R. Lakshmanan v. Indian Overseas Bank

T.Nagar, Chennai-600 0-17..4th Respondent(in W.P.No.19008/1998 and I Respondent & W.P.No.6483/2001)5.The Banking Ombudsman Reserve Bank of India Second Floor, Fort Glacis, Post Box No.40, Rajaji Salai, Chennai-600 001...I Respondent(in W.P.No.8061/2007 & W.P.No.8062/2007)6.R.Lakshmanan 38, Third Street, Abiramapuram, Chennai-600018...II Respondent(in W.P.No.6483/2001, and 3rd Respondent in W.P.No.8061/2007 & W.P.No.8062/2007)7.M/s.Pappu Benefit Fund Ltd., No.18, Dr.Nair Road, T.Nagar, Chennai-600 017...Respondent (in W.P.Nos.8061 & 8062/2007) ********Prayer in W.P.No.19008/1998: Writ petition filed under Article 226 ofthe Constitution of India praying for a Writ of Mandamus directingthe first and second respondents to comply with the award dated26.2.1998 passed by the fourth respondent.Prayer in W.P.No.6483/2001: Writ petition filed under Article 226 ofthe Constitution of India praying for a Writ of Certiorari callingfor the records of the first respondent in passing the award dated26.02.1998 in his proceedings No.BO(CHN)/AC 001/97-98 and to quashthe same.Prayer in W.P.No.8061/2007: Writ petition filed under Article 226 ofthe Constitution of India praying for a Writ of Certiorari or orderor direction in the nature of the writ relating to the charge sheetsinitiated by the 2nd respondent in No.ENQ/PAD/213/22 dated 9.1.99 andquash the same as illegal, arbitrary and against law.Prayer in W.P.No.8062/2007: Writ petition filed under Article 226 ofthe Constitution of India praying for a Writ of Certiorari or orderor direction in the nature of the writ relating to the charge sheetsinitiated by the 1st respondent in No.BO(CHN)/AC 001/97-98 dated26.02.1998 on the file of the 1st respondent and quash the same asillegal, arbitrary and against law. https://hcservices.ecourts.gov.in/hcservices/ For Petitioners :M/s.R.Margabandhu(in W.P.No.19008/1998)M/s.T.RaviKumar (in W.P.No.6483/2001)Mr.A.Thiyagarajan, Senior Counselfor Mr.S.Rameshkumar (in W.P.Nos.8061 & 8062/2007)For Respondents:Mr.T.Ravi Kumar andMr.P.T.Narendravasan(for R1 & R2 in W.P.No.19008/98 & for R2 in W.P Nos.8061 & 8062/07)Mr.R.Margabandur for R2 (in W.P.No.6483/2001)C O M M O N O R D E RSince the issue involved in these writ petitions are common theyare taken up together for disposal. 2. The matter pertains to an award passed by the BankingOmbudsman in exercise of his powers conferred under the BankingOmbudsman Scheme 1995. 3. The Indian Oversees Bank (hereinafter referred to as theBank) is aggrieved by the said award. The complainant before theBanking Ombudsman seeks for implementation of the award. OneMrs.V.Indira Stephen, who is also an employee of the bank haschallenged the award, since the award directs funds to be withdrawnfrom her savings bank account. She has also challenged the chargememo issued to her by the Bank in W.P.No.8061/2007. For the purposeof deciding the issue, I propose to take up first W.P.No.6483/2001filed by the bank, challenging the award passed by the Ombudsman. 4. Mr.R.Lakshmanan, the petitioner in W.P.No.19008/1998, hasmade a complaint to the Ombudsman on 29.8.1997. The allegation in thecomplaint is that Mrs.V.Indira Stephen, petitioner in W.P.Nos.8061 &8062/2007, the employee of the Bank received Rs.3,00,000/- fromMr.R.Lakshmanan to repay her housing loan and release the documentsand sell the property to Mr.R.Lakshmanan. It is further stated thatshe obtained loan from a finance company under the name and style ofM/s. Pappu Benefit Fund Ltd., 4th respondent in W.P.No.8062/2009 andthe finance company gave a cheque in favour of the Indian OverseesBank, Nungambakkam Branch a/c of Mrs.V.Indira Stephen. Since thecheque was issued to the bank, and as Mrs. Indira Stephen did nothave savings account in Indian Oversees Bank, Nungambakkam Branch atthat time the money was kept in suspense account. According to thesaid Mr.R.Lakshmanan, he had lodged a complaint with the Vigilance https://hcservices.ecourts.gov.in/hcservices/ Department of the Bank and after the complaint was lodgedMrs.V.Indira Stephen had taken the money which was kept in suspenseaccount. Based on these facts, Mr.R.Lakshmanan claimed the sum ofRs.3,00,000/- with full interest.5. The Ombudsman took up the matter and since the complaintremained unsettled by agreement, in exercise of his powers underClause 20 of the Scheme proposed to pass award. The Ombudsman byaward dated 26.2.1998 issued two directions as hereunder:(i) directing the bank to refund the sum of Rs.3,00,000/- withinterest at 21% p.a to M/s.Paapu Benefit Fund Limited withinstruction to credit to the loan account of Mr.R.Lakshmanan orto refund to him by M/s.Paapu Benefit Fund Ltd., if he hadrepaid the loan either wholly or in part.(ii) bank should pay the compensation of Rs.1,000/- to thecomplainant Mr.R.Lakshmanan for the expenses incurred by him inprosecuting his claim.6. Mr.T.Ravi Kumar, Learned Standing Counsel for the Bankassailed the correctness of the award passed by the Ombudsman bycontending that the transaction between Mr.R.Lakshmanan andMrs.V.Indira Stephen is purely a private dispute and the action ofthe Ombudsman in passing the award amounts to improper exercise ofjurisdiction. That the Ombudsman ought to have seen that the subjectmatter does not relate to any deficiency in banking service. On thedate when the cheque was deposited, Mrs.V.Indira Stephen was a staffof the Mount Road Branch and had availed housing loan from theNungambakkam branch of the bank and that the bank collects theproceeds of the instrument on behalf of the beneficiary of theinstrument.7. Since the instruments was to the account of Mrs.V.IndiraStephen, she had every right, based on that and the bank cannot beheld responsible in respect of any private dispute betweenMr.R.Lakshmanan and Mrs.V.Indira Stephen. That Mr.R.Lakshmanan hasno locus standi to file a complaint in the instant case as he is notthe customer of the Bank and if there is any dispute between himselfand Mrs.V.Indira Stephen, his remedy is elsewhere. The learnedcounsel would further submit that neither Mrs.V.Indira Stephen norM/s. Paapu Benefit Fund Ltd., were arrayed as respondents before theOmbudsman and the award is wholly erroneous and without jurisdiction.8.The complainant Mr.R.Lakshmanan filed a counter affidavit andreiterated the stand taken before the Ombudsman. Mr.R.Maargabandhu,Learned counsel appearing on behalf of Mr.R.Lakshmanan would contendthat Mrs.Indira Stephen and the bank colluded together to benefit herand transferred the cheque amount of Rs.3,00,000/- from the suspense https://hcservices.ecourts.gov.in/hcservices/ account to her savings bank account on 10.6.1996 and she haswithdrawn the entire amount of Rs.3,00,000/-. It is further contendedthat, as per the banking practice, the Bank should have intimatedeither Mr.R.Lakshmanan or M/s.Paapu Benefit Fund Ltd., to whichaccount the amounts should be transferred on finding thatMrs.V.Indira Stephen did not have a savings account in NungambakkamBranch. In fact, the said Mrs.V.Indira Stephen opened the account on8.6.1996 and had withdrawn the money two days later on 10.6.1996,without discharging the housing loan. Therefore, the learned counselwould contend that the Bank has committed deficiency of service, asper Clause 13(a)(vii) of the Banking Ombudsman Scheme 1995. SinceMr.R.Lakshmanan is an aggrieved person, he is entitled to maintainthe complaint before the Ombudsman and there is sufficient cause ofaction in terms of clause 16(3) of the scheme to maintain thecomplaint. On these grounds, the learned counsel would submit thatthe writ petition filed by the Bank is liable to be dismissed and theaward should be implemented by allowing the W.P.No.19008/1998.9. Mr.A.Thiyagarajan, Learned Senior Counsel appearing forMrs.V.Indira Stephen would contend that, she is not a party to theproceedings before the Ombudsman and has not been impleaded asrespondent in both the writ petitions in W.P.No.6483/2001 andW.P.No.19008/1998. The learned senior counsel would contend that theOmbudsman heard the matter without issuing notice to Mrs.V.IndiraStephen. That in terms of clause 16(d) of the scheme, the complaintfiled by Mr.R.Lakshmanan should not have been proceeded further as inrespect of the same subject matter he has filed criminal complaintand the Crime Branch, Madras had registered a case against thepetitioner Mrs.Indira Stephen on 2.9.1997 for offence under section420 I.P.C. Therefore, the learned senior counsel would submit thatthe award of the Ombudsman is liable to be set aside. In respect ofthe charge memo issued to Mrs.V.Indira Stephen which is impugned inW.P.No.8061/2007, the learned senior counsel would submit that thecriminal case which was registered against the petitioner had endedin acquittal by judgment dated 14.12.2004 in C.C.No.9562/1999 on thefile of the learned Additional Chief Metropolitan Magistrate, Egmore,Chennai-8. In view of the acquittal, the department proceedingsinitiated based on the same set of charges cannot be proceeded.Therefore, the learned senior counsel would submit that thedepartmental charge memo is also liable to be set aside.10. I have carefully considered the submissions made by thelearned counsels on either side and perused the entire materials onrecord.11.The main contention raised by the Bank is that the Ombudsmandoes not have jurisdiction to entertain the complaint and to givedirections as given in the impugned award. It is their furthercontention that the complainant Mr.R.Lakshmanan has no locus standi https://hcservices.ecourts.gov.in/hcservices/ to make such complaint as he is not a customer of the Bank and thedispute is purely a dispute between Mr.R.Lakshmanan and Mrs.V.IndiraStephen and the Ombudsman, ought not to have entertained such acomplaint. 12. The scheme which is relevant for the purpose of the presentcase is the Banking Ombudsman Scheme, 1995. Oxford EnglishDictionary defines "Ombudsman" to be an official appointed toinvestigate individual complaints against an organisation, especiallya public authority.13. Pursuant to the notification issued by the Reserve Bank ofIndia, dated 14.6.1995, in exercise of the powers conferred undersection 35A of the Banking Regulation Act 1949, the Scheme wasintroduced in public interest and in the interest of banking policyto provide for a system of Banking Ombudsman for redressal ofgrievances against deficiency in banking services, concerning loansand advances and other specified matters. In terms of the Clause 2of the Scheme, the object is to enable resolution of complaintsrelating to provision of banking services and to facilitate thesatisfaction, or settlement of such complaints. In terms of Clause12(a), the powers and duties of the Banking Ombudsman will be toreceive complaints relating to the provision of banking service.Clause 13 of the scheme specifies the ambit of authority of theOmbudsman as regards banking services and the same shall includecomplaints pertaining to the operations in any saving, current or anyother account maintained with a bank, such as delays, non-credit ofproceeds of parties accounts, non-payment of deposit or non-observance of the Reserve Bank directives, if any, applicable to rateof interest on deposits. In terms of Clause 16(1) of the Scheme, anyperson who has a grievance against a bank may himself or through anauthorised representative make a complaint in writing to the BankingOmbudsman within whose jurisdiction the branch or office of the bankcomplained against is located. 14. On a perusal of the provisions as stated above, the objectof the Scheme is to enable resolution of complaints and the Ombudsmanis entitled to receive complaints relating to provision of bankingservices and if the complaint pertains to an operation of savingsbank account or current account maintained by the bank, the Ombudsmanwould have jurisdiction to entertain such complaint. The provisionsof Clause 16(1) are very widely couched by stating that any personwho has a grievance against the Bank could lodge a complaint.Therefore, the objections raised by the Bank that the Ombudsman hasno jurisdiction to entertain the complaint is not tenable.Therefore, I am of the view that the Ombudsman is entitled toentertain complaint at the instance of any person who has grievanceagainst the Bank and he not be a customer of that Bank and thereforethe complaint filed by the said Mr.R.Lakshmanan cannot be said to bebarred under the provisions of the Scheme. https://hcservices.ecourts.gov.in/hcservices/

15. Having held that the Ombudsman has jurisdiction to lodge thecomplaint, the next issue to be seen is whether Mr.R.Lakshman haslocus standi to maintain the complaint. As stated above, Clause 16(1) of the Scheme empowers any person who has grievance against theBank may himself or through an authorised representative make acomplaint in writing to the Banking Ombudsman within whosejurisdiction the branch or office of the bank complained against islocated. Therefore, it cannot be said that Mr.R.Lakshman has nolocus standi to lodge the complaint, as he would fall within themeaning of the expression “any person”. 16. Next, it has to be seen whether the direction issued by theOmbudsman is within the ambit of authority of the Ombudsman andwhether it is in consonance with the procedure of disposal of suchcomplaint in accordance with Clause 16. It is to be noted that thecomplaint pertains to an operation in a Bank account with therespondent Bank. It is not in dispute that Mrs.V.Indira Stephen isan employee of the Bank and employed in Mount Road Branch and availedhousing loan in Nungambakkam Branch. The cheque in question wasdrawn by M/s. Pappu Benefit Fund Ltd., in favour of Indian OverseasBank a/c of Mrs.V.Indira Stephen. It is not in dispute that, on theday when the said cheque was presented before the Indian OverseasBank, Nungambakkam Branch M/s.V.Indira Stephen did not have a savingsaccount and there was only loan account. Therefore, it is contendedby Mr.R.Lakshmanan that the cheque in question was intended to closethe housing loan account availed by Mrs.Indira Stephen in theNungambakkam Branch and that he had obtained the said amount fromM/s. Pappu Benefit Fund Ltd., and it is on the understanding betweenthe Mr.Lakshman and Mrs.V.Indira Stephen such cheque was drawn insuch a manner. 17. However, the said Mr.R.Lakshmanan did not impleadMrs.V.Indira Stephen or M/s.Pappu Benefit Fund Ltd., as respondentsbefore the Ombudsman. Undoubtedly, both these persons were proper andnecessary parties to the proceedings. Therefore in my view, theOmbudsman committed gross error in proceeding with the complaintwithout issuing notice and hearing proper and necessary parties.Thus, on this ground itself, the award ought to be rendered as notbinding on persons who were not impleaded as respondents. 18. Further in terms of Clause 16(3)(d), no complaint to theBanking Ombudsman shall lie unless the complaint is not the subjectmatter, for which any proceedings before any Court, Tribunal orArbitrator or any other forum is pending or a degree or Award ororder of dismissal has already been passed. In the instant case, inrespect of the same instrument, the said Mr.R.Lakshman filed acriminal complaint before the Crime Branch, Chennai and the complaintsaid to have lodged on 18.9.1997. However on the date of filing the https://hcservices.ecourts.gov.in/hcservices/ complaint before the Ombudsman i.e., on 29.8.1997, a criminalcomplaint was not pending as it had been lodged subsequently i.e., on18.9.1997. In such circumstances, by considering the scope of Clause16(3)(d), the Ombudsman ought not to have proceeded further since thesame subject matter was pending before another forum. This view issupported by the judgment of the Hon'ble Supreme Court in Durga HotelComplex Vs. Reserve Bank of India and Others reported in 2007 (5) SCC120 and the Hon'ble Supreme Court while considering the stage atwhich the bar of jurisdiction could operate and held as follows:-“12. It is clear that when the appellant invoked thejurisdiction of the Banking Ombudsman, the respondent Bank hadnot approached the Debts Recovery Tribunal with its applicationfor recovery of the amounts due under the loan transaction.Therefore, this was a case where on the day the complaint wasfiled, no proceeding before any Tribunal on the subject-matterwas pending or in which a final order had been passed ordecision rendered. At the stage of initiation, there was noimpediment in the way of the Ombudsman in entertaining thecomplaint or in proceeding with it. The impediment, if any, wascaused by the Bank's subsequent filing of O.A No.157 of 2000before the Debts Recovery Tribunal. The High Court has takenthe view that since by the time the Ombudsman rendered thisaward, the Bank had already approached the Debts RecoveryTribunal with its claim under the Recovery of Debts Act, theBanking Ombudsman did not have jurisdiction to render the award,or has lost his jurisdiction to render the award. Clause 16 ofthe Scheme in sub-clause (1) speaks of a person making acomplaint in writing to the Banking Ombudsman. Clause (3) readin conjunction with sub-clause(d) indicates that no complaint tothe Banking Ombudsman shall lie if on the subject-matter that isput forward before the Ombudsman, there is a proceeding pendingbefore a court, arbitrator, tribunal or forum or a decree orfinal adjudication had earlier been made by any one of them.This would suggest that the bar is attracted only when on thedate of the filing of the complaint before the Ombudsman, aclaim on the subject-matter is pending before, say, the DebtsRecovery Tribunal. Here admittedly, on the day the jurisdictionof the Banking Ombudsman was invoked, no such claim was pendingbefore any court, arbitrator, the Debts Recovery Tribunal or anyother forum. To that extent, prima facie, there is merit in thecontention that clause 16(3) may not be attracted to the case onhand.13.Clause 16(3) of the Scheme says, “ No complaint to theBanking Ombudsman shall lie.” According to Black's LawDictionary “lie” means, “to have foundation in the law; to belegally supportable, sustainable, or proper”. In the context ofthe power conferred on the Ombudsman by the Scheme read in the https://hcservices.ecourts.gov.in/hcservices/ light of Section 35-A of the Banking Regulation Act, it would beappropriate to understand the expression as having a foundationin law in the sense that the claim must have a foundation inlaw. A Banking Ombudsman, though might initially havejurisdiction to entertain a complaint on the basis that it has alegal foundation, here in terms of the Scheme, he may bedivested of that jurisdiction or the foundation in law might belost on either of the parties approaching the court, thearbitrator or the Debts Recovery Tribunal in respect of the samesubject-matter. Dealing with the expression “entertain” thisCourt held in Lakshmiratan Engg. Works Ltd. V. CST that it meansto deal with or admit to consideration. The Court approved theviews expressed by some of the High Courts that the word“entertain” meant not “receive” or “accept” but “proceed toconsider on merits” or adjudicate upon. The Court also acceptedthe dictionary meaning of the word as “admit to consider”. Thiswas also the view that was subsequently taken by this Court inHindusthan Commercial Bank Ltd. v. Punnu Sahu. It was held thattherein that the expression “entertain” in Order 21 Rule 90 ofthe Code meant, to “adjudicate upon” or to “proceed to consideron merits” and not “initiation of proceeding” along. Drawing ananalogy, it is possible to say that the complaint must continueto have a foundation in law at the time the Ombudsman takes upthe claim for his consideration and renders his decision oraward. The foundation would be lost when a court, arbitrator,tribunal or any other competent forum is moved on the samesubject-matter. When the subject-matter of the complaint istaken to any other competent forum, the complaint loses itsfoundation in law. In other words, the subject-matter of thecomplaint should not be pending in any other tribunal, or courtor before an arbitrator not merely when it is filed but alsowhen it is taken up for consideration and disposal.”(emphasis supplied) 19. Thus, in view of the law declared by the Hon'bleSupreme Court, the bar under Clause 16(3)(d) in the instant case hasoccurred subsequent to the filing of the complaint before theOmbudsman since the criminal complaint came to be given on the samesubject matter on 18.9.1997 by Mr.R.Lakshmanan himself. However,there is no record to show whether this fact was brought to thenotice of this Ombudsman by the complainant himself. Had the properand necessary parties been impleaded before the Ombudsman, this factwould have come to the notice of the Ombudsman. In any event, thefact that such criminal complaint was pending before the appropriateforum and which also subsequently came to be registered asC.C.No.9562/1999 on the file of the learned Additional ChiefMetropolitan Magistrate, Egmore, Chennai-8 for the offence undersection 420 I.P.C. It has to be necesssarily held that the complaintbefore the Ombudsman loses its foundation and the jurisdiction of the https://hcservices.ecourts.gov.in/hcservices/ Ombudsman had been taken away on and after that stage. Therefore, theOmbudsman stands statutorily barred from proceedings further. 20. Further, it is seen that certain directions have beenissued by the Ombudsman to the Bank to effect payment in favour ofthe complainant Mr.R.Lakshmanan or in the alternative to refund themoney to M/s. Pappu Benefit Fund Ltd. In my view, such directionsare beyond the jurisdiction of the Ombudsman more so in the absenceof proper and necessary parties having been made parties to theproceedings. Whether there was a civil transaction relating topurchase of a property between Mr.R.Lakshmanan and Mrs.V.IndiraStephen is a question of fact which is now being disputed. Whetherat the instance of the said Mr.R.Lakshmanan, M/s. Pappu Benefit FundLtd., released the amount and issued the cheque favouring IndianOversees Bank account of Mrs.V.Indira Stephen is also a disputedquestion of fact. Further, was there any civil transaction betweenMr.R.Lakshmanan and Mrs.V.Indira Stephen in respect of the immovableproperty in question or as to whether any third parties were involvedin the matter are also disputed question of fact. These aspectsobviously cannot be adjudicated by the Ombudsman and they would allfall outside the ambit of authority as enumerated under Clause 13 ofthe Scheme. Therefore, I am of the view that the award passed by theOmbudsman is not sustainable. However, it is always open to theparties to work out their rights before the competent forum and ifsuch proceedings are initiated, it is needless to state that suchforum shall independently decide the issue based on oral anddocumentary evidence without being in any manner influenced by theobservations of this Order.21.Therefore, W.P.No.6483/2001 and W.P.No.8062/2007 are allowedand W.P.No.19008/1998 is dismissed. There shall be no order as tocosts.22. W.P.No.8061/2007, this writ petition has been filed byMrs.V.Indira Stephen questioning the departmental charge memo dated26.2.1998. The main ground on which the writ petition has been filedis that the Bank has initiated departmental proceedings on the sameset of charges as that of the charge in the criminal case and thesame ended in an acquittal before Criminal Court in C.C.No.9562/1998dated 14.5.2004 on the file of the Additional Chief MetropolitanMagistrate, Egmore, Chennai-8 and since the charge sheet issued bythe Bank has been issued based on same set of allegations the Bankcannot proceed further in the epartmental charge sheet. 23.In the departmental charge, a statement of imputations ofmisconduct has been mentioned wherein there are fifteen allegations.A perusal of such allegations clearly reveals that, it not onlypertains to the cheque in question which was the subject matter ofthe complaint before the Ombudsman and the criminal case, but https://hcservices.ecourts.gov.in/hcservices/ pertains to various other allegations which prima facie appears to beserious. In fact the allegations 1 to 4 pertains to the validity ofthe title of the property which is the subject matter of mortgagewith the Bank. The said allegations reads as follows:“1. On 11.2.1995, you have availed a staff housing loan ofRs.2,13,100/- (Rs.1,42,100/- as SHL and Rs.71,000/- as Term Loanfor housing) at out Nungambakkam Branch for purchase of a houseat RS No.468/11 and 469(part), Shenoy Road, Nungambakkam,Madras-600 034 and in this connection you have wilfully enteredinto a conspiracy with one Mrs.A.Philomina and/or one Mr.AnwarBasha who impersonated as power of attorney holder of the ownerby entering into an unauthorised 'Agreement for sale' dated6.12.1994 and later got the 'sale deed' executed on 15.12.1995for the above property by the aforesaid Mr.Anwar Basha which isreported to be a fraudulent transaction.2. You have wilfully and with malafide intention depositedthe original title deed (sale deed 15.12.1995 referred above)with the branch with an intention to secure the staff housingloan of Rs.2,13,100/- available by you as above. The fraudulentnature of the transfer of the ownership of the property has leftthe staff housing loan availed by you without the backing of anysecurity.3. You have wilfully and with malafide intention failed todisclose to the Bank the fact of your defective title to theproperty and/or non possession of the property by you before orafter availing the staff housing loan and/or mortgaging the samein favour of the Bank.4. You have failed to safeguard the interest of the Bank inthe said property purchased under Staff Housing Loan and toobtain possession thereof.”24. Based on this statement of imputations of misconduct, fourcharges have been framed against the petitioner under Clause 17.5.(d), 17.5.(e), 17.5.(j) of the Bi-partite Settlement dated 14.12.1966between the Bank and its workmen. On these, the petitioner has beendirected to show cause in writing as to any disciplinary actionshould not be taken. However, the petitioner without submitting herexplanation to the charge, has sought for adjournment of theproceedings requesting for copies of the order passed by theOmbudsman. Thereafter, it is seen that notice of enquiry was issuedfixing the enquiry on 10.1.2007. On receipt of notice of enquiry,the petitioner has given a representation on 7.1.2007 stating thatthe union representatives are out of station and hence the enquirymay be adjourned to some other date after 1st week of February 2007.The request has been complied with and the enquiry was postponed to https://hcservices.ecourts.gov.in/hcservices/

8.2.2007 and thereafter the petitioner as filed the present writpetition. 25. As stated above, the departmental charge sheet is notidentical to that of the charge in the criminal case. The statementof imputations encompasses other allegations against the petitioner.Therefore merely because the petitioner has been acquitted in thecriminal case would not be a ground to quash the departmental chargesheet. It is necessary for the authority to go into the aspects asregards the fact of the criminal copy judgment on the departmentalproceedings. These issues cannot be adjudicated in the present writpetition and it is for the petitioner to submit her explanation tothe charge memo and thereafter the competent authority has to decidethe same in the departmental enquiry. It is to be noted thatMrs.V.Indira Stephen is an employee of the Bank and the Bank has tonecessarily conduct an enquiry into the matter, since the samepertains to matters concering the internal working of the Bank. Theacquittal in criminal case will not automatically set aside thepunishment or would not automatically render the Department chargememo as redundant. Further there could be no rigid or inflexiblerule that the finding of a Criminal Court is conclusive in everysense upon the Disciplinary Authority. The Hon'ble Supreme Court inthe following judgments have decided the effect of an acquittal by aCriminal Court on Department proceedings as held as follows:(i) in Ajit Kumar Nag V. General Manager(PJ), Indian Oil Corpn Ltd.,Haldia and Others reported in (2005) 7 SCC 764 "As far as acquittal of the appellant by a criminal courtis concerned, in our opinion, the said order does not precludethe Corporation from taking an action if it is otherwisepermissible. In our judgment, the law is fairly well settled.Acquittal by a criminal court would not debar an employer fromexercising power in accordance with the Rules and Regulations inforce. The two proceedings, criminal and departmental, areentirely different. They operate in different fields and havedifferent objectives. Whereas the object of criminal trial isto inflict appropriate punishment on the offender, the purposeof enquiry proceedings is to deal with the delinquentdepartmentally and to impose penalty in accordance with theservices rules. In a criminal trial, incriminating statementmade by the accused in certain circumstances or before certainofficers is totally inadmisible in evidence. Such strict rulesof evidence and procedure would not apply to departmentalproceedings. The degree of proof which is necessary to order aconviction is different from the degree of proof necessary torecord the commission of delinquency. The rule relating toappreciation of evidence in the two proceedings is also notsimilar. In criminal law, burden of proof is on the prosecutionand unless the prosecution is able to prove the guilt of theaccused "beyond reasonable doubt", he cannot be convicted by a https://hcservices.ecourts.gov.in/hcservices/ court of law. In a departmental enquiry, on the other hand,penalty can be imposed on the deliquent officer on a findingrecorded on the basis of "preponderance of probability".Acquittal of the appellant by a Judicial Magistrate, therefore,does not ipso facto absolve him from the liability under thedisciplinary jurisdiction of the Corporation. We are,therefore, unable to uphold the contention of the appellant thatsince he was acquitted by a criminal court, the impugned orderdismissing them from service deserves to be quashed and setaside"(ii) in Depot Manager, Andhra Pradesh State Board TransportCorporation Vs. Mohd. Yousuf Miya Etc., reported in 1996 (9) Scale 65"The purpose of departmental enquiry and of prosecution aretwo different and distince aspects. The criminal prosecution islaunched for an offence in violation of a duty the offender owesto the society or for breach of which law has provided that theoffender shall make satisfaction to the public. So crime is anact of commission in violation of law or of commission of publicduty. The departmental enquiry is to maintain discipline in theservice and efficiency of public service. It would, therefore,be expedient that the disciplinary proceedings are conducted andcompleted as expeditiously as possible. It is not, therefore,desirable to lay down any guidelines as inflexiblel rules inwhich the departmental proceedings may or may not be stayedpending trial in criminal case against the deliquent officer.Each case requires to be considered in the backdrop of its ownfacts and circumstances. There would be no bar to proceedsimultaneously with departmental enquiry and trial of a criminalcase unless the charge in the criminal trial is of grave natureinvolving complicated questions of fact and law. Offencegenerally implies infringement of public, as distinguished frommere private rights punishable under criminal law. When trialfor criminal offence is conducted it should be in accordancewith proof of the offence as per the evidence defined under theprovisions of the Evidence Act. Converse is the case ofdepartmental enquiry. The enquiry in a departmental proceedingsrelates to conduct or breach of duty of the delinquent officerto punish him for his misconduct defined under the relevantstatutory rules of law. That the strict standard of proof ofapplicability of the Evidence Act stands excluded is a settledlegal position. The enquiry in the departmental proceedingsrelates to the conduct of the delinquent officer and proof inthat behalf is not as high as in offence in criminal charge. Itis seen that invariably the departmental enquiry has to beconducted expeditiously so as to effectuate efficiency in publicadministration and the criminal trial will take its own course.The nature of evidence in criminal trial is entirely differentfrom the departmental proceedings. In the former, prosecutionis to prove its case beyond reasonable doubt on the touchstone https://hcservices.ecourts.gov.in/hcservices/ of human conduct. The standard of proos in the departmentalproceedings is not the same as of the criminal trial. Theevidence also is different from the standard point of EvidenceAct. The evidence required in the departmental enquiry is notregulated by Evidence Act. Under these circumstances, what isrequired to be seen is whether the departmental enquiry wouldseriously prejudice the delinquent in his defence at the trialin a criminal case. It is always a question of fact to beconsidered in each case depending on its own facts andcircumstances. In this case, we have seen that the charge isfailure to anticipate the accident and prevention thereof. Ithas nothing to do with the culpability of the offence undersections 304A and 338 of the I.P.C. Under these circumstances,the High Court was not right in staying the proceedings.26. The award of the Banking Ombudsman has been set aside ontechnical grounds viz., that proper and necessary parties were notimpleaded to the proceedings, and that a criminal complaint waspending, as a result of which the jurisdiction of the Ombudsman stooddivested in terms of Clause 16(3)(d) of the Scheme, the allegationsand averrments made by the complainant Mr.R.Lakshmanan against thepetitioner herein are disputed questions of fact which could not havebeen gone into by the Ombudsman without impleading proper andnecessary parties and causing an enquir into those facts would beoutside the scope of his ambit of authority under Clause 13. Sincethe award of the Ombudsman has been quashed on these technicalgrounds, the factual details available with the Bank which has beenthe basis for the departmental charge sheet could very well be goneinto and the petitioner should have sufficient opportunity to rebuttthe allegations made against her and defend herself in thedepartmental enquiry. Therefore it is made clear that the Bank isentitled to enquire into the entire charge sheet and during thecourse of enquiry the effect of the present in the criminal case onthe Departmental charge shall also be considered.27. For the above reasons, W.P.No.8061/2007 challenging thecharge memo fails and accordingly the same is dismissed. Thepetitioner is granted three weeks time to submit her explanation tothe charge sheet and thereafter the respondent Bank shall proceedwith the enquiry in accordance with law. JvmSd/-Asst. Registrar//True Copy//Sub Asst. Registrar https://hcservices.ecourts.gov.in/hcservices/ To1.The Chief Manager, Indian Overseas Bank Nungambakkam Branch, 109, Nungambakkam High Road, Chennai-600 034.2.Chairman cum Managing Director, Indian Overseas Bank, Mount Road, Chennai-600 0023.Reserve Bank of India, Department of Supervision, Mumbai4.Banking Ombudsman (Tamil Nadu Union Territories of Pondicherry and Andaman Nicobar Islands), Challa Mall, 8th Floor, 11/11A, Sir Theagaraya Road, T.Nagar, Chennai-600 0-175.The Banking Ombudsman Reserve Bank of India Second Floor, Fort Glacis, Post Box No.40, Rajaji Salai, Chennai-600 001.+ 1 cc to Mr. T.Ravikumar, Advocate SR No.57607+ 1 cc to Mr. S. Ramesh Kumar, Advocate SR No.57675KK(CO)SR/3.11.2009 OrderW.P.No.19008/1998, W.P.No.6483/2001W.P.No.8061/2007 & W.P.No.8062/2007