JUDGMENT Sunil Ambwani, J.
1. The petitioner Satya Narain Misra has challenged the order dated 9.3.1993 by which the Managing Director of the U. P. Rajya Sahkari krishi Evam Gramya Vlkas Bank Ltd.. Lucknow, has reverted the petitioner from the post of Officiating Internal Auditor to his original post of Accountant in the minimum of pay-scale and to recover half of the losses which have been caused to the bank if the loan is not recovered. The order is said to have been passed after approval of the U. P. Co-operative Society Institution Service Board vide its letter dated 21.8.1993.
2. 1 have heard Sri H.N. Tripathi for the petitioner and Sri J. N. Tiwari for the respondents.
3. The facts to this case are that the petitioner was appointed on the post of Junior Assistant/Assistant Accountant by the Committee of Management of U. P. Rajya Sahkari Krishi Gramya Vlkas Bank Ltd., Lucknow. It is alleged that in the year 1973, the petitioner was promoted on the post of Field Officer. He was transferred as Incharge Internal Auditor/Branch Manager on 19.9.1986 and was posted at Haldwani. He was thereafter transferred to different places on the post of Branch Manager and In the year. 1990. he was posted at Allahabad and worked upto 1992. Thereafter he was again transferred as Internal Auditor/Branch Manager and was posted at Dehradun. A charge-sheet was given to the petitioner on 18.2.1992 by the Inquiry Officer without any supporting document. The petitioner requested for supply of relevant documents which were not given to him. He submitted a reply on 2.3.1992 with the help of some documents which were in his custody. On 8.5.1992, a show cause notice was given to the petitioner to which also he submitted a reply. On 9.3.1993, Impugned order was passed by the Managing Director reverting the petitioner in the minimum of pay-scale of his original posting with the direction to recover 50% of such losses which may not be recovered.
4. The counsel for the petitioner has challenged the order on the following grounds :
(i) The appointing authority of the petitioner is the Committee of Management of the Bank which neither started disciplinary proceedings nor passed the impugned order. The Managing Director of the Bank, who was also functioning as Administrator of the superseded Committee of Management was not appointing authority and had no power to Initiate the disciplinary proceedings.
(ii) The petitioner was not supplied all the relevant documents in respect of the charges insplte of the demand made by him and was thus not given an effective opportunity to defend violating the principles of natural justice.
(iii) Even if the charges are said to be proved, the punishment awarded is not commensurate with the gravity of the charges : and
(iv) The petitioner could not have been awarded the punishment of being placed In the minimum of the pay-scale after he was given the punishment of reversion and in any case, a further punishment of recovery of half of the doubtful recovery amounts to multiple punishment on the same charges which cannot be justified under the Rules.
5. The services of the employees of Co-operative Bank are governed by U. P. Co-operative Societies Employees Service Regulations. 1975. On the first ground, the petitioner has relied upon the judgment in Writ Petition No. 7340 (S/S) of 1991. Suresh Chandra v. Registrar, Cooperative Societies, U. P. Lucknow and Ors., dated 7.7.1992. In this case, the question was whether the Registrar, Co-operative Societies, U. P., can appoint himself by name as Administrator of the Co-operative Societies. Suresh Chandra working as Branch Manager of U. P. Rajya Sahkari Krishi Gramya Vikas Bank Ltd., was an accused in a crime under Section 7/13(2) read with Section 13(1)(d) of the Prevention of Corruption Act for receiving the illegal gratification in discharging of official duties. The Committee of Management was superseded under Section 29 of the U. P. Co-operative Societies Act, 1965, and the powers of the Committee of Management were to be exercised by the Administrator of the Bank. It was alleged that the Managing Director of the Bank was not the appointing authority as contemplated in para 85 (iv) of the Regulations and was thus not authorised to appoint an Inquiry Officer. The aforesaid para 85 (iv) of the Act provides that the Inquiry Officer shall be appointed by the appointing authority or by an officer of the Society authorised for the purpose by the appointing authority. The by-laws of the Society provides that the Committee of Management shall be the appointing authority. The Court held that the language of Section 29 (iv)(B) authorises the Registrar to appoint an Administrator or any member of the Committee or to appoint a committee in place of an Administrator or vice versa from time to time. Relying upon Kashi Nath Misra v. Chancellor, University of Allahabad, AIR 1967 All 101. In which powers of para 11 (1) of the Allahabad University Act were challenged to the effect that the Chief Justice could not nominate himself as a member of the Committee, and that the Court has held that the Chief Justice could not nominate himself for the Selection Committee In exercise of the aforesaid powers, it was held that the power to appoint under Section 35 of the U. P. Cooperative Societies Act, 1965, does not include the power to appoint himself and that if the Legislature had Intended to vest any power with the Registrar, it would have made arrangement for reference of dispute to any other authority instead of Registrar because no person can become a judge of his own cause. The Court concluded that Registrar does not possess any power under the Act to appoint as Administrator of the Co-operative Society and thus the orders passed by him were set aside.
6. The same view was taken in Ram Pal Singh Tyagt v. U. P. Cooperative Federation Ltd. and Anr. (1993) 3 ESC 2355 (All), holding that the U. P. Co-operative Federation Ltd., Karmchari Seva Niyamawall, 1980, has restricted the use of power of suspension on the Committee of Management by Regulation 84 (v) and the question of exercising such power of Committee of Management by any delegated authority did not arise because there was no Committee of Management at all when the impugned order was passed nor was there any Administrator. Repelling the arguments that the word "current duties" of the Committee of Management in Section 29 (5) as of necessity must include the power to take Immediate and imperative action of suspension, on the ground that the life term of the Managing Director as envisaged by the aforesaid subsection by amendment by U. P. Act No. 1 of 1977 cannot be permitted to extend for a very long period and thus individual officer cannot be permitted to run the Federation for a long term.
7. in reply. Sri J.N. Tiwari has firstly relied upon the powers delegated to Managing Director of the Bank who forwarded the disciplinary proceedings by an order of delegation dated 17.2.1990, by the Bank for effective functioning of the Bank. A perusal of this delegation order does not show that the Managing Director was authorised with the power to initiate disciplinary proceedings or to pass the orders of punishment. Sri J.N. Tiwari thereafter submitted that the defect. If any, in the authority to forward the disciplinary proceedings was subsequently cured by the order of the Managing Director who passed the order Imposing punishment with the approval of the U. P. Co-operative Institutional Service Board. Sri H.N. Tripathi has admitted that the order of punishment is by a competent authority who was duly appointed as Administrator but he reiterated that the initiation was bad and as such, the whole Inquiry was illegal.
8. Sri J.N. Tiwari has relied upon the State of Madhya Pradesh and Ors. v. Shardul Singh. 1970 (1) SCC 108. in this case, the Supreme Court held that Article 311(1) does not in terms require that the authority empowered under that provision to dismiss or remove an official, should itself Initiate or conduct the enquiry proceeding, the dismissal or removal of the officer or even that the enquiry should be done at its instance. But for the Incorporation of Article 311 in the Constitution even in respect of matters provided therein, rules could have been framed under Article 309. The provisions of Article 311 confer additional rights on the civil servants. in the said case, Supreme Court did not agree with the High Court that the guarantee given under Article 311(1) includes within Itself a further guarantee that the disciplinary proceedings resulting in dismissal or removal of a civil servant should also be initiated and conducted by the authorities mentioned in the Article. In Registrar of Co-operative Societies. Madras and Anr. v. F.X. Fernando. (1994) 2 SCC 746. a charge-sheet was Issued by an officer who was not empowered to Impose any penalty. Relying upon P.V. Srinivasa Sastry v. Comptroller and Auditor General, AIR 1993 SC 3121. the Supreme Court held that initiation of a departmental proceeding per se does not visit the officer concerned with any evil consequence. A superior authority can initiate such proceeding. Further relying upon State of Madhya Pradesh u. Shardul Singh (supra) where the departmental inquiry has been initiated against Sub-Inspector of Police by Superintendent of Police and on an Inquiry report being sent to the Inspector General, the Inspector General of Police dismissed the officer concerned was not held to be bad in law. Similar view was also taken in Transport Commissioner. Madras v. A. Radna Krishna Moorthy. (1995) 1 SCC 332. where the initiation by an officer subordinate to the appointing authority was held to be unobjectionable. Since in the present case final order of punishment has been passed by the Managing Director who was appointed as the Administrator by the Registrar, and was authorised to pass the order with the approval of the U. P. Co-operative Institutional Service Board, it is held that the Inquiry cannot be held to be illegal, on the ground that the authority competent to initiate the proceedings was not authorised to Initiate proceedings. In the case of Suresh Chandra (supra), cited by the counsel for the petitioner, final order had not been passed and that the initiation itself was challenged which was held to be bad. In Ram Pal Singh Tyagi, both the orders initiating and imposing punishment were passed by the same authority who was not competent to initiate the proceedings. Both the cases are, therefore, distinguishable.
9. On the second contention, namely, the denial of relevant documents during the enquiry causing violation of principles of natural justice, it is found that the petitioner has not given the details of the documents which he required to file effective defence. In his reply dated 2.3.1993, the petitioner did not state that he was not supplied with any document or that he was denied inspection. He has relied upon various documents in his reply and did not request for any document. A delinquent employee has not only to show the relevance of the documents required by him but also to prove that any prejudice was caused to him by withholding such documents. The petitioner has not detailed the documents required by him, nor he appears to be in any way handicapped in giving reply. This submission also does not have any force.
10. Sri H.N. Tripathi. has relied upon the judgment of this Court in Vijay Bahadur Yadau v. Chairman, U. P. Co-operative Federation Ltd., Lucknow, 1992 (3) AWC 1479 : (1992) 2 UPLBEC 1215. To support his submission that the petitioner could not have been awarded the punishment of bringing him down to the minimum of the pay-scale and for recovery of half of the doubtful recoveries after having awarded the punishment of reversion. Regulation 84 of the Service Regulations provides for imposition of penalties which states that the delinquent employee may be punished by any one of the punishment, namely, censure, withholding of Increment, fine as employee of category IV, recovery from pay or security deposit to compensate in whole or in part for any pecuniary loss caused to the Cooperative Society, reduction in rank or grade held substantively by the employee, removal from service, or dismissal from service. The judgment holds that the impugned order providing for three penalties cannot be sustained, Inasmuch as in the said case the employee was awarded with punishment of recovery of an amount, stoppage of two annual increment and censure entry in their character roll.
11. In Writ Petition No. 6725 of 1989, Najeebullah Siddiqul v. Registrar, U. P. Co-operative Societies, decided on 2.2.1996, relying upon the aforesaid judgment of Vijay Bahadur Yadav, a review application was allowed directing that only one penalty could be imposed. In this case also three punishments were imposed namely recovery of amount sought to be misappropriated, censure entry and withholding of three Increments.
12. Coming to the present case, the petitioner has been reverted to his original post on the minimum of the pay-scale and half of the doubtful loan to be recovered from him. In Assistant General Manager, S.B.I. v. Thomas Jose, (2000) 10 SCC 280, the Supreme Court was dealing with the case of the Bank Employees. In paragraph 3 of this Judgment, it was observed as follows :
"3. In the aforestated case, in more or less similar circumstances, this Court declined to interfere with the view taken by the Labour Court that an errant workman should be given an opportunity to reform himself and prove to be a loyal and disciplined employee of Scooters India Ltd. There is, in our view, a vital difference between an undertaking such as Scooters India Ltd. and the Bank. A bank deals with public moneys. Misappropriation by an employee of a bank is misappropriation of public moneys and must be treated very differently. Misconduct such as this cannot be treated as lightly as it has been done. We think that the appropriate order should at least have been of reinstatement without back wages plus a direction that the first respondent would not be entitled to any increments for a substantial period with all the cumulative consequences of such an order. That is the order that we propose to pass."
13. In case bank employee who is found to have embezzled the amount, the public policy demands that apart from the punishment given by departmental authority, he be held responsible for the recovery of the pecuniary loss caused by the employee to the Bank. If an employee is held to be liable to only one of the punishments, it may become an incentive to misappropriate or embezzle a large amount and escape liability of such misappropriation or embezzlement. The punishment of reversion or removal or dismissal on the ground of misconduct should be with direction of recovery to make good the loss caused due to such misconduct. Regulation 84, providing for penalties and stating that the employee is liable to be punished by any one of the penalty has thus to be interpreted to mean that in case of misappropriation or embezzlement which is the misconduct on account of which the employee has been penalised, the recovery of the amount of pecuniary loss caused to the bank is necessary to be coupled with the penalty effected upon delinquent employee. In V.K. Bahadur u. State Bank of India. 2001 L&IC 935, this Court following the judgment in State Bank of India v. T.J. Paul. AIR 1999 SC 1994 ; Kailash Nath Gupta v. Inquiry Officer : 1997 (1) AWC 2.63 (NOC): 1997 ACJ 896, held that where financial irregularities of serious nature are found proved against the bank employee no lenient view should be taken. A bank runs on public confidence. A greater integrity and devotion is required from bank employee in comparison to employees of other organisations. If the allegation of embezzlement, misappropriation or gross negligence is found to be established causing pecuniary loss to the bank on account of delinquent employee, the amount of loss must be made good by him. In the present case, only half of the doubtful recoveries have been sought to be made good, and in the circumstances it is held that imposition of penalty of reversion along with recovery of the amount, does not violate Regulation 84 of the U. P. Co-operative Societies Service Regulation. 1975.
14. Coming to the last submission, the Supreme Court has held that the case of disproportionate punishment is establishment, when the nature of charge of punishment is such which may shock the conscience of the Court. In the present case, the petitioner was found guilty of sanctioning loans without following the norms of the bank. He was found to have disbursed loan indiscriminatorily and to have further disbursed the instalments without ensuring utilisation of the earlier disbursement. He did not obtain quotations/bills from the firms recognised by Industries Department or Khadi Gramodyog Department, and in case of 27 matters, conditions of acceptance of loans were not found to have been Issued. Even after he came to know that the loans have not been properly utilised, he did not cause the Inspection and submitted reports to immediately recall entire loan. These actions caused loss to the bank. The Court thus find that the punishment was not disproportionate to the charges found established against the petitioner.
15. In the circumstances, I do not find any valid ground to Interfere with the order of punishment. The writ petition is accordingly dismissed. There shall be no order as to costs.