BOLORAM BORDOLOI Vs. LAKHIMI GAOLIA BANK & ORS.

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INTRODUCTION

In the instant case, Boloram Bordoloi who is a manager of Lakhimi Gaolia Bank challenged the order of compulsory retirement from the service in the Supreme Court of India by going through the Gauhati High Court. Bordoloi was subjected to disciplinary measures because of his recklessness and negligence in the following of laid down procedures in sanctioning loans and misappropriation. The Enquiry Officer pointed to all the charges and held them to be proved and the Disciplinary Authority ordered compulsory retirement. The Gauhati High Court dismissed the petition concluding that the Government’s order of compulsory retirement was legal but held that it was unlawful not to pay his service benefits and pensionary dues. Dissatisfied with this ruling, Bordoloi took his dismissal to the Supreme Court, because the sanctions were excessive in relation to the offenses and procedural violations of the disciplinary process. The Supreme Court refused to entertain his case and struck out his appeal on the basis that it had no legal merits.

FACTS OF THE CASE

1. The manager of Lakhimi Gaolia Bank was Boloram Bordoloi. There were allegations of misconduct, thus disciplinary proceedings were started against him.
2. The Enquiry Officer concluded that all charges (1 to 5) had been proved. In this case, the disciplinary authority had decided to give a compulsory retirement penalty.
3. Bordoloi’s appeal was dismissed by the departmental appellate authority. He challenged the decision in the High Court of Gauhati. Although the High Court upheld compulsory retirement, it held that it was illegal to withhold service benefits and pensionary dues.
4. Bordoloi approached the Supreme Court appealing disproportionate punishment and procedural unfairness.
5. The Supreme Court did not grant his appeal arguing that the charges were severe and so was the penalty he received. The Court also highlighted that procedural fairness was observed in the disciplinary processes.

ISSUES RAISED

1. Whether the act of the disciplinary authority in issuing show cause notice for compulsory retirement without awaiting the inquiry report was legal or not?
2. Were the disciplinary and appellate authorities silent when they passed the orders to impose and confirm the punishment?
3. Was the punitive compulsory retirement out of proportion to the appellant’s offenses that comprised the charges against him?
4. Whether the respondent-bank complied with the correct procedure as enshrined in rules and the ratio of the case Managing Director, ECIL, Hyderabad v. B. Karunakar & Ors. (1993)?

CONTENTIONS OF APPELLANT

The appellant, Boloram Bordoloi, contended that:

1. A disciplinary authority issued a show cause notice directing compulsory retirement before providing him with the inquiry report which was unlawful while relying on the judgments of the Hon’ble Supreme Court in Managing Director, ECIL, Hyderabad v. B. Karunakar (1993) and State Bank of India v. Mohammad Badruddin (2019).
2. Both the disciplinary authority as well as the appellate authority did not give out the reason while arriving at the order of Compulsory Retirement.
3. This showed that the punishment which was given to him was unjustified as compared to the charges that were leveled on him.
4. Bordoloi therefore moved to the court for orders that the impugned orders be and are hereby quashed for having been made without following legal procedures and for being excessive.

CONTENTIONS OF REPONDENT

The respondent bank, represented by learned counsel Sri Rajesh Kumar, contended that:

1. The allegations leveled against the appellant were serious and profound and since he was a manager of the bank the order to compulsory retirement was proper.
2. The penalty that was given was not out-of- proportion bearing in mind the charges that had been leveled against the accused.
3. It is permissible for the disciplinary authority to mention the proposed punishment in the show cause notice while annexing a copy of the Enquiry Report after the completion of the said inquiry.
4. The respondents had followed the procedure contemplated under the Rules & this was in consonance with the ratio laid in Managing Director, ECIL, Hyderabad (1993).
5. The decision made in Mohammad Badruddin (2019) was not relevant to the affairs of this appellant.

JUDGEMENT

The Court of Appeal also dismissed the appeal as it was unmerited. The Court said that the procedure prescribed under the rules was followed by the respondent and that the punishment imposed was not disproportionate to the gravity of the charges which was held by the Court to be serious and grave. The Court also observed that the appellant has almost agreed with the charges leveled against him in his show cause notice. As such, the judgment passed by the Gauhati High Court was affirmed.

ANALYSIS

This Supreme Court case demonstrates the necessity of conforming with certain procedures in disciplinary action and the severity of employees’ misconduct within banks. The Court ruled that the respondent bank had complied with the rules and regulations applicable to the appellant’s case and therefore the punishment of compulsory retirement was justified because the appellant after the charges against him included sanctioning of loans without following the procedures, misappropriation among others deserved it. The Court underlined that during work, bank officers and employees have to do with public money, and the lack of strict adherence to procedural norms may entail deterioration of the population’s attitude towards the bank. This ruling also affirms that the disciplinary authority can state the possibility of punishment in the show cause notice along with the enclosing inquiry report and further clarifies that specific reasons are not necessary in the order that brings punishment if the findings of the Enquiry Officer are accepted. This ruling affirms the need to discipline and hold accountable those who are associated with the banking activities in the society.

CONCLUSION

The judgment was delivered in Boloram Bordoloi & Ors. v. Lakhimi Gaolia Bank & Ors. by the Supreme Court focuses on the primacy to adhere to the proper procedure in exercising order and functioning of the banking sector, particularly in South Korea. While deciding about the disciplinary action against the appellant, the Court stated that the respondent bank had followed strict rules that were laid down for conducting these disciplinary proceedings The punishment of compulsory retirement appeared reasonable to the Court keeping in mind the severe misconducts like sanctioning of these loans without following the process and misappropriation of funds. This the Court dismissed the elements of natural justice and proportionality of the punishment arguing that banks exercise fiduciary duties over public funds and as such any compromise affects the public’s confidence in the employees. This decision is clear that when hearing and dealing with any misconduct committed on the part of the employees of the bank, the court will not make light of this misconduct and any disciplinary measures given, will be supported insofar as such measures have been taken in compliance with the laid down procedures, and that the penalty imposed, is appropriately proportionate to the offense committed.

REFERENCES

1. SCC Online
2. https://indiankanoon.org/doc/86081992/ 

This Article is written by Aman Raj, a student of Chanakya National Law University, Patna (CNLU); Intern at Legal Vidhiya.

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