Central Bank of India Ltd., New Delhi
Vs. Shri Prakash Chand Jain  INSC 198 (20 August 1968)
20/08/1968 BHARGAVA, VISHISHTHA
BHARGAVA, VISHISHTHA VAIDYIALINGAM, C.A.
CITATION: 1969 AIR 983 1969 SCR (1) 735
R 1972 SC1031 (24,37) R 1978 SC1004 (11)
Industrial Disputes Act, 1947 (14 of 1947),
s. 33(2)(b)- Powers of Industrial Tribunal under section-Interference with
findings of domestic enquiry justified when findings are perverse-Tests of
perversity-Hearsay evidence not legal evidence even in domestic enquiries.
The respondent was an employee of the
appellant. After a domestic inquiry in respect of alleged misconduct he was
dismissed. As an industrial dispute was pending an application was made to the
Industrial Tribunal under s. 33(2)(b) of the Industrial Disputes Act, 1947. The
tribunal held that though the enquiry was fair, the findings of the enquiry
Officer were perverse and therefore it did not give its approval the order of
dismissal. By special leave the appellant came to this Court, contending that
since the enquiry was held to be fair the Tribunal no jurisdiction to interfere
with the findings of fact arrived at by the Enquiry Officer.
HELD: (i) Earlier decisions of 'this Court
make it clear that when in Industrial Tribunal is asked to give its approval to
an order of dismissal under s. 33(2)(b) of the Act, it can disregard the
findings given y the Enquiry Officer only if the findings are perverse. The
findings are reverse when either they are not based on legal evidence or they
are such as no reasonable person could have arrived at on the basis of material
before the domestic tribunal. [739 G-740 C] Bangalore Woolien, Cotton and Silk
Mills Company Ltd. v. Dasappa B) (Binny Mills Labour Union) & Ors. 
II L.L.J. 39, Lard Krishna Textile Mills v. Its Workmen,  3 S.C.R. 204,
State lndhra Pradesh v.S. Sree Rama Rao,  3 S.C.R. 25, applied.
(ii) A domestic tribunal though not bound by
the technical rules rout evidence contained in the Indian Evidence Act cannot
ignore subsintive rules which would form part of principles of natural justice.
The principle that a fact sought to be proved must be supported by statements
lade in the presence of the person against whom the enquiry is held that
statements made behind the back of the person charged are not be treated as
substantive evidence, is one of such basic principles which. domestic tribunal
cannot disregard. The previous statement of a witness not substantive evidence
unless affirmed as truthful by the witness when actually examined in the
presence of the workman charged. A finding by the domestic tribunal based not
on substantive evidence but on hearsay, is perverse, because hearsay is not
legal evidence. [743 C-E; 745 Khardah Co. Ltd. v. Their Workmen,  3
S.C.R. 506, State of ysore V.S.S. Makapur,  2 S.C.R. 943 and M/s.
Kesoram Cotton ills Ltd. v. Gangadhar, 
2 S.C.R. 809, relied on.
(iii) In the present case the findings of the
Enquiry Officer were held by the Industrial Tribunal to be perverse as they
were not sed on legal evidence and were not justified by the material before m.
[749 C-E] 736
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 498 of 1966.
Appeal by special leave from the order dated
July 10, 1964 of the Industrial Tribunal Delhi in O.P. No. 79 of 1962.
Bishan Narain, P.C. Bhartari, J.B. Dadachanji
and C.L. Chopra, for the appellant.
H.R. Gokhale, Janardan Sharma and T.R.
Bhasin, for the respondent.
The Judgment of the Court was delivered by
Bhargava, J. The Central Bank of India Ltd., New Delhi has flied this appeal,
by special leave, challenging an order of the Industrial Tribunal, Delhi,
refusing to accord approval to an order of dismissal of the respondent, Prakash
Chand Jain, under section 33(2)(b) of the Industrial Disputes Act (hereinafter
referred to as "the Act"). A charge-sheet, containing two charges was
served on the respondent on 21st July, 1961 in order to initiate formally an enquiry
for the purpose of taking disciplinary ,action against him. The two charges
flamed were as follows :-- "1. On 14-1-1960, a sum of Rs. 30,400/- was
paid to Mr. P.C. Jain by the Assistant Cashier Mr. Nand Kishore out of the
cheque No. 43004 dated 14-1-60 drawn by Messrs Mool Chand Hari Kishan for Rs.
63,000/-. Taking this money Mr. P.C. Jain on the same day i.e. 14-1-1960 left
for Muzaffarnagar in company of some persons to retire the following bills
drawn by M/s. Gupta Iron Industries :Naya Bazar LBC 3 drawn on Puran Chand ....
5,100/-Naya Bazar LBC 5 drawn on Hiralal
Shyam...... Rs. 4,950/- Thus it was within the knowledge of Shri P.C.
Jain that the bills of Messrs Gupta Iron
Industries were drawn on bogus firms and that those were retired by drawer's
representative who accompanies Mr. P.C. Jain to Muzaffarnagar. Instead of
reporting, such serious matters to higher authorities, Mr. P.C. Jain claims
that he had never visited Muzaffarnagar.
2. Mr. P.C. Jain encashed on 25-2:60 cheque
No. 400506 for Rs. 46,000/- from the United Bank of India Ltd., Chandni Chowk
and brought cash to Naya Bazar after 11.30 a.m.i.e. after the time for
presenting of the clearing cheques at the State Bank of India. To cover the
misdeeds of Mr. Shiv Kumar Sharma the then 737 Sub-Agent of Naya Bazar Office,
Mr. P.C. Jain Treasurer's representative stated in his explanation dated
16-2-1961 that cash was received at the office at about 11 a.m.i.e. before the
The above acts of Mr. Jain were prejudicial
to the interests of the Bank as defined in' paragraph 521-4(J) of the Sastry
Award and amount to gross misconduct. The inquiry will be held on 12-8-1961 at
Chandni Chowk Branch at 10.30 a.m. by Mr. P.B. Tipnis, Chief Agent, Agra."
Subsequently, an enquiry was held by Mr. Tipnis, one of the senior Officers of
the Bank. The Enquiry Officer, after recording evidence tendered on behalf of
the Bank as well as the evidence given by the respondent, recorded his findings
holding that both the charges were proved against the respondent and, basis,
came to the view that the actions of the respondent were prejudicial to the
interests of the Bank and amounted to gross misconduct, so that he proposed to
award the punishment of dismissal from the Bank's service. The respondent was
given a week's time to show cause against this proposed punishment and,
thereafter, an order was made dismissing the respondent with effect from 18th
July, 1962 and a month's wages were paid to him in accordance with the
provision contained in s. 33(2)(b) of the Act. Since an industrial dispute was
pending before the Industrial Tribunal, Delhi, an application under s.
33(2)(b) of the Act was made requesting the
Tribunal to accord approval to this order of dismissal. The Tribunal, when
dealing with this application, held that the enquiry, which had been held by
the Enquiry Officer, was fair and was not vitiated by any irregularity or
unfairness, but refused to accord approval on the ground that the findings
accorded by the Enquiry Officer were perverse and were not based on evidence
inasmuch as most of the findings were the result of mere conjecture on behalf
of the Enquiry Officer. It is this order of the Tribunal that has been
challenged in this appeal.
Learned counsel appearing for the appellant
Bank urged that the Tribunal, in refusing to accord approval and in
disregarding the findings recorded by 'the Enquiry Officer, exceeded its
jurisdiction conferred by s. 3'3(2) (b) of the Act. It was further' urged that,
when the Tribunal found that. the enquiry was fair, the Tribunal had no
jurisdiction to go into the question whether the findings of fact recorded by
the Enquiry Officer were correct and could not sit in judgment over those
findings like a Court of Appeal. The Tribunal should have accepted those findings
and only examined whether a prima facie case was made out for ' according an
approval. If the Tribunal had proceeded in accord- 738 ance with this
principle, there. would have been no justification for the Tribunal to refuse
to approve the order of dismissal.
The jurisdiction and functions of a Tribunal
under s. 33(2) (b) of the Act were 'explained by I this Court in Bangalore
Woolien, Cotton and Silk Mills Company Ltd. v. Dasappa (B) (Binny Mills Labour
Union) and Others(1), where it was held :-- "The settled position in law
therefore is that permission should be refused if the tribunal is satisfied
that the management's action is not bona fide or that the principles of natural
justice have been violated or that the materials on the basis of which the
management came to a certain conclusion could not justify any reasonable person
in coming to such a conclusion. In most cases it will happen where the
materials are such that no reasonable person could have come to the conclusion
as regards the workman's misconduct that the management has not acted bona
A finding that the management has acted bona
fide will ordinarily not be reached if the materials are such that a reasonable
man could not have come to the conclusion which the management has reached. In
every case, therefore, it. would be proper for the tribunal to address itself
to the question, after ascertaining that the principles of natural justice have
not been violated, whether the materials on which the management has reached a
conclusion adverse to the workman, a reasonable person could reach such a
conclusion." The point was again considered by this Court in the case of
Lord Krishna Textile Mills v. Its Workmen(2) and it was held :- "In view
of the limited nature and extent of the enquiry permissible under s. 33 (2)(b)
all that the authority can do in dealing with an employer's application is to
consider whether a prima facie case for according approval is made out by him
or not. If before dismissing an employee the employer has held a proper
domestic enquiry and has proceeded to pass the impugned order as a result of
the said enquiry, all that the authority can do is to enquire whether the
conditions prescribed by s. 33(2)(b) and the proviso are satisfied or not. Do
the standing orders justify the order of dismissal ? Has an enquiry been held
as required by the standing order ? Have the wages for the month been paid as
required by the proviso'?; and, has an application been made as prescribed by
the proviso ?" (1)  II L.L.J. 39.
(2)  3 S.C.R. 204.
739 The Court then proceeded to consider
whether the Tribunal in that case had acted rightly, and noted that one had
merely to read the order to be satisfied that the Tribunal had exceeded its
jurisdiction in attempting to enquire if the conclusions of fact recorded in
the enquiry were justified on the merits. The Tribunal did not hold that the
enquiry was defective or the requirements of natural justice had not been
satisfied in any manner. The Court then indicated that the Tribunal had
proceeded to examine the evidence, referred to some discrepancies in the
statements made by witnesses and had come to the conclusion that the domestic
enquiry should not have recorded the conclusion that the charges had been
proved against the workmen in question. It was then held that, in making these
comments against the findings of the enquiry, the Tribunal clearly lost sight
of the limitations statutorily placed upon its power and authority in holding
the enquiry under s. 33(2)(b). The Court then indicated the principle
applicable by saying:
"It is well known that the question
about the adequacy of evidence or its sufficiency or satisfactory character can
be raised in a court of facts and may fall to be considered by an appellate
court which 'is. entitled to consider facts; but these considerations are
irrelevant where the jurisdiction of the court is limited as under s. 33(2)(b).
It is conceivable that even in holding an enquiry under s. 33(2)(b) if the
authority is satisfied that the finding recorded at the domestic enquiry is
perverse in the sense that it is not justified by any legal evidence whatever,
only in such a case it may be entitled to consider whether approval should be
accorded to the employer or not; but it is essential to bear in mind the
difference between a finding which is not supported by any legal evidence and a
finding which may appear to be not supported by sufficient or adequate or
satisfactory evidence." These decisions make it clear that, when an
Industrial Tribunal is asked to give its approval to an order of dismissal
under s. 33(2) (b) of the Act, it can disregard the findings given by the
Enquiry Officer only if the findings are perverse. The test of perversity that
is indicated in these cases is that the findings may not be supported by any
legal evidence at all. This principle was further affirmed in a different
context in State of Andhra Pradesh V.S. Sree Rama Rao, (1), where this Court
had to consider whether a High Court, in a proceeding for a writ under Art. 226
of the Constitution, could interfere with the findings recorded by departmental
authority ill disciplinary proceedings taken against a Government servant, The
Court held :-- (1)  3 S.C.R. 25.
740 "But the departmental authorities
are, if the enquiry is otherwise properly held, the sole judges of facts and if
there be some legal evidence on which their findings can be based, the adequacy
or reliability of that evidence is not a matter which can be permitted to be
canvassed before the High Court in a proceeding for a writ under Art, 226 of
the Constitution." In this connection, reference was also made to some
cases where this Court has held that a finding by a domestic tribunal like an
Enquiry Officer can be held to be perverse in those cases also where the finding
arrived at by the domestic tribunal is one at which no reasonable person could
have arrived on the material before the tribunal. Thus, there are two cases
where the findings of a domestic tribunal like the Enquiry Officer dealing with
disciplinary proceedings against a workman can be interfered with and these two
are cases in. which the findings are not based on legal evidence! or are such
as no reasonable person could have arrived at on the basis of the material
before the Tribunal. In each of these cases, the findings are treated as
perverse. It is in the light of these principles that we have to see whether
the Industrial Tribunal, Delhi, in the present case, was justified in refusing
to accord approval to the order of dismissal which was passed on the basis of
the evidence recorded 'by the Enquiry Officer, Mr. Tipnis.
We have already reproduced above the charges
that were framed against the respondent and we proceed to examine how far the
Tribunal was correct in holding that the Enquiry Officer's findings on these
charges were without legal evidence and were based merely on conjecture. The
first charge consisted of the following elements :- (i) that on 14-1-1960, a
sum of 30,400 was paid to the respondent by the Assistant Cashier Nand Kishore
out of the amount payable on a cheque drawn by M/s. Mool Chand Hari Kishan for
Rs. 63.000; ' (ii) that the respondent left the same day for Muzaffarnagar;
(iii) that he left for Muzaffarnagar in
company of some persons to retire the bills drawn by M/s. Gupta Iron
(iv) that these bills of M/s. Gupta Iron
Industries had been drawn on bogus firms;
(v) that these bills were retired by the
drawer's representative who accompanied the respondent to Muzaffarnagar;
741 (vi) that the respondent failed to report
these serious matters to higher authorities;
and (vii) that the respondent, instead,
wrongly claimed that he had never visited Muzaffarnagar.
The Tribunal in its Order has held that on
all these elements the findings recorded by the Enquiry Officer were perverse,
because they were based on hearsay evidence and on conjecture. Learned counsel
appearing for the Bank took us through the entire evidence recorded by the
Enquiry Officer in order to canvass his argument that these findings recorded
by the Enquiry Officer were based on the material before him. We have found
that, on two of these points, there was material before the Enquiry Officer
which could be held to be legal evidence and, consequently, we have to hold
that, on those two points, the Tribunal was incorrect in recording its view
that the findings of the Enquiry Officer were defective and could be
disregarded by the Tribunal.
These two are elements Nos. (ii) and (vii).
The finding that the respondent left for Muzaffarnagar on 14-1-1960 was based
on the inferences drawn by the Enquiry Officer from the records of the Branch
of the Bank in which the respondent was working on that day. The facts found by
the Enquiry Officer were that, in the cash receipt book of that date, there
were only four entries in the handwriting of the respondent that he made no
payments on that day; that, though he was in charge of the entire cash
department, he had no knowledge that cash of Rs. 1 sac was brought from the
Chandni Chowk Office of the Bank three times during that day; that the Godown
Keeper had also verified several vernacular signatures when it was the
respondent's duty only to verify them; and that the cash account of that day
was closed by the Godown Keeper instead of the respondent who should have done so
if he was in the Bank until the closure of the work on that day. These
circumstances were brought to the notice of the Enquiry Officer from the
records of the Bank by Management's witness, J.J. Daver. In our opinion, the
Tribunal was incorrect in holding that the- Enquiry Officer was acting on mere
conjecture when, on the basis of these circumstances, he drew the inference
that the respondent had left his work in the Naya Bazar Branch of the Bank on
14-1-1960 after working there for a short time only.
Further, the Enquiry Officer in his report
mentioned that three witnesses, S: C.L. Chawla, Officer Incharge of the
Muzaffarnagar Office of the Bank, Inder 'Sain Jain, Cashier in the
Muzaffarnagar Office, and Nihalchand Jain, who was a Clerk in the Muzaffarnagar
Office, had stated that they had seen the respondent at Muzaffarnagar Office on
14-1-1960, and relied on their evidence to hold that the respondent did go to
Muzaffarnagar on that day leaving his work in the Naya Bazar Office of the Bank
at Delhi. The Tribunal criticised the evidence of these three witnesses and 742
came to the view that the Enquiry Officer was not justified in believing these
witnesses and in holding on the basis of their evidence that the respondent was
in Muzaffarnagar on that day. It is clear that, in adopting this course, the
Tribunal exceeded its powers. It was not for the Tribunal to sit in judgment
over the view taken by the Enquiry Officer about the value to be attached to
the evidence of these witnesses, even though the Tribunal thought that these
witnesses were unreliable because of circumstances found by the Tribunal in
their evidence. What the Tribunal at this stage did was to interfere with the
finding of fact recorded by the Enquiry Officer by making a fresh assessment on
the value to be attached to the evidence of these witnesses which was not the
function of the Tribunal when dealing with an application under s. 33 (2 )(b)
of the Act.
In these two respects. we find that the
Tribunal fell into an error.
However, we find that, on the other
ingredients of the first charge, the Tribunal was justified in arriving at the
conclusion that the findings recorded by the Enquiry Officer Were perverse. The
Tribunal gave the reason that these findings were based on hearsay evidence. This
view taken by the Tribunal appears to be fully justified. The first and the
third elements of the charge relating to payment of the sum of Rs. 30.400 to
the respondent by Nand Kishore, and of the respondent leaving for Muzaffarnagar
in the company of some persons in order to retire the bills drawn by M/s.
Gupta Iron Industries, were sought to be
proved before the Enquiry Officer by the evidence of the Internal Auditor, N.
N. Vazifdar, but the latter could not give
any direct evidence. as he was not present at the time when money was paid to
the resplendent or when the respondent left for Muzaffarnagar. He purported to
prove these elements of the charge by deposing that a statement was made to him
by Nand Kishore to the effect that Nand Kishore had paid Rs. 30,400 to the
respondent and that, thereafter, the respondent left for Muzaffarnagar in the
company of two persons. The Enquiry Officer accepted this evidence of Vazifdar,
but, ignored them. fact that Vazifdar's evidence was not direct evidence in
respect of the elements of the charge sought to be proved, and that Vazifdar
was only trying to prove a previous statement of Nand Kishore which, as rightly
held by the Tribunal, would amount to hearsay evidence. Nand Kishore himself
was also examined as a witness, but, in his evidence, which was admissible as
substantive evidence, he made no statement that this sum of Rs. 30,400 was paid
by him to the respondent or that the respondent left for Muzaffarnagar in the'
company of some persons to retire the bills drawn by M/s. Gupta Iron
Industries. In fact. Nand Kishore even went further and denied that he had made
any statement to Vazifdar as stated by Vazifdar. The Enquiry Officer was, of
course, entitled to form his own opinion and 743 to believe Vazifdar in preference
to Nand Kishore; but, on this basis, the only finding that the domestic
tribunal could record was that Nand Kishore's statement given before him was
incorrect and that Nand Kishore had made statements to Vazifdar as deposed by
Vazifdar. Those statements made by Nand Kishore to Vazifdar could not, however,
become substantive evidence to prove the correctness of these elements forming
part of the charge. It is in this connection that importance attaches to the
views expressed by this Court in the cases cited above, where it was pointed
out that a finding of a domestic tribunal may be perverse if it is not
supported by any legal evidence. It is true that, in numerous cases, it has
been held that domestic tribunals, like an Enquiry Officer, are not bound by
the technical rules about evidence contained in the Indian Evidence Act;
but it has nowhere been laid down that even
substantive rules, which would form part of principles of natural justice, also
can be ignored by the domestic tribunals. The principle that a fact sought to
be proved must be supported by statements made in the presence of the person
against whom the enquiry is held and that statements made behind the back of
the person charged are not to be treated as substantive evidence, is one of the
basic principles which cannot be ignored on the mere ground that domestic
tribunals are not bound by the technical rules of procedure contained in the
Evidence Act. In fact, learned counsel for the appellant Bank was unable to
point out any case at all where it may have been held by this Court or by any
other Court that a domestic tribunal will be justified in recording its
findings on the basis of hearsay evidence without having any direct or
circumstantial evidence in support of those findings.
In the case of Khardah Co. Ltd. v. Their
Workmen(1), this aspect was noted by this Court as follows :- "Normally,
evidence on which the charges are sought to be proved must be led at such an
enquiry in the presence of the workman himself. It is true that in the case of
departmental enquiries held against public servants, this Court has observed in
the State of Mysore v.S.S. Makapur(2) that if the deposition of a witness has
been recorded by the' enquiry officer in the absence of the public servant and
a copy thereof is given to him, and an opportunity is given to him to
cross-examine the witness after he affirms in a general way the truth of his
statement already recorded, that would conforms the requirements of natural
justice; but as has been emphasised by this Court in M/s. Kesoram Cotton Mills
Ltd. v. Gangadhar(3) these observations must be applied (1)  3 S.C.R. 506
at pp. 512-13.
(2)  2 S.C.R. 943.
(3)  2 S.C.R. 809.
744 with caution to enquiries held by
domestic tribunals against the industrial employees.
In such enquiries, it is desirable that all
witnesses on whose testimony the management relies in support of its charge
against the workman should be examined in his presence.
Recording evidence in the presence of the
workman concerned serves a very important purpose. The witness knows that he
giving evidence against a particular individual who is present before him, and
therefore, he is cautious in making his statement. Besides, when evidence is
recorded in the presence of the accused person, there is no room for persuading
the witness to make convenient statements, and it is always easier for an
accused person to cross-examine the witness if his evidence is recorded in his
Therefore, we would discourage the idea of
recording statements of witnesses ex parte and then producing the witnesses
before the employee concerned for cross-examination after serving him with such
previously recorded statements, even though the witnesses concerned make a
general statement on the latter occasion that their statements already recorded
correctly represent what they stated." In the case of M/s. Kesoram Cotton
Mills Ltd. v. Gangadhar and Others(1) referred to in the quotation above, it
was held :-- "Even so, the purpose of rules of natural justice is to
safeguard the position of the person' against whom an inquiry is being
conducted so that he is able to meet the charge laid against him properly.
Therefore, the nature of the inquiry and the status of the person against whom
the inquiry is being held will have some bearing on what should be the minimum
requirements of the rules of natural justice. Where, for example, lawyers are
permitted before a tribunal holding an inquiry and the party against whom the
inquiry is being held is represented by a lawyer, it may be possible to say
that a mere reading of the material to be used in the inquiry may sometimes be
sufficient see New Prakash Transport Co. v. New Suwarna Transport Co. (2)] but
where in a domestic inquiry in an industrial matter lawyers are not permitted,
something more than a mere reading of statements to be used will have to be
required in order to safeguard the interest of the industrial worker. Further,
we can take judicial notice of the fact that many of our industrial workers are
illiterate and sometimes even the representatives of labour union may not (1)
 2 S.C.R. 809. (2)  S.C.R. 98.
745 be present to defend them. In such a
case, to read over a prepared statement in a few minutes and then ask the
workmen to cross- examine would make a mockery of the opportunity that the
rules of natural justice require that the workmen should have to defend
themselves. It seems to us, therefore, that when one is dealing with domestic
inquiries in industrial matters, the proper course for the management is to
examine the. witnesses from the beginning to the end in the presence of the
workman at the enquiry itself. Oral examination always takes much longer than a
mere reading of a prepared statement of the same length and bring home the evidence
more clearly to the person against whom the inquiry is being held.
Generally speaking, therefore, we should
expect a domestic inquiry by the management to be of tiffs kind."
Proceeding further, the Court held :-- "The minimum that we shall expect
where witnesses are not examined from the very beginning at the inquiry in the
presence of the person charged, is that the person charged should be given a
copy of the statements made by the witnesses which are to be used at the
inquiry well in advance before the inquiry begins and when we say that the.
copy of the statements should be given well in advance, we mean that it should
be given at least two days before the inquiry is to begin. If this is not done
and yet the witnesses are not examined-in-chief fully at the inquiry, we do not
think that it can be said that principles of natural justice which provide that
the person charged should have an adequate opportunity of defending himself are
complied with in the case of a domestic inquiry in an industrial matter."
These views expressed by this Court, in our opinion, bring out what was meant
when this Court held that findings recorded by an Enquiry Officer must be
supported by legal evidence. The evidence, as indicated in these cases, should
consist of statements made in the presence of the workman charged. An exception
was envisaged where the previous statement could be used after giving copies of
that statement well in advance to the workman charged, but with the further
qualification that previous statement must be affirmed as truthful in a general
way when. the witness is actually examined in the presence of the workman.
Applying this principle to the present case,
it is clear that the previous statement made by Nand Kishore to Vazifdar could
not be taken as substantive evidence against the respondent, because 746 Nand
Kishore did not affirm the truth of that statement when he appeared as a
witness and, on the other hand, denied having made that statement altogether.
Even though his denial may be false, that fact would not convert his previous
statement/into substantive evidence to prove the charge against the respondent
when that statement was given to Vazifdar in the absence of the respondent and
its truth is not affirmed 'by him at the time of his examination by the Enquiry
Officer. This statement of Nand Kishore made to Vazifdar being ignored, it is
clear that no other material was available to the Enquiry Officer on the basis
of which he could have held that the sum of Rs. 30,400 was paid to the
respondent by Nand Kishore and that Nand Kishore, there.after left for
Muzaffarnagar in the company of some persons with that money.
The fourth element of the charge was that the
bills of M/s. Gupta Iron Industries were drawn on bogus firms. We think that
the Tribunal is quite correct in its comment that the Enquiry Officer, in
holding that the bills were drawn on bogus firms, proceeded to do so without
any evidence altogether. In fact, the Enquiry Officer has not referred to any
material which was available to him before accepting the allegation against the
respondent that the bills had been drawn. on bogus firms. Even in the course of
his submissions before us, learned counsel for the Bank was unable to point out
any evidence which would support this part of the charge. The only evidence to
which learned counsel could refer was the statement of Nihal Chand Jain who
said that intimations of the bills were sent to the parties: mentioned in the
bills by post, but were received back unserved. Those intimations were not produced
before the Enquiry Officer and there is no mention of the reason why the postal
authorities returned those intimations. The mere return of the intimations
could not possibly lead to the inference that the parties, to whom they were
addressed, were bogus. It is quite likely that their addresses there
incomplete, so that the postal authorities were unable to trace them. Clearly,
in these circumstances, the finding on this point recorded by the Enquiry
Officer was without any evidence or material.
The same remarks apply with regard to the
element of the charge to the effect that the bills were retired by the drawer's
representative who accompanied the respondent to Muzaffarnagar.: 'The Enquiry
Officer again does not mention any witness who may have stated that the bills
were retired by the drawer's representative or that representative had
accompanied the respondent. The only evidence on this point, to which our
attention was ,drawn, was that of T.C. Jain who purported to prove a previous
:statement of Inder Sain Jain made to him. According to T.C.
747 Jain, Inder Sain Jain had come to him and
told him that Prakash Chand Jain had come with the representative of the drawer
to retire the bills, This evidence of T.C. Jain was rightly not relied upon or
referred to by the Enquiry Officer, because Inder Sain Jain, when he appeared
as a witness before him, did not state, that he had made any such statements to
T.C. Jain and, in his examination, he excluded the possibility of his having
made that statement.
According to Inder Sain Jain's statement
before then. Enquiry Officer, the respondent only accosted him once and bid him
"Jai Ram Ji Ki". He had no other talk with him. He also.
stated that this happened about two hours
after the bills had been retired. Consequently, according to Inder Sain Jain's
statement before the Enquiry Officer, the respondent was not present when the
bills were retired and there was no question of the respondent. accompanying
the drawer's representative for retiring the bills. Inder Sain Jain also did
not state that the bills were retired by the representative of the drawer.
Thus, on this point also, there is no legal evidence on which a. finding could
have been recorded against the respondent.
So far as the sixth element of the charge is
concerned, that becomes totally immaterial when it is found that the Enquiry
Officer's findings that the bills were drawn on bogus firms and that they were
retired by the drawer's representative accompanying the respondent are held to
have been given without any legal evidence. If the bills are not proved to have
been drawn on bogus firms and to have been retired by the drawer's
representative with the aid of the respondent, there was nothing that the
respondent was required to convey to higher authorities.
So far as the second charge is concerned, we
find that, similarly, the principal findings given by the Enquiry Officer are
not supported by any legal evidence. The substance of the charge was that the
respondent encashed the cheque for Rs. 46,000' from the United Bank of India
and brought the cash after 11.30 a.m., but
wrongly stated that he had brought the cash to the Naya Bazar Office of the
Central Bank before 11 a.m. The significance of the time we emphasised by the
Enquiry Officer because, according to him, 11 a.m. was the clearing time of
another cheque of Rs. 15,000 which had been marked as "good for
payment" by the then Sub-Agent, Shiv. Kumar Sharma and the respondent had
to show that cash in respect of the other cheque of Rs. 46,000 had been brought
to the Bank at Naya Bazar for deposit in the account of the Drawer of that
cheque of Rs. 15,000 so as to justify the endorsement made by the Sub-Agent
that it was 'good for payment'. We examined the whole record and we are unable
to find any evidence at all in support of the fact accepted by the Enquiry
Officer that the clearing time was 11 a.m. On the contrary, the only evidence
on this point, which was that of Management's witness J.J. Daver, was to the
effect that the clearing time was 11.30 a'.m. Ignoring tiffs evidence
altogether, the Enquiry Officer proceeded to record his findings against the
respondent on the basis that the clearing time was 11 a.m.
without at all referring to any evidence in
support of this fact. The second significant point was as to the time by which
the respondent brought the cash in respect of the cheque of Rs. 46,000/- from
the United Bank of India Ltd., Chandni Chowk, to his own Central Bank Branch in
No one gave any' direct evidence as to the time
when the respondent brought the money. The Enquiry Officer has proceeded to
hold that the money could not have been brought before 11 a.m. because there is
an endorsement on that cheque of Rs. 46'000/which, according to the Enquiry
Officer, shows that cheque was presented for encashment at the United Bank of
India Ltd., Chandni Chowk, at 11.15 a.m.
This endorsement was also examined by us as
it appeared on the photo-stat copy of the cheque. The endorsement consists of a
number 37 beneath which as noted the time 11.15 a.m. with a line drawn between
them. From this endorsement alone, the Enquiry Officer proceeded to infer that
this cheque was presented for encashment at 11.15 a.m., even though no evidence
at all was given by anyone working in the United Bank of India Ltd., Chandni
Chowk, to prove that this endorsement of time of 11.15 a.m. represented the
time of presentation of the cheque at that Bank. In fact the Enquiry Officer
has not made reference to any evidence at all when holding that this cheque was
presented for payment at 11 a.m. at the counter of the United Bank of India.
Learned counsel for the Bank, however, referred us to the evidence of J.J.
Daver on this point. Darer in this case was discharging a dual function as a
witness and as the prosecutor of the case against the respondent for the Bank.
In his evidence, Darer stated that this endorsement represented the time when
the token was issued to the person encasing the cheque. Later, while
prosecuting the case against the respondent on behalf of the Bank, Darer urged
before the Enquiry Officer that this endorsement of 11.15 a.m. represented the
time of presentation of the cheque and this was noted by the Enquiry Officer in
Obviously, the time of presentation of the
cheque and the time of issue of 'the token in respect of it would not be
identical. In fact, there can be a lapse of an appreciable interval between the
two. In spite of this fact, the Enquiry Officer seems to have proceeded on the
basis 'of what was urged before him by J.J. Darer while acting as prosecutor,
and what was stated in that capacity was not evidence at all. The evidence
given by Darer was different and that was not relied upon by the Enquiry
Officer. On the face of it, the proper evidence, by which it could have been
proved that the cheque was either presented at 11.15 a.m. or that the token in
respect of it 749 was issued at 11.15 a.m., could have been obtained if the
Bank had cared to examine the person in charge of encashing the cheque at the
United Bank of India, Chandni Chowk.
Daver was not present when the cheque was
presented and he has not explained on what basis he stated in his evidence that
this endorsement represented the time when the token was issued. It is clear
that, era this charge also on the two crucial points of the time, viz., the
clearing time of the cheque of Rs. 15,000/- as well as the time when the second
cheque of Rs. 46,000/- was presented for encashment at the United Bank of India
Ltd., Chandni Chowk, the Enquiry Officer has recorded findings without those
findings being supported by any legal evidence.
In these circumstances, it is clear that the
Tribunal was fully justified in holding that the findings recorded by the
Enquiry Officer on both the charges were perverse in the sense of not being
supported by any legal evidence, of course, with the exception of the finding
recorded to the effect that on 14-1-1960 the respondent, after doing some work
in the Naya Bazar Branch of the Bank, left for Muzaffarrnagar and was seen in
Muzaffarnagar on that day.
It was to this liraired extent that the first
charge only could have been held to have been proved before the Enquiry Officer
against the respondent. On this limited proof and on holding that the Enquiry
Officer's findings were correct in respect of this part of the charge only, the
Tribunal would be fully justified in withholding its approval of the order of
dismissal which was passed by the Bank on the basis that all the elements of
both the charges had been proved. The order of the Tribunal refusing to grant
approval was, therefore, not vitiated by any error and must be upheld.
The appeal fails and is dismissed with costs.
G.C. Appeal dismissed.