IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 12TH DAY OF SEPTEMBER, 2025 PRESENT THE HON'BLE MRS. JUSTICE ANU SIVARAMAN AND THE HON'BLE MR. JUSTICE RAJESH RAI K WRIT APPEAL NO. 191 OF 2024 (S-RES) BETWEEN: 1 . BANK OF BARODA REPRESENTED BY ITS CHAIRMAN AND MANAGING DIRECTOR HEAD OFFICE AT: 41/2, M.G. ROAD BENGALURU-560 001 2 . THE EXECUTIVE DIRECTOR AND APPELLATE AUTHORITY BANK OF BARODA No.41/2, M.G. ROAD, BENGALURU-560 001 3 . THE GENERAL MANAGER-PERSONNEL DISCIPLINARY AUTHORITY BANK OF BARODA PERSONNEL DEPARTMENT HEAD OFFICE, No.41/2 M.G. ROAD BENGALURU-560 001 4 . THE DEPUTY GENERAL MANAGER BANK OF BARODA INDIRANAGAR BRANCH BENGALURU-560 038 NOTE: ALL THE APPELLANTS ARE NOW REPRESENTED BY CHIEF MANAGER (HRM) - 2 ZONAL OFFICE (BENGALURU) ...APPELLANTS (BY SRI. PRADEEP S. SAWKAR, ADVOCATE & SRI. SUNDARSWAMY, ADVOCATES) AND: SHRI. A.R.T. ARASU CODE No.10254 S/O A.G. RAMACHANDRAN WORKED AS ASSISTANT MANAGER VIJAYA BANK REGIONAL OFFICE BANGALORE SOUTH, INDIRANAGAR BENGALURU-560 038 RESIDING AT No.215 3RD CROSS, KASTURINAGAR BENGALURU-560 043 …RESPONDENT (BY SRI. ANJANDEV NARAYANA, ADVOCATE FOR C/R) THIS WRIT APPEAL IS FILED U/S 4 OF THE KARNATAKA HIGH COURT ACT, 1961, PRAYING TO SET ASIDE THE ORDER DATED 13.09.2023 PASSED BY THE LEARNED SINGLE JUDGE IN W.P.No.41108/2010 BY ALLOWING THIS APPEAL AND CONSEQUENTLY DISMISS THE W.P.No.41108/2010 WITH COSTS. THIS WRIT APPEAL HAVING BEEN HEARD AND RESERVED FOR JUDGMENT ON 20.08.2025 AND COMING ON FOR PRONOUNCEMENT OF JUDGMENT THIS DAY, ANU SIVARAMAN J., PRONOUNCED THE FOLLOWING: CORAM: HON'BLE MRS. JUSTICE ANU SIVARAMAN and HON'BLE MR. JUSTICE RAJESH RAI K - 3 CAV JUDGMENT (PER: HON'BLE MRS. JUSTICE ANU SIVARAMAN) This Writ appeal is filed by the employer - Bank against the Order dated 13.09.2023 passed by the learned Single Judge in Writ Petition No.41108/2010, interfering with the Order of the Disciplinary Authority and modifying the punishment of dismissal from service to that of compulsory retirement. 2. We have heard Shri S.S. Ramdas, learned senior counsel appearing for the appellants and Shri. Anjandev Narayana, learned counsel appearing for the caveator/respondent. 3. The learned senior counsel for the appellants submits that the respondent had been dismissed from service after following all due procedure and after conducting the disciplinary proceedings in accordance with law. 4. The Articles of Charges, which were issued to him, read as follows: - 4 "ARTICLES OF CHARGE No.1 During your tenure as Asst. Manager at Bank's Indiranagar branch, Bangalore from 06.06.2005 to 13.03.2007, you have alleged to have committed irregularities in the matter of handling cheques purchased under "clean Bills Purchase" (CBP) head of account and thus failed to comply with the guidelines of the Bank contained in Manual of Instructions-Advances, 2002- 2003. ARTICLES OF CHARGE No.2 During your tenure as Asst.Manager at Bank's Indiranagar branch, Bangalore from 06.06.2005 to 13.03.2007, you have alleged to have committed irregularities in the matter of passing/effecting entries in the sensitive head of account - "Clearing Suspense A/c" & thus failed to comply with the guidelines of the Bank contained in Manual of instruction-Deposits, 2002- 2003." 5. The charges were supported by Statement of Allegations. The respondent submitted his written objections to the Articles of Charges dated 23.08.2008, which is produced as Annexure 'B'. He admitted that it is the usual practice when clearing instruments are received to check the balance in the account and to keep instruments which cannot be cleared for reasons such as insufficiency of funds etc, in Clearance/Suspense overnight and if the customer - 5 makes the payment on the next day, the instruments would be cleared. It was contended that this is a common practice prevailing at the branches and that the Indiranagar Branch cannot be an exception. 6. A full-fledged enquiry was conducted and the charges were found proved. After issuing show cause notice with a copy of the inquiry report and considering the reply of the respondent, the punishment of dismissal from service was inflicted. Though appeal and review were filed, the same were also dismissed. 7. The respondent challenged the dismissal from service before the learned Single Judge contending that no financial loss had occurred to the Bank. A detailed statement of objection was placed on record by the Bank. However, the learned Single Judge found that the punishment of dismissal from service for the misconduct of not following the prescribed procedure in handling instruments is excessive and grossly disproportionate to the misconduct proved against the respondent. The learned Single Judge therefore held that the extreme punishment of - 6 dismissal from service was not warranted and substituted the punishment with that of compulsory retirement from service. It is also ordered that the retirement benefits due shall be released to the respondent. 8. The learned senior counsel appearing for the Bank submits that in a case where the employer is a Bank and the employee is an Assistant Manager of the Bank and also in the light of the clear allegations of financial irregularity alleged against the employee, the learned Single Judge was completely unjustified in having interfered with the punishment and substituting the punishment with that of compulsory retirement. It is submitted that it is only in cases where the punishment is grossly disproportionate to the proven misconduct that this Court exercising its powers of judicial review, can interfere with the punishment awarded by the Disciplinary Authority. It is submitted that the learned Single Judge, having found that the disciplinary proceedings had been properly conducted, was completely unjustified in holding that the punishment is excessive, in the facts and circumstances of the case. - 7 9. The learned senior counsel for the appellants has relied on the following citations in:- • Union of India and Others v. P Gunasekaran reported in (2015) 2 SCC 610; • B.C. Chaturvedi v. Union of India and Others reported in (1995) 6 SCC 749; and • Deputy General Manager (Appellate Authority) and Others v. Ajai Kumar Srivastava reported in (2021) 2 SCC 612; The said three citations are relied on in support of the contentions that the scope of interference in disciplinary proceedings is permissible only if the findings are wholly arbitrary and capricious or based on no evidence or perverse. • Disciplinary Authority-cum-Regional Manager and Others v. Nikunja Bihari Patnaik reported in (1996) 9 SCC 69; • Syndicate Bank and Others v. Venkatesh Gururao Kurati reported in (2006) 3 SCC 150; In support of the proposition that proof of loss is not necessary when a Scale One Officer of the Bank allowed - 8 overdrafts or passed cheques involving substantial amounts beyond his authority. The Apex Court held that such acts should not be treated merely as errors of judgment and where the funds of the Bank have been placed in jeopardy on a number of instances and where the enquiry finds a responsible officer of the Bank guilty of the misconduct then interference is not warranted in judicial review. • Tara Chand Vyas v. Chairman and Disciplinary Authority reported in (1997) 4 SCC 565; • State of T.N v. Thiru K.V. Perumal and Others reported in (1996) 5 SCC 474; • Sunil Kumar Banerjee v. State of West Bengal and Others reported in (1980) 3 SCC 304; • Union of India and Others v. Subrata Nath in Civil Appeal Nos.7939-7940/2022, dated 23.11.2022; • Anil Kumar Upadhyay v. The Director General, SSB and Others in Civil Appeal No.2707/2022 dated 20.04.2022; - 9 • Union of India and Another v. G. Ganayutham, reported in (1997) 7 SCC 463; and • State of U.P v. Sheo Shanker Lal Srivastava and Others, reported in (2006) 3 SCC 276. In support of the contention that the disciplinary authority has the exclusive jurisdiction in awarding punishments and the Courts cannot substitute the punishment or modify the punishment awarded by the Disciplinary Authority unless the punishment awarded is so disproportionate as to shock the conscience of the Court. 10. The learned counsel appearing for the respondent, on the other hand, contends that the learned Single Judge has specifically taken note of the contention that there was no financial loss was caused to the Bank due to the actions of the respondent. The learned Single Judge also found that the punishment imposed was grossly disproportionate to the proven misconduct. It is therefore contended that the interference in the punishment was justified in the facts of the case. - 10 11. In support of his contentions, he has relied on the following citations:- • United Bank of India v. Biswanath Bhattacharjee reported in (2022) 3 S.C.R.988; • Umesh Kumar Pahwa v. The Board of Directors Uttarakhand Gramin Bank & Others (2022) 16 S.C.R 420, and • Canara Bank v. Sri. M.H.Ron since deceased by LRs in Writ Appeal No.1444/2024 dated 14.03.2025. In Biswanath Bhattacharjee's case (supra), the Apex Court considered a case where a Bank employee had been dismissed from service on allegations of misappropriation. A Division Bench of the Calcutta High Court set aside the orders of the appellate and disciplinary authorities and set aside the penalty. On appeal by the Bank and considering all the decisions on the point, the Apex Court held that the Division Bench of the High Court had held that there was no evidence to show that the employee in question had removed the documents and that the setting aside of the punishment was justified. In Umesh Kumar - 11 Pahwa's case (supra), the Apex Court had modified the punishment of removal of service to one of compulsory retirement. In Canara Bank's case (supra), a co-ordinate Bench of this Court had considered an appeal against an order of the learned Single Judge allowing the Writ Petition and setting aside the penalty and had upheld the same. The judgements relied on by the learned counsel for the respondent were once rendered in the facts and circumstances of those cases where it was found that the allegations against the employees were not proved or were held to be proved on no evidence in the disciplinary proceedings. 12. Having considered the contentions advanced, we notice that the learned Single Judge has specifically found that there is no illegality in the procedure and the conduct of the disciplinary proceedings as against the respondent. 13. The Apex Court in State Bank of India and others v. Samarendra Kishore Endow and another - 12 reported in (1994) 2 SCC 537, had occasion to consider and almost an identical case. The respondent was a Cashier in the SBI and was charged with misconduct with respect to irregularities in handling the bank funds. The Disciplinary authority found him guilty and imposed the punishment of dismissal. The High Court interfered holding the dismissal too harsh and substituted it with lesser punishment. The Supreme Court held that the Disciplinary Authority is the sole judge of the quantum of punishment. Courts in judicial review cannot act as appellate authorities. Interference is permissible only if punishment is so disproportionate that it shocks the judicial conscience. In cases involving bank employees handling public money, a high degree of integrity is expected. Even small deviations can justify dismissal. The Supreme Court restored the punishment of dismissal and set aside the High Court's interference. 14. In the facts and circumstances of the instant case where the employer is a Bank and the respondent is an Assistant Manager and also in the nature of the allegations raised against the respondent, we are of the opinion that - 13 this is not a fit case, where interference in the quantum of punishment by this Court was warranted. 15. In the above view of the matter, we are of the opinion that the substitution of the punishment was not warranted. In the result:- (i) The Writ Appeal is allowed. (ii) The order dated 13.09.2023, passed by the learned Single Judge in Writ Petition No.41108/2010, is hereby set aside. (iii) However, in the facts and circumstances of the case, we direct the appellate authority of the Bank to reconsider the case of the respondent and to pass appropriate orders on the question of punishment to be awarded. (iv) Necessary shall be done within a period of three months from the date of receipt of a copy of this judgment. - 14 All pending interlocutory applications shall stand dismissed. Sd/- (ANU SIVARAMAN) JUDGE Sd/- (RAJESH RAI K) JUDGE cp*