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UCO Bank & Ors. v. SK Shrivastava

Civil Appeal · 2026 INSC 328Decided 7 Apr 2026
C.A. No.-000375-000375 - 2020
Justice J.K. Maheshwari · Justice Vijay Bishnoi · Justice Atul S. Chandurkar

Background

SK Shrivastava, a Branch Manager at UCO Bank, submitted a notice of voluntary retirement (with the required three months' notice) after suspicious transactions in certain accounts at his branch came to the bank's attention. Before the notice period expired, the bank issued a show-cause notice about the transactions but never formally refused or withheld his voluntary retirement within the notice period; only after the three months had lapsed did the bank issue a chargesheet and later dismiss him. Shrivastava challenged both the denial of his retirement-linked terminal benefits and the chargesheet/dismissal, and the High Court ruled in his favour on both counts, prompting the bank to appeal to the Supreme Court in two connected appeals.

Decision Breakdown

The Supreme Court held that under the applicable Pension and Service Regulations, once an employee gives valid notice of voluntary retirement, the notice takes effect automatically at the end of the notice period unless the bank's competent authority formally refuses or withholds it within that period: merely issuing a show-cause notice is not enough to stop the retirement from taking effect. Since UCO Bank never passed any such order of refusal before 04.01.2011 (when the notice period expired), Shrivastava's retirement became effective by operation of law on that date, meaning the bank had no employee left to chargesheet or dismiss when it later did so. The Court examined and distinguished the bank's cited precedents (the R.L. Capoor line of cases), finding they dealt with a different regulatory provision, and upheld the High Court's reasoning as correct. It dismissed both of the bank's appeals, directing the bank to pay Shrivastava all consequential retiral benefits with interest within three months.

Lesson Learnt

An employer cannot indefinitely sit on a validly submitted voluntary retirement notice, if it wants to block it (e.g., because of pending disciplinary concerns), it must formally refuse or withhold it before the notice period expires; otherwise the retirement takes legal effect automatically, and any later disciplinary action against the by-then-retired employee is void.

Official source (sci.gov.in)View Judgment (PDF)

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