Boloram Bordoloi v. Lakhimi Gaolia Bank & Ors.
Background
The appellant was a bank Manager against whom disciplinary proceedings were initiated for sanctioning and disbursing loans without following due procedure, including irregular loans to shell units and multiple loans to members of the same family. After an enquiry held all five charges proved, the disciplinary authority imposed compulsory retirement, which was upheld by the bank's appellate authority (Board of Directors) and later by both a Single Judge and a Division Bench of the Gauhati High Court. The appellant challenged this before the Supreme Court, arguing the enquiry report was effectively decided on before being served, that no reasons were recorded, and that the punishment was disproportionate.
Decision Breakdown
The Supreme Court held that the enquiry report had in fact been enclosed along with the show-cause notice proposing punishment, so there was no violation of the employee's right to receive the report before a final decision was taken: merely proposing a punishment in the show-cause notice does not amount to a prior decision. It also held that once a disciplinary authority accepts the enquiry officer's findings, no elaborate separate reasons are required in the punishment order. On proportionality, the Court found the charges grave (a bank manager mishandling public money and sanctioning irregular loans) and noted the appellant had virtually admitted the lapses in his reply, so compulsory retirement was, if anything, a lenient punishment, not a disproportionate one. The appeal was dismissed with no order as to costs.
Lesson Learnt
In disciplinary proceedings, serving the enquiry report along with the show-cause notice (rather than before it) is sufficient compliance with natural justice, and courts will be reluctant to brand a punishment "disproportionate" where the employee held a position of trust (like a bank manager) and the proved misconduct involved mishandling public money.