Mihir Kumar Hazara Choudhury vs Life Insurance Corpn. And Anr.

Mihir Kumar Hazara Choudhury ….Appellant(s)

VERSUS

Life Insurance Corpn. & Anr. …Respondent(s)

JUDGMENT

Abhay Manohar Sapre, J.

1) This appeal is directed against the final

judgment and order dated 04.07.2007 passed by

the High Court at Calcutta in APO No.591 of 2003

whereby the Division Bench of the High Court

allowed the appeal filed by the Life Insurance

Corporation of India (respondent No.1 herein), set

aside the order of the Single Judge and the award of Signature Not Verified Digitally signed by ASHA SUNDRIYAL Date: 2017.09.11 16:26:16 IST Reason: 1 the Tribunal and upheld the dismissal order passed

by respondent No.1.

2) In order to appreciate the issues involved in

the appeal, it is necessary to set out the relevant

facts hereinbelow.

3) In the year 1960, the appellant was appointed

as an Assistant in the set up of respondent No.1-

Life Insurance Corporation of India (hereinafter

referred to as “LIC”). At the relevant time, he was

posted in the Branch Office of LIC at a place called

Burir Bagan, PO & District Burdwan (WB).

4) During the year 1977, it came to the notice of

the officials of respondent No.1 (LIC) that the

appellant, in discharge of his duties, issued as

many as seven receipts including special premium

receipts to the policyholders without receiving any

premium amount from them. The details of the

policies such as their numbers, names of

2 policyholders, due date of premium and the amount

of premium are mentioned below:

Policy No. Name Due Premium Total

i) 9764225 Sri D. Hazra July 1973 Rs. 251.00 July 1974 July 1977 & January 1977 @ Rs.62.75 each

ii) 31098245 Sri S. June, 1975 Rs. 737.00 Mukherjee December, 1975 June, 1976 December, 1976 & June, 1977 @ Rs.147.40 each iii) 30982313 Sri S.K. Roy May, 1974 Rs. 406.08 August, 1974 November, 1974 February, 1975 May, 1975 August, 1975 November, 1975 & February, 1976 May, 1976 August, 1976 November, 1976 February, 1977 @ Rs.33.84 each iv) 31210746 Sri T.N. April, 1975 & Rs. 821.20 Samanta April, 1977 @ Rs.410.60 each v) 31214187 Sri P.K. September, 1976 Rs. 316.80 Mallick & March, 1977 @Rs.158.40 each vi) 31211624 Sri N.C. August, 1976 & Rs. 1,762.60 Hazra February, 1977 @ Rs.881.30 each vii) 312111625 Sri U.C. February, 1975 Rs. 3,318.80 Hazra February, 1976 August, 1976 & February, 1977 @ Rs.829.70 each

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5) After being prima facie satisfied on verification

of the records that the appellant had committed the

alleged misconduct, the LIC placed the appellant

under suspension and then issued the charge-sheet

under Regulation 39 of the Life Insurance

Corporation of India (Staff) Regulations, 1960

(hereinafter referred to as “the Regulations”) to the

appellant on 07.11.1977 (Annexure-A) setting out

therein the specific charges with details mentioned

above. The appellant was asked to submit his reply.

6) On 28.11.1977, the appellant replied to the

charges (Annexure-B). The appellant, in substance,

admitted the issuance of receipts by him and also

admitted non-receipt of the amount against any of

these receipts from any of the policyholders. All he

said was that he had neither any mala fide intention

nor any oblique motive behind this. According to the

appellant, it occurred due to the pressure of work

4 and family circumstances/worries. The appellant,

therefore, prayed respondent No.1 to take lenient

view in the case against him.

7) Dissatisfied with the reply of the appellant,

respondent No.1 referred the matter to the Enquiry

Officer for holding regular Departmental Enquiry

into the charges leveled against the appellant as per

the service regulations. The Departmental Enquiry

was, accordingly, held in which the appellant fully

participated. The respondent (LIC) adduced

evidence to prove the charges.

8) On 31.07.1981, the Enquiry Officer submitted

his report (Annexure-D). The Enquiry Officer, in his

detailed report running into 27 pages, held the

charges leveled against the appellant as proved. He

recorded the following findings against the

appellant:

“Thus I hold him guilty on the charges of his mala fide intention of perpetrating

5 fraud on the Corporation for wrongful personal gains.

Thus it is proved further beyond any doubt that Shri M.K. Hazra Chowdhury willfully indulged in the acts of deliberate omission and/or commission by defalcating the amounts and causing temporary financial loss to the Corporation which he tried to compensate by influencing the policy-holders to deposit the amounts subsequently with interest and acted in a manner prejudicial to good conduct and failed to maintain absolute integrity and devotion to duty so as to serve the Corporation honestly and faithfully. I have come to this conclusion based on the evidence on records and hold the accused employee guilty of all the charges.”

9) The respondent (LIC) agreed with the findings

of the Enquiry Officer and, accordingly, dismissed

the appellant from the service by order dated

07.12.1981(Annexure-E) as provided in the

Regulations.

10) The appellant (employee), felt aggrieved of the

dismissal order, preferred departmental appeal to

Zonal Manager. It was dismissed by order dated

22.04.1982. The appellant then sought industrial

reference to the Central Government Industrial

6 Tribunal (hereinafter referred to as “the Tribunal”)

under Section 10 of the Industrial Disputes Act,

1947 to decide the legality and correctness of the

dismissal order. It was referred to the Tribunal as

Reference No. 5/1989.

11) The Tribunal then embarked upon the

reference and by award dated 15.06.1998 held that

the Departmental Enquiry was defective and,

therefore, bad in law. The Tribunal, therefore,

granted an opportunity to the respondent (employer)

to prove the charges leveled against the appellant on

merits by adducing evidence. The respondent(LIC),

accordingly, adduced evidence before the Tribunal

and proved the charges. The Tribunal, however,

held that the evidence adduced by the

respondent(LIC) was not credible and, therefore,

charges were not proved against the appellant.

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12) In other words, in the opinion of the Tribunal,

the respondent(LIC) failed to prove the charges

against the appellant for want of adequate evidence

and, therefore, the dismissal order was liable to be

set aside. It was, accordingly, set aside with a

further direction to the respondent(LIC) to pay the

entire retiral benefits to the appellant because, in

the meantime, the appellant had attained the age of

superannuation.

13) The respondent, felt aggrieved, filed writ

petition (W.P. No.2578/1998) before the High Court

at Calcutta. The learned Single Judge stayed the

operation of the award of the Industrial Tribunal on

condition that the respondent(LIC) would pay a sum

of Rs.50,000/- by way of ex-gratia payment to the

appellant and then disposed of the writ petition by

order dated 31.03.1999 giving liberty to the parties

to apply before the Tribunal.

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14) It may here be mentioned that in between,

there were some more proceedings ensued between

the parties resulting in passing some interim orders

by the Tribunal, Single Bench, Division Bench and

this Court but eventually the matter reached back

to the Division Bench in appeal at the instance of

the respondent (LIC) against the order of the Single

Bench dated 31.03.1999.

15) By impugned order, the Division Bench

allowed the appeal filed by respondent No.1 (LIC),

set aside the order of the Single Judge and the

award of the Tribunal and upheld the dismissal

order passed by the respondent.

16) It is against this order, the employee felt

aggrieved and filed this appeal by way of special

leave before this Court.

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17) Heard Mr. Swatantra Rai, learned counsel for

the appellant and Mr. Kailash Vasudev, learned

senior counsel for the respondents.

18) Having heard the learned counsel for the

parties and on perusal of the record of the case

including the written submissions filed by the

learned counsel for the appellant (employee), we

find no merit in the appeal.

19) The short question that arises for

consideration in this appeal is whether the charges

leveled against the appellant (employee), as set out

above, were proved in the departmental proceedings

before the Enquiry Officer or/and before the

Tribunal? If yes, then whether the punishment

imposed by the respondent(employer) on the

appellant(employee) dismissing him from the service

is just and proper?

10

20) As mentioned above, the Division Bench held

that the charges leveled against the appellant stood

proved and, in consequence, upheld the appellant's

dismissal order holding it to be commensurate with

the gravity of the charges.

21) We are in agreement with the reasoning and

the conclusion arrived at by the Division Bench. In

our considered opinion also, the respondent(LIC)

was able to prove the charges leveled against the

appellant(employee). This we say for the following

reasons:

22) Firstly, the charges can be held proved by

mere reading of the appellant's reply (Annexure-B)

wherein he, in no uncertain terms, admitted that he

had issued the disputed premium/special premium

receipts to the concerned policyholders and did not

receive the amount from any of them. Secondly, all

he had said was that such mistake occurred on his

11 part due to heavy pressure of workload on him and

some family circumstances/worries that were

troubling him during those days which, in our

opinion, was hardly any defense to the charges; and

thirdly, he himself requested for taking action

against him with leniency.

23) As would be clear, the Enquiry Officer had

recorded a finding of fact that the action on the part

of the appellant was willful and with mala fide

intention to perpetrate the fraud on the respondent

(LIC) for wrongful personal gains.

24) Though, this report was set aside by the

Tribunal but the Division Bench set aside the award

of the Tribunal and upheld the dismissal order. It is

for this reason, the report of the Enquiry Officer can

now be looked into. Though, learned counsel for

the appellant made sincere attempt to attack to

12 challenge the departmental proceedings but we find

no merit in the same.

25) We find that the principle of natural justice

was fully observed in departmental proceedings

wherein the appellant throughout participated. We

have not been able to notice any kind of prejudice

having been caused to the appellant while

participating in the Enquiry proceedings. That

apart, despite the appellant virtually admitting the

charges, the respondent had also adduced the

evidence before the Enquiry officer and then before

the Tribunal to prove the charges independently,

which found acceptance to the Division Bench and,

in our opinion, rightly.

26) In our opinion, keeping in view the three

reasons set out above coupled with the findings of

the Enquiry Officer, which Division Bench has

rightly upheld, we have no hesitation in holding that

13 the charges against the appellant were proved not

only on the strength of the admission of the

appellant in his reply but also independently with

the aid of the evidence led by the LIC (respondent

No.1) before the Enquiry Officer and later before the

Industrial Tribunal.

27) An employee, in discharge of his duties, is

required to exercise higher standard of honesty and

integrity. In a case where he deals with the money

of the depositors and customers, it is all the more

necessary for him to be more cautious in his duties

because he deals with the money transactions for

and on behalf of his employer. Every such

employee/officer is, therefore, required to take all

possible steps to protect the interest of his

employer. He must, therefore, discharge his duties

with utmost sense of integrity, honesty, devotion

and diligence and must ensure that he does

14 nothing, which is unbecoming of an

employee/officer. Indeed, good conduct and

discipline are inseparable from the functioning of

every employee/officer of any Institution and more

when the institution deals with money of the

customers. Any dereliction in discharge of duties

whether by way of negligence or with deliberate

intention or with casualness constitutes misconduct

on the part of such employee/officer. (See some

observations in Damoh Panna Sagar Rural

Regional Bank & Anr. v. Munna Lal Jain, (2005)

10 SCC 84)

28) There is no defense available to a

delinquent to say that there was no loss or profit

resulting in a case when officer/employee is found

to have acted without authority. The very discipline

of an organization and especially financial

institution where money is deposited of several

15 depositors for their benefit is dependent upon each

of its employee, who acts/operates within the

allotted sphere as custodian of such deposit. Acting

beyond one's authority by itself is a breach of

discipline and thus constitutes a misconduct

rendering the delinquent to suffer the adverse

orders (see some observations in Disciplinary

Authority-cum-Regional Manager & Ors. Vs.

Nikunja Bihari Patnaik, 1996(9) SCC 69).

29) In our opinion, having regard to the

seriousness of the charges coupled with virtually no

defense taken by the appellant in answer to the

charges and lastly, the findings of the Enquiry

Officer, the punishment of dismissal was

appropriate as provided in the service regulations

and hence does not call for any leniency in awarding

such punishment.

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30) Learned counsel for the appellant (employee)

made sincere attempt in his oral as well as written

submissions to find fault in the conducting of the

departmental proceedings and also urging from

interfering in the quantum of punishment by

imposing lesser punishment but we are afraid we

can interfere in either.

31) As held supra, the departmental proceedings

were conducted strictly in accordance with law by

following the principle of natural justice in which

the appellant duly participated. The appellant

neither set up any defense nor denied the factum of

charges, yet the respondent proved the charges with

the aid of relevant evidence, which found

acceptance to the Division Bench and this Court

too. As an Appellate Court, neither we can sit over

the findings of the Enquiry Officer and find fault in

17 it nor can we re-appreciate the evidence of

witnesses examined in departmental Enquiry.

32) In the light of foregoing discussion, we find no

merit in the appeal. The appeal thus fails and is,

accordingly, dismissed.

33) It was, however, brought to our notice that the

learned Single Judge during pendency of the writ

petition by an interim order had directed the

respondent (LIC) to pay a sum of Rs.50,000/- by

way of ex-gratia payment to the appellant. The

respondent accordingly paid this amount to the

appellant. Let this amount be remained with the

appellant.

………...................................J. [R.K. AGRAWAL]

…...

……..................................J. [ABHAY MANOHAR SAPRE] New Delhi;

September 11, 2017

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