ALLAHABAD BANKversusPREM NARAIN PANDE AND OTHERS

                      ALLAHABAD BANK                                           A
                              v.
                PREM NARAIN PANDE AND OTHERS

                           OCTOBER 19, 1995

         [B.P. JEEVAN REDDY AND S.B. MAJMUDAR, JJ.)                            B

        Se1vice Law-Allahabad Bank (Discipline and Appeal) Regula-
 tions,1976 as amended in 198(}--Regulations 4, 5(2), 6(21), (ii) and 7-Dis-
,ciplinary proceedings against Junior Management Scale-I officer intiated by
 Dy. General Manage,.....Asstt. General Manager competent to continue the      c
proceedings-No restriction of right to appeal-No likelihood of con-
 flict-Hence, valid.

      The Respondent No.l a Junior Management Scale-I officer in the
Appellant Bank was served with a change sheet in 1983, for his miscondnct
as Manger of the Bank during 1979-80. The charge sheet was served on           D
him by the Dy. General Manager, Lucknow. While the enquiry was being
conducted he was transferred to Ranchi, Bihar. After his transfer, the
Asst. General Manager, Patna Zone took over as Disciplinary authority in
respect of the pending enquiry-he also informed Respondent No.l on
20.3.1986 that he bas been nominated by the competent authority to act as      E
the Disciplinary Authority in respect of the enquiry against him. On
21.3.1986 after considering the report of the Enquiry Officer, the assistant
General Manager, Patna Zone passed an order dismissing Respondent
No.l from service.

       Respondent No.l challenged the order of dismissal by w•y of a writ      F
petition. Though he raised various contentions the High Court allowed
the writ petition solely on the ground that Assistant General Manager was
not competent to. pass the impugned order.

      In appeal to this Court the Appellant Bank contended that there was G
nothing in the Regulations to suggest that disciplinary proceedings cannot
be transferred to an equally competent authority and that the right of
appeal is not whittled down since it can be entertained by a still higher
authority as per Regulations.

      The employee contended that once the disciplinary proceedings were H
                                    481
    482                    SUPREME COURT REPORTS [1995] SUPP. 4 S.C.R.

A   initiated by Deputy General Manager they had to be carried on to their
    logical end by the same authority and that abruptly in midstream after the
    en<1uiry report \Vas submitted proceedings could not have been transferred
    to Assistant General l\1anager, that in any case there was nothing on the
    record to indicate that the conlpetent authority had ordered continuation
    of these disciplinary proceedings by a different authority, Hiat he came to
B know for the first time about the change only on 20th March, 1986 and
    before he could make any representation to that Authority on 21st March
    the impugned order was passed and that on the scheme of the Regulations
    the order of the High Court was perfectly valid and justified.

C           Allowing the appeal ,this Court

          HELD : 1. The High Court was wrong in assuming that under the
    Regulations it is the disciplinary authority which initiates the proceedings
    as per Regulation 6 (3) of Allahabad Bank (Discipline and Appeal) Regula-
    tions ,1976 that has necessarily to complete the proceedings till the stage
D   of Regulation 7 and it is that very authority which must pass the final
    orders of penalty. [491-F]

          2. The High Court has erred in taking the view that a change of
    disciplinary authority before completion of enquiry would whittle down the
    right of appeal available to the delinquent. [491-B)
E
          3. The High Court was wrong in assuming that ii is likely to result
    in two conflicting orders of two equally competent authorities since it is
    only a continuing proceeding. [490-F]

            4. Tl1e· proceedings are remanded to the High Court for fresh
F
    decision on merits on remaining contentions which may be canvassed by
    Respondent No.l against the impugned order. [492-B)

            CIVIL APPELLATE JURISDICTION : Civil Appeal No.6038 of
    1993.
G
         From the Judgment and Order dated 30.7.93 of the Allahabad High
    Court in W.P. No.3841 of 1986.

            G.L. Sanghi, Dhruv Mehta and S.K. Mehta for the Appellant.

H           M.L., Verma, R.P. Singh, R.K. Khanna, O.P. Srivastava, Akhilcsh
        ALLAHABAD BANK v. P.N. PANDE [S.B. MAIMUDAR,.I.]               483

Kumar Pamley, P.N. Puri and E.M.S. Anam (NP) for the Respondents              A
     The Judgment of the Court was delivered by

      S.B.MAJMUllAR, J. The appellant-bank by special leave has
brought in challenge the order passed by the Lucknow Bench of the
Allahabad High Court in Writ Petition No. 3841 of 1986 decided on 30th        B
Juiy 1993. The respondent no.l was the writ petitioner before the High
Court. The short question involved in this appeal is as to whether the
Assistant General Manager of the Patna Division of the appellant - bank
was entitled to pass the penalty order against respondent no.l.

      In order to appreciate the nature of the controversy between the        c
parties it is necessary to note a few background facts.

     Background facts

    . Respondent No.l was serving in the appellant-bank in the Junior
Management Scale I while posted in the regional office of the appellant -     D
bank at Lucknow. He was served with a charge - sheet dated 24th August
1983 containing charges of misconduct as Manager of the Palia Kalan
Branch of the Allahabad Bank, District Lakhimpur Kheri during the period
from April 1979 to December 1980.
                                                                              E
      The chargesheet was served on the respondent No.1 by the Deputy
General Manager of the Bank working at the Central Zone, Lucknow. The
said disciplinary authority appointed Shri B.B. Shesh as Enquiry Officer to
enquire into the charges of misconduct. The said appointment was made
by the Deputy General Manager on 19th December 1983. It appears that
the disciplinary proceedings continued for quite some time and in the         F
meantime on 15th .I uly 1985 the respondent No. 1 employee was trans-
ferred from Lucknow to Ranchi, Bihar. Respondent No.1 unsuccessfully
challenged his transfer order before the High Court. His writ petition was
ultimately not pressed. The enquiry was completed on 24th February 1986.
The Enquiry Officer submitted his report together with the records of the     G
enquiry proceedings and other documents to the Disciplinary Authority.

      It appears that after transfer of Respondent No.1 to Ranchi Branch
of the bank, the Assistant General Manager, Zonal Office, Allahabad
Bank, Patna Zone took over as the Disciplinary Authority in respect of the
pending enquiry against respondent no.l. On 20th March 1986 the Assis-        H
    484                   SUPREME COURT REPORTS [1995] SUPP. 4 S.C.R.

A tant General Manager informed the respondent no.l-ofliccr that he has
    been nominated by the competent authority lo act as the Disciplinary
    Authority in respect of the enquiry against him.

           That after considering the report of the Enquiry Officer and record
    of the proceedings, the Assistant General Manager, Zonal Office, Patna,
B   passed an order dated 21st March 1986 dismissing the respondent no.l
    from service of the bank in terms of Regulation No. 4 of rhe Allahabad
    Bank (Discipline and Appeal) Regulations, 1976 !hereinafter referred to
    as 'the Regulations'].

C          Respondent no.1 challenged the said order of dismissal by filing a
    writ petition in Allahabad High Court, Lucknow Bench. In the said writ
    petition respondent no.l raised various contentions for challenging the
    impugned order. One of the contentions canvassed before the High Court
    by respondent no.l was to the effect that when disciplinary proceedings
D   were initiated against him by the Dy. General Manager, Central Zone,
    Lucknow, the Asst!. General Manager, Zonal Office, Patna had no
    authority or jurisdiction to pass the impugned dismissal order and it was
    the Disciplinary Authority which initiated the proceedings which was com-
    petent to pass the final order of penalty, if any. The appellant-bank resisted
    the petition and contended amongst others that as per the Regulations the
E   Assistant General Manager, Zonal Office, Patna was fully competent as a
    Disciplinary Authority to pass the impugned dismissal order. The High
    Court took the view that respondent no.7, the Assistant General Manager,
    Patna Zone, Patna was not competent to pass the impugned order of
    dismissal. Only on this short ground the writ petition was allowed. The
    High Court did not, therefore, go into the other contention~ canvassed by
F
    respondent no.l against the impugned order of dismissal. The I-Iigh Court
    accordingly set aside the order dated 21st March 1986 as contained in
    Annexure 29 to the writ petition. It is the aforesaid order of the High Court
    which has brought the appellant-bank lo this Court being aggrieved by the
    .same.
G
    Rival Co11tentions

          Shri Sanghi, learned senior counsel for the appellant-bank contended
    that the High Court had patently erred in law in voiding the impugned
H   order of respondent no. 7 on the ground that he was not competent to pass
        ALLAHABAD BANK v. P.N. PANDEjS.B. MAJMUDAR.J.j                 485

the said order. Thal the relevant regulations of the bank were nol properly   A
appreciated by the High Court. Thal there was nothing in the Regulations
to suggest that once a Disciplinary Authority had initiated the proceedings
by serving a chargeshecl and appointing an Enquiry Officer against the
delinquent officer the proceedings cannot be transferred lo another equally
competent Disciplinary Authority as per the Regulations. That there was       B
no question of parallel proceedings being conducted by two Disciplinary
Authorities al a given point of lime. That the High Court has wrongly
assumed that that would be the situation if the appellant-bank's contention
was accepted. The High Court had equally erred in assuming that under
the Regulations the respondent no.1 would lose right of appeal if the
disciplinary proceedings initiated by the Deputy General Manager got
                                                                              c
decided ultimately by the Assistant General Manager as appeal would
otherwise lie against the order of the Assistant General Manager to the
Deputy General Manager. Thal in such an eventuality, submitted. learned
senior counsel, the appeal may be entertained by still higher authority,
namely, the General Manager and that such an eventuality had still not        D
occurred and it was not the contention of respondent no. 1 that his right
of appeal had not whittled down under the Regulations. It was, therefore,
contended that the decision rendered by the High Court was required to
be set aside.
                                                                              E
      Shri Verma, learned senior counsel for respondent fio.1-employee,
who is the only contesting party, on the other hand submitted that once the
disciplinary proceedings were initiated by Deputy General Manager they
had to be carried to their logical end by the same Authority and that
abruptly in midstream after the enquiry report was submitted proceedings F
could not have been transferred to Assistant General Manager. In any case,
submitted learned senior counsel for respondent no.l, there was nothing
on the record to indicate that the competent authority had ordered con-
tinuation of these disciplinary proceedings by Assistant General Manager
though initially they were started by the Dy. General Manager. It was
further contended that respondent no.1 came to know for the first time G
that the Disciplinary Authority had been changed only on 20th March 1986
and before he could make any representation to that Authority almost
simultaneously on the next day, that is, 21st March 1986 the impugned
order was passed. It was ultimately submitted by Shri Verma, learned
senior counsel for respondent no.1 that on the scheme of the Regulations H
    486                   SUPREME COURT REPORTS [1995] SUPP. 4 S.C.R.

A the order of the High Court was perfectly justified and well sustained.

    Our conclusion and reasons thereof


          We have carefully considered these rival contentions. We have
    reached the conclusion that High Court has taken too narrow a view of the
B
    controversy posed before it and has set aside the dismissal order on too
    hyper-technical a view which is not well sustained on the scheme of the
    Regulations.

          We will, therefore, proceed to consider the scheme of the Regula-
c tions which governs the controversy between the parties. The Regulations
  of 1976 have been framed by the appellant-bank in exercise of powers
   conferred by Section 19 of the Banking Companies (Acquisition and
  Transfer of Undertakings) Act, 1970. The Regulations arc framed in
   consultation with the. Reserve Bank and with previous sanction of the
D Central Government. Regulation 3 contains definitions. It has been laid
   down therein that in these regulations, unless the context otherwise re-
   quires, 'Appellate Authority' means the authority specified in the Schedule
   to dispose of appeals; 'Competent Authority' means the authority ap-
   pointed by the Board for the purpose of these regulations; and 'Discipli-
   nary Authority' means the authority specified in the Schedule which is
E competent to impose on an officer employee any of the penalties specified
   in regulation 4. Regulation 4 deals with penalties. It provides for imposition
   on any officer employee for act of misconduct or for any other good or
   sufficient reason amongst others major penalty of dismissal which shall
   ordinarily be disqualification for future employment. It is not in dispute
F .between the parties that respondent no.l at the relevant time was officer
   employee who was in Junior Management Scale I. It is also not in dispute
   that he was imposed a penalty by way of dismissal from service. Regulation
   5 deals with authority to institute disciplinary proceedings and impose
   penalties. Sub-regulation (1) thereof lays down that the Managing Director
   or any other authority empowered by him by general or special order may
G institute or direct the Disciplinary Authority to institute disciplinary
    proceedings against an officer employee of the bank. It has also been
    mentioned therein that the Chairman & Managing Director vide order
    dated 11th May 1979 has Authorised Deputy General Managers in terms
    of Rule 5(1) of the said Regulation to take disciplinary action against
H officers in Grade III and above as also to impose on them Minor and/or
       ALLAHABAD BANK v. P.N. PANDE [S.B. MATMUDAR. J.)                 487

Major Penalties as under :                                                     A

       Minor Penalties :

        (i) Censure

        (ii) Recovery from pay of the whole or part of any pecuniary loss      B
        caused by the officer to the Bank by negligence or breach of orders.

        (iii) Withholding of increments of pay.

       Major Penalties :

        (i) Stoppage of one or more increment(s)
                                                                               c
        (ii) Reduction to a lower stage in the grade of the officer or to a
        lower grade.

        (iii) Compulsory retirement.
                                                                               D
        (iv) Termination of service.

        (v) Dismissal from service.

The order of the Chairman & Managing Director dated 11th May 1979 as
per sub-regulation (1) of Regulation 5 was further amended on 15th             E
December 1980 to the following effect :

       "In addition to the Schedule to Allahabad Bank Officer Employees'
       (Discipline & Appeal) Regulations, 1976, and in furtherance to my
       order dated 1st-July, 1977, as well as 11th May, 1979, I do hereby
                                                                               F
       authorise Deputy General Managers and Assistant General
       Managers in terms of Rule 5(1) of the said Regulations to take
       disciplinary action against officer in Grade III, Grade II and Grade
       I (Corresponding to Scale I, Scale II and Scale III respectively of
       Allahabad Bank Officers Service Regulations, 1979) and also to
       impose on them Minor and/or Major Pe_nalties as under :-                G
       Minor Penalties :

       (a) .............. .

       (b) .............. .                                                    H
    488                         SUPREME COURT REPORTS [1995] SUPP. 4 S.C.R.

A           (c) .............. .

            (d) .............. .

            Major Penalties :

B           (a) ....... ········

            (b) ............•.

            (c) ······· ....... .

c           (d) Dismissal which shall ordinarily be a disqualification for future
            employment."

    Sub-regulation (2) of Regulation 5 lays down that the Disciplinary
    Authority may himself institute disciplinary proceedings. As per Regulation
    6 sub-regulation (2) 'whenever the Disciplinary Authority is of the opinion
D   that there are grounds for enquiring into the truth of any imputation of
    misconduct or misbehaviour against an officer employee, it may itself
    enquire into, or appoint any other public servant (hereinafter referred to
    as the· inquiring authority) to inquire into the truth thereof.' As per sub-
    regulation (3) of Regulation 6, 'where it is proposed to hold an inquiry, the
E   Disciplinary Authority shall frame definite and distinct charges on the basis
    of the allegations against the officer employee and the articles of charge,
    together with a statement of the allegations, on which they are based, shall
    be communicated in writing to the officer employee, who shall be required
    to submit within such time as may be specified· by the Disciplinary
    Authority (not exceeding 15 days), or within such extended time as may be
F   granted by the said Authority, as written statement of his defence.' As per
    sub-regulation 21(ii) of Regulation 6 after completion of the enquiry 'the
    inquiring authority, where it is not itself the Disciplinary Authority, shall
    forward tc the Disciplinary Authority the records of inquiry which shall
    include -
G
             (a) the report of the inquiry prepared by it under Clause (i);

             (b) the written statement of defence, if any, submitted by the officer
             employee referred to in sub-regulation (15);

H            (c) the oral and documentary evidence produced in the course of
        ALLAHABAD BA"!K v. P.i'{. PAN DE [S.B. MAJMUDAR.J.]             489

        the enquiry;                                                          A

        (d) written briefs referred lo in sub-regulation (18), if any, and

        (c) the orders, if any, made by the Disciplinary Authority and the
        Inquiring Authority in regard to the inquiry.'
                                                                               B
Then follows Regulation 7 which deals with 'Action on the inquiry report'.
Sub-regulation (3) of Regulation 7 provides that 'if the Disciplinary
Authority, having regard to its findings on all or any of the articles of
charge, is of the opinion that any of the penalties specified in Regulation
4 should be imposed on the officer employee it shall, notwithstanding
anything contained in Regulation 8, make an order imposing such penalty.'
                                                                               c
       We may now turn to the Scheduled to the Regulations. We have
already noted the definition of Disciplinary Authority as found in Defini-
tion Clause (g) of Regulation 3. The Disciplinary ·Authority which can
impose penalties specified in Regulation 4 are those which are specified in D
the Schedule. The relevant amended Schedule to the Regulations lays
down that for officers Scale I to III the Disciplinary Authority is Deputy
General Manager/Assistant General Manager, the Appellate Authority is
Deputy General Manger/General Manager and the Reviewing Authority is
Chairman & Managing Director. It becomes, therefore, clear that both the
Dy. General Manager as well as the Asstt. General Manager are discipli- E
nary authorities who can initiate proceedings against the officer like
respondent no.1 who is in Scale I and who can also pass the final penalty
order. It is of course true as rightly contended by learned senior counsel
Shri Verma that there cannot he two parallel simultaneous proceedings
before the two disciplinary authorities, namely Dy. General Manager and F
Assistant General Manager. However, there is nothing in the Regulations
to suggest as the High Court has with respect wrongly assumed that once
a competent disciplinary authority, namely, Dy. General Manager has
initiated disciplinary proceedings by framing charges and appointing En-
quiry Officer as per Regulation 6 sub-regulation (3), it is only that Discipli- G
nary Authority, namely, the Dy. General Manager who must necessarily
complete the proceedings till they are terminated and final orders arc
passed under Regulation 7. It may also be noted at this stage that there
was nothing on the record of the High Court in the writ petition to suggest
that it was the Chairman & Managing Director who had directed the Dy.
General Manager to institute disciplinary proceedings against the respon- H
    490                  SUPREME COURT REPORTS [1995] SUPP. 4~.C.R.

A   dent no. L On the contrary as provided by sub-regulation (2) of Regulation
    5 any competent authority can himself institute disciplinary proceedings.
    Even otherwise Regulation 5(1) as further amended on 15th December
    1980 shows that there is a general authorisation given by the Chairman &
    Managing Director to all the Dy., General Managers and Asstt. General
8   Managers in terms of Rule 5(1) of the Regulations to take disciplinary
    action against officers in Scale I like respondent no.I and has also
    authorised them to impose on them minor and major penalties including
    the major penalty of dismissal. Therefore, authorisation both to Dy.
    General Manager as well as Asstt. General Manager to act as disciplinary
    authorities for initiating departmental enquiries against Scale I officers as
c   per Regulation 6(3) as well as to pass appropriate penalty orders under
    Regulation 7 is already granted by general order of the Managing Director
    as seen from the amended Regulation 5(1) dated 15th December 1980. It
    is, of course, true that in the present case the Dy. General Manager,
    Lucknow Division, initiated the disciplinary proceedings as Disciplinary
D   Authority under Regulation 6(3) by framing charges and appointing the
    Enquiry Officer. The enquiry was completed by him but before the stage
    of Regulation 7 was reached the Enquiry Officer's report as per Regulation
    6 sub-regulation 21(ii) came to be sent to another equally competent
    Disciplinary Authority, namely, Asstt. General Manager, Patna Branch.
E   Beyond that stage, when Regulation 7 was to operate, it was only the Asstt.
    General Manager who remained the sole Disciplinary Authority in the field
    on account of transfer of these disciplinary proceedings from initial Dis-
    ciplinary Authority, namely, Dy. General Manager to Assistant General
    Manager who was an equally competent disciplinary authority._ With
    respect the High Court has wrongly, assumed that this is likely to result in
F   two conflicting orders of two equally competent authorities. Such a situa-
    tion would never arise for the simple reason that for one disciplinary
    enquiry against a concerned officer at a given point of time there would be
    only one disciplinary authority. But that would not mean that the entire
    gamut of the departmental enquiry against the officer must be conducted
G   from beginning to end by only one disciplinary authority and one com-
     petent disciplinary authority which initiated the proceedings cannot get
     changed in midstream by another equally competent disciplinary authority.
    As we have seen earlier the amended Scheduled clearly shows that for
     officers like respondent no. 1 in Scale I both the Dy. General Manager and
H    the Asstt. General Manger are equally competent to act as disciplinary
        ALLAHABAD BANK v. P.N. PANDE IS.B. MAJMUDAR,J.]                  491

authorities. Under Regulation 6 such a competent disciplinary authority A
can initiate proceedings. He can appoint an Enquiry Officer but for
exigency of service and requirements of administration if final action at the
stage of Regulation 7 is to be taken by any other equally competent
disciplinary authority like Asst!. General Manger it cannot be said that
both the competent authorities are simultaneously acting at the same point
                                                                               B
of time in the departmental enquiry against the officer. In our view the
High Court has also· erred in taking the view that such a change of
disciplinary authority before completion of the enquiry would whittle down
the right of appeal available to the concerned delinquent. Firstly such a
situation has still not arisen in the present case as it is not the contention
of respondent no. 1 that his right of appeal under the Regulations against      c
the impugned order has been adversely affected. In fact he has not filed
any appeal against the impugned order of dismissal but he straightaway
went to the High Court challenging the same. But even that apart, if the
Dy. General Manager has initiated the disciplinary proceedings against the
delinquent officer as per Regulation 6 sub-regulation (3) and if at the stage D
of passing final orders he is substituted by another equally competent
disciplinary authority like Asstt. General Manager, then in such a case, the
penalty order though passed by Asstt. General Manger will have a linkage
with the initiation of the disciplinary proceedings by the Dy. General
Manger as disciplinary authority and in such an eventuality the appeal
would lie to the General Manager who is also one of the appellate               E
authorities as mentioned in the amended Scheduled and in either case the
Reviewing Authority against the appellate authority will remain the same,
namely , the Chairman & Managing Director. Consequently it cannot be
held as assumed by the High Court that under the Regulations it is the
disciplinary authority which initiates the proceedings as per Regulation 6      F
sub-regulation (3) that has necessarily to complete the proceedings till the
stage of Regulation 7 and it is that very authority which must pass the final
orders of penalty. Consequently the decision of the High Court voiding the
impugned order of dismissal on this short ground cannot be sustained.

      We may also mention here that the submission of learned senior G
counsel for respondent no. 1 that he did not get adequate opportunity to
represent against the proposed action based on the enquiry report before
the changed disciplinary"authority, namely, respondent no. 7 is a contention
which has nothing to do with the competence of respondent No. 7 as the
disciplinary authority to pass impugned order of dismissal under Regula- H
    492                  SUPREME COURT REPORTS [1995] SUPP. 4 S.C.R.

A   tion 7. The contention about absence of reasonable opportunity to make
    such a representation before the new disciplinary authority has not been
    gone into by the High Court. Therefore, it cannot be considered by us at
    this stage. We, however make it clear that as the High Court has allowed
    the writ petition only on the short ground about the competence of respon-
    dent no. 7 to pass the impugned order of dismissal and as we disagree with
B
    the said view of the High Court and as the High Court has not gone into
    other contentions convassed by learned counsel for respondent no. 1 for
    challenging the impugned order it will also be open to respondent No. 1
    to challenge the impugned order of dismissal on the ground of non-
    availability of reasonable opportunity for putting forward his defence
C   before the ultimate disciplinary authority, as the proceedings will have to
    be remanded to the High Court for a fresh decision on merits on other
    contentions that may be open for respondent no. l, which of course will be
    decided by the High Court in accordance with law after hearing all con-
    cerned.

D         In the result this appeal succeeds and is allowed. The order of the
    High Court is quashed and set aside. Writ petition No. 3841 of 1986 is
    restored to the file of the High Court for decision on merits on remaining
    contentions which may be canvassed by respondent no. 1 against the
    impugned order of dismissal. As respondent no.l is out of service since
E   21st March 1986 and as pending this appeal the order of the High Court
    was stayed by this Court we request the High Court to make it convenient
    to dispose of the remanded proceedings in the aforesaid writ petition at its    1
    earliest convenience and preferably within six months from the receipt of
    the writ of this order at its end. In the facts and circumstances of the case
    there shall be no order as to costs.
F
    V.M.                                                        Appeal allowed.