Bombay High Court
THE CHAIRMAN AND MANAGING DIRECTOR UCO BANK AND ANRversusDHIREN MOHANLAL THANKI AND ORS
- Decided
- Disposal
- Disposed Off
- Bench
- SANDEEP V MARNE
Holding
The removal of the employee did not involve moral turpitude, and he is entitled to gratuity with interest limited to the period before the gratuity amount was deposited.
Summary
The Chairman and Managing Director of Uco Bank filed a writ petition challenging an order of the Appellate Authority under the Payment of Gratuity Act, 1972 which confirmed the Controlling Authority’s decision that the bank must pay a gratuity of Rs. 10 lakh to former senior manager Dhiren Mohanlal Thanki. The employee had been removed from service on 22 March 2014 on grounds of misconduct involving alleged irregularities in bill discounting, and the bank argued that the misconduct amounted to moral turpitude, thereby disqualifying him from gratuity. The court examined the charge‑sheet and found that while negligence and loss to the bank were established, there was no evidence of misappropriation or personal pecuniary gain, and thus the misconduct did not constitute moral turpitude. Consequently, the court upheld the employee’s entitlement to gratuity and limited the bank’s liability for interest to the period from 22 March 2014 to the date the gratuity amount was deposited on 4 July 2017. The petition was dismissed without costs, and the pending interim application was also disposed of.
Issues considered
- Whether the employee's removal for misconduct involved moral turpitude within the meaning of the Payment of Gratuity Act, 1972.
- Whether the employee is entitled to gratuity despite the alleged misconduct.
- Whether the bank is liable to pay interest on the gratuity amount and, if so, for what period.
Legislation cited
Subjects
- Payment of Gratuity Act
- moral turpitude
- employee removal
- gratuity entitlement
- interest liability
- negligence
- banking misconduct
Judgment
2026:BHC-AS:32638
Renuka 2-WP-2490-2020.docx
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO.2490 OF 2020
WITH
INTERIM APPLICATION (ST) NO. 97695 OF 2020
The Chairman And Managing Director ...Petitioner
Uco Bank and Anr
V/s.
Dhiren Mohanlal Thanki and Ors ...Respondents
________________
Mr. Ashok D. Shetty with Ms. Rita K. Joshi (through VC) and Mr. Bushra
A. Moughal for Petitioner.
Mr. Vijay P. Vaidya with Mr. Mahendra Agvekar with Ms. Shraddha
Chavan for Respondent No. 1.
Mrs. Shehnaz V. Bharucha for Respondent Nos. 2 and 4.
________________
CORAM: SANDEEP V. MARNE, J.
DATED: 6 AUGUST 2026.
P.C.:
1) The Petition challenges order dated 9 September 2019
passed by the Appellate Authority under the Payment of Gratuity Act,
1972 (PG Act) dismissing Appeal preferred by the Petitioner-Bank and
conBrming the order of the Controlling Authority dated 17 March 2017.
By the impugned order, the Petitioner is directed to pay gratuity of Rs. 10
lakh to the Respondent alongwith interest at the rate of 10% per annum
from 31 May 2014.
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Renuka 2-WP-2490-2020.docx
2) I have heard, Mr. Shetty, the learned counsel appearing for
the Petitioner, Mr. Vaidya, the learned counsel appearing for Respondent
No. 1 and Mrs. Bharucha, the learned counsel appearing for Respondent
Nos. 2 and 4.
3) Respondent No. 1 has been removed from service as a
measure of penalty on 22 March 2014. The order of removal has attained
Bnality on account of dismissal of Writ Petition No. 497 of 2019 on 25
March 2026. It appears that the Bank declined to pay gratuity on the
ground that removal was premised on misconduct involving moral
turpitude.
4) I have gone through the charges levelled against
Respondent No. 1. The broad frame of the chargesheet was that there
was a customer of the Bank operating his account from Collaba Branch,
which was merged in Madam Kama Branch Mumbai. At that time,
Respondent No. 1 was Senior Manager of Collaba Branch. He later got
transferred to JVPD Branch of the Petition-Bank. It is alleged in the
chargesheet that though Madam Kama Branch was at a proximate
distance, the customer still continued having dealings with JVPD Branch
where Respondent No. 1 was posted. It is alleged that the staff at JVPD
Branch acted negligently in discounting the bills presented by the
customer. It is alleged that Respondent No. 1 was at the helm of affairs at
JVPD Branch. Thus irregularities in sanctioning of the bill discounting in
respect of the customer were ascribed to the Respondent No. 1. The
charges are ultimately proved and the dismissal order is also upheld by
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this Court. The only issue is whether there is an element of moral
turpitude in misconduct proved against Respondent No. 1.
5) Mr. Shetty, would submit that Respondent No. 1 committed
misconduct of misappropriation and that his actions caused loss to the
Bank. While cause of loss to the Bank can be accepted, in the facts of the
present case, it is difBcult to conclude that Respondent No. 1
misappropriated any amounts of the Bank. He may have been negligent
in disbursing amounts towards bill discounting. However, there is no
allegation in the chargesheet that Respondent No. 1 was in hand in
gloves with the borrower or that he received any pecuniary advantage to
himself. The case thus involves misconduct of negligence in performance
of duties. It therefore, cannot be concluded that removal of the
Respondent No. 1 was owing to misconduct involving moral turpitude.
The Controlling and Appellate Authorities have rightly upheld
entitlement of Respondent No. 1 to gratuity. Writ Petition is devoid of
merits and deserves to be dismissed.
6) It appears that at the time of preferring its appeal,
Petitioner-Bank has deposited principal amount of gratuity of Rs. 10 lakh
on 4 July 2017. Respondent No. 1 has already withdrawn the principle
amount of gratuity on 15 November 2019. In my view, therefore, the
interest liability of Bank is required to be restricted only from 31 March
2014 to 4 July 2017. Accordingly, the Petitioner-Bank shall pay over to
Respondent No. 1, the amount of interest on principal amount of
gratuity of Rs. 10 lakh in respect of period from 22 March 2014 to 4 July
2017 within outer limit of two months. If any interest has accrued on the
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Renuka 2-WP-2490-2020.docx
principal amount of gratuity deposited with the Controlling Authority,
the Registry of the Controlling Authority shall pay the accrued amount
of interest to Respondent No. 1.
7) Writ Petition is accordingly dismissed. There shall be no
order as to costs.
8) Pending Interim Application is also disposed of.
[SANDEEP V. MARNE, J.]
Signed by: Renuka S Thakur
Page No.4 of 4
Designation: PA To Honourable Judge 6 August 2026
Date: 07/08/2026 14:47:34
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