NARESH CHANDRA BHARDWAJversusBANK OF INDIA & ORS.

240                       [2019]
               SUPREME COURT     6 S.C.R. 240
                              REPORTS                         [2019] 6 S.C.R.


A                     NARESH CHANDRA BHARDWAJ
                                         v.
                           BANK OF INDIA & ORS.
                         (Civil Appeal No. 4037 of 2019)
B                                APRIL 22, 2019
        [SANJAY KISHAN KAUL AND INDIRA BANERJEE, JJ.]
             Service Law: Removal from service – Appellant-bank officer
      sanctioned three loans while posted in one branch and recommended
      two loans at another branch which were ultimately classified as
C
      Non-Performing Assets – When the process of granting these loans
      was scrutinised by the Bank, various procedural abnormalities were
      found, which were likely to cause a loss of Rs.70.32 lakhs to the
      Bank – Punishment of removal from service imposed on the appellant
      – Appellant prayed that, on parity, he should also be visited only
D     with the punishment of compulsory retirement as there were two other
      cases of officers where also similar loss was caused on account of
      the same party and they were visited with the punishment of
      compulsory retirement – Held: Recommendation of the Chief
      Vigilance Officer showed that earlier the proposal was for removal
      from service for all the three officers – However, only in respect of
E
      other two officers, it was converted into compulsory retirement –
      The reason was stated to be the seriousness of the acts of misconduct
      of the appellant and the fact that he was the recommending authority
      in two cases and the sanctioning authority in three other cases –
      No mala fide was proved in case of the appellant – It was found
F     that there was one key person who defrauded many organisations
      by proving his identity through different identity cards acquired by
      him fraudulently – There was no significant difference in the conduct
      of the three officers as would justify this differentiation in punishment
      – As per the counter affidavit submitted by the respondents-employer,
      in their own wisdom they had agreed to grant compassionate
G
      allowance to the appellant, ensuring that no financial loss is
      suffered by the appellant on account of removal from service –
      Appellant was given maximum benefit under the Pension Regulations
      1995 dealing with compassionate allowance – Since there was no
      financial difference and the role was practically identical, there
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                                        240
NARESH CHANDRA BHARDWAJ v. BANK OF INDIA & ORS.                           241


was no visible reason to not convert the punishment inflicted on the      A
appellant from one of “removal from service” to “compulsory
retirement” – In the said facts & circumstances, the plea of the
appellant to convert his punishment to one of “compulsory
retirement” is accepted.
       Administrative law: Judicial review – Quantum of punishment        B
– Scope of judicial review – Held: The domain of the courts on the
issue of quantum of punishment is very limited – It is the disciplinary
authority or the appellate authority, which decides the nature of
punishment keeping in mind the seriousness of the misconduct
committed – However, if the punishment is so disproportionate that
it shocks the conscience of the court, the courts are not denuded of      C
the authority to interfere with the same – Normally, even in such
cases, it may be appropriate to remit the matter back for
consideration by the disciplinary/appellate authority – However,
one other cause for interference can be where the plea raised is of
parity in punishment but then the pre-requisite would be that the         D
parity has to be in the nature of charges made and held against the
delinquent employee and the conduct of the employee post the
incident – Service law.
       Administrative law: Judicial review – Quantum of punishment
– Principle of equality – When the concerned employee and co-             E
delinquent are equally placed – There has to be complete parity
between the two not only in respect of nature of charge but
subsequent conduct as well after the service of charge sheet in the
two cases – If co-delinquent accepted the charges, indicating remorse
with unqualified apology, lesser punishment to him would be
justifiable.                                                              F

      Allowing the appeal, the Court
      HELD: 1. It is the disciplinary authority or the appellate
authority, which decides the nature of punishment keeping in mind
the seriousness of the misconduct committed. This would not               G
imply that if the punishment is so disproportionate that it shocks
the conscience of the court the courts are denuded of the authority
to interfere with the same. [Para 6][244-B-C]
      Rajendra Yadav v. State of Madhya Pradesh & Ors.
      (2013) 3 SCC 73 : [2013] 1 SCR 1029 ; Lucknow
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242            SUPREME COURT REPORTS                      [2019] 6 S.C.R.


A           Kshetriya Gramin Bank (Now Allahabad, Uttar Pradesh
            Gramin Bank) & Anr. v. Rajendra Singh (2013) 12 SCC
            372 : [2013] 17 SCR 309 – referred to.
            2. In case of the other two officers, the likely loss to the
      Bank was assessed in the range of about Rs.77.70 lakh in the
B     case of one RKM and Rs.39.74 lakh in the case of VKS. The
      amount is, at least, not very different from one as in the case of
      RKM. However, what is more important is the role performed.
      RKM and VKS were both the sanctioning authorities in respect
      of the loans in questions and there were four loans each involved
      in the case of both the officers. In the case of the appellant, he
C     was the sanctioning authority in three loans while he was the
      recommending authority in two loans. No mala fide was proved
      in case of the appellant. It was found that one VD was the key
      person who is a cheat and has defrauded many organisations.
      [Paras 10-11][245-H; 246-A-C]
D           3. A reading of the recommendation of the Chief Vigilance
      Officer shows that while earlier the proposal was for removal
      from service for all the three officers, in respect of other two
      officers it was converted into compulsory retirement while not
      doing so in the case of the appellant. The rationale is stated to be
E     the seriousness of the acts of misconduct of the appellant and
      the fact that he was the recommending authority in two cases and
      the sanctioning authority in three other cases. However, the real
      reason was that while the other two officers were provident fund
      optees, the appellant was a pension optee. There was no
      difference in the conduct of the three officers as would justify
F     this differentiation in punishment. Once there is no financial
      difference and the role is practically identical, there was no reason
      for the respondents to not convert the punishment inflicted on
      the appellant from one of “removal from service to “compulsory
      retirement.” [Paras 13-15][246-H; 247-A-C; H]
G                            Case Law Reference
      [2013] 1 SCR 1029              referred to             Para 6
      [2013] 17 SCR 309              referred to             Para 6

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NARESH CHANDRA BHARDWAJ v. BANK OF INDIA & ORS.                             243


      CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4037                  A
of 2019.
      From the Judgment and Order dated 25.10.2017 of the High Court
of Judicature at Allahabad in Writ A. No. 41237 of 2010.
      Sanjay Ghose, Kaustubh Anshuraj, Baburam, Advs. for the
Appellant.                                                                  B

       Rajesh Kumar-I, Anant Gautam, Aakash Sehrawat, Ms. Shruti
Vats, Ms. Sakshi Gaur, Ms. Khushboo Aggarwal, Anmol Mehta, Advs.
for the Respondents.
      The Judgment of the Court was delivered by                            C
      SANJAY KISHAN KAUL, J. 1. Leave granted.
       2. The appellant was employed with respondent No.1/Bank of
India (for short ‘Bank’) as Scale II Officer when he sanctioned three
loans while posted at the Lal Bangla Branch of the Bank at Kanpur.
The appellant was also the recommending authority for two loans at          D
Harsh Nagar Branch, once again, at Kanpur. These loans were ultimately
classified as Non-Performing Assets (‘NPAs’) and the process of granting
these loans was scrutinised by the Bank when various procedural
abnormalities were found, which were likely to cause a loss to the Bank
of Rs.70.32 lakh.
                                                                            E
       3. In pursuance of the disciplinary proceedings initiated the
appellant was visited with the major penalty of removal from service
which shall not be disqualification for future employment upon the
appellant. The endeavour of the appellant to assail the proceedings
visiting him with these adverse consequences have throughout been
                                                                            F
unsuccessful including vide impugned order dated 25.10.2017.
       4. On 4.7.2018 the only aspect which persuaded this Court to
issue notice was with respect to the quantum of penalty. This was on
the basis of the submission advanced by learned counsel for the appellant
that there were two other cases of officers, one Mr. R.K. Mishra and
other Mr. V.K. Srivastava where also similar losses had been caused on      G
account of the same party and they had been visited with the punishment
of compulsory retirement. In effect the appellant sought that on parity
he should be also visited only with the punishment of compulsory
retirement.
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244               SUPREME COURT REPORTS                         [2019] 6 S.C.R.


A            5. On the respondents entering appearance, learned counsel for
      the respondent sought to obtain instructions whether the punishment could
      be so altered to compulsory retirement on parity with the other two
      delinquent employees. A counter affidavit has been filed in this behalf
      which opposes the request made on behalf of the appellant. That is the
      limited contour of controversy we have to examine in the present case.
B
             6. It is trite to say that the domain of the courts on the issue of
      quantum of punishment is very limited. It is the disciplinary authority or
      the appellate authority, which decides the nature of punishment keeping
      in mind the seriousness of the misconduct committed. This would not
      imply that if the punishment is so disproportionate that it shocks the
C     conscience of the court the courts are denuded of the authority to interfere
      with the same. Normally even in such cases it may be appropriate to
      remit the matter back for consideration by the disciplinary/appellate
      authority. However, one other cause for interference can be where the
      plea raised is of parity in punishment but then the pre-requisite would be
D     that the parity has to be in the nature of charges made and held against
      the delinquent employee and the conduct of the employee post the
      incident. It is the latter aspect which is sought to be advanced by learned
      counsel for the appellant by relying upon the judgment in Rajendra Yadav
      v. State of Madhya Pradesh & Ors.1 On this very aspect learned
      counsel for the respondents drew out attention to a subsequent judgment
E     in Lucknow Kshetriya Gramin Bank (Now Allahabad, Uttar Pradesh
      Gramin Bank) & Anr. v. Rajendra Singh2 which had taken note of
      the earlier judgment referred to aforesaid.
             7. There is really no difference in the proposition, which is sought
      to be propounded except that in the latter judgment the principles have
F     been succinctly summarised in the last paragraph of the judgment, which
      read as under:
               “19. The principles discussed above can be summed up and
               summarized as follows:

G              19.1. When charge(s) of misconduct is proved in an enquiry the
               quantum of punishment to be imposed in a particular case is
               essentially the domain of the departmental authorities.


      1
          (2013) 3 SCC 73
      2
H         (2013) 12 SCC 372
NARESH CHANDRA BHARDWAJ v. BANK OF INDIA & ORS.                                245
           [SANJAY KISHAN KAUL, J.[

      19.2. The Courts cannot assume the function of disciplinary/             A
      departmental authorities and to decide the quantum of punishment
      and nature of penalty to be awarded, as this function is exclusively
      within the jurisdiction of the competent authority.
      19.3. Limited judicial review is available to interfere with the
      punishment imposed by the disciplinary authority, only in cases          B
      where such penalty is found to be shocking to the conscience of
      the Court.
      19.4. Even in such a case when the punishment is set aside as
      shockingly disproportionate to the nature of charges framed against
      the delinquent employee, the appropriate course of action is to          C
      remit the matter back to the disciplinary authority or the appellate
      authority with direction to pass appropriate order of penalty. The
      Court by itself cannot mandate as to what should be the penalty in
      such a case.
      19.5. The only exception to the principle stated in para (d) above,      D
      would be in those cases where the co-delinquent is awarded lesser
      punishment by the disciplinary authority even when the charges
      of misconduct was identical or the co-delinquent was foisted with
      more serious charges. This would be on the Doctrine of Equality
      when it is found that the concerned employee and the co-delinquent
      are equally placed. However, there has to be a complete parity           E
      between the two, not only in respect of nature of charge but
      subsequent conduct as well after the service of charge sheet in
      the two cases. If co-delinquent accepts the charges, indicating
      remorse with unqualified apology lesser punishment to him would
      be justifiable.”                                                         F
                                                      (emphasis supplied)
        8. The principle, thus, culled out is that remitting a matter on the
issue of quantum of punishment would be as set out in para 19.5 aforesaid,
i.e., where a co-delinquent is awarded lesser punishment by the
disciplinary authority even when the charges of misconduct were identical      G
or the co-delinquent was foisted with more serious charges. This is
based on the principle of equality but then there has to be an absolute
parity.

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246             SUPREME COURT REPORTS                           [2019] 6 S.C.R.


A           9. We now proceed to analyse the facts of the present case in the
      contours of the aforesaid principles.
             10. If we look to the case of the other two officers, the likely loss
      to the Bank was assessed in the range of about Rs.77.70 lakh in the
      case of Mr. R.K. Mishra and Rs.39.74 lakh in the case of Mr. V.K.
B     Srivastava. The amount is, at least, not very different from one as in the
      case of Mr. R.K. Mishra. However, what is more important is the role
      performed. Mr. R.K. Mishra and Mr. V.K. Srivastava were both the
      sanctioning authorities in respect of the loans in questions and there
      were four loans each involved in the case of both the officers. In the
      case of the appellant, he was the sanctioning authority in three loans
C     while he was the recommending authority in two loans.
            11. In order to appreciate this aspect, we would first refer to the
      findings on the charges against the appellant. It is noteworthy that no
      mala fide was proved. It was found that one Mr. Vikram Dixit alias Mr.
      Vinny Sondhi was the key person who is a cheat and has defrauded
D     many organisations by proving his identity through different identity cards
      acquired by him fraudulently. Third important aspect is that the approved
      advocates and valuers submitted a report which was relied upon by the
      Bank officials. These actually appear to be a common thread in all the
      three cases.
E           12. Now turning to the recommendations of the Chief Vigilance
      Officer dated 20.8.2009, it would be relevant to reproduce para 6.2,
      which reads as under:
            “6.2 The DA has recommended imposition of the major penalty
            of “Compulsory Retirement” on all the three Officers. On perusal
F           of the records, we find that S/Shri V.K. Srivastava and R.K. Mishra
            are P.F. optees and Shri N.C. Bhardwaj is a pension optee. Earlier,
            we had proposed “Removal from Service” in respect of all the
            three Officer, looking to the fact that in case compulsory retirement
            is imposed on Shri Bhardwaj, he would be entitled for compulsory
G           retirement person. Looking to the seriousness of the acts of
            misconduct committed by Shri Bhardwaj, we feel that “Removal
            from Service” should be the appropriate penalty in his case. It is
            so because apart from his involvement as recommending authority
            in 2 cases at Harsh Nagar Branch, he had sanctioned 3 more
            loans from Lal Bangla Branch to accommodate the same party
H           i.e., Shri Vikram Dixit.”
NARESH CHANDRA BHARDWAJ v. BANK OF INDIA & ORS.                                   247
           [SANJAY KISHAN KAUL, J.[

        13. A reading of the aforesaid shows that while earlier the proposal      A
was for removal from service for all the three officers, in respect of
other two officers it was converted into compulsory retirement while
not doing so in the case of the appellant. The rationale is stated to be the
seriousness of the acts of misconduct of the appellant and the fact that
he was the recommending authority in two cases and the sanctioning
                                                                                  B
authority in three other cases. However, the real reason comes out
from the earlier part of the paragraph, which is that while the other two
officers were provident fund optees, the appellant was a pension optee.
It is, however, not explained in any of the pleadings before us as to what
is the financial ramification in respect of the two options and as to whether
the appellant would get a greater financial benefit by reason of being a          C
pension optee.
       14. It is difficult for us to accept that there is any difference in the
conduct of the three officers as would justify this differentiation in
punishment. The most important fact in this behalf to notice is that as
per the counter affidavit submitted by the respondents, in their own wisdom       D
they have agreed to grant compassionate allowance to the appellant,
which is 2/3rd of the full pension as would be payable to him had the
punishment of removal from service not been imposed on him. What is
also important to note is that it is further submitted in the same paragraph
8.2 that even if the punishment is modified to compulsory retirement the
appellant would receive 2/3rd of the full pension which is equivalent to          E
the 2/3rd of the full pension as received for compassionate allowance.
The appellant has been given the maximum benefit under Regulations
31 & 33 of the Pension Regulations 1995 dealing with compassionate
allowance.
       “8.2. …...It is further submitted that even in case a punishment of        F
       “Removal from service” is imposed upon the Petitioner is modified
       to that of “Compulsory Retirement”, he would receive 2/3rd of the
       Full Pension, which is equivalent to the 2/3rd of Full Pension which
       he is receiving at present as a “Compassionate Allowance.””
       15. We fail to appreciate that once there is no financial difference       G
and the role is practically identical, why the respondents hesitated
themselves to convert the punishment inflicted on the appellant from
one of “removal from service which shall not be disqualification for future
employment” to “compulsory retirement.” The only aspect is the nature
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248              SUPREME COURT REPORTS                       [2019] 6 S.C.R.


A     of punishment which appears to tar the appellant more than the other
      two officers without any financial implication for the respondent-Bank.
            16. In the aforesaid facts & circumstances, we are, thus, inclined
      to accept the plea of the appellant to convert his punishment in terms
      aforesaid to one of “compulsory retirement.”
B            17. The appeal is accordingly allowed leaving the parties to bear
      their own costs.


      Devika Gujral                                              Appeal allowed.

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