Holding

No employee of a nationalised bank may solicit or collect donations for any trust from customers in the course of employment, and the petitions are dismissed as malicious with an injunction restraining such activities.

Summary

The petitioners, senior officers of the Canara Bank Officers' Association, alleged that senior bank officials forced bank staff to collect donations and sell greeting cards for the Canara Bank Relief and Welfare Society and the Association's Trust Fund, claiming coercion and victimisation. The Bombay High Court dismissed the writ petition, accepting the bank's assurance that no such compulsion existed. The petitioners filed a special leave petition, repeating the allegations. The Supreme Court found the petitions malicious, noting no evidence of post‑order coercion, but observed that it is impermissible for employees of a nationalised bank to solicit donations from customers in the course of their duties. The Court therefore dismissed the petitions, imposed an injunction restraining bank officers from collecting or manipulating funds for the Trust, barred them from holding trustee positions, ordered the Union of India to nominate independent trustees, and directed a CBI inquiry into the conduct of the existing trustees.

Issues considered

Whether employees of a nationalised bank may collect donations for a trust or other organisation from persons they deal with in the course of their employment.
Whether the writ petition and special leave petition are maintainable in view of the lack of evidence of coercion after the High Court order.
Whether an injunction can be issued to restrain bank officers from collecting funds and to remove them from trustee positions of the Association's Trust Fund.
Whether the Union of India may be authorised to nominate independent trustees and whether a CBI inquiry is appropriate.

Legislation cited

Bombay Public Trust Acts. 1950
Central Civil Services (Conduct) Ruless. 1964 Rule 12
Constitution of Indias. Article 32
Income Tax Acts. 80-G

Subjects

public sector bankdonation collectiontrust fundmisuse of officeinjunctionCentral Civil Services Conduct RulesCBI inquirybank employees

Judgment

r
754
A

S.A. KINI & ANOTHER

B
v.

UNION OF INDIA & ORS.

April I 6, I 985
c
.. _/f

[D.A. DESAI AND 0. CHINNAPPA REDDY, JJ.]

Servic1s t

D Empfoyeea of a Nationalised Bank/ Public Sector Corporc.tion-Whether
they can collect. donations for any trust or other organisation fro!n p'ersons who
comejnto contact in the course of their employment-Code of conduct.

The petitioners, Deputy General Secretary of the Canara Ban'k Offi~rs'
Association and the Canara Bank Officers' Association, filed a writ petition in
E the High Court alleging that the Chairman and Managing Director, t~e General
Manager and tb.e top. officials of the Management of Canara Bank 'have been
using their official position and authority to coerce the officers and ~taff of the
Canara Bank to collect funds for the Canara Bank Relief and Welf~re Society
and the Kamakoti Prabba Trust and one of the principal modes of collecting
funds was the sale of greeting cards by the officials of the. bank to t.heir custo-
mers. They also alleged that officers, who protested against the diredtive to sell
F greeting cards, were victimised by the bank, and officers, who \Vere highly
successful 'card-sellers' were given accelerated promotion over the beads -°!j
seniors. The respondent-Bank made a statement before the High Court "that/
it has never at any time whatsoever compelled it') employees to sell greeting
cards or collect funds for the Canara Bank Relief and Welfa1e Sodety or any
other institution; nor has the first respondent-bank at any time considered the
same as a relief factor for evaluating performance of its employees for promo-
G tion; nor shall the first respondent-bank do so in future." The High Court
accepted the statement of the respondent-bank and dismissed the writ petition.
But, the petitioners were not satisfied with the assurance given by the respondent
bank and filed the present special leave petition ·and the writ petition repeating
the same allegations and praying for "the issue of a writ in the nature of Man-
damus directing the respondents to forbear from using the bank o(Iicials/bank
machinery bankfresourccs for the purpose of collections of funds in the garb of
any welfare organisation.

H
S. A. KINi!v. UNION

While dismissing the petition and the special leave petition as malicious A
and as designed to denigrate the management of the bank, it was found by. the
Court during the course of the hearing that the petitioners themselves were in-
dulging in rash and feckless activities of the very nature of which they were Com-
plaining against the respondents. Pursuant to several orders made by the Court
from time to time calling for detailed information from both the parties about
the activities of the Canara Bank Relief and Welfare Society and the Canara
Bank Staff Officers' Association and the collections made for them and by them, B
it transpired that the Canara Bank. OfficcrE' Association was formed in the year
1971. On August 18, 1981 the Association started the Canara Bank Officers'
Association Trust Fund registering it as a Public Trust under the Bombay
Public Trust Act, 1950. Five officers of the bank who were also office bearers
of the Association were made life trustees of the Association Trust Fund. Right
....... from the date of formation of the Trust, donations were collected by the
~- members of the Officer!' Agsociation from the customers of the bank. In the
c
"short span of about twe years, the funds of the Trust have s_welled to more than
Rs. twenty four Jakhs. The sowcalled donations range from sums in hundreds
to thousands of rupees. The number of donors is also quite large.

HELD : 1.1 While one does appreciate that there must be several chari~
table inclined persons amongst the bank's customers, there is no doubt that
most of the customers that gave donations to the Trlist Fund must have felt
D
obliged to do so because of favour received or expected to be received by them.
Even if no coercive methods were employed by the members of the Association
to collect donations, the customers must have felt morally pressurised i.hat
otherwise their interests would not be properly taken care of or would be jeopar·
dised·or neglected by the officers with whom they wer~ compelled to deal in the
course of their business. [769C-D]
E
1.2 No employee of a nationalised bank or any other Public Sector Cor-
poration should engage himself in coliecting 'donations' for any trust or other
organisation from person'i with whom he com:s into contact in the course Or
his employment. It is not desirable. It is likely to lead to unhealthy practices
) ..,., _and harmful results, intended or unintended. In the world of commerce, quid
!L _pro quo and not charity is the rule, Those in a position of advantage by reason F
'"' of their office have to be very wary. Otherwise, they may unsuspe~tingly walk
into traps. That b why the Central Civil Services (Condµct) Rules:, 1964, for
example, provide that no Government servant shall, except with the previous
sanction of the Government or of prescribed authority, ask for or accept contri-
butions to, or otherwise associate himself with raising of any funds or other
collections in cash or in kind in pursuance of any object whatsoever (Rule 12).
It is a rule of prudence. It is a rule of com nensencse. It is born of wi5dom
gained by experience. [771G-H; 772A-B]

2. The que!tion, therefore, is what was to be done with the Canara Bank
Officers' Association Trust Fund. First, an in_iunction on the same lines as that
which was in force during the pendency of the writ petition in this Court shall
issue, that is, the officers of the Canara Bank, their agents nominees are restrai- 'H
SUPlBME COURT REPORTS (198 5) 3 s.C.R

ned from directly or indirectly recovering or manipulating to get any fund or con-
A
tribution to the Trust Fund. Second, no officer of the Canara Bank shall be
permitted to hold the office of life trustee, trustee or any other office of the
Canara Bank Officers• Association Trust Fund. Third, the Union of Itidia, who
bas been impleaded as a party shall be entitled to nominate five trustees .who are
not connected with the Canara Bank to administer the Canara Bank Officers•
Association Trust Fund. Fourth, the trustees nominated by the Union.of India
shall administer the Trust Fund in accordance with the provisions of the
u Bombay Public Trusts Act and the deed of trust by which the Can~ra Bank
Officers' Association Trust Fund was created. Fifth, the trustees appt;>inted by
the Union of India shall hoJd oitice until apprQpriate arrangements are· made by
the Charity Commissioner, Maharas\itra on an applicatien to be moved by the
Centra1 Government within six months from today. Sixth, there sl~all be an
inquiry by the CBI into the conduct of the five life trustees in relati'on to the
Trust Fund and such further action as may be necessary may be taken by the ,~
c CBf. Any further direction which may be necessary may be sought from the--·
High Court of Bombay. (7720-G]

ORIGINAL JURISDICTION: Writ Petition No. 9933 of 1982

(Under Article 32 of the Constitution of India.)
D WITH
Special Leave Petition (Civil), No. 13981 of 1982

From the Judgment and Order dated 21. JO. 1982 of the
Bombay High Court in W. P. No. 3137 of 1982.

S. Balakrishnan, M. K. D. Namboodiri and Ramesh Kesll'ani for
the Petitioners.
K. N. Bhat and Ms. Madhu Moo/chandani for the Resp'ondents.

The Judgment of the Court was delivered by
F
CH1NNAPPA REDDY, J,. The writ petition and the special leav~
petition are malicious and ill-motivated. But they have served one ·
good purpose, namely, they have brought to light the undesirable
activities of the petitioners themselves. We will have some
harsh things to ·say about the petitioners in our judgme~t. In!an
attempt to malign the top management of the Canara B~nk, they
have ·exposed themselves and the allegations have boomeranged.
The spider has been caught in its own web.
The first petitioner in the writ petitions is S.A. Kini, _Deupty
General Secretary of the Canara Bank Officers' Association and
the second petitioner is the Canara Bank Ofli 1l rs' Association. The
II
s. A. KINI v. UNION (Chinnappa Reddy, J.) 757
A
respondents in the writ petition are the Union of India represented
by the Secretary, Ministry of Finance, Department of Economic
Affairs, Banking Division, Canara Bank (a nationalised bank!, the
Chairman and Managing Director of Canara Bank and the
. General Manager of Canara Bank. The special leave petition is
directed against an order of the High Court of Bvmbay dated n
October 21, 1982 dismissing a writ petition filed by the same
petitioners as in the writ petition before us. The respondents to
the petition for special leave are also the same as in the writ
petition.

The principal allegation made by the petitioners in the writ
c
petition filed in the Bombay High Court and repeated in this Court
·is that the Chairman and Managing Director, the General
Manager and the top officials of the Management of
Canara Bank have been using their official position and
authority to coerce the officers and staff of the Canara D
Bank to collect funds for the Canara Bank Relief and Welfare
Society. Apart from seeking donations from customers, it is alleged
that one of the principal modes of collecting funds was the sale of
greeting cards by the officials of the bank to their customers.
Each officer was allotted a certain quota and was compelled to sell
his quota of cards to customers. The petitioners further alleged E
that officers, who protested against the directive to sell greeting
cards, were victimised by the bank, and officers, who were highly
·successful 'card-sellers' were given accelerated promotion over the
heads of seniors. Thiruvengandam was cited as an instance of a
victimised officers who was danied promotion while Annappa Pai
was cited as an instance of an officer, who had benefited and who F
was allowed to leap over seveal senior officers and was promoted
as a reward for bis services by the sale of cards. The· petitioners
alsu alleged that the top management was also interested in collect-
ing fonds for-
G
(i) Deposit Mobilisation Club;

(ii) The Canara Cank Cultural Brotherhood Organisation;
and

(iii) The Kamakoti Prabha Trust. H
ts8 SUPREME COURTS REPORTS (l98SJ j S1C.R.

At the hearing before us, the alegations in regard to the
Deposit Mobilisation Club and the Canara Bank Cultural Brother-
hood were abandoned. In regard to the Kamakoti Prabha Trust, the
allegation was that it was started by one S. Venkataraman, whti at
the time when it was formed, happened to be the Deputy General
Manager of the bank. He has long since retired from the bank and
B nothing bas been shown to us as to how the Kamakoti Pr~bha
Trust is in any manner linked with the top management of the
bank or how the management has promoted the int ere• t~ of the
Trust. It is unnecessary to pursue the allegations made in regard
to the Kamakot; Prabha Trust, which in our opinion have lieen
made out of pure spite and mere vexation. We are only left jl'ith
c the allegations made in connection with the collection of fttnds 'and
the sale of greeting card• for the benefit of the Canara B~nk
Relief and Welfare Society. The allegation that Thiruvengandm
was superseded because he refused to sell greeting cards and the
allegation that Annappa Pai was given an accelerated promotion
because of his excellent performance in selling greeting cards reri1ai-
D ned mere allegations. There was no material whatsoever placed before
us to substantiate either of these allegations. It was, however, asserted
before us by the petitioners and admitted by the respondonts that
until the year 1982, the General Manager and other top officials
used to associate themselves with the sale of greeting cards to
benefit the Canara Bank Relief and Welfare Society. It appears
E from the facts placed before us that the Canara Bank. Relief and
Welfare Society was formed and registered in the year 1961 at a
time when the bank was a private bank. The bank was nationalised
in 1969 and thereafter the bank ceased to have anything to do
with the society, though out of a total membership of2020 about ioo
past and present employees of the bank only are now members of
F the society. Until 1982 one individual director of the bank used to be
one of the several members of the Executive Committee of
the Society, but the present position is that no member
of the Executive Committee of the Society is an official of
the bank. The only link of the bank with the society
G
now is the name of the Society. The memorandum of associati\)n
of the society was also placed before us and the objects of the
society are wholly unconnected with the bank or its employees.
The principal objects are to provide relief in case of calamities like
flood, earthquake, fire, famine, epidemic, etc, to organise hospitals,
maternity and child welfare centres, homes for the poor, sick, aged
S. A. KiNJ. v. UNiON (Chinnappa Reddy, J.) iS9
and disabled, to maked cash contributions to educational and other A
social welfare organisations, to undertake rural development
programmes and so on. None of the objectives involves any special
benefit or advantage to the employees of the bank. A great many
details of the commendable work done by the society have been
given to us in the several statements filed on behalf of the respon- B
dents. The pe.itioners, unfortunately, have needlessly dragged the
society into the picture' making unworthy allegations. But even so
when the writ petition was filed by the present petitioners in. the
Bombay High Court, the management of the bank realised that
there may be some scope for abuse by some officials of the bank .in
the matter of selling greeting cards or raising funds for the society. c
They, therefore, made a statement before the Bombay High Court
in the following terms:

"The first respondent bank states that it has never at
any time whatsoever compelled its employees to sell
greeting cards or collect funds for the Canara Bank Relfef D
and Welfare Society or any other institution, nor has the
first respondent bank at any time considered the same as
a relief factor for evaluating performance of its employees
for promotion, nor shall the first respondent bank do so in
future.''

E
The High Court accepted the statement of the respondent
bank and rejected the writ petition. The assurance given by the
bank, as contained in the statement made by the bank before the,
Bombay High Court, should have satisfied the petitioners
if they had '1DY genuine grievance that, in the past,
officers of the bank had been forced to raise funds and sell greeting· F
cards for. the benefit of the society. But the petitioners were not
willing to be easily satisfied. They filed the present special leave
petition and the writ petition repeating the allegations made in the
Bomby High Court and praying for 'the issue of a writ in the
nature ol mandamus directing the respondents to forbear from
using the bank officials/bank m1chinery ban\: resources for the G
purposes of collections of funds in the garb of any welfare organisa-
tion in general and.in particular in the name of the various funds,
details of which wore set out in paragraph 22 of the writ petition'.
After the statement filed by the bank in the High Court of Bombay,
we are unable to find any justification whatsoever for the petitio-
H
760 SUPREME COUl<.T RP.PORTS [1985]3 ~,.C.R.

A ners to pursue the matter by filing the present special leave petition
and writ petition except to harrow the bank. When we poinledly
and repeatedly asked the learned counsel for the petitioners wh~ther
there was a single instance of a sale of greeting card or colleetion'
of funds by an official of the bank subsequent to the order of the
B Bombay High Court on October 21, 1982, the learned counsel was
unable to cite a single instance, but persisted in referring to the
sale of greeting cards before the order of the Bombay High Court.
Ultimately he had to admit that there was not a single instance of
sale of greeting cards or collection of funds by officials of the bank
subsequent to the order of the Bombay High Court. We hav6 no
c hesitation in holding that the writ petition and the special leave petit-
ionare both malicious and are designed to denigrate the management
of the bank. Sri K.N. Bhatt' learned counsel for respondents
(2 to 4) assures us that the bank stands by the statement m.ade
before the Bombay High Court. We have, therefore, on hesitation in
dismissing the writ petition and.the special leave petition with costs
0 which we quantify at Rs. 10,000 in each.

But that is not an end of the matter. Right at the commence-
ment, when the petitions came up for admission, the court cam~ to
be oppressed by the vast opportunity for abuse of financial power
E presented to Nationalised Banks and Financial Institutions of the
Public Sector. There were indications in the writ petition it~elf
which revealed that while the petitioners were indulging in rash and
feckless allegations against the top echelons of the bank, on the
other hand.. they themselves were indulging in brash and reckl~ss
activities of the very nature of which they were complaining against
F the respondents. lt appeared to the court that the petitioners, hands
were unclean, and that they were by no means the champions .of
the 'oppressed' officers of the bank. There was one significant
paragraph in the writ petition, which though meant to mislead ~he
court, exposed them. In paragraph 12 of the writ petition, it \\'.as
stated;
G
"12. That realising the importance of strict observance
of legal and moral norms in bank business, the Central
Government had issued the following directive:- •
H
s. A. KINI v. UNION (Chinnappa Reddy, J.) 761
A
Immediate
F .No.6/9/5/82, I. R.
Government of India
Ministry of Finance
Department of Economic Affairs
(Banking Division) B
New Delhi, the July 22, 1982.

Chairman,
Indian .Banks' Association,
Bombay.
c
Subject: ......... Bank officers, Association Trust Fund-
Collection of funds and creation of trust-

Dear Sir.

I am directed to state that it has come to the notice of D
'the Government that ......... Bank Officers' Association has
formed a Trust by name ...... Bank Officers' Association
Trust Fund, which is registered in 1981 under the Bombay
Public Trust Act, 1950 and it has also been granted
exemption under sec• ion 80-G of Income Tax Act for
donations made by asscssees to the Fund. Apart from using E
bank's name which will have avoidable misgivings in the
clientele, trust Fund· has issued an appeal soliciting
donations etc. from general public. We feel that even as
members of the Association, the employees cannot collect
funds from the public and the clients to. the bank as it
constitutes a clear misuse of their office. I am, therefore, E

Y-
I
to suggest that TBA may consider a~vising member banks
to ensure that such trusts are not set up elsewhere.

Kindly acknowledge receipt of the letter.
Yours faithfully,
Sd/- c
( Yashwant Raj)
Under Secretary to the
Government of India
This directive ha< been flagrantly violated by the top
management of the bank and personal aggrandizement of
H
sta~gcring proportions are be in~ made at the cost of lhe
762 SUPREME COURT REPORTS (1985] 3 S.C:R.

A Bank and at the cost of the depositors money."

It was a blatant case of supprcisio veri a"d suggestio falsi.
The petitioners sought to imply and suggest that the directive oflhe
Central Government was directed against the activities of the top
management of the Bank in connection with the collection of fu11ds
B for the Canara Bank Relief and Welfare Society, a society which
was in existence years before the nationalisation of banks was
thought of, whereas the truth was that the directive was a direct
consequence of the complaint> feceived against the activities of \he
petitioners in collecting funds for the Canara Bank Offic~rs·
c Association Trust Fund. The allegations in the petition and t'he
reference in pargaraph 12 to the " ..•...... Bank Officers' Trlist
Fund" provoked the court into a deeper probe as it was felt that
the customer-public was being exploited by some officers of the
bank and the matter needed comment and required correction.
Thereafter we made several orders from ti me to time calling for
D detailed information from both the parties ab6ut
the activities of the Canara Bank Relief and Welfare Society and
the Canara Bank Staff Officers. Association and the collections
made from them and by them. The orders made by us are self-
explanatory and are worth extracting since they give· a picture of
the dilatory and recalcitrant attitude of the present petitioners. We
E propose to extract the ordes_ in so far as they relate to the peti(io-
ners only, since we have already absolved the respondents. By \Jur
order dated January 17, 1983, we directed,

"The petitioners are directed to give the followiag
F detailed informotion.

There is a trust called "Canara Bank Officers"
Associatio~ Trust Fund, which is alleged to have been
formed on August 18, 1981. The petitioners will have
detailed information since the constitution of the Trust of
G its office bearers and their position in the Bank including
the designation and salary as also if any emoluments in
cash or kind is drawn from the Trust. The petitioners will
also give detailed information of every contribution made
to this Trust with reference to the party's name, his dealing
with the bank as a customer and the amount contributed
by the party to the trqst anq ]\ow the contrib11tors were
s. A. KINI v. UNION (Chinnappa Reddy, J.) 763

persuaded to make the contributions and the motives for A
contribution, as also service received by each contributer
from the bank, with reference to the branch. If there are
withdrawals from the trust, the details should be furnished
with the name of the person who has withdrawn the
amount and where the money is at present kept or deposi-
ted and how the money was utilised. Withdrawal by'cash B
or demand d~aft may be separately mentioned.

By our order dated April 27, 1983, we directed,

"By an order made by this Court on January 17, 1933,
this Court directed the petitioners to give the following c
information in respect of a Trust called Canara Bank
Officers' Association Trust Fund. The information was to
be given under the following heads :

I. Names of the office bearers of the Trust since its
inception. D

2- The position ·of each trustee in the organisation of the
hank showing the designation, the place of work and
salary drawn.

3. Whether any salary or emolument of any kind return E
in cash or kind was drawn from the aforementioned
Trust.

4. If the answer to query 3 is in the affirmative the mode
and method of payment.
F
5. Name of each contributor to the Trust fund, the
amount of contribution, relation of the contributor to
the bank and whether at any point of time, the
contributor had been using or enjoying the services
of the bank especially from the branch in which the G
trustee was working and the contributor was .
connected to the branch.

6. If the contributor is not connected with the bank
. organ.isat~on, the reasons and the motives for making
contr:buhon to such a trust, the beneficiaries of which
tt
764 SUPREME COURT REPORTS (1985] 3 S.C.R.

A are none other than the officers of Canara Bank.

7. The service received by each contributor from
the bank or its branch since making the contribution
or since six months prior to the making of the
contribution.
B
8. Withdrawal from the Trust fund, if any made by
whom in what amount on what date and for what:
purpose and whether the withdrawal was in cash,
cheque or demand draft.

c The petitioners were called upon to furnish this·
information when the matter was taken up for hearing ..
Mr. R.K. Garg, learned counsel for the P"titioncrs read
out the affidavit of Mr. S.A. Kini dated February 18, 1983.
We also went through the accompaniments to the affidavit.
We arc satisfied that the petitioners have not given full
details under every head and there is non-compliance with '
the order of the Court.

We direct the petitioners to fully comply with the
order of this Court giving information under each of the
E separate head as set out hcrcinbcfore except those where
the information has already been supplied as an annexure
to the afore-mentioned affidavit. In that case, the deponent
shall state which annexurc of the earlier affidavit complies
with the Court's direction. This information must necessa-

.""
rily be supplied by July 17, 1983 and the matter shall
F appear on board on July 25, 1983.
(
Both the parties including their officers, agents or '
nominees are injuncted from directly or indirectly recover-
ing or illanipulating to get any fund or contribution io the
trust funds, one mentioned in our order and those other
G
·mentioned at page 16 of the writ petition hereafter. This
will not come in the way of the association recovering the
membership fee from the members who are bona fide
members and are on the staff of the bank.,'

We direct accordin~ly."
ff
,
s. A. "!NI v: UNION (Chinnappa Reddy, J.) 765

By our order dated August 30, 1983, we again directed, A

Petitioner No.2, the Canara Bank Officers' Association
shall give full detail of the donations collected by the said
Association, commenCing from 1970 till today. While
giving the datails of the donation, the Association shall B
specify the name of the donor not the branch from which
the donation was received, the amount of donation, the full
name and address of the parties giving donation, its rela-
tion with the bank, and also to specify the branch through
which the parties were getting banking service and
.alteration and or modification of banking service , c
or facilities granted since giving of the donation and which
officers motivated persons to give donation to the Associa-
tion as also the name and full address of the officer. If
possible, the Association may state the motivation for the
donation.
D
The Canara Bank Officers' Associartion Trust shall give
full details of the donation received from .the public giving
some details as hereinabove· indicated as in the case of
Canara Bank Officers' Associaiion. Let it be noted that
the details given till now are far from sufficient and are
evasive in character. It must state whether a receipt is E
issued to each individual donor and whether counter-
foils are preserved ..................... "

Finally, by our Order dated August 23, 1984, we observed
and directed :
F
"By our detailed Order dated April 27, 1983, the
petitioners were directed to give, amongst others, the
following information in respect of Canara Bank Officers'
Association Trust Fund ('Trust' for short) :

"Name of each contributor to the Trust f1<nd, the G
amount of contribution, relation of the contributor to the
bank and whether at any point or time, the contributor
had been using or enjoying the services of the bank
especially froin the branch in which the trustee was
working and the contributor was connected to the
!>ranch,"
"
766 SUpREME COURT REPORTS [1985] 3 s.c.R.

A S.A. Kini, one of the petitioners, filed his affidavit to
which was annexed a list showing the amount received
from each individual/firm/company. It is annexure IV at
pages 126·163 of Volume-I.

It immediately transpired that there was a delierate
B attempt at evading the court's order with a view to relevant ·
information being not made available.

The Court by its order dated Augnst 30, 1983, gave
certain specific directions. Petiti0ners No.2 was specifi-
c cally directed to give further detail of the donations
collected by the trust from 1970 till the date of the order.
It was clarified so as to leave no one in doubt that the
petit10ners shall specify the name of the donor (not branch
from which donation was received), the amount of dona-
tion, the full name and address of the parties giving the
0
donation and the relation, business commercial or other-
wise of the donor to the bank and to further specify the
branch through which the donor parties were getting
banking services and facilities from the Canara Bank. The
petitioners were also directed to state whether there was
E any advantageous alteration or modification of the
banking services or facilities granted to the donor since
the donation as also to indicate and specify the name of
each of the officers who were members of the Trust and
who facilitated such alteration or modification advanta-
geous to the customers in respect of banking facilities. The
F name of the officer and his full address was also directed
to be stated. The petitioners were also directed, if possible,
to state the motivation for the donation.

There was noticeable relucta11ce en the part of the
petitioners to implement this order or at any rate to avoid
G
compliance with the same. On the last occasion, the Court
directed the petitioners strictly comply with the afore-
mentioned order.

Y csterday when the matter came up for hearing, a
ff statement running into about 24 pages not signed by any
responsible person and not verified by an affidavit was
i s. A. KINI v. UNION (Chinnappa Reddy, J.) 767

placed on record. We would be perfectly justified in A
rejecting this spurious document as unworthy of being
looked into. Mr.M.K. Ramamurthy repeatedly, though
wholly unsuccessfully, tried to persuade us to hold that the
state is in compliance with the. orders of this Court. A
mere glance at the statement would -show that fr is a
futile repetition of a bizaree exercise which resulted in the
statement Annexure IV volume I and by the information
supplied by the statement we are in no way wiser. The
purpose for calling upon the petitioners to submit the
name of each donor was to identify the donor so that a
detailed enquiry can be made as .to how the officers of the (,'
Trust misusing and abusing their petition have procured
donations by granting banking facilities to the donors. The
additional purpose was also to ascertain whether the
donors were coerced into making the so-called donations
at the instance of the officers of the Trust so that a detailed
enquiry can be undertaken to ascertain the use and misuse p
and abuse of the office by the members of the Trust.

The petitioners have been consistently striving to
suppress this information from the court. This becomes
evident from the fact that even the statement filed
yesterday and marked as Volume VI the name of the donor
' is mentioned without the address or even the city in which
the donor was residing or having his place of business .. It
is not stated what banking facilities the donors obtained
since. the donation
.
and through · which officer. Every
covert or overt attempt is made to withl:iold the identity of F
the donor to thwart the court to reach the donor so that
the shady ·of the members of the Trust in collecting the
so-called donations can be unearthed.

Apart from the statement being barren, it is not
G
supported by an affidavit and as it does not appear to
have been signed by any responsible officer. We reject it
as unworhy of any credence. The result is•that till today
there is non-compliance with the aforementioned orders
of the court. q
768 SUPREME COURT REPORT' (1985]3 S.C.R·

.A It was made ·specifically clear that the name of the
donor and the address must be clearly specified. Even after
long lapse of more than. year and a half since the order,
the information is branchwise which was categorically
rejected by this Court. The specific instances which remains
B . unexplained are pointed out by Mr .K.N. Bhatt, learned
advocate for the Canara Bank in his statement annexed to
the letter dated August 22, 1984. The statement is taken
on record.

c We propose to give hst opportunity to the petitioners
to comply with the orders of this court in letter and spirit.
Any attempt at deviance or defiance will unquestionably
land to serious consequences which we refrain from
specifiying at this stage. We record our utter disapproval
of this hide and seek game of the petitioners and we want
D to leave no one in doubt that they do so was at their own
peril. The arms oflaw are long and strong to reach them
and no effort will be spared to unearth their illegal activi-
ties if once they are so establi•hed. It is not for a moment
suggested that we so held. But this escapist attitude of the
petitioners have raised strong suspicion in our minds that
E
there is something imroper, illegal and unbusiness-like
in their conduct disclosing either misuse or abuse of -0ffice
by the officers of the Canara Bank in collecting a huge
amount as donation from the customers of the baQk for •
the purpose of the trust. What is stated is just. a warning.
Jl
'' We direct that petitioners shall comply "ith the orders
as bereinabove as indic·ated within a period of 6 weeks from
,today. The matter shall come up before this Bench after
·6 weeks."

G Pursuant to the last of our orders, the petitioners have
filed some more statements, but even so the full information which
we. desired to have bas not been furnished. The reason is fairly
obvJous. and we consider it unnecessary to further dilate on this
matter. From the information now available to us as a result of
the several statements filed before us, it transpires that the Canara
Bank Officers' Association was formed in the year 1971. On August
H
18, 1981 the Associatjon started the Canara Bank Officers' Associa-
tion Trust Fund registering it as a Public Trust under the l3ombny
s. A. k1N1 v. UNION (Chinnappa Reddy; .j.) ' 769
Public Trust Act, 1950. Five officers of the bank who were also A
office bearers of the Association were made life trustees of the
Association Trust Fund. Right from the date of formation of a
Trust, donations were collected by the members of the Officers'
Association from the customers of the bank. In the short span of r,
.about two years, the funds of the Trust have swelled to more than B
Rs. twenty four lakhs. The so-called donations range from sums
in hundreds to thousands of rupees. The number of donors is also
quite large. While one does appreciate that there ·must be. several
charitably inclined persons amon:st the bank's customers, Vie do
not have any doubt that most of the customers that gave donations
.~to the Trust Fund must have felt obliged to do so because of
c
) favours received or expected to be received by them. Even if no
coercive method• were employed by the members of the Association
to collect donations, the customers must have felt morally pressuri-
sed that otherwise their interests would not be properly taken ·care
of or would b"' Jeopardised or neglected by the 9fficers with whom D'
they were compelled to deal in the course of their b.usin.ess. Very
shortly after the formation of the Trust Fund, complaints began
pouring in against the collection of funds for the Association
Trust Fund by the officers of the bank. The All-India ·Bank
·Depositors' Association complained to the Central Minister incharge
· of banking as fol19ws E

"We are receiving complaints ·that some bank
employees are pressurising customers for dona_tions for
various activities which have nothing to do with the bank
· as such.
F·
For instance these funds are demanded for ponfere•
nces, for helping the family of·deceased employees, etc.
Where customers fail to respond, they begin to face problems
and difficulties in their banking transactions .

. You are aware of the hostile public attitude towards G
bank employees and the costs imposed on the economy
as a result of poor service and frequent disruption of work.
Without allowini; the situation to deteriorate further the
pubiic expect the Government to take remedial steps.
This is an opportunity for the Government to prove that
it is responsive to public criticism." H.
1to SUPiEME COURT REPORTS [!985j 3 s.c.li.
A The Management of the Canara Bank also received numerous
complaints. Feeling rightly disturbed by the complaints received,
the Management called upon the Association to furnish particulars
of the collections made by the officers and sent the following telex
message to the Association :
D
"This is with reference to the Canara Bank officers
Association Trust Fund formed by the Association for
which an appeal "also has b"en issued to the pu.blic for
donations. We also learn that funds are being collected
from the bank's clients as ·well as from the public and the
c staff by way of donations and coupons. Usuage of the __..,,I
name of Canara Bank for a Tn.,t of such type has led to - r .
the impression amongst our client• that the Bank. is also
having a role and interest in this Trust. Apart from
other reasons we are afraid that the usuage of the bank's
{]
name in a Trust which is not formed by the bank besides
creating compiications may become a bad pre~edent for
some others to form similar trusts. While we have no
objection for your collecting funds from our own officers
we request you not to collect funds from customers and
the public. We also request you to kindly furnish to us
the particulars of collections already made by.you from the
bank's clients and from the public as we intend referring
the matter to our Board at its next meeting and the
Ministry for their consideration ....

, The Board of Directors discussed the matter and confirmed
F. the action of the bank. They also looked with disfavour on the
collection of funds from customers by the Association. . They de~
sired the bank to convey the information to the Ministry for appro- :
priate action and follow-np measures. Thereupon the Bank addres-
sed a detailed letter to the Government of India seeking guidance
after setting forth the objects of the Trust, etc. and the action taken
by them till then. The response of the Govenment was immediate
and categoric. The Government said:-

"Please refer to your letter No. IRS/I. 2220. TPM
dated 18.6.1982 regarding Canara Bank Officers' Associa-
tion Trust Fund. We would request you to pursue this
H matter seriously. Even as members of the Association the
s. A. KINI v. UNION (Chinnappa Reddy, J.) 111

employees cannot solicit funds from the public. This is
clearly a misuse of their office. We would like to be
informed of the further developments in the matter."

In addition to writing to the Chairman of the bank as
aforesaid, the Government also wrote to the Chairman, Indian Banks'
B
Association, Bombay a letter which was extracted.i.n paragraph 12
of the writ petition and which has also been quoted by us earlie.r.
In turn the Indian Bank's Association addressed the Chief Execu-
tives of all public sector Banks and told them :

"In one of the member'banks in the public sector the
officers' Association had formed a trust and taken exe.mp-
c
tion under section 80-G of the Income Tax Act for
receiving donations to the fund. On the question of the
propriety of creating such trusts and collecting' funds from
the public, the Government is of the view that it would D
constitute a clear misuse of their office by the employees.
We have been requested by the Government to advise all
public sector banks to ensure that such trusts are not set
up.

We reproduce overleaf a copy of the communication F,
received by us from the Banking Division for your·
information and necessary action."

It is clear from what has been' stated above that the writ
petition in this Court and the writ petition filed in tl:ie Bombay
High Court which led upto the special leave petition are retaliatory 11

y
l
actions consequent on the displeasure expressed by the Management
and, on account of the Management, by the Board of Directors·
and the Central Government. We are of the firm opinion that no
employee of a nationalised Bank or any, other Public Sector Corpo-
ration should engage himself in collecting 'donations' for any trust
or other organisations fro.m per rnns with whom he comes into contact G
in the course of his employment. It is not desirable. It is likely to
lead to unhealthy practices and harmful results, intended or im'iil- ·
tended. In the world of comme'rce, quid pro quo and not charity
is the rule. Those in a position of advantage by reason of their
office have to be very wary. Otherwise, they may unsuspectingly
walk into traps. That is why the Central Civil Services (Con.duct)
Rules, 1964,_for example, provide that no Government servant shall H
772 SUPREME COURT REPORTS (1985] 3 s.c.ll.
A except with the previous sanctions of the Government or of .prescri-
bed authority, ask for or accept contributions to, or otherwise_
associate himself with raising of any funds or other collec.tions in
cash or in kind in pursuance of any object whatsoever. (R.ule 12).
It is a rule of prudence. It is a rule of commonsens. It is born of
wisdom gained by experience. We fully endorse the raison d'etre
B behind the rule. We also endorse what has been said by the.bank in
. its telex message to the officers' Association, by the Govarnment in
its letters to the bank and to the Indian Banks' Associatio!) and by
the Indian Banks' Association to the Chief Executives of ah Public
Sector Banks, all of which we have extracted earlier in this
judgment.
c
The question, therefore, is what has to be done with the
Canara Bank Officers' Association Trust Fund. First, aa, injunc-
tion on the same lines as that which was in force during the pende-
ncy of the writ petition in this Court shall issue, ·that is, the officers
D of the Canara Bank, their agents or nominees are restrained from
directly or indirectly recovering or mainpulating to get an~ fund or
·contribution to the Trust Fund. Second, no officer of the Canara
Bank shall be permitted to hold the office of life trustee, trustee
or any other office of the Canara Bank Officers' Association Tru;t
Fund. Third, the Union of India, who has been impleaded as a
E party shall be entitled to nominate five trustees who are not connec-
ted with the Canara Bank to administer the Canara Bank Officers'
Association Trust Fund. Fourth, the trustees. nominated by the ,_
Union of India shall administer the Trust 1:und in accorda'nce with
the provisfons of the Bombay Public Trusts Act and the dee\! of trust
by which the Canara Bank Officers' Association Trust Fund was
F created. Fifth, the trustees appointed by the Union of Ii\dia shall
hold office until appropriate arrangements are made by the. Charity
Commissioner, Maharashtra on an application to be mov~d by the
Central Government within six months from today. Sixth, there shall
be an enquiry by the CBI into the conduct of the five trustees in
G
relation to the Trust Fund and such further action as may be
necessary may be taken by the CBI. Any further directfon which
may be necessary may be sought from the High Court of Bombay.

H Mt.A. Petitions dismissed.