 20.
7.2. Enquiry proceeding started on 24.05.2011 and
concluded on 06.09.2011. Thereafter on 08.12.2011, the enquiry
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officer submitted the enquiry report to the disciplinary authority.
Out of the 20 allegations, the enquiry officer held that 16 were
proved; 3 were partly proved; and one not proved. The disciplinary
authority vide the forwarding letter dated 17.12.2011 forwarded
a copy of the enquiry report to the respondent calling upon him
to respond thereto within 15 days from the date of receipt of the
report.
7.3. Respondent submitted his reply to the disciplinary
authority on 15.01.2012 pointing out various flaws in the enquiry
report and requesting the said authority to drop the proceeding.
7.4. The disciplinary authority, however, passed order
dated 07.03.2012 imposing the penalty of dismissal from service
on the respondent. Respondent preferred an appeal against the
order of penalty. However, by order dated 26.10.2012, the appeal
of the respondent was dismissed. It was thereafter that
respondent preferred a review petition which also came to be
dismissed by the reviewing authority vide the order dated
16.01.2014.
8. Aggrieved thereby, respondent preferred a writ petition
before the High Court assailing the order of penalty dated
07.03.2012 as affirmed by the appellate authority vide the order
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dated 26.10.2012 and by the reviewing authority vide the order
dated 16.01.2014. The writ petition was registered as W(S) No.
3446 of 2014. Vide the judgment and order dated 06.09.2016, a
Single Bench of the High Court held that service of the respondent
was extended till 01.10.2010 after his superannuation in the year
2003. There was no further extension of service after 01.10.2010.
Departmental (disciplinary) proceeding was initiated on
18.03.2011 when the chargesheet was issued by the disciplinary
authority to the respondent which was admittedly after
01.10.2010. Therefore, the appellant bank i.e. SBI had no
jurisdiction to initiate departmental (disciplinary) proceeding
beyond 01.10.2010. That being the position, the order of penalty
dated 07.03.2012, the order of the appellate authority dated
26.10.2012 and the order of the reviewing authority dated
16.01.2014 were set aside and quashed. Appellants were directed
to extend consequential service benefits to the respondent.
9. The aforesaid judgment and order dated 06.09.2016
passed by the Single Bench was assailed by the appellants before
the Division Bench of the High Court in LPA No. 505 of 2016.
9.1. Vide the judgment and order dated 11.02.2020, the
Division Bench concurred with the view of the Single Bench and
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held that departmental (disciplinary) proceeding could not have
been initiated and continued after superannuation of the
respondent. Consequently, the Division Bench dismissed the
letters patent appeal of the appellants as being devoid of any
merit.
10. Appellants had assailed the above findings before this
Court by way of a special leave petition and on leave being
granted, the present civil appeal came to be registered.
11. Respondent has filed counter affidavit. While defending
the judgments of the Single Bench and the Division Bench of the
High Court, respondent has stated that he had joined service in
the appellant bank on 08.06.1973. As per requirement of Rule
19(1) of the Service Rules, appellant bank had extended the
service of the respondent on completion of 30 years of service from
27.12.2003 to 01.10.2010. From 01.10.2010, no order, either oral
or written, was issued by the appellant bank further extending
the service of the respondent. Therefore, the master and servant
relationship between SBI and the respondent came to be severed
on 01.10.2010.
11.1. During the extended period of service i.e. on
18.08.2009, appellant bank had issued a notice to the respondent
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alleging irregularities by the respondent in the sanction and in
the following up of advances and demand draft purchase for the
periods from 19.01.2006 to 29.10.2008 and from 23.01.2009 to
22.08.2009.
11.2. Thereafter on 21.08.2009 respondent was placed
under suspension.
11.3. Respondent had exchanged several rounds of
communication with the appellant bank to permit him to have
access to documents relied upon by them while making the
allegations against the respondent. In view of the documents
being very voluminous, respondent had sought for time to submit
his explanation which was declined by the appellant bank.
11.4. Disciplinary authority vide the show cause notice
dated 18.03.2011 informed the respondent that departmental
(disciplinary) proceeding was being initiated against him on the
articles of charges framed. Respondent has contended that
initiation of disciplinary proceeding on 18.03.2011 was after
expiry of the extended period of service of the respondent on
01.10.2010. Be that as it may, disciplinary authority had
appointed an enquiry officer who conducted enquiry into the
charges and thereafter submitted his report on 17.12.2011.
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11.5. On the basis of the enquiry report, disciplinary
authority imposed the penalty of dismissal from service on the
respondent vide the order of penalty dated 18.03.2011.
11.6. It is the contention of the respondent that the
disciplinary proceeding was initiated against him after expiry of
the extended period of service i.e. post superannuation.
Therefore, such a disciplinary proceeding and the consequential
order of penalty, appellate order and review order are non est in
the eye of law being void-ab-initio.
12. Mr. Balbir Singh, learned senior counsel appearing for
the appellants, submitted that while the respondent was in
service, he had committed serious irregularities. In this
connection, show cause notice was issued on 18.08.2009.
Thereafter, a detailed departmental enquiry was held in which the
respondent had fully participated. Enquiry officer in his report
dated 17.12.2011 held that out of the 20 charges, 16 were proved
and 3 partly proved. He elaborated the charges which were proved
against the respondent and summarised the same as under :
a. sanctioned loans to his family members without
obtaining prior approval.
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b. sanctioned loans on false certificates bearing
false local addresses.
c. unauthorisedly debited a customer’s account to
meet the margin requirement in the loan
sanctioned to his son.
d. disbursed various loans without completing the
formalities of documentation.
e. took educational loans as a co-borrower along
with his son and daughter, without approval.f. disbursed loans in various accounts without
obtaining documents.
g. allowed large value debits in 49 KCC accounts
after the date of credit of waiver amounts under
the scheme.
h. 9 cheques belonging to his wife and daughter
were presented by him, which were later on
dishonoured.
i. took cash under acknowledgment on 9 occasions
from customers of the bank but did not credit
money to their account.
12.1. He further submitted that respondent would have
attained the age of 60 years on 30.10.2012. In fact, this has been
the consistent stand of the respondent throughout the
departmental proceeding. The penalty order was issued on
1107.03.2012 before the respondent had attained the age of 60
years on 30.10.2012.
12.2. Learned senior counsel also argued that it was not the
case of the respondent either in appeal or in review or even before
the learned Single Judge that the departmental proceeding
against him was initiated after his superannuation and therefore
was void-ab-initio. He had assailed the order of penalty on various
other grounds including on merit. Therefore, the High Court was
not justified in allowing the challenge of the respondent on the
unpleaded ground that the departmental proceeding was initiated
against him after his superannuation. This aspect was also
overlooked by the Division Bench.
12.3. Referring to the stand taken by the respondent in the
departmental enquiry as well as before the appellate authority
that he was due to superannuate on 30.10.2012, Mr. Singh
submits that the same is binding on him. In fact, appellant bank
had paid subsistence allowance to the respondent even after
01.10.2010 right upto the date of dismissal from service which
the respondent had accepted. Therefore, it is not open to the
respondent to now contend that his service with the appellant
bank had come to an end on 01.10.2010.
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12.4. Learned senior counsel also referred to Rule 19 of the
Service Rules more particularly to sub-Rule (2) thereof and
contends that there cannot be any automatic superannuation of
an officer from the service of the appellant bank. Superannuation
of an officer has to be sanctioned by the competent authority
under Rule 19(2) of the Service Rules.
12.5. Finally, Mr. Singh, learned senior counsel submits that
the departmental proceeding against the respondent was initiated
before he had retired from service. Therefore, in terms of the Rule
19(3) of the Service Rules, respondent was deemed to have
continued in service of the appellant bank for the purpose of such
departmental proceeding. In this connection, he has placed
reliance on the decision of this Court in SBI Vs. C.B. Dhall1.
13. Per contra, Mr. Vishwajit Singh, learned senior counsel
for the respondent, submits that there is no error or infirmity in
the impugned decision of the High Court.
13.1. Learned senior counsel submits that the issue involved
in the present case is quite simple: whether the appellant bank
1
(1998) 2 SCC 544
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could have initiated disciplinary proceeding against the
respondent after his superannuation.
13.2. He submits that respondent had completed 30 years of
service in the appellant bank in the year 2003. Therefore in terms
of Rule 19(1) of the Service Rules, he was due to superannuate on
26.12.2003. However, the appellant bank invoked the proviso to
Rule 19(1) of the Service Rules and by recording reasons in
writing extended the service of the respondent beyond 30 years
from 27.12.2003 to 01.10.2010. Thereafter, no further extension
of service was granted by the appellant bank. As such, the
respondent’s service in the appellant bank had ceased with effect
from 01.10.2010.
13.3. Though appellant bank had issued notice dated
18.08.2009 to the respondent alleging irregularities and had
suspended him from service on 21.08.2009, departmental
proceeding was initiated against the respondent in terms of Rule
68(1) of the Service Rules only on 18.03.2011 when the charge
memo was issued, which was clearly after 01.10.2010. The
factum of the respondent participating in the departmental
proceeding or stating that he was due to superannuate on
30.10.2012 would be of no consequence. Further, payment of
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subsistence allowance by the appellant bank and acceptance of
the same by the respondent would also not lead to extension of
service of the respondent post 01.10.2010.
13.4. Learned senior counsel for the respondent therefore
submits that the order of penalty imposed by the appellant bank
on the respondent is clearly void-ab-initio and the High Court had
rightly interfered with the same. In support of his submissions,
he has placed reliance on the following decisions:
(i) UCO Bank Vs. Rajinder Lal Capoor2; and
(ii) UCO Bank Vs. M.B. Motwani3,
14. Submissions made by learned counsel for the parties
have received the due consideration of the Court.
15. Having heard learned counsel for the parties and upon
perusal of the materials on record, we may briefly refer to the
relevant provisions of the statutes governing the service condition
of the respondent.
15.1. In exercise of the powers conferred by sub-Section(1)
of Section 43 of the State Bank of India Act, 1955, the Central
Board of the State Bank of India has made the State Bank of India
2
(2007) 6 SCC 694
3
(2023) SCC Online SC 1327
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Officers (Determination of Terms and Conditions of Service)
Order, 1979 (briefly ‘the Service Order’ hereinafter) to determine
certain terms and conditions of appointment and service of
officers in the State Bank of India (SBI). Order 19 thereof deals
with the age of retirement. Clause (1) of Order 19 says that an
officer shall retire from the service of SBI on attaining the age of
58 years or upon the completion of 30 years’ service or 30 years’
pensionable service if he is a member of the Pension Fund,
whichever occurs first. Thus, as per clause (1) of Order 19 of the
Service Order, an officer of SBI shall retire from the service of the
bank on the happening of three contingencies whichever occurs
first. The three contingencies are:
(i) on attaining the age of 58 years; or
(ii) upon completion of 30 years of service; or
(iii) completed 30 years of pensionable service, if he is a
member of the Pension Fund.
15.2. Therefore, what this provision contemplates is that an
officer of SBI shall retire from service on completion of any one of
the three contingencies whichever happens first. The first proviso
confers a discretion upon the competent authority to extend the
period of service of an officer who has either attained the age of
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58 years or has completed 30 years of service or has completed
30 years of pensionable service, if it is deemed that such
extension is desirable in the interest of SBI. However, the
extended period of service shall not be counted for the purpose of
pension.
15.3. As per clause (2) of Order 19, no officer of SBI who has
ceased to be in the service of SBI by virtue of any of the
contingencies provided for in clause (1), shall be deemed to have
retired from the service of the said bank for the purpose of the
Pension and Guarantee Fund Rules or the Pension Fund Rules
unless such cessation of service has been sanctioned on
retirement for the purpose of either of the aforesaid two rules.
15.4. Clause (3) of Order 19 makes it clear that in case
disciplinary proceeding under the relevant rules of service has
been initiated against an officer before he ceases to be in the
service of SBI, the disciplinary proceeding may, at the discretion
of the Managing Director, be continued after cessation of service
and concluded by the authority which had initiated the same as
if the officer continues in service. However, such an officer shall
be deemed to be in service only for the purpose of continuance
and conclusion of such proceeding.
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15.5. A conjoint reading of the three clauses of Order 19
would indicate that an officer of SBI shall retire from the service
of the said bank on fulfilment of either of the three conditions.
However, the competent authority has the discretion to extend
the period of service of such an officer, if such extension is
deemed desirable in the interest of SBI though the extended
period of service will not be counted for the purpose of pension.
Under clause (2), no officer who has ceased to be in the service of
SBI by virtue of the contingencies stipulated in clause (1), shall
be deemed to have retired from service for the purpose of the
Pension and Guarantee Fund Rules or the Pension Fund Rules
unless such cessation of service has been sanctioned. Therefore,
the sanctioning of cessation of service is only for the purpose of
the aforesaid rules. Clause (3) contains the clarification that if
disciplinary proceeding has been initiated against such an officer
under the relevant service rules before he ceases to be in the
service of SBI, the disciplinary proceeding may be continued and
concluded by the authority which had initiated the same even
post cessation of service of the officer. However, he shall be
deemed to be in service only for the purpose of continuance and
conclusion of such proceeding and not for any other purpose.
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16. Now let us turn to the State Bank of India Officers’
Service Rules, 1992 (already referred to as ‘the Service Rules’).
Preamble to the Service Rules says that the said rules have been
framed by the Central Board of the State Bank of India exercising
powers conferred by sub-Section(1) of Section 43 of the State
Bank of India Act, 1955 to determine the terms and conditions of
appointment and service of all officers in the State Bank of India.
The Service Rules came into effect from 01.01.1992.
16.1. Rule 2(1) says that the Service Rules shall apply to all
officers of SBI who are appointed or promoted to any of the grades
mentioned in Rule 4 and also to whom any of the rules mentioned
thereunder are applicable. The rules include the State Bank of
India Officers’ (Determination of Terms and Conditions of Service)
Order, 1979 (already referred to as ‘the Service Order’
hereinbefore). Rule 19 deals with retirement. As per Rule 19(1),
an officer shall retire from the service of SBI on attaining the age
of 60 years or upon the completion of 30 years of service or 30
years of pensionable service, if he is a member of the Pension
Fund, whichever occurs first. The first proviso says that the
competent authority, may, for reasons to be recorded in writing,
extend the period of service of an officer who has completed 30
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years of service or 30 years of pensionable service, as the case
may be, should such extension be deemed desirable in the
interest of the bank. However, the second proviso clarifies that an
officer who has attained the age of 60 years shall not be granted
any further extension in service.
16.2. From a comparative analysis of Order 19(1) of the
Service Order with Rule 19(1) of the Service Rules, what is
discernible is that the only change introduced by the latter is in
one of the conditions of superannuation i.e. the age. From 58
years it has now become 60 years. Rest of the provision has
remained unaltered, including the contingencies of
superannuation. Whether it is 58 or 60 years, it is only one of the
contingencies of superannuation, not the sole. Before attaining
the age of 58 years or 60 years, as the case may be, an officer
shall superannuate from service if he has completed 30 years of
service or 30 years of pensionable service. However, the second
proviso has made a clarification that an officer who has attained
the age of 60 years shall not be granted any further extension in
service. This means that an officer can be superannuated before
attaining the age of 60 years if any one of the other two
contingencies are fulfilled; he may also be granted extension of
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service thereafter but such extension of service cannot be beyond
the age of 60 years.
16.3. Rule 19(2), on the other hand, starts with a non-
obstante clause. It says that notwithstanding anything to the
contrary in the Service Rules, no officer who has ceased to be in
the bank’s service by the operation of, or by virtue of, any
provision shall be deemed to have retired from the service of SBI
for the purpose of the Imperial Bank of India Employees’ Pension
and Guarantee Fund Rules or the State Bank of India Employees’
Pension Fund Rules unless such cessation of service has been
sanctioned as retirement for the purpose of either of the said
pension fund rules as may be applicable to him. Thus what Rule
19(2) contemplates is sanctioning of cessation of service for the
purpose of the aforesaid two rules only and for no other purpose.
16.4. Sub-Rule (3) of Rule 19 provides that in case
disciplinary proceeding under the relevant rules of service has
been initiated against an officer before he ceases to be in the
service of SBI by operation of, or by virtue of, any of the said rules
or the provisions of the Service Rules, the disciplinary proceeding
may at the discretion of the competent authority, be continued
and concluded by the authority by which the proceeding was
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initiated in the manner provided in the said rules post cessation
of service as if the officer continues to be in service; but he shall
be deemed to be in service only for the purpose of continuance
and conclusion of such proceeding.
17. Chapter XI of the Service Rules deals with conduct,
discipline and appeal. Chapter XI comprises of Rule 50 to Rule
70.
17.1. Section 2 of Chapter XI deals with discipline and
appeal. Rule 67, which is part of Section 2, provides for various
categories of minor and major penalties which may be imposed
on an officer for an act of misconduct or for any other good and
sufficient reason to be recorded in writing.
17.2. The heading of Rule 68 which is also part of Chapter
XI is decision to initiate and procedure for disciplinary action. Rule
68(1) says that the disciplinary authority either by itself or on a
direction of the superior authority may institute disciplinary
proceeding against an officer. The disciplinary authority or any
authority higher than it may impose any of the penalties
mentioned in Rule 67 on such an officer.
17.3. As per Rule 68(2), no order imposing any of the major
penalties shall be made except after an inquiry held in accordance
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with Rule 68(2). Clause (iii) of sub-Rule (2) of Rule 68 says that
where it is proposed to hold an inquiry, the disciplinary authority
shall frame definite and distinct charges on the basis of the
allegations against the officer and the articles of charge(s)
together with the statement of allegations on which those are
based, list of documents and witnesses relied on, copies of relied
upon documents to the extent possible and the statement of
witnesses shall be communicated in writing to the officer who
shall be required to submit within such time as may be specified
by the disciplinary authority, a written statement of his defence.
17.4. Thereafter, the procedure for conducting inquiry is laid
down.
17.5. Rule 69 provides for appeal and review. As per sub-
Rule (1), an officer may appeal to the appellate authority against
an order imposing upon him any of the penalties specified in
Rule 67 or against an order of suspension. The procedural part of
such an appeal is provided in sub-Rule (2).
17.6. Rule 69(3) deals with review. Clause (i) thereof, which
starts with a non-obstante clause, says that notwithstanding
anything contained in Section 2, the reviewing authority may call
for the record of the case within six months of the date of the final
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order and after reviewing the case, pass such order(s) thereon as
it may deem fit.
18. In Union of India Vs. K.V. Jankiraman4, this Court was
examining the impact of sealed cover procedure on an employee
due for promotion, increment etc. In that case, the employees
were eligible for promotion but because of pending disciplinary
proceeding, were subjected to sealed cover procedure. It was in
that context that this Court considered amongst others the
question as to what is the date from which it can be said that a
disciplinary proceeding is pending against an employee. After due
analysis, this Court held that it is only when a charge memo is
issued to the employee that it can said a departmental
(disciplinary) proceeding is initiated against the employee.
19. This issue was again considered by this Court in
Rajinder Lal Capoor (supra). Respondent in that case was an
officer of the UCO Bank. Following a disciplinary proceeding, he
was dismissed from service. However, the High Court in writ
jurisdiction converted the punishment of removal from service
into one of compulsory retirement with effect from the date of
4
(1991) 4 SCC 109
24
superannuation. UCO Bank came up in appeal following leave
granted before this Court. On examining, this Court while opining
that the High Court may not have been correct in converting the
penalty of removal from service to compulsory retirement,
however, came to the conclusion that initiation of departmental
proceeding itself was wholly illegal and without jurisdiction. The
chargesheet was issued on 13.11.1998 whereas the respondent
had attained the age of superannuation on or before 01.11.1996.
Referring to the relevant provision i.e. Regulation 20(3)(iii) of the
UCO Bank Officer Employees’ Service Regulations, 1979 which
created a legal fiction of continuance in service of the concerned
officer post superannuation if disciplinary proceeding had been
initiated prior to superannuation, such continuance of service
being only for the purpose of conclusion of the disciplinary
proceeding, this Court held that such a provision could be
invoked only when the disciplinary proceeding had clearly been
initiated prior to the respondents’ ceasing to be in service. Only
when a valid departmental proceeding is initiated against the
officer while in service, despite his attaining the age of
superannuation, the disciplinary proceeding can be allowed to be
continued on the basis of the legal fiction as if he was in service.
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Thus, when a departmental proceeding is continued by reason of
the legal fiction, the delinquent officer would be deemed to be in
service although he has reached his age of superannuation.
Reiterating the view taken in K.V. Jankiraman(supra), this Court
held that the departmental proceeding is not initiated merely by
issuance of a show cause notice. It is initiated only when a
chargesheet is issued. In the facts of that case, since the
disciplinary proceeding was initiated after the age of
superannuation, the chargesheet, inquiry report and the order of
punishment were held to be illegal and without jurisdiction by
this Court and those were set aside. Consequently, all retiral
benefits due to the respondent was directed to be paid.
20. Similarly in Coal India Ltd. Vs. Saroj Kumar Mishra5,
this Court again reiterated the legal position that a departmental
proceeding is ordinarily said to be initiated only when a
chargesheet is issued.
21. A three-Judge Bench of this Court in Canara Bank Vs.
D.R.P. Sundharam6 examined the meaning and effect of
Regulation 20(3)(iii) of the Canara Bank (Officers’) Service
5
(2007) 9 SCC 625
6
(2016) 12 SCC 724
26
Regulations, 1979 which is pari materia to Regulation 20(3)(iii) of
the UCO Bank Officer Employees’ Services Regulations, 1979 in
the light of the view taken in Rajinder Lal Capoor (supra) and held
that Regulation 20(3)(iii) is a stand-alone provision. By virtue of
the said provision, a disciplinary proceeding initiated by means of
a chargesheet prior to the retirement of a bank employee would
continue even after his retirement in view of the provision
contained in Regulation 20(3)(iii). In the facts of that case, the
Bench noted that disciplinary proceeding was initiated by
submission of chargesheet after the retirement of the respondent.
Therefore, while confirming the decision of the High Court, this
Court dismissed the appeal filed by Canara Bank.
22. In the case of M.B. Motwani (supra), Supreme Court
once again reiterated the position that a departmental proceeding
is not initiated merely on issuance of a show cause notice. It is
initiated only when a chargesheet is issued because that is the
date of application of mind on the allegations levelled against an
employee by the competent authority. In that case, it was noticed
that the deceased employee had attained the age of
superannuation on 31.07.1991 whereas the chargesheet was
issued to him on 07.12.1991 meaning thereby that on the date of
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his superannuation, no disciplinary proceeding was pending
against him. That being the position, this Court dismissed the
appeal filed by UCO Bank.
23. Having surveyed the relevant legal provisions and the
case law, let us now revert back to the essential undisputed facts
of the case. Respondent was appointed in the SBI as a clerk typist
on 08.06.1973. In due course of time, he rose through the ranks
and reached managerial position. On completion of 30 years of
service, he was due to superannuate on 26.12.2003. Exercising
powers under Rule 19(1) of the Service Rules, respondent was
granted extension of service vide order dated 05.08.2023 from
27.12.2003 to 01.10.2010. On 18.08.2009, a notice was issued
to the petitioner wherein and whereby serious irregularities
allegedly committed by him were highlighted and his response
was sought for. On 21.08.2009, respondent was placed under
suspension. Though respondent had submitted his reply to the
notice dated 18.08.2009 on 27.10.2009, it appears that the
disciplinary authority did not accept such reply and decided to
initiate disciplinary proceeding against the respondent by issuing
show cause notice dated 18.03.2011 under Rule 68(1) of the
Service Rules. Alongwith the show cause notice, articles of
28
charges and the statement of allegations on the basis of which
the charges were framed, were sent to the respondent. There is
nothing on record to show further continuance of service by the
respondent beyond 01.10.2010. As noted above, service of the
respondent was extended from 27.12.2003 to 01.10.2010.
24. From the above, it is evident that charge memo was
issued to the respondent on 18.03.2011 after his extension of
service was over on 01.10.2010. This is an undisputed
jurisdictional fact.
25. Appellants have contended that respondent was paid
subsistence allowance from his date of suspension i.e.
21.08.2009 till his dismissal from service vide order dated
07.03.2012 beyond 01.10.2010. Besides it was the case of the
respondent himself before the enquiry officer, disciplinary
authority as well as before the appellate authority that he was
due to superannuate on 30.10.2012. He also did not plead either
before the said authorities or before the High Court that he had
ceased to be in service of SBI from 01.10.2010 and therefore the
disciplinary proceeding initiated thereafter on 18.03.2011 was
void-ab-initio. As such the learned Single Judge was not justified
29
in accepting the challenge of the respondent to the order of
penalty on a completely different ground.
26. We are afraid we cannot accept such a contention on
behalf of the appellants. Where the disciplinary proceeding itself
is without jurisdiction, upholding the same on the specious plea
that it was not challenged on the ground of lack of jurisdiction
would be tantamount to giving imprimatur to a patently illegal
proceeding. This aspect was gone into by the learned Single Judge
in the following manner:
6. After hearing learned counsel for the respective
parties at length and on perusal of the records, I am
of the considered view that the petitioner has been
able to make out a case for interference due to the
following facts and reasons stated hereinbelow:
(I) Indisputably, on completion of 30 years of service
in the year 2003, the services of the petitioner was
extended till 01.10.2010 as per the State Bank of
India officers (determination of term & conditions of
services 1979). The alleged charges pertains to the
extension period of the petitioner as Branch Manager,
SBI, Tangerbansali Branch, Ranchi during the period
19.01.2006 to 29.10.2008 and 23.01.2009 to
22.08.2009. After submission of explanation to the
alleged charges, the disciplinary authority decided to
initiate departmental proceeding vide letter dated
18.03.2011 containing article of charges. In the
30disciplinary proceeding the order of dismissal has
been passed under Rule 67(j) of the SBI Officers
Service Rules which has been affirmed by the
appellate as well as revisional authority. Admittedly,
there has not been extension of service after
01.10.2010 nor any provision of relevant rules has
been brought to the notice of this Court as to what
would be effect the disciplinary proceeding after
retirement. When there is no express order by the
respondent bank for extension of services after
01.10.2010, the said date is to be treated as the date
of retirement in usual course. In the instant case, the
charge sheet was issued on 18.03.2011 after the date
of deemed retirement of the petitioner when there was
no specific order by the banking authorities for
extension of services. Therefore, on that score, the
impugned order of dismissal dated 07.03.2012 passed
by the appointing authority being affirmed by the
appellate authority as well as reviewing authorities
being not legally sustainable is liable to be quashed.
The view of this Court gets fortified by the decision of
Hon’ble Supreme Court in the case of Union of India
Vs. J. Ahmad reported in 1979 (2) SCC 286 which still
holds the fields the entire departmental proceeding
initiated against the petitioner after non-extension of
service in terms of State Bank of India Officers
(Determination of Terms and Conditions of Service)
Order, 1979 as substituted on 23.02.1984 and State
Bank of India Officers Service Rules, 1992 the
relationship of master and servant has come to an end
31
after 01.10.2010. Therefore, the respondent bank had
no jurisdiction to initiate departmental proceeding
without extension of services of the petitioner beyond
01.10.2010. Apart from the aforesaid legal of
provision in the instant case as apparent from the
pleadings of the parties the bank has not suffered any
pecuniary loss for any act of omission or commission
on the part of petitioner. In the aforesaid backdrop
of fact the initiation of departmental proceeding and
imposition of extreme punishment of dismissal from
services is unreasonable, illegal and not legally
sustainable.
27. When the appellants approached the Division Bench of
the High Court in letters patents appeal, the Division Bench
repelled the contention of the appellants and held as follows:
11. The contention of the learned counsel for the
appellant Bank that as per the Rule 19(1) of the State
Bank of India Officers’ Service Rules, 1992, the
respondent writ petitioner was to superannuate on
completion of 60 years of age, is again, not in
consonance with the Rules. The relevant portion of
Rule 19(1) of the aforesaid Rules reads as follows:-
“19.(1) An officer shall retire from the service
of the Bank on attaining the age of sixty years
or upon the completion of thirty years’ service
or thirty years’ pensionable service, if he is a
member of the Pension Fund, whichever
occurs first.”
32A bare perusal of the Rule clearly shows that if
an officer of the State Bank of India, completes thirty
years of service prior to attaining the age of 60 years,
he is to superannuate from service, on completion of
thirty years of service, irrespective of the fact that he
has not attained the age of 60 years.
12. In the case of the writ petitioner, he was made
to superannuate on the date of completion of 30
years of service in the year 2003 itself, and he was
again given an extension of service from 27.12.2003
to 1.10.2010. As such, by no stretch of imagination,
it can be said that even in case of extension of service
given to the respondent writ petitioner beyond the
period of 30 years of service, he was to continue in
service till he attained the age of 60 years. No other
Rule has been brought on record, or to the notice of
this Court to show that even after completion of 30
years of service, the officer of the Bank shall continue
in service, till he attains the age of 60 years. Rule
19(1) of the State Bank of India Officers’ Service
Rules, 1992, is absolutely clear, without any
ambiguity, wherein there is no scope of accepting the
submission of learned counsel for the appellant
Bank.
13. Thus, the only conclusion that can be drawn
in the present case, is that the writ petitioner could
not have been allowed to continue in service after
1.10.2010, in absence of any further extension of
service, which admittedly was not done in the present
case. In that view of the matter, we find that the
33departmental proceeding had been initiated and the
punishment order was passed after the
superannuation of the petitioner on 1.10.2010, as
the initiation of the departmental proceeding was
done on 18.03.2011, and the punishment order was
passed by the Disciplinary Authority on 7.03.2012,
i.e., after the date of superannuation, which was not
permissible in the eyes of law, in absence of any
disciplinary Rules. Admittedly, no such Rules were
brought to the notice of the Writ Court, or to the
notice of this Court.
14. As such, we find no illegality in the impugned
Judgment dated 6.9.2016, passed by the Writ Court
in W.P.(S) No.3446 of 2014, holding that the
departmental proceeding could not have been
initiated and continued after the superannuation of
the respondent writ petitioner, and allowing the writ
application, quashing the order of dismissal from
service passed by the Disciplinary Authority, as well
as the orders of the Appellate and the Reviewing
Authorities, worth any interference in exercise of the
LPA jurisdiction.
28. In so far the present case is concerned, respondent was
due to superannuate on 26.12.2003 apparently on completion of
30 years of service but his service was extended on 05.08.2003
from 27.12.2003 to 01.10.2010. Thus, the extended service of the
respondent came to an end on 01.10.2010. The relationship of
34
master and servant between the appellants and the respondent
came to be severed on and from 01.10.2010. The factum of receipt
of subsistence allowance thereafter or the respondent declaring
that he would superannuate on a later date i.e. on 30.10.2012 on
attaining the age of 60 years would not make any difference to the
legal and factual scenario. Therefore, it is evident that respondent
was no longer in the service of SBI post 01.10.2010.
29. Attaining 60 years of service (earlier 58 years) is not
the sole criterion of superannuation of an officer serving in SBI.
As already noted and discussed above, it is one of the three
contingencies. If any of the three contingencies are fulfilled, an
officer would be superannuated. Respondent had actually
superannuated from service in SBI on 26.12.2003 on completion
of 30 years of service but his service was extended prior thereto
on 05.08.2003 from 27.12.2003 to 01.10.2010. Post 01.10.2010
there was no further extension of service.
30. Disciplinary proceeding against the respondent was
not initiated on 18.08.2009 when the first notice to show cause
was issued but was initiated only on 18.03.2011 when the
disciplinary authority issued the charge memo to the respondent.
35
31. As has been held by this Court on more than one
occasion, a subsisting disciplinary proceeding i.e. one initiated
before superannuation of the delinquent officer may be continued
post superannuation by creating a legal fiction of continuance of
service of the delinquent officer for the purpose of conclusion of
the disciplinary proceeding (in this case as per Rule 19(3) of the
Service Rules). But no disciplinary proceeding can be initiated
after the delinquent employee or officer retires from service on
attaining the age of superannuation or after the extended period
of service.
32. Even in the case of C.B. Dhall (supra) relied upon by
the appellants, this Court while considering the purport of Rule
20B of the State Bank of India (Supervising Staff) Service Rules,
1975 held that under Rule 20B disciplinary proceeding, if
initiated against an employee before he retires from service, could
be continued and concluded even after his retirement and for the
purpose of conclusion of the disciplinary proceeding, the
employee is deemed to have continued in service but for no other
purpose.
33. That being the position, we see no merit in the appeal.
Accordingly, the appeal is dismissed. Appellants are directed to
36
release all the service dues of the respondent expeditiously and
at any rate not later than six weeks from today.
………………………………J.
[ABHAY S. OKA]
.……………………………J.
[UJJAL BHUYAN]
NEW DELHI;
NOVEMBER 19, 2024.