Supreme Court Upholds UCO Bank’s Disciplinary Action Against Employee for Misconduct: General Manager(Operation-1) vs. Krishna Kumar Bhardwaj (2022)

Date of the Judgment: February 18, 2022
Citation: (2022) INSC 1458
Judges: Justice Ajay Rastogi and Justice Abhay S. Oka
Can a disciplinary inquiry be set aside if the charges are deemed vague? The Supreme Court of India recently addressed this question in a case concerning a UCO Bank employee accused of misconduct. The Court examined whether the High Court was justified in overturning the disciplinary proceedings initiated against the employee. The Supreme Court bench comprised Justice Ajay Rastogi and Justice Abhay S. Oka, who delivered the judgment.

Case Background

The case revolves around Krishna Kumar Bhardwaj, an employee of UCO Bank, who was serving as an officiating Manager at the Taharpur Bhabisa branch in Muzaffarnagar. In 1993, the bank initiated disciplinary proceedings against him, alleging gross irregularities and misconduct in the discharge of his duties. The charges included opening accounts without proper verification, mishandling cash deposits, and issuing false certificates. The disciplinary action resulted in penalties, which were later challenged by Bhardwaj.

Timeline:

Course of Proceedings

The disciplinary authority confirmed the inquiry officer’s findings, holding Bhardwaj guilty of charges 1, 2, and 3, and imposed penalties on August 12, 1996. The appellate authority upheld the guilt but modified the punishment on November 14, 1998. Bhardwaj challenged this order before the High Court of Allahabad, which set aside the disciplinary proceedings on February 19, 2021, leading to the current appeal before the Supreme Court.

Legal Framework

The disciplinary proceedings against the respondent were initiated under Regulation 6 of the UCO Bank Officers Employees’ (Conduct) Regulations, 1976. The charges alleged violation of Regulation 3 of the same regulations, which mandates that employees must discharge their duties with utmost honesty, integrity, diligence, and devotion.

The specific charges against Mr. K.K. Bhardwaj were:

• Opening two S.B. accounts without proper introduction and completion of necessary formalities, violating Regulation 3 of the UCO Bank Officers Employees’ (Conduct) Regulations, 1976.
• Not following the procedure laid down in the Bank’s Manual of Instructions (Cash) while depositing cash in the currency chest at Meerut, also violating Regulation 3.
• Facilitating unscrupulous persons to derive pecuniary benefits under Government amnesty schemes by opening accounts without proper introduction, allowing huge transactions, and issuing false certificates, violating Regulation 3.
• Remaining absent from duties for several months without proper sanction of leave, violating Regulation 3.

Arguments

The appellants (UCO Bank) argued that the High Court erred in assuming that the appellate authority had exonerated the respondent from charges 2 and 3. They contended that the appellate authority had only modified the punishment while upholding the finding of guilt on all three charges (1, 2 and 3). The bank also argued that charge no. 1 was specific and clear, and the respondent had participated in the inquiry without raising any objections about its vagueness.

The respondent (Krishna Kumar Bhardwaj) did not dispute the factual findings of the inquiry officer or the confirmation of guilt by the disciplinary and appellate authorities. However, he argued that the punishment was not supported by the material on record, and the High Court was justified in setting aside the disciplinary proceedings.

Issues Framed by the Supreme Court

The Supreme Court did not frame any specific issues in the judgment. However, the core issue before the court was:

✓ Whether the High Court was correct in setting aside the disciplinary proceedings based on the premise that charge no. 1 was vague and that the appellate authority had exonerated the respondent from charges 2 and 3.

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues

Authorities

The Supreme Court did not cite any specific cases or books in this judgment. However, it referred to the general principles of judicial review in disciplinary matters, stating that constitutional courts should not act as appellate authorities and should only correct errors of law or procedure that lead to injustice or violation of natural justice.

Judgment

The Supreme Court allowed the appeal, setting aside the High Court’s judgment. The Court found that the High Court had incorrectly assumed that the appellate authority had exonerated the respondent from charges 2 and 3. The Court also held that charge no. 1 was not vague and that the respondent had participated in the inquiry without any objections.

Authorities Viewed by the Court:

✓ UCO Bank Officers Employees’ (Conduct) Regulations, 1976 [CITATION]: The court examined the disciplinary proceedings under these regulations.

✓ Regulation 3 of the UCO Bank Officers Employees’ (Conduct) Regulations, 1976 [CITATION]: The court referred to this regulation to assess the alleged violations.

✓ Articles 226 and 227 of the Constitution of India [CITATION]: The court discussed the limitations of judicial review under these articles.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the factual inaccuracies in the High Court’s judgment and the established principles of judicial review in disciplinary matters. The Court emphasized that the High Court had wrongly assumed that the appellate authority had exonerated the respondent from charges 2 and 3, and that charge no. 1 was vague. The Court also noted that the respondent had participated in the inquiry without raising any objections about the vagueness of charge no. 1.

The Court’s reasoning was based on the following points:

• The High Court had incorrectly assumed that the appellate authority had exonerated the respondent from charges 2 and 3.
• Charge no. 1 was clear and specific, not vague.
• The respondent had participated in the inquiry without raising any objections to the charges.
• Constitutional courts should not act as appellate authorities in disciplinary matters.

“The admitted fact is that the finding of guilt in reference to charge nos. 1,2 and 3 which was proved by the inquiry officer as indicated in the report of inquiry was confirmed by the disciplinary authority and also by the appellate authority…”

“So far as the finding which has been recorded by the High Court in reference to charge no. 1 being vague and unclear, which has deprived the respondent delinquent in submitting reply is concerned, it is factually incorrect.”

“In our considered view, the premises on which the High Court has proceeded even in reference to charge no. 1 is unsustainable and deserves to be set aside.”

Key Takeaways

• High Courts should not act as appellate authorities in disciplinary matters.
• Charges in disciplinary proceedings should be specific and clear, but if the employee participates in the inquiry without raising objections, it can be inferred that they understood the charges.
• Appellate authorities can modify punishments while upholding the guilt of the employee.

Directions

No specific directions were given by the Supreme Court in this judgment.

Development of Law

The ratio decidendi of this case is that the High Court should not interfere in disciplinary matters unless there is a clear error of law or procedure, or a violation of natural justice. The Supreme Court reiterated that the High Court should not act as an appellate authority and should not overturn findings of guilt based on a misinterpretation of the facts. This case reinforces the established principles of judicial review in disciplinary matters.

Conclusion

The Supreme Court’s judgment in General Manager(Operation-1)/Appellate Authority, UCO Bank & Ors. vs. Krishna Kumar Bhardwaj reaffirms the limited scope of judicial review in disciplinary matters. The Court overturned the High Court’s decision, emphasizing that the appellate authority had not exonerated the respondent from charges 2 and 3, and that charge no. 1 was not vague. This case underscores the importance of adhering to established procedures in disciplinary inquiries and the limited role of constitutional courts in reviewing such matters.

Category:

• Service Law
  • Disciplinary Proceedings
  • Judicial Review
  • UCO Bank Officers Employees’ (Conduct) Regulations, 1976
  • Regulation 3, UCO Bank Officers Employees’ (Conduct) Regulations, 1976
  • Articles 226 and 227, Constitution of India

FAQ

Q: What was the main issue in the case?
A: The main issue was whether the High Court was correct in setting aside the disciplinary proceedings against a UCO Bank employee based on the premise that the charges were vague and that the appellate authority had exonerated the employee from some charges.

Q: What did the Supreme Court decide?
A: The Supreme Court overturned the High Court’s decision, holding that the charges were not vague and that the appellate authority had not exonerated the employee from any charges, but had only modified the punishment.

Q: What is the significance of this judgment?
A: This judgment reinforces the principle that High Courts should not act as appellate authorities in disciplinary matters and should only interfere if there is a clear error of law or procedure, or a violation of natural justice.

Q: What are the implications for employees facing disciplinary action?
A: Employees should ensure that they participate in the inquiry process and raise any objections about the charges at the earliest stage. If they fail to do so, it may be inferred that they understood the charges.

Q: What are the implications for employers initiating disciplinary proceedings?
A: Employers should ensure that the charges are specific and clear. They should also follow the prescribed procedures for disciplinary inquiries.