Supreme Court Protects Women’s Dignity at Workplace in Transfer Case: Punjab and Sind Bank vs. Durgesh Kuwar (2020)

Introduction

Date of the Judgment: 25 February 2020
Citation: (2020) INSC 123
Judges: Dr Dhananjaya Y Chandrachud, J and Ajay Rastogi, J
Can a transfer order be deemed a punishment for an employee who reports corruption and sexual harassment? The Supreme Court of India recently addressed this critical question in a case involving a senior bank officer who faced a transfer after reporting irregularities and sexual harassment. This case highlights the intersection of service law and the fundamental constitutional rights of women at the workplace.

The Supreme Court, in this judgment, examined whether the transfer of a female bank officer was a retaliatory measure for her complaints about corruption and sexual harassment. The bench, consisting of Justices Dr. Dhananjaya Y Chandrachud and Ajay Rastogi, delivered the judgment. Justice Dr. Dhananjaya Y Chandrachud authored the opinion.

Case Background

Mrs. Durgesh Kuwar, the respondent, was appointed as a Probationary Officer at Punjab and Sind Bank on 8 October 1998. She was later promoted to Chief Manager in Scale IV. On 2 September 2011, she was transferred to the Zonal Office at Mumbai, and subsequently to the Branch Office at Indore on 7 October 2011. In September 2016, she was promoted to Chief Manager in Scale IV and was allowed to continue at the Indore branch. However, on 11 December 2017, she was transferred to a Branch Office at Sarsawa, a rural branch in the district of Jabalpur. She was informed of this transfer on 14 December 2017.

The respondent submitted a representation on 31 January 2018 to the Zonal Manager, referencing the bank’s circulars regarding the posting of women officers, requesting to be retained at Indore. She followed this with reminders on 15 February 2018 and a representation on 19 February 2018 to the Executive Director of the bank.

In her representations, the respondent stated that as a Branch Manager, she had investigated the concentration of accounts maintained by liquor contractors at the branch. She had detected significant irregularities that were detrimental to the bank’s interests. She submitted a detailed report to the Zonal Manager, Bhopal on 31 December 2016, highlighting issues such as duplicate Bank Guarantee registers and the sanctioning of limits to parties not connected to Indore. She alleged that instead of addressing these irregularities, she was pressured to cover them up. She also accused the Zonal Manager of calling her at late hours for non-urgent matters and making inappropriate personal advances. She stated that her transfer to a small rural branch 600 kilometers away was a retaliatory measure.

Timeline:

Course of Proceedings

The respondent challenged the transfer order before the High Court of Madhya Pradesh under Article 226 of the Constitution. A Single Judge stayed the transfer order during the proceedings. On 11 February 2019, the Single Judge quashed the transfer order, stating that the respondent was transferred in violation of the bank’s circulars and the Ministry of Finance guidelines. The High Court noted that the respondent, a Scale IV officer, was posted to a branch where only a Scale I officer could be posted. The High Court also observed that the bank did not refute the allegations made by the respondent.

The Division Bench of the High Court affirmed the Single Judge’s decision. The Division Bench noted that the respondent had raised serious allegations against the Zonal Manager and that the transfer was a malafide reprisal for the respondent’s actions and allegations.

Legal Framework

The judgment references the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (the “Act”). Section 3 of the Act states that no woman shall be subjected to sexual harassment at any workplace. It also defines circumstances that may amount to sexual harassment, including:

• “implied or explicit promise of preferential treatment in her employment;”
• “implied or explicit threat of detrimental treatment in her employment;”
• “implied or explicit threat about her present or future employment or status;”
• “interference with her work or creating an intimidating or offensive or hostile work environment for her;”
• “humiliating treatment likely to affect her health or safety.”

Section 4 of the Act mandates the constitution of an Internal Complaints Committee (ICC) at all administrative units or offices of the workplace. Section 4(2) specifies the composition of the ICC, which includes:

• “a Presiding Officer who shall be a woman employed at a senior level at workplace from amongst the employees”
• “not less than two Members from amongst employees preferably committed to the cause of women or who have had experience in social work or have legal knowledge”
• “one member from amongst non-governmental organisations or associations committed to the cause of women or a person familiar with the issues relating to sexual harassment”

The judgment also refers to the fundamental rights of a woman to equality under Articles 14 and 15 and her right to live with dignity under Article 21 of the Constitution, as well as her right to practice any profession or to carry on any occupation, trade or business.

Arguments

Arguments by the Appellants (Punjab and Sind Bank and Others):

• The appellants argued that the respondent had been in Indore for several years, as shown in the provided chart of her postings.
• They contended that the transfer was a routine administrative matter and that the bank had offered to transfer her to a Scale IV branch in Jabalpur, Jaipur, or New Delhi, but she did not choose any of these options. They also offered to accommodate her at a Scale IV branch in Bhopal.
• The appellants argued that the respondent’s initial representation on 31 January 2018 did not mention the allegations of irregularities or sexual harassment, which were raised later in her communication on 19 February 2018.
• They stated that the transfer order was issued by the Executive Director based on the recommendation of three General Manager level officers, and therefore, the malafides alleged against the Zonal Manager should not be attributed to the authority that issued the transfer.
• The appellants submitted that the Internal Complaints Committee (ICC) of the bank found no substance in the allegations of sexual harassment in its report dated 26 February 2019.
• The bank argued that it had conducted a vigilance and special audit upon receiving the respondent’s complaint.
• The appellants relied on the principle of restraint in judicial review in matters of transfer, citing the decisions in Bank of India v Jagjit Singh Mehta [(1992) 1 SCC 306], State of UP v Gobardhan Lal [(2004) 11 SCC 402], and Rajendra Singh v State of UP [JT 2009 (10) SC 187].

Arguments by the Respondent (Mrs. Durgesh Kuwar):

• The respondent argued that the appellants had suppressed vital documents, including communications from 31 December 2016 to 15 November 2017, detailing the irregularities and corruption she discovered.
• She submitted that the transfer order was a direct result of her stringent measures against the irregularities she had discovered.
• The respondent argued that the Local Complaints Committee (LCC) concluded that the charge of sexual harassment against the fourth appellant (Zonal Manager) was established.
• The respondent contended that the ICC was biased against her, as it lacked an independent member, as mandated by the Act. She pointed out that the so-called independent member was a panel counsel for the bank.
• The respondent submitted that the original transfer order proposed her transfer to a branch under the Zonal Office at Dehradun, but was later modified to a branch at Sarsawa, which remained under the same Zonal Office.
• She argued that the bank had not fairly presented the Central Vigilance Commission’s Office Memorandum regarding the rotation of officers in sensitive posts.
• The respondent contended that her transfer to a Scale I level branch was in violation of the Board Resolution dated 27 September 2017, which approved the policy regarding branch classifications.
• The respondent emphasized that she was not accepting the offers of transfer to other locations because she wanted the court to determine the validity of the transfer order in the present case as a matter of principle.

Submissions of the Parties

Issues Framed by the Supreme Court

The Supreme Court considered the following issues:

1. Whether the order of the High Court quashing the transfer order can be sustained, having regard to the principles of law governing transfer.
2. Whether the transfer of the respondent was a retaliatory measure for her complaints about corruption and sexual harassment.
3. Whether the Internal Complaints Committee was constituted as per the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Treatment of the Issue by the Court

Authorities

Cases Relied Upon by the Court:

• Bank of India v Jagjit Singh Mehta [(1992) 1 SCC 306] – The Court noted the principle that transfer is an exigency of service and employees do not have a choice of postings.
  Ratio: Transfer is an exigency of service and employees do not have a choice of postings.
• State of UP v Gobardhan Lal [(2004) 11 SCC 402] – The Court reiterated that transfer orders are generally not interfered with unless malafide or contrary to statutory provisions.
  Ratio: Transfer orders are generally not interfered with unless malafide or contrary to statutory provisions.
• Rajendra Singh v State of UP [JT 2009 (10) SC 187] – The Court affirmed the principle of judicial restraint in matters of transfer.
  Ratio: The principle of judicial restraint in matters of transfer is to be followed.

Legal Provisions Considered by the Court:

• Articles 14 and 15 of the Constitution of India – Guarantees the right to equality before the law and prohibits discrimination.
• Article 21 of the Constitution of India – Guarantees the right to life and personal liberty, which includes the right to live with dignity.
• The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
  • Section 3 – Defines sexual harassment and prohibits it at the workplace.
  • Section 4 – Mandates the constitution of an Internal Complaints Committee (ICC).
  • Section 4(2)(c) – Specifies that one member of the ICC must be from a non-governmental organization or a person familiar with the issues relating to sexual harassment.

Authorities Considered by the Court

Judgment

How each authority was viewed by the Court?

• Bank of India v Jagjit Singh Mehta [(1992) 1 SCC 306]: The court acknowledged the principle that transfer is an exigency of service, but distinguished the case due to the malafide nature of the transfer in the present case.
• State of UP v Gobardhan Lal [(2004) 11 SCC 402]: The court recognized the principle that transfer orders are generally not interfered with unless malafide or contrary to statutory provisions, but found that the present case fell under the exception due to malafide intention.
• Rajendra Singh v State of UP [JT 2009 (10) SC 187]: The court noted the principle of judicial restraint in matters of transfer but found that the present case required intervention due to the malafide nature of the transfer.
• Articles 14 and 15 of the Constitution of India: The court used these articles to highlight the violation of the fundamental right to equality and non-discrimination, which was violated in the present case.
• Article 21 of the Constitution of India: The court emphasized the right to live with dignity, which was violated by the retaliatory transfer.
• The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013: The court relied on this Act to underscore the importance of protecting women from sexual harassment and the need for a properly constituted ICC.

What weighed in the mind of the Court?

The Supreme Court’s decision was heavily influenced by the following factors:

• Malafide Intent: The court found that the transfer was not a routine administrative decision but a retaliatory measure against the respondent for reporting irregularities and sexual harassment.
• Violation of Rules: The transfer was in violation of the bank’s own rules regarding the posting of officers of appropriate scales to different branches. The respondent, a Scale IV officer, was transferred to a branch meant for a Scale I officer.
• Defective ICC: The Internal Complaints Committee (ICC) was not properly constituted as it lacked an independent member as mandated by Section 4(2)(c) of the Act. This raised concerns about the fairness and impartiality of the inquiry into the allegations of sexual harassment.
• Suppression of Facts: The bank did not disclose all relevant documents, including the respondent’s communications detailing the irregularities and corruption she had discovered.
• Protection of Women’s Dignity: The court emphasized the need to protect women’s dignity at the workplace and to ensure that they are not victimized for reporting misconduct. The court highlighted the intersection of service law with fundamental constitutional precepts about the dignity of a woman at her workplace.
• Retaliatory Transfer: The court was convinced that the transfer was a direct consequence of the respondent’s complaints and was designed to punish her for speaking out.

Sentiment Analysis of Reasons

Fact:Law Ratio

Logical Reasoning

Court’s Reasoning

The court’s reasoning was based on a step-by-step analysis of the facts, legal precedents, and constitutional principles:

1. Initial Assessment: The court began by acknowledging the settled principle that transfer is an exigency of service and that employees do not have a choice of postings. However, it also noted that this principle is not absolute and that transfer orders can be challenged if they are malafide or contrary to statutory provisions.
2. Factual Analysis: The court meticulously examined the timeline of events, noting that the respondent was transferred shortly after she had submitted several communications detailing serious irregularities and corruption at her branch. The court noted that the transfer was served on the respondent within a month of the last of the representations.
3. Malafide Intent: The court concluded that the transfer was not a routine administrative decision but a retaliatory measure against the respondent for reporting irregularities and sexual harassment. The court observed that the respondent was transferred to a branch that was not commensurate with her position as a Scale IV officer, which further indicated the malafide intention behind the transfer.
4. Violation of Rules: The court highlighted that the transfer was in violation of the bank’s own rules regarding the posting of officers of appropriate scales to different branches. The respondent, a Scale IV officer, was transferred to a branch meant for a Scale I officer. The court stated that the branch to which the respondent was posted was not commensurate to her position as a Scale IV officer.
5. Defective ICC: The court found that the Internal Complaints Committee (ICC) was not properly constituted as it lacked an independent member as mandated by Section 4(2)(c) of the Act. The court noted that the so-called independent member was a panel counsel for the bank, which raised concerns about the fairness and impartiality of the inquiry into the allegations of sexual harassment. The court observed that this was a significant facet which goes to the root of the constitution of the ICC.
6. Constitutional Principles: The court emphasized the fundamental rights of women to equality under Articles 14 and 15 and her right to live with dignity under Article 21 of the Constitution. The court stated that sexual harassment at the workplace is an affront to these fundamental rights.
7. Protection of Women’s Dignity: The court stressed the need to protect women’s dignity at the workplace and to ensure that they are not victimized for reporting misconduct. The court observed that the respondent had been victimized and that her reports of irregularities met with a reprisal.
8. Precedents: The court distinguished the present case from the precedents cited by the appellants, such as Bank of India v Jagjit Singh Mehta [(1992) 1 SCC 306], State of UP v Gobardhan Lal [(2004) 11 SCC 402], and Rajendra Singh v State of UP [JT 2009 (10) SC 187], stating that those cases did not involve malafide transfers.

The court rejected the bank’s argument that the transfer was a routine administrative matter and held that the transfer was an act of unfair treatment and is vitiated by malafides.

Quotes from the Judgment

• “The case involves the intersection of service law with fundamental constitutional precepts about the dignity of a woman at her workplace.”
• “The respondent was posted on 14 December 2017 to a branch, which even according to the bank, was not meant for the posting of a Scale IV officer.”
• “There can be no manner of doubt that the respondent has been victimized. Her reports of irregularities in the Branch met witha reprisal.”
• “The ICC was not constituted as per the provisions of Section 4(2) of the Act of 2013. The so-called independent member was a panel counsel for the bank.”
• “The transfer of the respondent was not a routine administrative matter. The transfer was an act of unfair treatment and is vitiated by malafides.”
• “The transfer of the respondent was in violation of the bank’s own rules and the transfer was a reprisal for the respondent’s complaints about corruption and sexual harassment.”
• “The transfer of the respondent was a malafide measure and was a reprisal for the respondent’s actions and allegations.”

Final Order

The Supreme Court disposed of the appeal in terms of the signed reportable judgment, affirming the High Court’s decision to quash the transfer order. The court held that the transfer was a malafide measure and a reprisal for the respondent’s actions and allegations. The court also emphasized the importance of protecting women’s dignity at the workplace and ensuring that Internal Complaints Committees are constituted as per the law.

Impact and Implications

This judgment has significant implications for the protection of women’s rights at the workplace:

• Protection against Retaliatory Transfers: The judgment establishes that transfer orders can be challenged if they are a retaliatory measure for reporting irregularities or sexual harassment. This provides a crucial safeguard for employees who speak out against misconduct.
• Importance of Properly Constituted ICCs: The judgment emphasizes the need for Internal Complaints Committees to be constituted as per the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. This ensures that complaints of sexual harassment are dealt with fairly and impartially.
• Upholding Constitutional Rights: The judgment reaffirms the fundamental rights of women to equality and dignity at the workplace, highlighting that sexual harassment is a violation of these rights.
• Judicial Scrutiny of Transfer Orders: The judgment clarifies that while transfer orders are generally not interfered with, courts can intervene if they are malafide or contrary to statutory provisions.
• Promoting a Safe Workplace Environment: By protecting employees who report misconduct, the judgment encourages a more transparent and accountable workplace environment.

Conclusion

The Supreme Court’s judgment in Punjab and Sind Bank vs. Durgesh Kuwar (2020) is a landmark decision that reinforces the importance of protecting women’s dignity at the workplace. By quashing the malafide transfer order and emphasizing the need for properly constituted Internal Complaints Committees, the court has sent a strong message that retaliatory actions against employees who report misconduct will not be tolerated. This judgment serves as a crucial precedent for future cases involving the rights of women at the workplace and underscores the intersection of service law with fundamental constitutional precepts.