MIHIR KUMAR HAZARA CHOUDHURYversusLIFE INSURANCE CORPN. & ANR.

                           [2017] 9 S.C.R. 418


A              MIHIR KUMAR HAZARA CHOUDHURY
                                    v.
                  LIFE INSURANCE CORPN. & ANR.
                      (Civil Appeal No. 7612 of2009)
B                         SEPTEMBER 11, 2017
      [R. K. AGRAWAL AND ABHAY MANOHAR SAPRE, JJ.]
        Service Law - Dismissal.from service -Assistant of LIC issued
  receipts to policy holders without actually receiving payme/1fs from
C them - Department proceedings - Employee held guilty of
  misconduct and dismissed from service - Tribunal set aside the
  dismissal order. howeve1; High Court set aside the order of the
  tribunal - On appeal. held: No irregularity in the departmental
  proceedings - LIC department independently proved charges before
  Enquiry Officer and tribunal '- Appellant admitted the charges and
D only made a prayer for leniency - Furthe1; no defense available to
  employee to say that there was no loss or profit resulting in a case
  when employee acted· without authority - Having regard to the
  seriousness of the charges and no defense being taken by Assistant,
  punishment of dismissal was appropriate - Life Insurance
E Corporation of India (Stajj) Regulations, 1960 - Reg. 39.
          Dismissing the appeal, the Court
        HELD: 1.1 The reasoning and the conclusion arrived at by
  the Division Bench that the charges leveled against the appellant
  stood proved and, in consequence, upheld the appellant's
F dismissal order holding it to be commensurate with the gravity
  of the charges, arc accepted. Also, the respondent (LIC) was
  able to prove the charges leveled against the appellant
  (employee). The charges can be held proved by mere reading of
  the appellant's reply wherein he, in no uncertain terms, admitted
  that he had issued the disputed premium/special premium
G receipts to the concerned policyholders and did not receive the
  amount from any of them. All he had said was that such mistake
  occurred on his part due to heavy pressure of workload on him
  and some family circumstances/worries which, was hardly any

H
                                 418
MIHIR KUMAR HAZARA CHOUDHURY v. LIFE INSURANCE                         419·
                CORPN. & ANR.

defense to the charges; and that he himself requested for taking A
action against him with leniency. [Paras 21, 22)(425-G-H; 426-A-
B)
       1.2 The Enquiry Officer had recorded a finding of fact that
 the action on the part of'the appellant was willful and with ma/a
fide intention to perpetrate the fraud on the respondent (LIC)         B
for wrongful personal gains. Though, this report was set aside by
 the tribunal but the Division Bench set aside the award of the
 tribunal and upheld the dismissal order. It is for this reason, the
 report of the Enquiry Officer can now be looked into. Though,
 sin~ere attempt was made to attack to challenge the departmental
 proceedings but there is no merit in the same. [Paras 23, 24](426-    C
 B-D]
      1.3 The principle of natural justice was fully observed in
departmental proceedings wherein the appellant throughout
participated. No prejudice was noticed having been caused to
the appellant while participating in the Enquiry proceedings.That D
apart, despite the appellant virtually admitting the charges, the
respondent had also adduced the evidence before the Enquiry
officer and then before the tribunal to prove the charges
independently, which rightly found acceptance by the Division
Bench. [Para 25][426-D-E)                                         E
      1.4 Keeping in view the reasons set out coupled with the
findings of the Enquiry Officer, which Division Bench has rightly
upheld, there is no hesitation in holding that'the charges against
the appellant were proved not only on the strength of the
admission of the appellant in his reply but also independently         F
with the aid of the evidence led by the LIC before the Enquiry
Officer and later befor~ the tribunal. [Para 26)(426-F-G)
      1.5 An employee, in discharge of his duties, is required to.
exercise higher standard of honesty and integrity. In a case where
he deals with the money of the depositors and customers, it is all G
the more necessary for him to be more cautious in his duties
because he deals with the money transactions for and on behalf
of his employer. Every such employee/officer is, therefore,
required to take all_ pos~ible steps to profect the interest of his
employer. He must, therefore, discharge his duties with utmost
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420           SUPREME COURT REPORTS                     [2017) 9 S.C.R.


A sense of integrity, honesty, devotion and diligence and must
  ensure that he does nothing, which is unbecoming of an employee/
  officer. Indeed, good conduct and discipline are inseparable from
  the functioning of every employee/officer of any Institution and
  more when the institution deals with money of the customers.
  Any dereliction .in _discharge of duties whether by way of negligence
8
  or with deliberate intention or with casualness constitutes
  misconduct on the part of such employee/officer. [Para 27)(426-
  G-H; 427-A-B]
        1.6 There is no defense available to a delinquent to say
  that there was no loss or profit resulting in a case when officer/
c employee is found to have acted without authority. The very
  discipline of an organization and especially financial institution
  where money is deposikd of several depositors for their benefit
  is dependent upon each of its employee, who acts/operates within
  the allotted sphere as custodian of such deposit. Acting beyond
D one's authority by itself is a breach of discipline and thus,
  constitutes a misconduct rendering the delinquent to suffer the
  adverse orders. [Para 28)(427-C-D)
        1.7 Having regard to the seriousness of the charges coupled
  with virtually no defense taken by the appellant in answer to the
E charges and the findings of the Enquiry Officer, the punishment
  of dismissal was .appropriate as provided in the service regulations
  and hence, does not call for any leniency in awarding such
  punishment. [Para 29][427-E)
            1.8 The appellant neither set up any defense nor denied
F     the factum of charges, yet the respondent proved the charges
      with the aid of relevant evidence, which found acceptance to the
      Division Bench and this Court too. As an Appellate Court, neither
      this Court can sit over the findings of the Enquiry Officer and
      find fault in it nor can re-appreciate the evidence of witnesses
      examined in departmental Enquiry. [Para 31][427-G-H; 428-A]
G
           Damoh Panna Sagar Rural Regional Ba11k & Am: v.
           Munna Lal Jai11 (2005) 10 SCC 84; Disciplinary
           Authority-cum-Regional Ma11ager & Ors. v. Nikunja
           Bihari Patnaik 1996 (9) SCC 69 : (1996] 1 Suppl. SCR
           314 - referred to.
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MIHIR KUMAR HAZARA CHOUDHURY v. LIFE INSURANCE                               421
                CORPN. & ANR.

                          Case Law Reference                                 A
(2005) 10 sec 84                  referred to              Para27
(1996) 1 Suppl. SCR 314           referred to              Para 28
      CIVIL APPELLATE JURISDICTION: Civil Appeal No. 7612
~W®.                                                                         B
      From the finaU1,1dgment and Order dated 4'h July, 2007 passed by
the High Court at Calcutta in APO No.591 of 2003.
     · Swatantra Rai, S. K. Puri, Vibhav Srivastava, Ms. Vijayalakshmi
(For Ms.Priya Puri), Advs. for the Appellant
      Kailash Vas~1dev, Sr. Adv., Umrao Singh Rawat, Dr. Puran Chand,
                                                                             c
S. Rajappa, Advs. for the Respondents.
      The Judgment of the Court was delivered by
      ABHAY MANOHAR SAPRE, J.
       1. This appeal is directed against the final judgment and order D
dated 04.07 .2007 passed by the High Court at Calci.1tta in APO No.591
of 2003 whereby the Division Bench of the High Court allowed the
appeal filed by the Life Insurance Corporation oflndia (respondent No. I
herein), set aside the order of the Single Judge and the award of the
Tribunal and upheld.the dismissal order passed by respondent No. I.      E
      2. In order to appreciate the issues involved in the appeal, it is
necessary to set out the relevant facts hereinbelow.
       3. In the year 1960, the appellant was appointed as an Assistant in
the set up of respondent No. I- Life Insurance Corporation of India
(hereinafter referred to as "LIC"). At the relevant time, he was posted      F
in the Branch Office ofLIC at a place called Burir Bagan, PO& District
Burdwan (WB).
      4. During the year 1977, it came to the notice of the officials of
respondent No. I (LIC) that the appellant, in discharge of his duties,
issued as many as seven receipts including special premium receipts to G
the policyholders without receiving any premium amount from them.
The details of the policies such as their numbers, names of policyholders,
due date of premium and the amount of premium are mentioned b.elow:

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422            SUPREME COURT REPORTS                           [2017] 9 S.C.R.



A           Policl'. No.   Name               Due Premium        Total



      i)    9764225        Sri D. Hazra       July 1973          Rs. 251.00
                                              July 1974
B                                             July 1977 &
                                              January 1977 @
                                              Rs.62.75 each

      ii)   31098245       Sri s: Mukherjee
                                      June, 1975                 Rs. 737.00
                                      December, 1975
c                                     June, 1976
                                      December, 1976 &
                                      June, 1977@
                                      Rs.147.40 each
      iii) 30982313  Sri S.K. Roy     May,          1974         Rs. 406.08
                                      August,       1974
D                                     November, 1974
                                      February, 1975
                                      May,          1975
                                      August,       1975
                                      November, 1975
                                      & Febmary, 1976
 E                                    May,          1976
                                      August,       1976
                                      November, 1976
                                      February, 1977
                                      la!. Rs.33.84 each
      iv) 31210746 . Sri T.N. Samanta April, l 975 &             Rs. 821.20
 F                                    April, l977 @
                                      Rs.410.60 each
      v) 31214187    Sri P.K. Mallick September, 1976 &          Rs. 316.80
                                      March, 1977
                                      laJ.Rs.158.40 each
      vi) 31211624   Sri N.C. Hazra   August, 1976 &             Rs. 1,762.60
                                      February, 1977@
G
                                      Rs.881.30 each
      vii) 312111625 Sri U.C. Hazra   February,   1975           Rs. 3,318.80
                                      February, 1976
                                      August, 1976 &
                                      February, 1977@
                                       Rs.829.70 each
H
MIHIR KUMAR HAZARA CHOUDHURY v. LIFE INSURANCE                            423
     CORPN. & ANR. [ABHAY MANOHAR SAPRE, J.]

       5. After beingprimafacie satisfied on verification of the records A
that the appellant had committed the alleged misconduct, the UC placed
the appellant under suspension and then issued the charge-sheet under
Regulation 39 of the Life Insurance Corporation of India (Staff)
Regulations, 1960 (hereinafter referred to as "the Regulations") to the
appellant on 07. I l .1977 (Annexure-A) setting out therein the specific B
charges with details mentioned above. The appellant was asked to
submit his reply.         ·
       6. On 28.11.1977, the appellant replied to the charges
(Annexure-B). The appellant, in substance, admitted the issuance of
receipts by him and als.o admitted non-receipt of the amount against any C
of these receipts from any of the policyholders. All he said was that he
had neither any mala fide intention nor any oblique motive behind this.
According to the appellant, it occurred due to the pressure of work and
family circumstances/worries. The appellant, therefore, prayed
respondent No. I to take lenient view in the case against him.
       7. Dissatisfied with the reply of the appellant, respondent No.I D
referred the matter to the Enquiry Officer for holding regular
Depa11mental Enquiry into the charges leveled against the appellant as
per the service regulations. The Departmental Enquiry was, accordingly,
held in which the appellant fully participated. The respondent (LIC)
adduced evidence to prove the charges.                                    E
      8. On 31.07 .1981, the Enquiry Officer submitted his repo11
(Annexure-D). The Enquiry Officer, in his detailed report running into
27 pages, held the charges leveled against the appellant as proved. He
recorded the following findings against the appellant:
          "Thus I hold him guilty on the charges of his mala fide         F
      intention ofperpetrating fraud on the Corporation for
      wrongful personal gains.
           Thus it is proved further beyond any doubt that Shri
      M.K. Hazra Chowdhury willfully indulged in the acts of
      deliberate omission and/or commission by defalcating the G
      amounts and causing temporary financial loss to the
      Corporation which he tried to compensate by influencing
      the policy-holders to deposit the amounts subse<1uently with
      interest and acted in a manner prejudicial to good conduct
      and failed to maintain absolute integrity and devotion to H
424             SUPREME COURT REPORTS                          [2017) 9 S.C.R.


A           duty so as to serve the Corporation honestly and faithfully .
            .I have come to this conclusion based on the evidence on
            records and hold the accused employee guilty of all the
            charges."
        9. The respondent (LIC) agreed with the findings of the Enquiry
B Officer and, accordingly. dismissed the appellant from the service by
  order dated 07.12.198 l(Annexure-E) as provided in the Regulations.
             I0. The appellant (employee), felt aggrieved of the dismissal order,
      preferred departmental appeal to Zonal Manager. It was dismissed by
      order dated 22.04. L982 .. The appellant then sought industrial reference
c     to the Central.Government Industrial Tribunal (hereinafter referred to
      as "the Tribunal") under Section I0 of the Industrial Disputes Act, 194 7
      to decide the legality and correctness of the dismissal order. It was
      referred to the Tribunal as Reference No. 511989.
         11. The Tribunal then embarked upon the reference and by award
D dated 15.06.1998 held that the Departmental Enquiry was defective and,
  therefore, bad in law. The Tribunal, therefore, granted an opportunity to
  the respondent (employer) to prove the charges leveled against the
  appellant on merits by adducing evidence. The respondent(LIC),
  accordingly, adduced evidence before the Tribunal and proved the
  charges. The Tribunal, however, held that the evidence adduced by the
E respondent(LIC) was not credible and, therefore, charges were not
  proved against the appellant.
          12. In other words, in the opinion of the Tribunal, the
   respondent{LIC) failed to prove the charges against the appellant for
  .want of adequate evidence and, therefore, the dismissal order was liable
F to be set aside. It was, accordingly, set aside with a further direction to
   the respondent(LIC) to pay the entire retiral benefits to the appellant
   because, in the meantime, the appellant had attained the age of
   superannuation.
         13. The respondent, felt aggrieved, filed writ petition (W.P.
G No.2578/1998) before the High Court at Calcutta. The learned Single
  Judge stayed the operation of the award of the Industrial Tribunal on
  condition that the respondent(LIC) would pay a sum ofRs.50,000/- by
  way of ex-gratia payment to the appellant and then disposed of the writ
  petition by order dated 31.03 .1999 giving liberty to the parties to apply
  before the Tribunal.                                           ·
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MIHIR KUMAR HAZARA CHOUDHURY v. LIFE INSURANCE                               425
     CORPN. & ANR. [ABHAY MANOHAR SAPRE, J.]

       14. It may here be mentioned that in between, there were some A
more proceedings ensued between the parties resulting in passing some
interim orders by the Tribunal, Single Bench, Division Bench and this
Court but eventually the matter reached back to the Division Bench in
appeal at the instance of the respondent (LIC) against the order of the
Single Bench dated 31.03 .1999.
                                                                             B
       15. By impugried order, the Division Bench allowed the appeal
filed by respondent No. I (LIC), set aside the order of the Single Judge
and the award of the Tribunal and upheld the dismissal order passed by
the respondent.
       16. It is against this order, the employee felt aggrieved and filed   c
this appeal by way of ~pecial leave before this Cowt.
     .17. Heard Mr. Swatantra Rai, learned counsel for the appellant
and Mr. Kailash Vasudev, learned senior counsel for the respondents.
       18. Having heard the learned counsel forthe parties and on perusal
of the record of the case including the written submissions filed by the     D.
learned counsel for the appellant (employee), we find no merit in the
appeal.
                           .                                         .

      19. The short question that arises for consideration in this appeal
is whether the charges leveled against the appellant (employee), as set
out above, were proved in the departmental proceedings before the            E
Enquiry Officer or/and before the Tribunal? If yes, then whether the
punishment imposed by the respondent(employer) ori the
appellant(employee) dismissing him from the service.is just and proper?
                                                .               .
      . 20.As mentioned above, the Division Bench held that the charges
leveled against the appellant stood proved and, in consequence, upheld       F
the appellant's dismissal order holding it to be commensurate with the
gravity of the charges.
      21. We are in agreement with the reasoning and the conclusion
arrived at by the Division Bench. In our considered opinion also, the
respondent(LIC) was able to prove the charges leveled against the G
appellant( employee). This we _say for the following reasons:
      22. Firstly, the charges can be held proved by mere reading ofthe
appellant's reply (Annexure-B) wherein he, in no uncertain terms,
admitted that he had issued the disputed premium/special premium receipts
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426             SUPREME COURT REPORTS                          [2017] 9 S.C.R.


A to the concerned policyholders and did not receive the amount from any
  of them. Secondly, all he had said was that such mistake occurred on
  his pa11 due to heavy pressure of workload on him and some family
  circumstances/worries that were troubling him during those days which,
  in our opinion, was hardly any defense to the charges; and thirdly. he
  himselfrequested for taking action against him with leniency.
B
             23. As would be clear, the Enquiry Officer had recorded a finding
      of fact that the action on the part of the appellant was willful and with
      ma/a fide intention to perpetrate the fraud on the respondent (LIC) for
      wrongful personal gains.
c            24. Though.·this report was set aside by the Tribunal but the
      Division Bench set aside the award of the Tribunal and upheld the dismissal
      order. It is for this reason, the report of the Enquiry Officer can now be
      looked into. Though, learned counse I for the appellant made sincere
      attempt to attack to challenge the departmental proceedings but we find
      no merit in the same.
D
         25. We find that the principle ofnaturaljustice was fully observed
  in departmental proceedings wherein the appellant throughout
  pat1icipated. We have not been able to notice any kind of prejudice
  having been caused to the appellant while participating in the Enquiry
  proceedings. That apart, despite the appellant virtually admitting the
E charges, the respondent had also adduced the evidence before the Enquiry
  officer and then before the Tribunal to prove the charges independently,
  which found acceptance to the Division Bench and, in our opinion, rightly.
             26. In our opinion, keeping in view the three reasons set out above
      coupled with the findings of the Enquiry Officer, which Division Bench
F     has rightly upheld,' we have no hesitation in holding that the charges
      against the appellant were proved not only on the strength of the admission
      of the appellant in his reply but also independently with the aid of the
      evidence led by the LIC {respondent No. I) before the Enquiry Officer
      and later before the Industrial Tribunal.
G       27. An employee, in discharge of his duties, is required to exercise
  higher standard of honesty and integrity. In a case where he deals with
  the money of the depositors and customers, it is all the more necessary
  for him to be more cautious in his duties because he deals with the
  money transactions for and on behalf of his employer. Every such
H employee/officer is, therefore, required to take all possible steps to protect
MIHIR KUMAR HAZARA CHOUDHURY v. LIFE INSURANCE                           427
     CORPN. & ANR. [ABHAY MANOHAR SAPRE, J.]

the interest of his employer. He must, therefore, discharge his duties A
with utmost sense of integrity, honesty, devotion and diligence and must
ensure that he does nothing, which is unbecoming of an employee/officer.
Indeed, good conduct and discipline are inseparable from the functioning
of every employee/officer of any Institution and more when the institution
deals with money of the customers. Any dereliction in discharge of duties B
whether by way of negligence or with deliberate intention or. with
casualness constitutes misconduct on the part of such employee/officer.
(See some observations in Dam oh Panna Sagar Rural Regional Bank
& A11r. v. Munna Lal Jain, (2005) IO SCC 84)
      28. There is no defense available to a delinquent to say that there C
was no loss or profit resulting in a case when officer/employee is found
to have acted without authority. The very discipline of an organization
and especially financial institution where money is deposited of several
depositors for their benefit is dependent upon each of its employee, who
acts/operates within the allotted sphere as custodian of such deposit.
Acting beyond one's authority by itself is a breach of discipline and thus D
constitutes a misconduct rendering the delinquent to suffer the adverse
orders (see some observations in Disciplinary Authority-cum-
Rcgional Manager & Ors.. Vs. Nikunja Bihari Patnaik, 1996(9)
sec 69).
       29. In our opinion, having regard to the seriousness of the charges E
coupled with virtually no defense taken by the appellant in answer to the
charges and lastly, the findings of the Enquiry Officer, the punishment of
dismissal was appropriate as provided in the service regulations and
hence does not call for any leniency in awarding such punishment.
                      .. .   .
       30. Learned counsel for the appellant (employee) made sincere F
attempt in his oral as well as written submissions to find fault in the
conducting of the departmental proceedings and also urging from
inte1fering in the quantum of punishment by imposing lesser punishment
but we are afraid we can interfere in either.
        31. As held supra, the departmental proceedings were conducted 0
strictly in accordance with law by following the principle ofnaturaljustice
in which the appellant duly participated. The appellant neither set up any
defense nor denied the factum of charges, yet the respondent proved
the charges with the aid of relevant evidence, which found acceptance
to the Division Bench and this Comt too. As an Appellate Court, neither
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428                SUPREME COURT REPORTS                       [2017] 9 S.C.R.


·A we can sit over the findings of the Enquiry Officer and find fault in it nor
   can we re-appreciate the evidence of witnesses examined in departmental
   Enquiry.
            32. In the light of foregoing discussion. we find no merit in the
      appeal. The appeal thus fails and is, accordingly, dismissed.
 B           33. It was. however, brought to our notice that the learned Single
      Judge during pendency of the writ petition by an interim order had directed
      the respondent (LIC) to pay a sum of Rs.50.000/- by way of ex-gratia
      payment to the appellant. The respondent accordingly paid this amount
      to the appellant. Let this amount be remained with the appellant.
 c
      Nidhi Jain                                                  Appeal dismissed.