The Supreme Court reiterated that issuing a show cause notice does not qualify as initiating departmental proceedings and such proceedings can only be initiated after issuing a charge sheet.

The Court dismissed a Civil Appeal filed by the Appellant Bank whereby the High Court had set aside the punishment order against the First Respondent. The Court emphasized that the United Commercial Bank Officer’s Service Regulations, 1979 (Regulations, 1979) can be applied only when disciplinary proceedings have been initiated before the employee's service ceases. The Court noted that Regulations 1979 provides for the continuation of disciplinary proceedings, which should be initiated per the United Commercial Bank Officer, Employees (Discipline and Appeal) Regulations, 1976 (Regulation, 1976).

The Bench comprising Justice Hima Kohli and Justice Rajesh Bindal observed, “While interpreting the 1979 Regulations, this Court opined that the legal fiction created in clause (iii) of Sub-Regulation 20(3) of the 1979 Regulations, must be given full effect, but it is wellsettled that the scope and ambit of the legal fiction should be confined to the object and purport for which the same has been created. It was opined that the 1979 Regulations could be invoked only when the disciplinary proceeding had been initiated prior to the ceasing of the employees service. The delinquent employee would be deemed to be in service, although he has reached the age of superannuation, only if a valid departmental proceeding had been initiated. The departmental proceeding was not initiated merely on issuance of a show cause notice. It is initiated only when a chargesheet is issued”.

Additional Solicitor General Vikramjit Banerjee appeared for the Appellants, and Advocate Aman Mohit Hingorani appeared for the Respondent.

The First Respondent was employed with the Appellate Bank since 1952, and a few days before his retirement in 1991, the Appellant Bank sent him a memo requiring him to explain the irregularities and lapses related to certain accounts during his tenure in the Bombay Main Branch. The General Manager, exercising power under Regulation 12 of the 1976 Regulations, suspended the First Respondent and ordered that he would not be retired from the Bank's service despite having attained the age of superannuation under Regulation 20(3)(iii) of the 1979 Regulations. The First Respondent appealed the order of suspension, which the Appellate Authority dismissed.

The Appellant approached the Court by way of a Civil Appeal challenging the judgment of the High Court whereby the order passed by the Appellate Bank was set aside. The Appellate Bank had passed a punishment order of dismissal against the First Respondent, and the Appellate Authority dismissed an appeal he filed.

The Court, while relying on the case of UCO Bank & Anr. v Rajender Lal Capoor [(2007) 6 SCC 6948] reiterated that Clause 3 of sub-regulation 30 of Regulations 1979 stands as an independent provision. The Regulations, 1979, will solely apply when disciplinary proceedings have been initiated against an officer accused of misconduct and is to be punished. The Court observed that the 1976 Regulations provided for the method and manner in which the disciplinary proceeding is initiated. It specifically provides for delivering a charge sheet, which is crucial for initiating the disciplinary proceeding.

While harmoniously construing the 1976 and 1979 Regulations, this Court opined that Clause (iii) of Sub-Regulation 20 (3) of the 1979 Regulations is an independent provision. It provides for continuation of disciplinary proceeding which must have been initiated in terms of the 1976 Regulations. The 1979 Regulations will be applicable only in a case where proceeding has been initiated for the purpose of taking disciplinary action against a delinquent officer for the purpose of imposition of punishment on him. The disciplinary proceeding, thus, is initiated only in terms of the 1976 Regulations and not in terms of the 1979 Regulations”, the Bench noted.

Accordingly, the Court dismissed the Appeal and upheld the impugned judgment.

Cause Title: UCO Bank v. MB Motwani (thr LRs) and Ors. (2023 INSC 908)

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