Employee cannot be penalized without reasonable opportunity of defence: HC

 The High Court (HC) of Jammu & Kashmir and Ladakh Tuesday held that penalties cannot be imposed upon an employee unless the charges framed against him has been communicated to him in writing and an enquiry to ascertain correctness of the charges has been held.

The court while citing the Supreme Court directives in the case of Jagdish Prasad Saxena vs. State of Madhya Bharat recorded that an employee is entitled to have a reasonable opportunity of meeting the charges framed against him. 

The court further recorded that when a person is denied a proper and reasonable opportunity of defending himself, the penalty imposed upon him cannot be sustained.

The court of Justice Sanjay Dhar passed the rulings in a plea of Zia-ud Din Changal challenging the order passed by the Kashmir Mercantile Cooperative Bank on November 01, 2006 ordering the reinstatement of petitioner with a direction that he shall not be paid the salary for the period of suspension and he shall be reverted to the post of Cashier from which he was elevated to the post of Assistant Manager.

The order issued by the respondent Bank had further directed that additional increments and other monetary benefits granted to the petitioner at the time of promotion be recovered from him and he shall not be posted at the cash receipt or payment counter

The respondents had submitted before the court that the petitioner had indulged in defalcation of funds, as a result of which he was placed under suspension in terms of order issued on April 15, 2006. 

On the other hand, the petitioner contended that as per the Service Rules applicable to the petitioner that no charge sheet was served upon the petitioner nor any enquiry was conducted by the respondents against him before passing the order.

It was stated before the court that the order passed by the respondents is a result of “malafide and colourable exercise of power on the part of respondents.”

The court after perusing the material on record noted that it comes to the fore that neither any enquiry officer was appointed by the respondent Bank nor any enquiry was conducted by it before issuing the show cause notice on July 18, 2006 for imposing penalty against the petitioner and before imposing the penalty upon him vide the impugned order.

Justice Dhar underscored that it becomes manifest that so far as penalties of reduction to a lower category or grade, reduction in seniority and dismissal from service are concerned, such penalties cannot be imposed upon an employee unless the charge has been communicated to him in writing and an enquiry to ascertain correctness of the charges has been held.

In the instant case, the court said though the charge sheet has been served upon the petitioner, yet there is nothing on record to even remotely suggest that any enquiry has been conducted by the respondents before imposing the penalty of reversion of the petitioner from the rank of Assistant Manager to the rank of Cashier-cum-Clerk.

"In the absence of holding any enquiry against the petitioner, the question of granting him an opportunity to produce evidence or to cross-examine the witnesses also does not arise," the court said.

It further pointed out, thus, respondent Bank has, while imposing penalty vide the impugned order upon the petitioner, observed the provisions contained in Section 17.3 of the Service rules applicable to the employees of the Bank in breach. 

Justice Dhar underscored that it is not a case where petitioner had admitted the charges leveled against him but it is a case where he has specifically refuted each and every charge leveled against him by filing reply thereto. 

"So it was incumbent upon the respondent Bank to appoint an enquiry officer and hold enquiry against the petitioner before imposing the penalty of reduction of his rank," Judge Dhar said.

The court while setting aside the order issued by the Bank against the petitioner employee recorded that each charge leveled against an employee has to be sufficiently definite to furnish material to an employee to defend himself and it is absolutely essential to supply whole material relied upon by an employer against its employee in the enquiry. 

The court noted that one of the charges leveled against the petitioner is vague as it does not contain the sufficient and definite particulars about the incidents of alleged misbehaviour by the petitioner.

"This must have handicapped the petitioner from filing his reply to the said charge. Not only this, even the enquiry has not been conducted against the petitioner and, as such, there is no question of giving an opportunity of presenting his case to the petitioner before the enquiry officer," the court recorded.

It further recorded that the entire proceedings conducted by the respondents in the instant case show a complete disregard of Section 17.3 of the Service Rules applicable to the employees of respondent Bank.

"The impugned order, therefore, is not sustainable in law," the court held while allowing the plea.

Justice Dhar while setting aside the order issued by the Bank directed that the petitioner is held entitled to all the benefits which will ensue to him. 

"It shall, however, be open to the respondents to hold an enquiry against the petitioner in accordance with the Service Rules and thereafter take an appropriate decision in accordance with law," the court directed.