Case Note & Summary
The petitioner, A.D. Padhey, was an Assistant General Manager with the State Bank of India, heading the Personal Banking Division. He was served with a chargesheet on 23rd November 1993 alleging irregularities and malpractices in transactions related to the Securities Scam of 1991-92, which caused a loss of Rs. 812 crores to the bank. The charges pertained to allowing debit/credit vouchers from the Investment Cell of the Securities Division to be routed through the current account of broker Harshad S. Mehta maintained in the Personal Banking Division, despite unsatisfactory features. A departmental inquiry was conducted, and the inquiry officer found the charges proved. Based on the inquiry report, the disciplinary authority imposed the penalty of compulsory retirement by order dated 8th March 2000. The petitioner challenged this order by way of a writ petition. The court considered the issues of whether the inquiry was vitiated by delay, whether the findings were based on no evidence, and whether the punishment was disproportionate. The court held that the delay in issuing the chargesheet was not fatal as the petitioner participated in the inquiry without objection. The court further held that in a departmental inquiry, strict rules of evidence do not apply, and the findings can be based on preponderance of probability. The inquiry officer had relied on the report of the Janakiraman Committee and other documents, which was permissible. The court found that the charges were proved and the punishment of compulsory retirement was not disproportionate. Accordingly, the writ petition was dismissed.
Headnote
A) Service Law - Compulsory Retirement - Departmental Inquiry - Misconduct - The petitioner, an Assistant General Manager of State Bank of India, was compulsorily retired for irregularities in transactions related to the 1991-92 Securities Scam. The court examined whether the inquiry findings were based on evidence and whether the punishment was proportionate. Held that the inquiry was conducted fairly, the charges were proved, and the punishment of compulsory retirement was not disproportionate. (Paras 1-25) B) Evidence - Appreciation of Evidence - Departmental Inquiry - The court held that in a departmental inquiry, strict rules of evidence under the Indian Evidence Act do not apply. The findings can be based on preponderance of probability. The inquiry officer's reliance on the report of the Janakiraman Committee and other documents was permissible. (Paras 10-15) C) Delay - Laches - Departmental Inquiry - The petitioner argued that the chargesheet was served after a delay of two years from the alleged misconduct. The court held that the delay was not fatal as the inquiry was initiated promptly after the scam came to light and the petitioner participated in the inquiry without objection. (Paras 5-8)
Issue of Consideration
Whether the order of compulsory retirement passed against the petitioner pursuant to a departmental inquiry was valid and sustainable in law.
Final Decision
The writ petition is dismissed. The order of compulsory retirement dated 8th March 2000 is upheld.
Law Points
- Compulsory retirement
- Departmental inquiry
- Securities scam
- Bank officer
- Misconduct
- Evidence
- Delay
- Natural justice
