Bombay High Court
The General Manager – The Solapur Janata … vs Nandkumar Ramchandra Bidri on 16 April, 2025
2025:BHC-AS:17394
Neeta Sawant WP-4870-2007-LFC
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 4870 OF 2007
The General Manager,
The Solapur Janata Sahakari Bank Ltd.
Solapur } ...Petitioner
: Versus :
Shri. Nandkumar Ramchandra Bidri
Age : 42 yrs, Occ. Nil, R/o. 50, Sakhar
Peth, Solapur } ...Respondent
_____________________________________________________________
Mr. Sumedh Modak i/by. Mr. Vijay Killedar, for the Petitioner.
Mr. Neel Helekar i/by. Ms. Anjali N. Helekar, for the Respondent
______________________________________________________________
CORAM : SANDEEP V. MARNE, J.
Judgment Reserved on : 3 April 2025.
Judgment Pronounced on : 16 April 2025.
JUDGMENT:
1) Petitioner-Bank has filed this petition challenging the
judgment and order dated 31 August 2005 passed by the Presiding
Officer, First Labour Court, Solapur allowing Application BIR
No.1/2003 filed by the Respondent declaring that the termination
order dated 21 December 2002 and 26 December 2002 are illegal.
Petitioner is directed to reinstate the Respondent with continuity and
full backwages. The order passed by the Labour Court has been
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confirmed by the Industrial Court, Solapur by dismissing Appeal BIR
No.4/2005 preferred by the Petitioner-Bank. The Appellate Court has
however granted liberty to the Petitioner-Bank to recover amount of
Rs.90,000/- sanctioned to the Applicant as an advance through his
monthly salary by way of installments.
2) Brief facts of the case are that Petitioner is a Society
registered under the provisions of the Maharashtra Co-operative
Societies Act, 1960 and also carries on banking business. Respondent
functioned as Senior Clerk and was assigned duties of the post of
Cashier. While functioning as a Cashier on 9 March 2002, a suitcase
containing cash amount of Rs. 90,000/- was stolen from the
Respondent’s cabin. The Respondent apparently admitted negligence
on his part and showed willingness to repay the stolen amount. He
applied for sanction of advance of amount of Rs.90,000/-, which was
sanctioned and accordingly Rs.90,000/- was recovered from him. He
was supposed to repay the said advance of Rs.90,000/- through
installments by deductions from his salary. Respondent was served
with chargesheet dated 6 April 2002 under Clauses-23(i), (xiii), (xvii)
and (xix) of the Standing Order. After the charge was held to be
proved in the departmental enquiry, the Respondent was dismissed
from service by order dated 21 December 2002. He filed application
BIR No.1/2003 in the Labour Court, Solapur challenging the dismissal
order, as well as order directing deposit of Rs.90,000/- and sought
reinstatement with full backwages. The Application was resisted by
the Petitioner-Bank by filing Written Statement. The Labour Court
proceeded to allow the application by judgment and order dated 31
August 2005. It held that the order of dismissal dated 21 December
2002, as well as the order dated 26 December 2002 directing refund of
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Neeta Sawant WP-4870-2007-LFC
amount of Rs.90,000/- were illegal. The Petitioner was directed to
reinstate the Respondent in service with continuity and full
backwages.
3) Petitioner-Bank challenged judgment and order dated 31
August 2005 passed by the Labour Court by filing Appeal BIR
No.4/2005 before the Industrial Court. The Industrial Court has
however dismissed the Appeal by judgment and order dated 7 April
2007. The Industrial Court has however granted liberty to the
Petitioner-Bank to recover the amount of Rs.90,000/- granted to the
Respondent as advance from his monthly salary through installments.
The Petitioner-Bank has filed the present petition challenging the
orders passed by the Labour and the Industrial Courts.
4) By order dated 16 July 2007, this Court admitted the
petition and stayed the order passed by the Labour and Industrial
Courts subject to the condition of Petitioner-bank depositing the
backwages, less Rs.90,000/- in this court. Accordingly, Petitioner has
deposited amount of Rs.4,20.576.13/- in this Court on 17 September
2007. The petition is called out for final hearing.
5) Mr. Modak, the learned counsel appearing for the
Petitioner-Bank would submit that the Labour Court has grossly erred
in setting aside the penalty of dismissal. He would submit that the
charge of negligence was admitted by the Respondent. The enquiry
was held to be fair and proper and the findings of the enquiry were
also held to be not perverse by order dated 31 December 2004. That
once misconduct is held to be established, the Labour Court could not
have set aside the penalty imposed on the Respondent. That the
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Labour Court has erred in holding that consideration of past
misconduct amounts to double jeopardy. He would submit that the
past misconduct was considered only for the purpose of indicating the
gravity of misconduct for imposition of penalty. That the punishment
imposed is not for the past misconduct. That therefore the Labour
Court has erred in holding that the punishment is not in accordance
with the provisions of Section 78 of the Bombay Industrial Relations
Act,1949 (BIR ACT). He would further submit that the Industrial
Court has infact disagreed with the findings of the Labour Court on
the issue of discrimination in the matter of punishment. He would
submit that recovery of loss of Rs.90,000/- from the Respondent is an
independent act and cannot be mistaken as an act of punishment. In
support of his contention that mere recovery of lost amount does not
amount to punishment, Mr. Modak would rely upon judgment of the
Apex Court in Commissioner for Rural Development Versus. A.S.
Jaganathan1. Mr. Modak would accordingly pray for setting aside the
impugned orders passed by the Labour and Industrial Courts.
6) The petition is opposed by Mr. Helekar, the learned
counsel appearing for the Respondent. He would submit that the
Labour and Industrial Courts have concurrently held the punishment
imposed on the Respondent to be illegal and that such concurrent
findings based on evidence on record, do not warrant interference in
exercise of jurisdiction by this Court under Article 227 of the
Constitution of India. He would submit that there is no allegation of
misappropriation or theft against the Respondent and that mere loss
of amount of Rs.90,000/- from the cabin of a cashier does not ipso-facto
constitute a misconduct. He would submit that the evidence on record
1
1999 2 SCC 313
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bears out the fact that cashier is responsible for loss of cash and was
merely directed to reimburse the loss caused to the bank and was let
off with minor penalties. In the present case as well, what is
committed by the Respondent is not a positive act of misconduct. That
there is nothing on record to indicate that any particular act of the
Respondent has contributed any loss of cash from his cabin. That once
the bank has recovered the amount of Rs.90,000/- from the
Respondent, it was impermissible for the Bank to subject him to
disciplinary enquiry and punish him with harsh penalty of dismissal.
In support of his contentions, he would rely upon judgment of this
Court in Ramesh Gopinath Tidke Versus. Divisional Controller,
MSRTC2. The Labour Court had rightly held that the Respondent was
discriminated by imposition of harsh penalty of dismissal while
similarly placed employees were let off with insignificant penalties. In
support, he would rely upon judgment of the Apex Court in KVS Ram
Versus. Bangalore Metropolitan Transport Corporation3. He would
pray for dismissal of the petition.
7) Rival contentions of the parties now fall for my
consideration.
8) The Respondent faced the charge of loss of suitcase
containing bank cash of Rs.90,000/- from his cabin where he was
functioning as a cashier on 9 March 2002. The misconduct was thus of
negligent conduct in not being vigilant about protection of cash of the
bank. The charge is held to be established in the domestic enquiry. In
Part-I Award, the enquiry is held to be fair and proper and the findings
were held to be not perverse by order on preliminary issue dated 31
2
2009 2 Mh.L.J. 394
3
2015 12 SCC 39
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December 2004. The Respondent did not challenge the findings on
preliminary issues of fairness in the enquiry and perversity in the
findings of the enquiry report. Thus, the charge is established against
the Respondent.
9) Having held that the charge against the Respondent was
proved in the enquiry, the Labour Court has proceeded to set aside the
punishment of dismissal imposed vide order dated 21 December 2002
on the ground that the same was in violation of provisions of Section
78 the BIR Act. The issue for consideration is whether the Industrial
Court could have interfered in the penalty once the charge is held to be
established? It would therefore be necessary to consider the reasons
recorded by the Labour Court for interfering in the punishment of
dismissal.
10) Perusal of the findings recorded by the Labour Court
would indicate that it has gone all over places while deciding the issue
of legality of punishment of dismissal imposed on the Respondent.
The first aspect taken into consideration by the Labour Court is the
willingness expressed by the Respondent on 9 March 2002 to repay the
loan amount of Rs.90,000/- and his application for cash advance for
the said purpose. It appears that on 9 March 2002 itself, the bank
sanctioned cash advance of Rs.90,000/- to the Respondent and this is
how recovery of lost amount of Rs.90,000/- was made by the Bank.
The Labour Court has unnecessarily gone into the manner in which
the loan advance was made to the Respondent. Once the Respondent
himself applied for cash advance for making good the lost amount of
Rs.90,000/-, it becomes unnecessary to go into the manner in which
the cash advance was sanctioned and disbursed.
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11) The Labour Court has thereafter held that what is
committed by the Respondent was merely a mistake and that he
corrected the mistake by repaying the lost amount of Rs.90,000/-. The
Labour Court took into consideration the fact that there was no
allegation of theft. The Labour Court thereafter went into the aspect of
similar incidents in the past when there was theft of Rs.15,000/-
where the Respondent was working at Mangalvaar Peth, Solapur
Branch and he was punished with permanent stoppage of two
increments. The Labour Court held that at the time of theft of
Rs.15,000/-, the Petitioner-bank did not recover the same from the
Respondent but claimed insurance. The Labour Court thereafter
considered the evidence of the witness wherein he stated that even
qua the loss of amount of Rs.90,000/- insurance could have been
claimed. It took into consideration other past incidents where
insurance was claimed by the Bank when cash was found to be stolen.
It took into consideration incident of Dilip Janardhan Sutar from
whose custody Rs.1,00,000/- was found to be stolen from cash counter
and he was let off with punishment of stoppage of one increment. It
also took into consideration incident of Mahesh M. Patrudkar from
whom cash of Rs.2,00,000/- was stolen from the cashier counter in the
year 2003-04 and punishment of stoppage of one increment was
imposed. The Labour Court thereafter held that while imposing the
punishment, the bank had considered earlier incident also and has
invoked the principle of double jeopardy for holding that Respondent
could not have been punished twice for the same misconduct. The
Labour Court held that the punishment imposed on the Respondent
in the year 1992 could not be taken into consideration while imposing
the punishment of dismissal.
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12) On the above broad reasonings, the Labour Court
proceeded to set aside the punishment of dismissal. In my view, the
Labour Court erred in considering the twin aspects of recovery of
amount of Rs.90,000/- and past punishment imposed in the year 1992
for arriving at the conclusion that Respondent was punished twice for
same misconduct. Recovery of lost amount does not amount to
punishment. Reliance by Mr. Modak on judgment of the Apex Court
in Commissioner of Rural Development (supra) in this regard is
apposite. The apex Court has held in para-5 of the judgment as
under :
5. The Tribunal clearly had no jurisdiction to interfere with the
punishment imposed by the disciplinary authority under the order
of 4-6-1991. The Tribunal has purported to pass the order on the
ground that three punishments cannot be imposed for the same
charge. Now, the Tamil Nadu Civil Services (Classification, Control
and Appeal) Rules prescribe various penalties that may be imposed
under Rule 8. One of the penalties under Rule 8 is of withholding of
increments. Another penalty which can be imposed under Rule 8(v)
(a) is recovery from pay of the whole or part of any pecuniary loss
caused to the State Government by negligence or breach of orders.
Under the Tamil Nadu Pension Rules, Rule 9(1)(6), such pecuniary
loss can also be recovered from the pension of the employee if the
pecuniary loss is caused by negligence or grave misconduct while
in service and the employee has been found guilty of such
misconduct or negligence. In the present case, the disciplinary
authority has clearly found that there were serious charges against
the respondent which were established against him in a
disciplinary enquiry which was properly conducted. The
disciplinary authority has rightly observed that looking to the
serious nature of the charges proved, a minor punishment of only
stoppage of two increments without cumulative effect has been
imposed on the respondent by taking a lenient view since he is
about to retire. The order for recovery of the loss caused on
account of the respondent’s negligence and misconduct is also
permissible under the Tamil Nadu Civil Services (Classification,
Control and Appeal) Rules as also under the Tamil Nadu Pension
Rules, the former permitting recovery from pay and the latter
permitting recovery from pensionary benefits after retirement.
The Tribunal is wrong in holding that if an order is passed for
recovery of the amount lost from the employee, no punishment
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can be imposed on him. The disciplinary authority, in the present
case, was entitled to impose the punishment of stoppage of two
increments without cumulative effect. At the time of passing the
final order, the disciplinary authority was also entitled to pass order
relating to the suspension period pending enquiry. It has directed
that the period during which the respondent was under suspension
be treated as service period but without pay. The order must be
read as a whole. In the present case, the disciplinary authority has
awarded punishment and given directions looking to the nature of
the charges proved. The Tribunal was not entitled to interfere with
the punishment so accorded.
(emphasis added)
13) The Apex Court thus held that order for recovery of lost
amount because of employee’s negligent conduct is permissible, in
addition to imposition of punishment of stoppage of two increments.
Applying the ratio of the judgment to the present case, mere recovery
of amount of Rs.90,000/- from the Respondent did not put any fetter
on the Bank to punish the Respondent.
14) So far as the past punishment imposed on the
Respondent in the year 1992 when he was held responsible for theft
of Rs.15,000/-, it cannot be held that consideration of past
punishment amounts to double jeopardy. It is well settled established
position of law that employer is entitled to consider past
punishments for deciding the penalty to be imposed. To illustrate, if
the employee repeatedly remains absent and has been punished in
the past, the past punishment can be taken into consideration for
deciding the quantum of punishment to be imposed for the last
misconduct of absenteeism. Therefore, the Petitioner-Bank was
entitled to take past misconduct for considering the quantum of
punishment. In Govt. of A.P. v. Mohd. Taher Ali4, it is held:
4
(2007) 8 SCC 656
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5. Learned counsel appearing on behalf of the respondent submitted that in
fact, the disciplinary authority while passing the order has taken into
consideration the earlier absence of the respondent from the duty. He
submitted that this could not have been taken into consideration as the
respondent was not aware about these incidents and those were not the
part of the charges levelled against him. In support of his submission
learned counsel for the respondent has invited our attention to the
judgment of this Court titled State of Mysore v. K. Manche Gowda [AIR
1964 SC 506 : (1964) 4 SCR 540] but in the present case we are satisfied that
in fact the respondent deliberately absented himself from duty and did not
offer any explanation for his absence from election duty. It is not the
respondent’s first absence. He also absented himself from duty on earlier
occasions also. In our opinion there can be no hard-and-fast rule that
merely because the earlier misconduct has not been mentioned in the
charge-sheet it cannot be taken into consideration by the punishing
authority. Consideration of the earlier misconduct is often only to
reinforce the opinion of the said authority. The police force is a
disciplined force and if the respondent is a habitual absentee then there is
no reason to ignore this fact at the time of imposing penalty. Moreover,
even ignoring the earlier absence, in our opinion, the absence of 21 days by
a member of a disciplined force is sufficient to justify his compulsory
retirement.
15) In my view, therefore the Labour Court had grossly erred
in setting aside the punishment of dismissal imposed on the
Respondent. The Industrial Court did not agree with the findings of
the Labour Court on the issue of discrimination in the matter of
penalty and held that ‘I conclude that the punishment of dismissal
awarded to the Applicant cannot be made to be illegal or improper on the
ground that the other employees were given lesser punishment’. The
Industrial Court however fell in grave error by holding that since
recovery of loss is also one of the permissible punishments, second
punishment of dismissal could not be imposed. The findings
recorded by the Industrial Court are in the teeth of the ratio of
judgment of the Apex Court in Commissioner for Rural
Development (supra). Therefore, the order passed by the Industrial
Court is also erroneous. In my view, therefore the Petitioner-Bank
was entitled to punish the Respondent for proved misconduct of
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negligence even after recovery of amount of Rs.90,000/-. Also in the
present case, the recovery was through the mode of loan advanced to
the Respondent, which he never repaid and the Industrial Court
directed its recovery.
16) The next issue for consideration is whether the
punishment of dismissal was proportionate to the gravity of
misconduct. Though, theft of Rs.90,000/-from his cabin is neither
disputed and has been proved in the enquiry, it is equally true that
Respondent is not held responsible for any overt act leading to the
loss of bank cash. The Respondent has not misappropriated the said
amount. True it is that being a cashier, the cash was kept in his
custody and it was his duty to protect the same. However, inability of
the Respondent to take all possible measures to prevent theft of
bank’s cash by itself would not amount to grave misconduct
warranting punishment of dismissal from service. Reference in this
regard can be made to the judgment of the Apex Court in Union of
India Versus. J. Ahmed5 in which the Respondent/Deputy
Commissioner therein had faced the charge of showing lack of
leadership when disturbances had broken out and that he was
accused of displaying complete inaptitude, lack of foresight, lack of
firmness and capacity to take firm decisions, when riots had broken
out. The Apex Court considered whether such conduct constituted
‘misconduct’ and held that there may be negligence in performance of
duty and lapse in performance of duty or error of judgment in
evaluating the development situation amounting to negligence in
discharge of duties, but the same would not constitute misconduct.
It is therefore held that failure to attain the highest stand of efficiency
5
1979 AIR SC 102
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in performance of duty permitting an inference of negligence would
not constitute misconduct. The Apex Court held:
11. Code of conduct as set out in the Conduct Rules clearly indicates the
conduct expected of a member of the service. It would follow that conduct
which is blameworthy for the government servant in the context of Con-
duct Rules would be misconduct. If a servant conducts himself in a way in-
consistent with due and faithful discharge of his duty in service, it is mis-
conduct (see Pierce v. Foster [17 QB 536, 542] ). A disregard of an essential
condition of the contract of service may constitute misconduct
[see Laws v. London Chronicle (Indicator Newspapers [(1959) 1 WLR
698] )]. This view was adopted in Shardaprasad Onkarprasad Tiwari v. Di-
visional Superintendent, Central Railway, Nagpur Division, Nagpur [61
Bom LR 1596] , and Satubha K. Vaghela v. Moosa Raza [10 Guj LR 23] . The
High Court has noted the definition of misconduct in Stroud’s Judicial Dic-
tionary which runs as under:
“Misconduct means, misconduct arising from ill motive; acts of neg-
ligence, errors of judgment, or innocent mistake, do not constitute such
misconduct.”
In industrial jurisprudence amongst others, habitual or gross negligence
constitute misconduct but in Utkal Machinery Ltd. v. Workmen, Miss
Shanti Patnaik [AIR 1966 SC 1051 : (1966) 2 SCR 434 : (1966) 1 LLJ 398 : 28
FJR 131] in the absence of standing orders governing the employee’s under-
taking, unsatisfactory work was treated as misconduct in the context of dis-
charge being assailed as punitive. In S. Govinda Menon v. Union of
India[(1967) 2 SCR 566 : AIR 1967 SC 1274 : (1967) 2 LLJ 249] the manner in
which a member of the service discharged his quasi judicial function dis-
closing abuse of power was treated as constituting misconduct for initiating
disciplinary proceedings. A single act of omission or error of judgment
would ordinarily not constitute misconduct though if such error or omis-
sion results in serious or atrocious consequences the same may amount to
misconduct as was held by this Court in P.H. Kalyani v. Air France, Cal-
cutta [AIR 1963 SC 1756 : (1964) 2 SCR 104 : (1963) 1 LLJ 679 : 24 FJR 464]
wherein it was found that the two mistakes committed by the employee
while checking the load-sheets and balance charts would involve possible
accident to the aircraft and possible loss of human life and, therefore, the
negligence in work in the context of serious consequences was treated as
misconduct. It is, however, difficult to believe that lack of efficiency or at-
tainment of highest standards in discharge of duty attached to public
office would ipso facto constitute misconduct. There may be negligence
in performance of duty and a lapse in performance of duty or error of
judgment in evaluating the developing situation may be negligence in
discharge of duty but would not constitute misconduct unless the conse-
quences directly attributable to negligence would be such as to be irrepara-
ble or the resultant damage would be so heavy that the degree of culpabil-
ity would be very high. An error can be indicative of negligence and the de-
gree of culpability may indicate the grossness of the negligence. Careless-
ness can often be productive of more harm than deliberate wickedness or
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malevolence. Leaving aside the classic example of the sentry who sleeps at
his post and allows the enemy to slip through, there are other more familiar
instances of which a railway cabinman signals in a train on the same track
where there is a stationery train causing head-on collision; a nurse giving
intravenous injection which ought to be given intramuscular causing in-
stantaneous death; a pilot overlooking an instrument showing snag in en-
gine and the aircraft crashes causing heavy loss of life. Misplaced sympathy
can be a great evil (see Navinchandra Shakerchand Shah v. Manager,
Ahmedabad Coop. Department Stores Ltd. [(1978) 19 Guj LR 108, 120] ).
But in any case, failure to attain the highest standard of efficiency in per-
formance of duty permitting an inference of negligence would not con-
stitute misconduct nor for the purpose of Rule 3 of the Conduct Rules as
would indicate lack of devotion to duty.
(emphasis added)
17) In the present case, being a Cashier it was undoubtedly
the duty of the Respondent to remain vigilant and protect the cash of
the Petitioner-bank. He himself has not misappropriated the money
and there is no allegation of any malafide intention. In my view,
therefore the negligence exhibited by the Respondent in letting bank’s
cash of Rs.90,000/- being stolen would not constitute a grave
misconduct so as to attract the punishment of dismissal from service.
The Petitioner-bank therefore ought to have imposed some other
punishment on the Respondent.
18) Having held that the punishment of dismissal is not
commensurate with the proved misconduct against the Respondent,
the next issue for consideration is the nature of relief that can be
granted in favour of the Respondent. The Respondent was dismissed
from service on 21 December 2002 and by now, period of 23 long
years has elapsed. The age of the Respondent at the time of filing of
the complaint in the year 2003 was 48 years and by now, he must have
crossed the age of retirement. Therefore, there is no question of
remitting the proceedings to the Disciplinary Authority for
imposition of lesser punishment. In my view, therefore award of
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lumpsum compensation to the Respondent in lieu of reinstatement
and backwages would meet the ends of justice.
19) Petitioner-bank has deposited in this Court amount of
Rs.4,20,576.13/- towards backwages less the amount of Rs.90,000/-.
The amount of Rs.90,000/- represents the advance amount sanctioned
to the Respondent for recovery of the lost cash. It appears that the
Respondent had not paid the same. Since the amount of Rs.90,000/- is
deducted from the amount of backwages, recovery of loan amount is
already ensured. The backwages of Rs.4,20,576.13/- have been
invested in interest bearing deposits by the Registry. In my view, the
said deposited amount together with accrued interest would be the
adequate compensation to the Respondent in lieu of reinstatement
and backwages.
20) The petition succeeds partly and I proceed to pass the
following order:
(i)Judgment and Order dated 31 August 2005 passed by the
First Labour Court, Solapur in Application No.BIR-1/2003 and
judgment and order dated 7 April 2007 passed by the Industrial
Court, Solapur in Appeal No.BIR-4/2005 are set aside.
(ii)The Respondent is held entitled to lumpsum compensation
in lieu of reinstatement and backwages.
(iii)The amount deposited by the Petitioner-bank in this Court
together with accrued interest shall represent the lumpsum________________________________________________________________________
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Neeta Sawant WP-4870-2007-LFCcompensation payable to the Respondent in lieu of
reinstatement and backwages.
(iv)The Respondents would be at liberty to withdraw the
deposited amount alongwith accrued interest.
(v)Beyond the lumpsum compensation so paid, the Respondent
shall not be entitled to any other service related benefits from
the Petitioner-Bank.
21) With the above directions, the petition is partly allowed.
Rule is made partly absolute. There shall be no order as to costs.
Digitally
signed by
NEETA
NEETA SHAILESH
SHAILESH SAWANT
SAWANT Date: [SANDEEP V. MARNE, J.]
2025.04.17
16:30:05
+0530
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