# THE CHAIRMAN, STATE BANK OF INDIA AND ANOTHER v. M. J. JAMES

- **Citation:** [2021] 7 S.C.R. 373
- **Court:** Supreme Court of India
- **Decided:** 2021-11-16
- **Case number:** Civil Appeal No. 8223 of 2009
- **Bench:** L. Nageswara Rao, Sanjiv Khanna
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/the-chairman-state-bank-of-india-and-another-v-m-j-james-34916
- **Pages:** 30

## Headnote

Bank of Cochin Service Code: Clause 22(ix)(a) Chapter VIII
- Violation of - Disciplinary proceedings against the Bank Manager
for sanctioning advances in violation of the Head Office instructions
causing financial loss to the Bank - Bank manager not allowed to
be represented by an office bearer of an employees association of
another organisation - Thereafter, Manager dismissed from service
- Challenge to, after almost four and a half years - Both the Single
Judge as also the Division Bench of the High Court quashed the
disciplinary proceedings against the Bank Manager - On appeal,
held: Observations and findings in the disciplinary proceedings on
the aspect of irregularities regarding exceeding his authority in the
grant of advances, clear and undisputed - Bank Manager was aware
that his request to be represented by a representative of his own
choice had been rejected - Even then he took time and decided not
to file an appeal before the Board of Directors against the order of
the inquiry officer rejecting his request - On the alibi, the Manager
did not furnish any details or particulars of cases or instances and
had refused to lead evidence - As per Clause 22(ix)(a), an officer
can also be permitted to be defended by a representative of a
registered union/association of 'bank' employees, which means an
union/association of the employees of the Bank of Cochin and not
of any or other banks - Provision does not stipulate that the
employee requires permission from any authority or the inquiry
officer for representation - Furthermore, the dismissal order
remained unchallenged for more than four years - Though the
Service Code does not stipulate any time period within which the
appeal may be preferred but it should be within a reasonable time
depending upon the facts and circumstances of each case - Right
not exercised for a long time is non-existent - Doctrine of delay
and laches as well as acquiescence are applied to non-suit such
litigants - In the instant case, challenge to the order of dismissal
[2021] 7 S.C.R. 373
373
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from service by way of appeal was after four years, which was
highly belated and beyond justifiable time - Court is to consciously
examine whether a party has chosen to sit over the matter and has
woken up to gain any advantage and benefit - These facets, when
proven, must be factored and balanced, even when there is delay
and laches on the part of the authorities - Studied silence of the
respondent, was with an ulterior motive as he wanted to take benefit
of the slipup though he had suffered dismissal - Thus, the judgment
passed by the High Court is set aside and the order of dismissal is
upheld - Service law.
Clause 22(ix)(a), 2(e) - Object of definition clauses - Held:
Is to avoid frequent repetition in describing the subject matter to
which the word or expression is intended to apply - This is useful
when the same word or expression is used more than once in the
same enactment - Definition can be with the intent to attract a
meaning already established by law; expand the meaning by adding
a meaning; or narrow the meaning by exclusion - Repugnancy will
arise when the definition meaning does not agree with the subject
in the context - On facts, repugnancy not indicated and does not
arise in the context of Clause 22(ix)(a) by mere absence of article
'the' in Clause 22(ix)(a) before the word 'bank'.
Inquiry: Domestic inquiry - Choice of representation - Right
of - Held: Right to be represented by a counsel or agent of one's
choice is not an absolute right but can be controlled or regulated
by law, rules, or regulations - However, if the charge is of severe
and complex nature, then the request to be represented through a
counsel or agent should be considered - Said proposition flows
from the entitlement of fair hearing, applicable in judicial as well
as quasi-judicial decisions.
'Acquiescence' and 'delay and laches' - Distinction between
- Held: Doctrine o

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THE CHAIRMAN, STATE BANK OF INDIA AND ANOTHER
v.
M. J. JAMES
(Civil Appeal No. 8223 of 2009)
NOVEMBER 16, 2021
[L. NAGESWARA RAO AND SANJIV KHANNA, JJ.]
Bank of Cochin Service Code: Clause 22(ix)(a) Chapter VIII
- Violation of - Disciplinary proceedings against the Bank Manager
for sanctioning advances in violation of the Head Office instructions
causing financial loss to the Bank - Bank manager not allowed to
be represented by an office bearer of an employees association of
another organisation - Thereafter, Manager dismissed from service
- Challenge to, after almost four and a half years - Both the Single
Judge as also the Division Bench of the High Court quashed the
disciplinary proceedings against the Bank Manager - On appeal,
held: Observations and findings in the disciplinary proceedings on
the aspect of irregularities regarding exceeding his authority in the
grant of advances, clear and undisputed - Bank Manager was aware
that his request to be represented by a representative of his own
choice had been rejected - Even then he took time and decided not
to file an appeal before the Board of Directors against the order of
the inquiry officer rejecting his request - On the alibi, the Manager
did not furnish any details or particulars of cases or instances and
had refused to lead evidence - As per Clause 22(ix)(a), an officer
can also be permitted to be defended by a representative of a
registered union/association of 'bank' employees, which means an
union/association of the employees of the Bank of Cochin and not
of any or other banks - Provision does not stipulate that the
employee requires permission from any authority or the inquiry
officer for representation - Furthermore, the dismissal order
remained unchallenged for more than four years - Though the
Service Code does not stipulate any time period within which the
appeal may be preferred but it should be within a reasonable time
depending upon the facts and circumstances of each case - Right
not exercised for a long time is non-existent - Doctrine of delay
and laches as well as acquiescence are applied to non-suit such
litigants - In the instant case, challenge to the order of dismissal
[2021] 7 S.C.R. 373
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from service by way of appeal was after four years, which was
highly belated and beyond justifiable time - Court is to consciously
examine whether a party has chosen to sit over the matter and has
woken up to gain any advantage and benefit - These facets, when
proven, must be factored and balanced, even when there is delay
and laches on the part of the authorities - Studied silence of the
respondent, was with an ulterior motive as he wanted to take benefit
of the slipup though he had suffered dismissal - Thus, the judgment
passed by the High Court is set aside and the order of dismissal is
upheld - Service law.
Clause 22(ix)(a), 2(e) - Object of definition clauses - Held:
Is to avoid frequent repetition in describing the subject matter to
which the word or expression is intended to apply - This is useful
when the same word or expression is used more than once in the
same enactment - Definition can be with the intent to attract a
meaning already established by law; expand the meaning by adding
a meaning; or narrow the meaning by exclusion - Repugnancy will
arise when the definition meaning does not agree with the subject
in the context - On facts, repugnancy not indicated and does not
arise in the context of Clause 22(ix)(a) by mere absence of article
'the' in Clause 22(ix)(a) before the word 'bank'.
Inquiry: Domestic inquiry - Choice of representation - Right
of - Held: Right to be represented by a counsel or agent of one's
choice is not an absolute right but can be controlled or regulated
by law, rules, or regulations - However, if the charge is of severe
and complex nature, then the request to be represented through a
counsel or agent should be considered - Said proposition flows
from the entitlement of fair hearing, applicable in judicial as well
as quasi-judicial decisions.
'Acquiescence' and 'delay and laches' - Distinction between
- Held: Doctrine of acquiescence is an equitable doctrine which
applies when a party having a right stands by and sees another
dealing in a manner inconsistent with that right - Acquiescence
virtually destroys the right of the person - However, both limitation
and laches destroy the remedy but not the right - Laches like
acquiescence is based upon equitable considerations, but laches
unlike acquiescence imports even simple passivity - On facts,
inactive acquiescence on the part of the Bank Manager can be
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inferred till the filing of the appeal, and not for the period post
filing of the appeal - Nevertheless, this acquiescence being in the
nature of estoppel bars the Bank Manager from claiming violation
of the right of fair representation.
Administrative law: Statutory authority - Non-performance
of duty - Defence of delay and laches - Held: When the statutory
authority does not perform its duty within a reasonable time, the
same cannot be justified by taking the plea that the person deprived
of his rights has not approached the appropriate forum for relief -
Statutory authority cannot take the defence of laches and delay.
Allowing the appeal, the Court
HELD: 1.1 The judgment under challenge seems to have
overlooked the implications of clause 2(e) of the Bank of Cochin
Service Code. The objective of definition clauses is to avoid
frequent repetition in describing the subject matter to which the
word or expression is intended to apply. This is useful when the
same word or expression is used more than once in the same
enactment. The raison d'etre behind the definition clause is that
while interpreting a provision, the defined word or expression
would carry the same meaning as the defined words or expression
are employed and used by the maker in the sense appropriate to
the definition. The definition can be with the intent to attract a
meaning already established by law; expand the meaning by
adding a meaning; or narrow the meaning by exclusion. This
general rule of construction laid down by the enactment is subject
to the context. Albeit, the interpreter, to deviate from the defined
meaning, should record reasons to show that the word/expression
in that particular provision carries a different meaning. Contrary
context is not to be assumed or accepted easily, in the absence
of indication and reason to differ from the defined meaning. The
repugnancy will arise when the definition meaning does not agree
with the subject in the context. Repugnancy is not indicated and
does not arise in the context of Clause 22(ix)(a) of Chapter VIII
of the Service Code by mere absence of article 'the' in Clause
22(ix)(a) before the word 'bank', as held in the impugned
judgment. This is too weak and feeble a reason to discard and
over-ride the defined meaning which is the general norm, and
not an exception that has to be justified. Deficiency of 'the' does
THE CHAIRMAN, STATE BANK OF INDIA AND ANOTHER v.
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not disclose abandonment of the express definition of 'bank' vide
clause 2(e) of the Service Code. Absurdity or even ambiguity is
not obvious or even palpable. The word 'bank' in Clause 22(ix)(a)
can be validly and effectively interpreted as per the definition
clause as referring to the Bank of Cochin Ltd., and not any or
other bank(s). Therefore, the reasoning solely predicated on nonexistence of article 'the' before 'bank' in Clause 22(ix)(a) of the
Service Code does not justify inference of repugnancy in the
context of the subject- matter, including the intent behind Clause
22(ix)(a) of the Service Code. [Para 18, 19][389-E-H; 390-A-E]
Nahalchand Laloochand Private Ltd. v. Panchali Coop.
Housing Society Ltd. (2010) 9 SCC 536 : [2010] 10
SCR 804; Bhagwati Developers Pvt. Ltd. v. Peerless
General Finance and Investment Co. Ltd. & Anr. (2013)
9 SCC 584 : [2013] 7 SCR 547; Crescent Dyes and
Chemicals Ltd. v. Ram Naresh Tripathi (1993) 2 SCC
115 : [1992] 3 Suppl. SCR 559; National Seeds
Corporation Ltd. v. K.V. Rama Reddy (2006) 11 SCC
645 : [2006] 6 Suppl. SCR 725; Dharampal Satyapal
Ltd. v. Deputy Commissioner of Central Excise, Gauhati
and Others (2015) 8 SCC 519 : [2015] 6 SCR 437;
A.K. Kraipak and Others v. Union of India and Others
(1969) 2 SCC 262 : [1970] 1 SCR 457; State Bank of
Patiala and Others v. S.K. Sharma (1996) 3 SCC 364 :
[1996] 3 SCR 972; M.C. Mehta v. Union of India and
Others (1999) 6 SCC 237 : [1999] 3 SCR 1173; S.L.
Kapoor v. Jagmohan and Others (1980) 4 SCC 379 :
[1981] 1 SCR 746; State of U.P. v. Sudhir Kumar Singh
and Others (2020) SCC Online SC 847 - referred to.
Bennion on Statutory Interpretation, Indian Reprint,
Sixth Edition - referred to.
1.2 The right to be represented by a counsel or agent of
one's choice is not an absolute right but one which can be
controlled, restricted, or regulated by law, rules, or regulations.
However, if the charge is of severe and complex nature, then the
request to be represented through a counsel or agent should be
considered. The said proposition flows from the entitlement of
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fair hearing, which is applicable in judicial as well as quasi-judicial
decisions. [Para 20][391-C-E]
1.3 The respondent was aware that his request to be
represented by a representative of his own choice had been
rejected. Even then he took time and decided not to file an appeal
before the Board of Directors against the order of the inquiry
officer rejecting his request. He allowed the inquiry proceedings
to continue and then filed an application for production of
documents. When asked about relevancy, his stance was he had
his own reasons on how the documents were relevant. In spite of
ample opportunity, the respondent did not adduce evidence or
examine witnesses, and abruptly stood up and walked out.
Observations and findings in the disciplinary proceedings on the
aspect of irregularities regarding exceeding his authority in the
grant of advances, acceptance of discovery bills and the issue of
bank guarantees etc. are clear and remain uncontroverted. The
respondent's defence in the form of alibi that he had followed the
oral instructions of the then Chairman and the Director, which is
of questionable merit, is to be rejected as unproven. On this aspect
somewhat reflecting on merits, the Single Judge had observed
that the allegations if proven constitute gross misconduct,
warranting punishment of dismissal. The Division Bench has not
commented on this aspect, but has made observations assuming
prejudice was caused, which reasoning cannot be sustained. The
judgments under challenge do not consider the effect of the
defence pleaded by the respondent and whether there was no
effective denial. Conduct of the respondent, including the
opportunities granted during the departmental proceedings, have
gone unnoticed. On the alibi, the respondent did not furnish any
details or particulars of cases or instances and had refused to
lead evidence. Clause 22(ix)(a), as worded, envisages that an
employee against whom disciplinary action is proposed would be
served with memorandum of charges, be given sufficient time to
prepare and present his explanation and produce evidence which
he may wish to render in his defence. He is permitted to appear
before the officer conducting the inquiry, cross-examine the
witnesses and produce other evidence in his defence. Further,
the officer can also be permitted to be defended by a
representative, who must be a representative of a registered
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union/association of 'bank' employees, which means an union/
association of the employees of the Bank of Cochin and not
association of employees of any or other banks. Notably, the
provision does not stipulate that the employee requires
permission from any authority or the inquiry officer for
representation by a representative of a registered union or
association of the Bank of Cochin. Such permission is required if
an employee wants a lawyer to represent him/her in the
disciplinary proceedings. In this case, contrary to the observations
in the impugned judgment by the Division Bench, the respondent
had never prayed or sought permission to be represented by a
lawyer. This is despite the respondent being aware of the
professional status of the inquiry officer and the presenting officer.
[Para 26][396-B-H; 397-A-C]
1.4 The dismissal order passed on 18.04.1985 remained
unchallenged for more than four years, as the appeal to the Chief
General Manager of the State Bank of India was filed on
20.09.1989. The respondent, however, relies on Clause 22(x) of
the Service Code relating to appeals. Undoubtedly, the Service
Code does not stipulate any time period within which the appeal
may be preferred to the Board of Directors whose decision is to
be final, but it is well settled that no time does not mean any
time. The assumption is that the appeal would be filed at the
earliest possible opportunity. However, the appeal should be filed
within a reasonable time. What is a reasonable time is not to be
put in a straitjacket formula or judicially codified in the form of
days etc. as it depends upon the facts and circumstances of each
case. A right not exercised for a long time is non-existent.
Doctrine of delay and laches as well as acquiescence are applied
to non-suit the litigants who approach the court/appellate
authorities belatedly without any justifiable explanation for
bringing action after unreasonable delay. In the instant case,
challenge to the order of dismissal from service by way of appeal
was after four years and five months, which is certainly highly
belated and beyond justifiable time. Without satisfactory
explanation justifying the delay, it is difficult to hold that the appeal
was preferred within a reasonable time. Pertinently, the challenge
was primarily on the ground that the respondent was not allowed
to be represented by a representative of his choice. The
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respondent knew that even if he were to succeed on this ground,
as has happened in the writ proceedings, fresh inquiry would not
be prohibited as finality is not attached unless there is a legal or
statutory bar, an aspect which has been noticed in the impugned
judgment. This is highlighted to show the prejudice caused to
the appellants by the delayed challenge.[Para 27][397-C-H; 398A-B]
1.5 The appeal preferred by the respondent with the Chief
General Manager of the State Bank of India had remained
unattended for almost nine years. The appellants, it is apparent,
simply lost track and forgot that the service appeal was filed or
pending. The respondent was never an employee of the appellant's
bank as his services were terminated, nearly four months before
the Bank of Cochin, a private Bank, got amalgamated with the
State Bank of India. The appellants being at fault must bear the
burden and adverse consequences.[Para 28][398-B-D]
Ram Chand and Others v. Union of India and Others
(1994) 1 SCC 44 : [1993] 2 Suppl. SCR 558; State of
U.P. and Others v. Manohar (2005) 2 SCC 126 : [2004]
6 Suppl. SCR 911; Union of India and Others v. Tarsem
Singh (2008) 8 SCC 648 : [2008] 12 SCR 104; Motilal
Padampat Sugar Mills Co. Ltd. v. State of Uttar Pradesh
and Others (1979) 2 SCC 409 : [1979] 2 SCR 641;
U.P. Jal Nigam and Another v. Jaswant Singh and
Another (2006) 11 SCC 464 - referred to.
1.6 Doctrine of acquiescence is an equitable doctrine which
applies when a party having a right stands by and sees another
dealing in a manner inconsistent with that right, while the act is
in progress and after violation is completed, which conduct
reflects his assent or accord. He cannot afterwards complain. In
literal sense, the term acquiescence means silent assent, tacit
consent, concurrence, or acceptance, which denotes conduct that
is evidence of an intention of a party to abandon an equitable
right and also to denote conduct from which another party will be
justified in inferring such an intention. Acquiescence can be either
direct with full knowledge and express approbation, or indirect
where a person having the right to set aside the action stands by
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and sees another dealing in a manner inconsistent with that right
and inspite of the infringement takes no action mirroring
acceptance. However, acquiescence will not apply if lapse of time
is of no importance or consequence. [Para 29][400-B-E]
Prabhakar v. Joint Director, Sericulture Department and
Another (2015) 15 SCC 1 : [2015] 9 SCR 890; Gobinda
Ramanuj Das Mohanta v. Ram Charan Das and
Suyamal Das AIR 1925 Cal 1107; M/S Vidyavathi
Kapoor Trust v. Chief Commissioner Tax (1992) 194
ITR 584; Krishan Dev v. Smt. Ram Piari AIR 1964 HP
34 - referred to.
UN Mitra, Tagore Law Lectures - Law of Limitation
and Prescription, Volume I, 14TH Edition, 2016 -
referred to.
1.7 Laches unlike limitation is flexible. However, both
limitation and laches destroy the remedy but not the right. Laches
like acquiescence is based upon equitable considerations, but
laches unlike acquiescence imports even simple passivity. On
the other hand, acquiescence implies active assent and is based
upon the rule of estoppel in pais. As a form of estoppel, it bars a
party afterwards from complaining of the violation of the right.
Even indirect acquiescence implies almost active consent, which
is not to be inferred by mere silence or inaction which is involved
in laches. Acquiescence in this manner is quite distinct from delay.
Acquiescence virtually destroys the right of the person. Given
the said legal position, inactive acquiescence on the part of the
respondent can be inferred till the filing of the appeal, and not for
the period post filing of the appeal. Nevertheless, this
acquiescence being in the nature of estoppel bars the respondent
from claiming violation of the right of fair representation.[Para
30][400-E-G; 401-A-B]
1.8 The questions of prejudice, change of position, creation
of third-party rights or interests on the part of the party seeking
relief are important and relevant aspects as delay may obscure
facts, encourage dubious claims, and may prevent fair and just
adjudication. Often, relevant and material evidence go missing
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or are not traceable causing prejudice to the opposite party. It is,
therefore, necessary for the court to consciously examine whether
a party has chosen to sit over the matter and has woken up to
gain any advantage and benefit. These facets, when proven, must
be factored and balanced, even when there is delay and laches on
the part of the authorities. These have bearing on grant and
withholding of relief. Therefore, this Court has factored in the
aspect of prejudice to the appellants in view of the relief granted
in the impugned judgment.[Para 31][401-B-E]
M/s Dehri Rohtas Light Rly. Co. Ltd. v. District Board,
Bhojpur and Others (1992) 2 SCC 598 : [1992] 2 SCR
155; State of Maharashtra v. Digambar (1995) 4 SCC
683 : [1995] 1 Suppl. SCR 492 - referred to.
R. (on the application of Parkyn) v. Restormel BC [2001]
EWCA Civ 330; R. v. Monopolies and Mergers
Commission Ex p. Argyll Group [1986] 1 W.L.R. 763 -
referred to.
1.9 The relief as granted has serious financial repercussions
and would also prevent the appellants from taking further action,
which aspect has been noticed, though not finally determined in
the impugned judgment. The studied silence of the respondent,
who did not correspond or make any representation for nine years,
was with an ulterior motive as he wanted to take benefit of the
slipup though he had suffered dismissal. The courts can always
refuse to grant relief to a litigant if it considers that grant of relief
sought is likely to cause substantial hardship or substantial
prejudice to the opposite side or would be detrimental to good
administration. This principle of good administration is
independent of hardship, or prejudice to the rights of the third
parties and does not require specific evidence that this has in
fact occurred, though in relation to withholding relief some
evidence may be required. Relief should not be denied for mere
inconvenience but when the difficulty caused to the decision
maker approaches impracticability or when there is an overriding
need for finality and certainty. [Para 32][401-E-H; 402-A]
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1.10 The respondent had approached the High Court
through a writ petition whereby directions were issued vide for
consideration and disposal of the appeal, which, was interpreted
as a direction that the appeal should be decided on merits. One
can appreciate the predicament of the Chief General Manager
who had to adjudicate the appeal in terms of the direction of the
Constitutional Court and, thus, his reluctance to dismiss the
appeal on the ground of delay and laches. The appeal was
dismissed on merits. These aspects cannot be ignored as the
exercise of writ jurisdiction is always discretionary which has to
keep in view the conduct of the parties. [Para 33][402-B-D]
1.11 The dues payable to the respondent in terms of the
impugned judgment were released to him on furnishing security
to the satisfaction of the Chief General Manager. During the
course of hearing, it was stated that the amount released has
been kept in a fixed deposit. The payment released is directed
to be returned and restituted to the appellant bank without
interest within the stipulated period. [Para 34][402-D-E]
1.12 The impugned judgment is set aside and quashed. The
order of dismissal is upheld and consequently the writ petition
filed by the respondent would be treated as dismissed. [Para
35][402-F-G]
Case Law Reference
[2010] 10 SCR 804
referred to
Para 18
[2013] 7 SCR 547
referred to
Para 18
[1992] 3 Suppl. SCR 559
referred to
Para 20
[2006] 6 Suppl. SCR 725
referred to
Para 20
[2015] 6 SCR 437
referred to
Para 21
[1970] 1 SCR 457
referred to
Para 22
[1996] 3 SCR 972
referred to
Para 23
[1999] 3 SCR 1173
referred to
Para 24
[1981 1 SCR 746
referred to
Para 24
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[1993] 2 Suppl. SCR 558
referred to
Para 28
[2004] 6 Suppl. SCR 911
referred to
Para 28
[2008] 12 SCR 104
referred to
Para 28
[1979] 2 SCR 641
referred to
Para 28
(2006) 11 SCC 464
referred to
Para 28
[2015] 9 SCR 890
referred to
Para 29
AIR 1925 Cal 1107
referred to
Para 29
(1992) 194 ITR 584
referred to
Para 29
AIR 1964 HP 34
referred to
Para 29
[1992] 2 SCR 155
referred to
Para 31
[1995] 1 Suppl. SCR 492
referred to
Para 31
CIVIL APPELLATE JURISDICTION: Civil Appeal No.8223 of
2009.
From the Judgment and Order dated 09.12.2008 of the High Court
of Kerala at Ernakulam in Writ Appeal No.2052 of 2007.
Ms. Aishwarya Bhati, ASG, Buddy Ranganadhan, A. V. Rangam,
Advs. for the Appellants.
P. N. Ravindran, Sr. Adv., T. G. Narayanan Nair, Manish Nair,
Advs. for the Respondent.
The Judgment of the Court was delivered by
SANJIV KHANNA, J.
1. The Chairman, State Bank of India, Central Office, Mumbai,
and the Chief General Manager, State Bank of India, Local Head Office,
Chennai (the appellants) in this appeal assail the order and judgment
dated 09.12.2008 of the High Court of Kerala at Ernakulam dismissing
their intra-court writ appeal, W.A. No. 2052/2007. The Division
Bench,thereby, affirmed the order of the Single Judge in O.P No. 5527
of 1999 dated 14.03.2007, quashing the disciplinary proceedings against
Mr.M.J. James (the respondent) on the groundof violation of Clause
22(ix)(a) of Chapter VIII of the Bank of Cochin Service Code ("the
Service Code").
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2. Before we proceed further, we need to allude to the factual
background necessary for the disposal of the present appeal.
On 09.02.1984, a memorandum of charges was issued to the
respondent that while working as the bank manager of the Quilon branch
of the Bank of Cochinfrom February 1978 to September 1982, he had
committed grave misconduct by sanctioning advances in violation of the
Head Office instructions causing financial loss to the bank.The
respondent by the reply dated 30.03.1984 denied the charges stating
that there was substantial increase and growth in the business of the
bankwhen he was the manager of the Quilon branch. The deposits had
increased from Rs.20 lakh in 1978 to Rs. 1 crorein 1982, and the advances
had increased from Rs.1.5 crorein 1978 to Rs.6 crorein 1982. As the
bank manager of the Quilon branch, the respondent was aware that the
top management of the bank was contemplating a deep trust in advances
in view of the comfortable loanable fund availability. He had been asked
byMr. E.K. Andrew, former Chairman of the bank, to grant advances
without hesitation. He had got oral instructions from Mr. E.K. Andrew
to allow disbursement/drawings from most of the large accounts. Further,
the then Director, Mr. C.B. Joseph from the Quilon branch, was personally
involved as he had introduced the borrowers and most of the advances/
disbursements/drawings were made on his recommendation/
insistence.The respondent had claimed that the bank did not have a fool
proof system of delegation of financial and other powers to the branches
as powers were conferred on select managers. The respondent was
given to understand by the then Chairman and Director that he was
vested with adequate powers and the advances would be ratified by the
Board in due course.The functioning of the branch and the advances
were subjected to periodical inspections by the authorities, including the
Reserve Bank of India. The respondent had never been cautioned on
the pattern of business conducted by the branch. Subsequently, there
were changes in the top management, and abrupt restrictions were
introduced, affecting the recovery of the dues.
3. The aforesaid explanation of the respondent was not found to
be satisfactory, and an inquiry was directed to be held. Mr. C.T. Joseph,
a practising Advocate, was appointed as the inquiry officer. Mr. Jimmy
John was appointed as the presenting officer. The respondent claims
that Mr. Jimmy John is a former advocate.
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4. On 24.04.1984, the respondent wrote a letter to the Manager
(Personnel Department), Bank of Cochin,that he may be permitted to
engage services of Mr. F.B. Chrysostom (Syndicate Bank, Mattancherry,
Cochin), the Organising Secretary of the All-India Confederation of Bank
Officers Organisation, Kerala State Unit. The request was rejected.
Thereafter, the respondent wrote another letter to the inquiry officer on
18.07.1984 protesting the denial of permissionto be defended by
Mr. F.B. Chrysostom stating that this was against all norms of natural
justice and in clear violation of the Service Code. The inquiry officer,
however, disagreed and passed a ruling holding that in terms of the Service
Code, a charge-sheeted officer cannot be defended by an office-bearer
of any association or a union except an office-bearer of an association
or a union of the employees of the bank, that is,the Bank of Cochin Ltd.
To enable the respondent to prepare for representation, the inquiry officer
adjourned the proceedings to 06.07.1984 for the evidence of the
management. On 05.09.1984, the respondent requested a long
adjournment stating that he wanted to assail the order denying him
services of Mr. F.B. Chrysostom before the Board of Directors. While
the request for long adjournment was declined, the inquiry officer gave
the respondent two weeks to approach the Board and await their
directions, making it clear that no further adjournment would be granted.
On 20.09.1984, the respondent did not appear and sought postponement
of proceedings for one week on medical grounds through his brother.
This request was allowed, and the inquiry was posted to 28.09.1984.
5. On 28.09.1984, the respondent appeared and participated in
the inquiry in which statement of witnesses of the management were
recorded. The proceeding was adjourned to 06.10.1984 for the recording
of defence evidence. On 06.10.1984, the respondent requestedfor
directions to the management to produce documents as enumerated in
the list. The presenting officer objected. After due consideration, the
inquiry officer directed the respondent to specify the documents indicating
their relevancy in the context of his defence. On 17.10.1984, the
respondent again raised a request to furnish documents claiming that
they were specific inasmuch as he had stated the years to which the
returns relate. Further, the respondent had his own reasons on how these
documents were relevant for the inquiry.
6. The inquiry officer passed a detailed order considering
eachdocument and held that they were unnecessary and irrelevant.
THE CHAIRMAN, STATE BANK OF INDIA AND ANOTHER v.
M. J. JAMES [SANJIV KHANNA, J.]
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Thereupon, the respondent stated that he had no witnesses to examine,
or any other evidence to be adduced, and abruptly stood up and walked
out without signing the order sheet.
7. In his detailed report dated 14.01.1983, the inquiry officer
referred to the irregularities committed and held that the respondent had
made unauthorized advances beyond his discretionary powers without
the sanction of the Head Office. In fact,the respondent had admitted
violation of the Head Office instructions and the advances made were
unauthorized.All the charges were held to be proved.
8. By an order dated 18.04.1985, the Chairman of the Bank of
Cochin dismissed the respondent from service with effect from the close
of working hours on that day itself. This termination letter refers to the
inquiry report and states that the Chairman had carefully gone through
the records of the inquiry, connected papers, documents and findings of
the inquiry officer. Further, the Chairman had given the respondent an
opportunity for a personal hearing, which he did not avail of. Instead, the
respondent had sent a representation on 25.02.1985, which had been
already duly considered.
9. On 26.08.1985, the Bank of Cochin, a private bank, got
amalgamated with the State Bank of India.
10. Nearly four years and five months after his dismissal, the
respondent filed a memorandum of appeal on 20.09.1989 before the
Chief General Manager, State Bank of India, Local Head Office, Chennai,
which appeal remained unattended and was not listed for hearing forover
nine years. The respondent did not representor protest till 1998, when he
filed O.P. NO. 19807/1998 G before the High Court of Kerala at
Ernakulam, which was disposed of by a Single Judge on 14.10.1998,
recording that the respondent who was a petitioner therein had made a
limited prayer for quick disposal of his appeal. The second respondent
therein,that isthe Chief General Manager, was directed to consider the
appeal and pass appropriate orders after rendering an opportunity of
being heard to the respondent within ten weeks from the date of receipt
of the copy of the order.
11. In terms of the directions above, a personal hearing was granted
to the respondent on 22.12.1998. He was also permitted to submit written
representation.
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12. By the order dated 23.01.1999, the appeal was rejected by
the Chief General Manager recording, inter alia, that the inquiry officer's
report was clear, categorical, and based upon evidence,and concluded
that the respondent had exceeded his authorization in grant of credit
facilities, flouted head office instructions and had not obtained head office
ratificationfor several guarantees and documentary bills. The charges
as proved were grave, and hence the respondent's dismissal from service
was justified. The Chief General Manager specifically observed that the
defence of the respondent was not of denial, but that of following the
instructions of the Director or Chairman. Therefore, malefactions were
not factually and legally disputed. The contention that the respondent
was not allowed to be defended by an outsider was held to be without
substance as the inquiry officer had permitted the respondent to be
defended by an officer of the Bank of Cochin of his choice. The
respondent had refused to avail of the same. Hence, the respondent
could not raise plea of failure of natural justice.
13. The respondent had, thereupon, preferred O.P. No. 5527 of
1999 before the High Court of Kerala at Ernakulam challenging the
order of the Chief General Manager dated 23.01.1999 and had inter
alia prayed to be reinstated in service with back wages. Other prayers
made included direction to the opposite party to consider the quantum of
punishment, grant of gratuity and other benefits, and an opportunity of
inquiry as per the service rules.
14. By an order dated 14.03.2007, the writ petition was allowed
primarily on the ground that the inquiry officer had wrongly rejected the
request of the respondent to be defended/represented by the organizing
secretary of the All-India Confederation of Bank Organizations, Kerala
Unit. This amounted to a denial of reasonable opportunity, notwithstanding
the respondent's participation in the inquiry. Therefore, what weighed
with the Single Judge was a wrongful rejection of the respondent's request
to be represented by an office-bearer of the organization of his choice
as per the Service Code, and violation of the right to be represented
purportedly flowing from the principles of natural justice. Significantly,
the judgment rejects the argument of the respondent that the charges
held to be proved in the inquiry report would at best constitute 'minor
misconduct'. The Single Judge, referring to the allegations of unauthorized
advances beyond discretionary powers or without the sanction of head
office, held them to be 'gross misconduct'. Further, the Court observed
THE CHAIRMAN, STATE BANK OF INDIA AND ANOTHER v.
M. J. JAMES [SANJIV KHANNA, J.]
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that the charges were specific, and the allegations mentioned in the charge
sheet were detailed, though relevant provisions of the Service Code were
not mentioned. Therefore, the allegations detailed in the charge sheet
constituted 'gross misconduct', governed by Clause 22(iv)(a) of the
Service Code. Accordingly, the Single Judge had commended that "if
this misconduct is proved in a validly conducted inquiry, I see no reason
to find fault with the bank if dismissal is the punishment that is considered
appropriate by them".
15. The intra-court appeal, W.A. No. 2052 of 2007, by the
appellantswas dismissed by the Division Bench of the High Court of
Kerala at Ernakulam vide judgment dated 09.12.2008. They agreed with
the Single Judge that Clause 22(ix)(a) of Chapter VIII was violated as
the respondent was not allowed to be defended by a representative of a
registered bank employees' union/association. Interpreting the clause,
the Division Bench observed that the article "the" was missing before
the bank employees in the said clause, which indicates that the union/
association referred to therein was not onlyregarding employees of the
bank itself, namely 'the Bank of Cochin', and would, therefore, include
employees' union/association of other banks also. As the respondent
was entitled to be represented by a representative of a union or association
of bank employees, his prayer to be represented by Mr. F.B. Chrysostom
should have been accepted. The Bench rejected the contention of no
prejudiceby observing that this was only an assertion by the bank's
counsel. Further, the principles of natural justice were incorporated in
the Service Code itself,which the authorities were bound to follow strictly.
As the authorities had not followed the procedure prescribed, it would
be for the appellants to prove that by violating the procedure, no prejudice
was in fact caused. That apart, the Division Bench, upon perusal of the
proceedings and findings of the inquiry officer, felt that prejudice was
caused to the respondent. They observed that an experienced lawyer
had conducted the inquiry, and the presenting officer was also a lawyer
conversant with the procedure. Noticing that the respondent had retired,
it was observed that if the rules permit, the bank would be at liberty to
continue the disciplinary proceedings from the stage it had been
invalidated. However, if the rules do not permit such inquiry, the
respondent will be entitled to all benefits consequent to his illegal
termination.
16. We begin our discussion by reproducing Clause 22(ix)(a) of
the Service Code, which reads:
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"ix. The procedure in such cases shall be as follows:
(a) An employee against whom disciplinary action is proposed
or likely to be taken shall be given a charge sheet clearly
setting forth the circumstances appearing against him and a
date shall be fixed for an enquiry, sufficient time being given
to him to prepare and give his explanation as also to produce
any evidence that he may wish to tender in his defence. He
shall be permitted to appear before the officer conducting
the enquiry, to cross examine any witness and produce other
evidence in his defence. He shall also be permitted to be
defended by a representative of a registered Union/Association
of bank employees or with the Bank's permission, by a lawyer.
He shall also be given a hearing as regards the nature of the
proposed punishment in case any charge is established against
him."
17. In order to interpret, we would like to allude to clause 2(e) of
the definition clause in the Service Code, wherein the expression 'bank'
has been defined to mean the Bank of Cochin Ltd. and not any other
bank. Clause 2(e) of the Service Code reads:
"''Bank" means the Bank of Cochin Limited."
18. The judgment under challenge seems to have overlooked the
implications of clause 2(e) of the Service Code. The objective of
definition clauses is to avoid frequent repetition in describing the subject
matter to which the word or expression is intended to apply.1 This is
useful when the same word or expression is used more than once in the
same enactment.2 The raison d'etre behind the definition clause is that
while interpreting a provision, the defined word or expression would
carry the same meaning as the defined words or expression are employed
and used by the maker in the sense appropriate to the definition.The
definition can be with the intent to attract a meaning already established
by law; expand the meaning by adding a meaning; or narrow the meaning
by exclusion.3 This general rule of construction laid down by the enactment
1 Nahalchand Laloochand Private Ltd. v. Panchali Coop. Housing Society Ltd., (2010)
9 SCC 536
2 Bhagwati Developers Pvt. Ltd. v. Peerless General Finance and Investment Co. Ltd.
& Anr., (2013) 9 SCC 584
3 Part XII, Rules of Construction Laid Down by Statute, Sections 199 and 200 at page
517, Bennion on Statutory Interpretation, Indian Reprint, Sixth Edition.
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M. J. JAMES [SANJIV KHANNA, J.]
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is subject to the context. Albeit, the interpreter, to deviate from the defined
meaning, should record reasons to show that the word/expression in that
particular provision carries a different meaning.Contrary context is not
to be assumed or accepted easily, in the absence of indication and reason
to differ from the defined meaning.