A Person Cannot Be Deemed To Be In Service When First Dismissal Order Is In Force: Supreme Court

The Supreme Court Bench comprising Justices Krishna Murari and Bela M Trivedi has held that when the first dismissal order against a person in service is in force, irrespective of all pending litigations or his age of superannuation, he cannot be deemed to be continuing in service. 

Factual background of the Civil Appeal including its Judicial History

The brief facts of the appeal goes that the respondent, while posted as a Branch Manager at various branches, was found to have committed various lapses, in respect of which he was suspended on 14.06.1993 in terms of Rule 50A(i)(a) of SBIOSR, 1992. On the departmental proceedings having been conducted against him, the Inquiry Authority had largely found the allegations to be proved. The Disciplinary Authority agreed with some of the findings recorded by the Inquiry Authority and called upon the respondent to make his submissions on the same, after which the Respondent was dismissed from service by the Appointing Authority as per the order dated 11.08.1999.

The respondent being aggrieved by the said order had filed a Writ Petition before the High Court which was allowed by the Single Bench. An LPA was filed against that order with was finally dismissed.

In the meantime, the respondent attained the age of superannuation on 30.11.2009. The Appellant-Bank having filed a SLP challenging the order dated 22.04.2010 passed by the Division Bench, the same was allowed by the Supreme Court on 25.11.2013.

In view of the order passed by the top Court, the Appointing Authority issued a show-cause notice to the respondent on 06.02.2014, to which the respondent submitted his response on 10.02.2014.

The Appointing Authority after granting personal hearing to the respondent on 14.02.2014, again passed the order of dismissal from service against the Respondent on 17.02.2014 in terms of Rule 67(J) of SBISOR w.e.f. 11.08.1999 and treating his period of suspension as not on duty.

Being aggrieved by the said order passed by the Appointing Authority, the respondent filed Departmental appeal which was dismissed on 09.08.2014. The Respondent had then approached the High Court which allowed the said petition, and quashed and set aside the order of dismissal and ordered for payment of all arrears and benefits.

The aggrieved appellant-bank filed an LPA on 17.10.2016, which came to be dismissed by the Division Bench vide the impugned order dated 01.02.2018. Therefore the present Civil Appeal was initiated by the Appellant Bank.

State's Stand 

The primary contention raised by the state was that the High Court had wrongly interpreted Rule 19(1) and 19(3) of the SBIOSR, 1992.

ASG Balbir Singh, appearing for the Appellant-Bank, argued, “The Supreme Court in the first round of litigation had allowed the appeal filed by the Appellant-Bank and set aside the order passed by the Division Bench, and while observing that the person who hears the matter requires to pass an order, had directed the Appointing Authority to take appropriate decision within 2 months, keeping all the contentions of the parties open. The appointing authority, therefore had issued a show-cause notice to the respondent and after giving him an opportunity of hearing had passed the order of dismissal, which was wrongly set aside by the Single Bench and by the Division Bench.” 

Respondent's Arguments

The Respondent's arguments were in three parts: 

a) An affirmative action was expected to be taken by the Appellant-Bank in view of the order passed by the Supreme Court on 25.11.2013, as the respondent had already attained the age of superannuation pending the proceeding before the High Court.

b) The said order the Supreme Court had set aside the order of Division Bench, however had agreed with the view expressed by the Single Bench that as per the settled legal principle, the person who hears the matter is required to pass an order. The Supreme Court had granted the liberty only to the extent of directing the Appointing Authority to take appropriate action in accordance with law as the respondent had attained the age of superannuation. Under the circumstances, the Appointing Authority was required to take steps either to extend the service of the respondent in terms of Rule 19(1), or to continue the disciplinary proceedings, even after the superannuation of the respondent under Rule 19(3) of the Rules, however the Appellant- Bank did not take recourse to any of the said rules.

c) The discretion to continue with the disciplinary proceedings had to be exercised as an affirmative action by taking a conscious decision, which the Appointing Authority of the Appellant-Bank had failed to take, and on the contrary passed the order of dismissal with retrospective effect which was not legally permissible.

Discussion by the Court 

On the Legal Provisions Involved

Discussing Rule 19(1) of the SBIOSR 1992, the Court held, "On the bare perusal of the said Rules it clearly transpires that as per Rule 19(1), an officer could retire from the service of the bank on attaining the age of 58 years or upon the completion of 30 years’ service or 30 years’ of pensionable service if he is a member of the Pension Fund whichever occurs first, subject to the provisos mentioned therein.

The court further held, "As per the Rule 19(3), in case the disciplinary proceedings under the relevant rules of service have been initiated against an officer before he ceases to be in the Bank’s service by operation of, or by virtue of any of the rules, the disciplinary proceedings may at the discretion of Managing Director be continued and concluded, as if the officer had continued to be in service. However, the officer in that case shall be deemed to be in service only for the purpose of the continuance and conclusion of such proceedings."

‘Rule 19(3) Not Relevant’

On the reliance placed on Rule 19(3) by the Respondent, the court held that Rule 19(3) contemplates a situation, when the disciplinary proceedings are pending when the officer ceases to be in the Bank’s service, and in that case the Managing Director in his discretion may continue and conclude the disciplinary proceedings against the officer as if the officer continues to be in service. That is not the situation in the present case. 

Stating that since all the contentions were kept open by the Court while allowing the appeal filed by the Appellant-Bank, the court held that therefore no affirmative action was expected from the Appellant- Bank. Finally, the Court held, "The said order of Appointing Authority dismissing the respondent from service after granting opportunity of hearing to the respondent was in consonance with the direction given by this Court and could not be said to be arbitrary illegal or in violation of Rule 19(3) of the said Rules." Therefore, based on the above reasoning, the court went on to set aside the impugned order of the High Court setting aside the said order of dismissal.

The court held, "the disciplinary proceedings against the respondent were already initiated and had stood concluded, culminating into dismissal from service as per the order dated 11.08.1999 passed by the Appointing Authority. The said order was challenged by the respondent by filing the Writ Petition, which came to be allowed by the Single Bench…nonetheless the Appellant-Bank having preferred the LPA…The said LPA came to be dismissed on 22.04.2010, in the meantime on 30.11.2009, the respondent attained the age of superannuation i.e., during the time, when the operation of the order of Single Bench was stayed.”

The Court then held, “Thus, the order of Single Bench setting aside the order of dismissal passed by the Appointing Authority having been stayed by the Division Bench, the respondent could not be deemed to have continued in service, and also when he had attained the age of superannuation on 30.11.2009. Thereafter, the order of Division Bench dated 22.04.2010 passed in the LPA 378 of 2003 having been set aside by this Court while allowing the appeal filed by the Appellant-Bank vide the order dated 25.11.2013, again it could not be said that the respondent was continued in service, till he attained the age of superannuation.”

Case Title: STATE BANK OF INDIA & ORS. VERSUS KAMAL KISHORE PRASAD CIVIL APPEAL NO. 175 OF 2023 (Arising out of SLP (C) No. 9819 of 2018)

For Petitioner(s) Mr. Balbir Singh, Ld. ASG Mr. Sanjay Kapur, AOR Ms. Megha Karnwal, Adv. Mr. Arjun Bhatia, Adv. Mr. Lalit Rajput, Adv. Ms. Anu Sura, Adv. Ms. Akshata Joshi, Adv.

For Respondent(s) Mr. Kripa Shankar Prasad, AOR Ms. Alisha Shaili, Adv. Mr. Ainul Ansari, Adv.

Citation : 2023 LiveLaw (SC) 42

Service Law -SBI Officers Service Rules -when the first dismissal order against a person in service is in force, irrespective of all pending litigations or his age of superannuation, he cannot be deemed to be continuing in service.

Read the Judgment Here