S.A. Kini & ANR Vs. Union of India
& Ors [1985] INSC 89 (16 April 1985)
REDDY, O. CHINNAPPA (J) REDDY, O. CHINNAPPA
(J) DESAI, D.A.
CITATION: 1985 AIR 893 1985 SCR (3) 754 1985
SCC Supl. 122 1985 SCALE (1)747
ACT:
Services :
Employees of a Nationalised Bank/Public
Sector Corporation-Whether they can collect donations or any trust or other
organisation from persons who come into contact in the course of their
employment-Code of conduct.
HEADNOTE:
The petitioners , Deputy General Secretary of
the Canara Bank Officers' Association and the Canara Bank Officers'
Association. filed a writ petition in the High Court alleging that the Chairman
and Managing Director , the General Manager and the top officials of the
Management of Canara Bank have been using their official position and authority
to coerce the officers and staff of the Canara Bank to collect funds for the
Canara Bank Relief and Welfare Society and the Kamakoti Prabha Trust and one of
the principal modes of collecting funds was the sale of greeting cards by the
officials of the bank to their customers. They also alleged that officers , who
protested against the directive to sell greeting cards , were victimised by the
bank , and officers , who were highly successful 'card- sellers' were given
accelerated promotion over the heads of seniors. The respondent-Bank made a
statement before the High Court "that it has never at any time whatsoever
compelled its employees to sell greeting cards or collect funds for the Canara
Bank Relief and Welfare Society or any other institution; nor has the first
respondent-bank at any time considered the same as a relief factor for
evaluating performance of its employees for promotion; nor shall the first
respondent-bank do so in future." The High Court accepted the statement of
the respondent-bank and dismissed the writ petition. But , the petitioners were
not satisfied with the assurance given by the respondent bank and filed the
present special leave petition and the writ petition repeating the same
allegations and praying for "the issue of a writ in the nature of Mandamus
directing the respondents to forbear from using the bank officials/bank
machinery bank/resources for the purpose of collections of funds in the garb of
any welfare organisation.
755 While dismissing the petition and the
special leave petition as malicious and as designed to denigrate the management
of the bank , it was found by the Court during the course of the hearing that
the petitioners themselves were indulging in rash and feckless activities of the
very nature of which they were complaining against the respondents. Pursuant to
several orders made by the Court from time to time calling for detailed
information from both the parties about the activities of the Canara Bank
Relief and Welfare Society and the Canara Bank Staff Officers' Association and
the collections made for them and by them , it transpired that the Canara Bank
Officers' Association was formed in the year 1971. On August 18 , 1981 the
Association started the Canara Bank Officers' Association Trust Fund
registering it as a Public Trust under the Bombay Public Trust Act , 1950. Five
officers of the bank who were also office bearers of the Association were made
life trustees of the Association Trust Fund. Right from the date of formation of
the Trust , donations were collected by the members of the Officers'
Association from the customers of the bank. In the short span of about two
years , the funds of the Trust have swelled to more than Rs. twenty four lakhs.
The so-called donations range from sums in hundreds to thousands of rupees. The
number of donors is also quite large.
^
HELD: 1.1 While one does appreciate that
there must be several charitable inclined persons amongst the bank's customers
, there is no doubt that most of the customers that gave donations to the Trust
Fund must have felt obliged to do so because of favour received or expected to
be received by them. Even if no coercive methods were employed by the members
of the Association to collect donations , the customers must have felt morally
pressurized that otherwise their interests would not be properly taken care of
or would be jeopardised or neglected by the officers with whom they were
compelled to deal in the course of their business. [769C-D]
1.2 No employee of a nationalised bank or any
other Public Sector Corporation should engage himself in collecting 'donations'
for any trust or other organisation from persons with whom he comes into
contact in the course of his employment. It is not desirable. It is likely to
lead to unhealthy practices and harmful results , intended or unintended. In
the world of commerce , quid pro quo and not charity is the rule , Those in a
position of advantage by reason of their office have to be very wary. Otherwise
, they may unsuspectingly walk into traps. That is why the Central Civil
Services (Conduct) Rules , 1964 , for example , provide that no Government
servant shall , except with the previous sanction of the Government or of
prescribed authority , ask for or accept contributions to , or otherwise
associate himself with raising of any funds or other collections in cash or in
kind in pursuance of any object whatsoever (Rule 12). It is a rule of prudence-
It is a rule of common sense. It is born of wisdom gained by experience.
[771G-H; 772A-B]
2. The question , therefore , is what was to
be done with the Canara Bank Officers' Association Trust Fund- First , an
injunction on the same lines as that which was in force during the pendency of
the writ petition in this Court shall issue , that is , the officers of the
Canara Bank , their agents nominees are restrai 756 ned from directly or
indirectly recovering or manipulating to get any fund or contribution to the
Trust Fund. Second , no officer of the Canara Bank shall be permitted to hold the
office of life trustee , trustee or any other office of the Canara Bank
Officers' Association Trust Fund. Third , the Union of India , who has been
impleaded as a party shall be entitled to nominate five trustees who are not
connected with the Canara Bank to administer the Canara Bank Officers'
Association Trust Fund. Fourth , the trustees nominated by the Union of India
shall administer the Trust Fund in accordance with the provisions of the Bombay
Public Trusts Act and the deed of trust by which the Canara Bank Officers'
Association Trust Fund was created. fifth , the trustees appointed by the Union
of India shall hold office until appropriate arrangements are made by the
Charity Commissioner , Maharashtra on an application to be moved by the Central
Government within six months from today. Sixth , there shall be an inquiry by
the CBI into the conduct of the five life trustees in relation to the Trust
Fund and such further action as may be necessary may be taken by the CBI.
Any further direction which may be necessary
may be sought from the High Court of Bombay. [772D-G]
ORIGINAL JURISDICTION: Writ Petition No. 9933
of 1982 (Under Article 32 of the Constitution of India.) I) WITH
Special Leave Petition (Civil) , No. 13981 of 1982 From the Judgment and Order
dated 21. 10. 1982 of the Bombay High Court in W. P. No. 3137 of 1982.
S. Balakrishnan , M. K. D. Namboodiri and
Ramesh Keswani for the Petitioners.
K. N. Bhat and Ms. Madhu Moolchandani for the
Respondents.
The Judgment of the Court was delivered by
CHINNAPPA REDDY , J , . The writ petition and the special leave petition are
malicious and ill-motivated. But they have served one good purpose , namely ,
they have brought to light the undesirable activities of the petitioners
themselves. We will have some harsh things to say about the petitioners in our
judgment. Indian attempt to malign the top management of the Canara Bank , they
have exposed themselves and the allegations have boomeranged. The spider has
been caught in its own web.
The first petitioner in the writ petitions is
S.A. Kini , Deputy General Secretary of the Canara Bank Officers' Association
and the second petitioner is the Canara Bank Officers Association. The 757
respondents in the writ petition are the Union of India represented by the Secretary
, Ministry of Finance , Department of Economic Affairs , Banking Division ,
Canara Bank (a nationalised bank) , the Chairman and Managing Director of
Canara Bank and the General Manager of Canara Bank. The special leave petition
is directed against an order of the High Court of Bombay dated i; October 21 ,
1982 dismissing a writ petition filed by the same petitioners as in the writ
petition before us. The respondents to the petition for special leave are also
the same as in the writ petition.
The principal allegation made by the
petitioners in the writ petition filed in the Bombay High Court and repeated in
this Court is that the Chairman and Managing Director , the General Manager and
the top officials of the Management of Canara Bank have been using their
official position and authority to coerce the officers and staff of the Canara
Bank to collect funds for the Canara Bank Relief and Welfare Society. Apart
from seeking donations from customers , it is alleged that one of the principal
modes of collecting funds was the sale of greeting cards by the officials of
the bank to their customers. Each officer was allotted a certain quota and was
compelled to sell his quota of cards to customers. The petitioners further
alleged that officers , who protested against the directive to sell greeting
cards , were victimised by the bank , and officers , who were highly successful
'card-sellers' were given accelerated promotion over the heads of seniors.
Thiruvengandam was cited as an instance of a victimised officers who was denied
promotion while Annappa Pai was cited as an instance of an officer , who had
benefited and who was allowed to leap over several senior officers and was
promoted as a reward for his services by the sale of cards. The petitioners
also alleged that the top management was also interested in collecting funds
for- (i) Deposit Mobilisation Club , (ii) The Canara Bank Cultural Brotherhood
Organisation; and (iii) The Kamakoti Prabha Trust.
758 At the hearing before us , the
allegations in regard to the Deposit Mobilisation Club and the Canara Bank
Cultural Brother hood were abandoned. In regard to the Kamakoti Prabha Trust ,
the allegation was that it was started by one S. Venkataraman , who at the time
when it was formed , happened to be the Deputy General Manager of the bank. He
has long since retired from the bank and nothing has been shown to us as to how
the Kamakoti Prabha Trust is in any manner linked with the top management of
the bank or how the management has promoted the interests of the Trust. It is
unnecessary to pursue the allegations made in regard to the Kamakoti Prabha
Trust , which in our opinion have been made out of pure spite and mere
vexation. We are only left with the allegations made in connection with the
collection of funds and the sale of greeting cards for the benefit of the
Canara Bank Relief and Welfare Society. The allegation that Thiruvengandm was
superseded because he refused to sell greeting cards and the allegation that
Annappa Pai was given an accelerated promotion because of his excellent
performance in selling greeting cards remained mere allegations. There was no
material whatsoever placed before us to substantiate either of these
allegations. It was , however , asserted before us by the petitioners and admitted
by the respondents that until the year 1982 , the General Manager and other top
Officials used to associate them selves with the sale of greeting cards to
benefit the Canara Bank Relief and Welfare Society. It appears from the facts
placed before us that the Canara Bank Relief and Welfare Society was formed and
registered in the year 1961 at a time when the bank was a private bank. The
bank was nationalised in 1969 and thereafter the bank ceased to have anything
to do with the society , though out of a total membership of 2020 about 200
past and present employees of the bank only are now members of the society.
Until 1982 one individual director of the bank used to be one of the several
members of the Executive Committee of the Society , but the present position is
that no member of the Executive Committee of the Society is an official of the
bank. The only link of the bank with the society now is the name of the
Society. The memorandum of association of the society was also placed before us
and the objects of the society are wholly unconnected with the bank or its
employees. The principal objects are to provide relief in case of calamities
like flood , earthquake , fire , famine , epidemic , etc , to organise
hospitals , maternity and child welfare centers , homes for the poor , sick ,
aged 759 and disabled , to make cash contributions to educational and other
social welfare organisations , to undertake rural development programmes and so
on. None of the objectives involves any special benefit or advantage to the
employees of the bank.A great many details of the commendable work done by the
society have been given to us in the several statements filed on behalf of the
respondents. The petitioners , unfortunately , have needlessly dragged the
society into the picture' making unworthy allegations. But even so when the
writ petition was filed by the present petitioners in the Bombay High Court ,
the management of the bank realised that there may be some scope for abuse by
some officials of the bank in the matter of selling greeting cards or raising
funds for the society. They , therefore , made a statement before the Bombay
High Court in the following terms:
"The first respondent bank states that
it has never at any time whatsoever compelled its employees to sell greeting
cards or collect funds for the Canara Bank Relief and Welfare Society or any
other institution , nor has the first respondent bank at any time considered
the same as a relief factor for evaluating performance of its employees for
promotion , nor shall the first respondent bank do so in future." The High
Court accepted the statement of the respondent bank and rejected the writ
petition. The assurance given by the bank , as contained in the statement made
by the bank before the , Bombay high Court , should have satisfied the
petitioners if they had any genuine grievance that , in the past , officers of
the bank had been forced to raise funds and sell greeting cards for the benefit
of the society. But the petitioners were not willing to be easily satisfied.
They filed the present special leave petition
and the writ petition repeating the allegations made in the Bombay High Court
and praying for 'the issue of a writ in the nature of mandamus directing the
respondents to forbear from using the bank officials/bank machinery bank
resources for the purposes of collections of funds in the garb of any welfare
organisation in general and in particular in the name of the various funds ,
details of which were set out in paragraph 22 of the writ petition'. After the
statement filed by the bank in the High Court of Bombay , we are unable to find
any justification whatsoever for the petitio- 760 ners to pursue the matter by
filing the present special leave petition and writ petition except to harrow
the bank When we pointedly and repeatedly asked the learned counsel for the
petitioners whether there was a single instance of a sale of greeting card or
collection of funds by an official of the bank subsequent to the order of the
Bombay High Court on October 21 , 1982 , the learned counsel was unable to cite
a single instance , but persisted in referring to the sale of greeting cards
before the order of the Bombay High Court. Ultimately he had to admit that
there was not a single instance of sale of greeting cards or collection of
funds by officials of the bank subsequent to the order of the Bombay High
Court. We have no hesitation in holding that the writ petition and the special
leave petitioners both malicious and are designed to denigrate the management
of the bank. Sri K N. Bhatt' learned counsel for respondents (2to 4) assures us
that the bank stands by the statement made before the Bombay High Court. We
have , therefore , on hesitation in dismissing the writ petition and the
special leave petition with costs which we quantify at Rs. 10,000 in each.
But that is not an end of the matter. Right
at the commencement , when the petitions came up for admission , the court came
to be oppressed by the vast opportunity for abuse of financial power presented
to Nationalised Banks and Financial Institutions of the Public Sector. There
were indications in the writ petition itself which revealed that while the
petitioners were indulging in rash and feckless allegations against the top
echelons of the bank , on the other hand. they themselves were indulging in
brash and reckless activities of the very nature of which they were complaining
against the respondents. It appeared to the court that the petitioners , hands
were unclean , and that they were by no means the champions of the 'oppressed'
officers of the bank. There was one significant paragraph in the writ petition
, which though meant to mislead the court , exposed them. In paragraph 12 of
the writ petition , it was stated.
"12. That realising the importance of
strict observance of legal and moral norms in bank business , the Central
Government had issued the following directive:- 761 Immediate F.No.6/9/5/82 ,
I.R.
Government of India Ministry of Finance
Department of Economic Affairs (Banking Division) New Delhi , the July 22 ,
1982.
Chairman , Indian Banks' Association ,
Bombay.
Subject:..-.... Bank officers , Association
Trust Fund- Collection of funds and creation of trust- Dear Sir.
I am directed to state that it has come to
the notice if the Government that-Bank Officers' Association has formed a Trust
by name-Bank Officers' Association Trust Fund , which is registered in 1981
under the Bombay Public Trust Act , 1950 and it has also been granted exemption
under section 80-G of Income Tax Act for donations made by assesses to the
Fund. Apart from using bank's name which will have avoidable misgivings in the
clientele , trust Fund has issued an appeal soliciting donations etc. from
general public. We feel that even as members of the Association , the employees
cannot collect funds from the public and the clients to the bank as it
constitutes a clear misuse of their office. I am , therefore , to suggest that
IBA may consider advising member banks to ensure that such trusts are not set
up elsewhere.
Kindly acknowledge receipt of the letter.
Yours faithfully , Sd/- ( Yashwant Raj )
Under Secretary to the Government of India This directive has been flagrantly
violated by the top management of the bank and personal aggrandizement of
staggering proportions are being made at the cost of the 762 Bank and at the
cost of the depositors money." It was a blatant case of supprecssio veri
and suggestio falsi The petitioners sought to imply and suggest that the
directive of the Central Government was directed against the activities of the
top management of the Bank in connection with the collection of funds for the
Canara Bank Relief and Welfare Society , a society which was in existence years
before the nationalisation of banks was thought of , whereas the truth was that
the directive was a direct consequence of the complaints received against the
activities of the petitioners in collecting funds for the Canara Bank Officers
Association Trust Fund. The allegations in the petition and the reference in
paragraph 12 to the " Bank Officers' Trust Fund" provoked the court
into a deeper probe as it was felt that the customer-public was being exploited
by some officers of the bank and the matter needed comment and required
correction. Thereafter we made several orders from time to time calling for
detailed information from both the parties about the activities of the Canara
Bank Relief and Welfare Society and the Canara Bank Staff Officers. Association
and the collections made from them and by them. The orders made by us are self
explanatory and are worth extracting since they give a picture of the dilatory
and recalcitrant attitude of the present petitioners. We propose to extract the
orders in so far as they relate to the petitioners only , since we have already
absolved the respondents. By our order dated January 17 , 1983 , we directed ,
"The petitioners are directed to give the following detailed information.
There is a trust called "Canara Bank
Officers" Association Trust Fund , which is alleged to have been formed on
August 18 , 1981. The petitioners will have detailed information since the
constitution of the Trust of its office bearers and their position in the Bank
including the designation and salary as also if any emoluments in cash or kind
is drawn from the Trust. The petitioners will also give detailed information of
every contribution made to this Trust with reference to the party's name , his
dealing with the bank as a customer and the amount contributed by the party to
the trust and how the contributors were 763 persuaded to make the contributions
and the motives for contribution , as also service received by each contributor
from the bank , with reference to the branch. If there are withdrawals from the
trust , the details should be furnished with the name of the person who has withdrawn
the amount and where the money is at present kept or deposited and how the
money was utilised. Withdrawal by cash or demand draft may be separately
mentioned.
By our order dated April 27 , 1983 , we
directed , "By an order made by this Court on January 17 , 1983 , this
Court directed the petitioners to give the following information in respect of
a Trust called Canara Bank Officers' Association Trust Fund. The information
was to be given under the following heads:
1. Names of the office bearers of the Trust
since its inception.
2 The position of each trustee in the
organisation of the bank showing the designation , the place of work and salary
drawn.
3. Whether any salary or emolument of any
kind return in cash or kind was drawn from the aforementioned Trust.
4. If the answer to query 3 is in the
affirmative the mode and method of payment.
5. Name of each contributor to the Trust fund
, the amount of contribution , relation of the contributor to the bank and
whether at any point of time , the contributor had been using or enjoying the
services of the bank especially from the branch in which the trustee was
working and the contributor was connected to the branch.
6. If the contributor is not connected with
the bank organisation , the reasons and the motives for making contribution to
such a trust? the beneficiaries of which 764 are none other than the officers
of Canara Bank.
7. The service received by each contributor
from the bank or its branch since making the contribution or since six months
prior to the making of the contribution.
8. Withdrawal from the Trust fund , if any
made by whom in what amount on what date and for what purpose and whether the
withdrawal was in cash , cheque or demand draft.
The petitioners were called upon to furnish this
information when the matter was taken up for hearing. Mr.
R.K. Garg , learned counsel for the
petitioners read out the affidavit of Mr. S.A. Kini dated February 18 , 1983.
We also went through the accompaniments to the affidavit. We are satisfied that
the petitioners have not given full details under every head and there is
non-compliance with the order of the Court.
We direct the petitioners to fully comply
with the order of this Court giving information under each of the separate head
as set out here inn before except those where the information has already been
supplied as an annexure to the afore-mentioned affidavit In that case , the
deponent shall state which annexure of the earlier affidavit complies with the
Court's direction. This information must necessarily be supplied by July 17 ,
1983 and the matter shall appear on board on July 25 , 1983.
Both the parties including their officers ,
agents or nominees are injuncted from directly or indirectly recovering or
manipulating to get any fund or contribution to the trust funds , one mentioned
in our order and those other mentioned at page 16 of the writ petition
hereafter.
This will not come in the way of the
association recovering the membership fee from the members who arc bonafide
members and are on the staff of the bank.' We direct accordingly. " 765 By
our order dated August 30 , 1983 , we again directed , Petitioner No. 2 , the
Canara Bank Officers' Association shall give full detail of the donations
collected by the said Association , commencing from 1970 till today. While
giving the details of the donation , the Association shall specify the name of
the donor not the branch from which the donation was received , the amount of
donation , the full name and address of the parties giving donation , its
relation with the bank , and also to specify the branch through which the
parties were getting banking service and alteration and or modification of
banking service or facilities granted since giving of the donation and which
officers motivated persons to give donation to the Association as also the name
and full address of the officer. If possible , the Association may state the
motivation for the donation.
The Canara Bank Officers' Association Trust
shall give full details of the donation received from the public giving some
details as hereinabove indicated as in the case of Canara Bank Officers'
Association. Let it be noted that the details given till now are far from
sufficient and are evasive in character. It must state whether a receipt is issued
to each individual donor and whether counter foils are preserved.. ' Finally ,
by our Order dated August 23 , 1984 , we observed and directed:
"By our detailed order dated April 27 ,
1983 , the petitioners were directed to give , amongst others , the following
information in respect of Canara Bank Officers' Association Trust Fund ('Trust'
for short):
"Name of each contributor to the Trust
fund , the amount of contribution , relation of the contributor to the bank and
whether at any point or time , the contributor had been using or enjoying the
services of the bank especially from the branch in which the trustee was
working and the contributor was connected to the branch." 766 S.A. Kini ,
one of the petitioners , filed his affidavit to which was annexed a list
showing the amount received from each individual/firm/company. It is annexure
IV at pages 126-163 of Volume-l.
It immediately transpired that there was a
deliberate attempt at evading the court's order with a view to relevant
information being not made available.
The Court by its order dated August 30 , 1983
, gave certain specific directions. Petitioners No.2 was specifically directed
to give further detail of the donations collected by the trust from 1970 till
the date of the order. It was clarified so as to leave no one in doubt that the
petitioners shall specify the name of the donor (not branch from which donation
was received) , the amount of donation , the full name and address of the
parties giving the donation and the relation , business commercial or other
wise of the donor to the bank and to further specify the branch through which
the donor parties were getting banking services and facilities from the Canara
Bank. The petitioners were also directed to state whether there was any advantageous
alteration or modification of the - banking services or facilities granted to
the donor since the donation as also to indicate and specify the name of each
of the officers who were members of the Trust and who facilitated such
alteration or modification advantageous to the customers in respect of banking
facilities. The name of the officer and his full address was also directed to
be stated. The petitioners were also directed , if possible , to state the
motivation for the donation.
There was noticeable reluctance on the part
of the petitioners to implement this order or at any rate to avoid compliance
with the same. On the last occasion , the Court directed the petitioners
strictly comply with the aforementioned order.
Yesterday when the matter came up for hearing
, a statement running into about 24 pages not signed by any responsible person
and not verified by an affidavit was 767 placed on record. We would be
perfectly justified in ejecting this spurious document as unworthy of being
looked into. Mr. M.K. Ramamurthy repeatedly , though wholly unsuccessfully ,
tried to persuade us to hold that the state is in compliance with the orders of
this Court. A mere glance at the statement would show that it is a futile
repetition of a bizarre exercise which resulted in the statement Annexure IV
volume I and by the information supplied by the statement we are in no way
wiser. The purpose for calling upon the petitioners to submit the name of each
donor was to identify the donor so that a detailed enquiry can be made as to
how the officers of the Trust misusing are abusing their petition have procured
donations by granting banking facilities to the donors. The additional purpose
was also to ascertain whether the donors were coerced into making the so-called
donations at the instance of the officers of the Trust so that a detailed
enquiry can be undertaken to ascertain the use and misuse and abuse of the
office by the members of the Trust.
The petitioners have been consistently
striving to suppress this information from the court. This becomes evident from
the fact that even the statement filed yesterday and marked as Volume VI the
name of the donor is mentioned without the address or even the city in which
the donor was residing or having his place of business. It is not stated what
banking facilities the donors obtained since the donation and through which
officer. Every covert or overt attempt is made to withhold the identity of the
donor to thwart the court to reach the donor so that the shady of the members
of the Trust in collecting the so-called donations can be unearthed.
Apart from the statement being barren , it is
not supported by an affidavit and as it does not appear to have been signed by
any responsible officer. We reject it as unworthy of any credence. The result
is that till today there is non-compliance with the aforementioned orders of
the court.
768 It was made specifically clear that the
name of the donor and the address must be clearly specified. Even after long
lapse of more than year and a half since the order , the information is branch
wise which was categorically rejected by this Court. The specific instances
which remains unexplained are pointed out by Mr. K.N. Bhatt , learned advocate
for the Canara Bank in his statement annexed to the letter dated August 22 ,
1984. The statement is taken on record.
We propose to give last opportunity to the
petitioners to comply with the orders of this court in letter and spirit. ANY
attempt at deviance or defiance will unquestionably land to serious consequences
which we refrain from specifying at this stage. We record our utter disapproval
of this hide and seek game of the petitioners and we want to leave no one in
doubt that they do so was at their own peril. The arms of law are long and
strong to reach them and no effort will be spared to unearth their illegal
activities if once they are so established. It is not for a moment suggested
that we so held. But this escapist attitude of the petitioners have raised
strong suspicion in our minds that there is something improper , illegal and
unbusiness-like in their conduct disclosing either misuse or abuse of office by
the officers of the , Canara Bank in collecting a huge amount as donation from
the customers of the bank for the purpose of the trust. What is stated is just
a warning.
We direct that petitioners shall comply with
the orders as hereinabove as indicated within a period of 6 weeks from today.
The matter shall come up before this Bench after 6 weeks." Pursuant to the
last of our orders , the petitioners have filed some more statements , but even
so the full information which we desired to have has not been furnished. The
reason is fairly obvious and we consider it unnecessary to further dilate on
this matter. From the information now available to us as a result of the
several statements filed before us , it transpires that the Canara Bank
Officers' Association was formed in the year 1971. On August 18 , 1981 the
Association started the Canara Bank Officers' Association Trust Fund
registering it as a Public Trust under the Bombay 769 Public Trust Act , 1950.
Five officers of the bank who were also office bearers of the Association were
made life trustees of the Association Trust Fund Right from the date of
formation of a Trust , donations were collected by the members of the Officers'
Association from the customers of the bank. In the short span of about two
years , the funds of the Trust have swelled to more than Rs. twenty four
lakhs.- The so-called donations range from sums in hundreds to thousands of
rupees. The number of donors is also quite large. While one does appreciate
that there must be several charitably inclined persons amongst the bank's
customers , we do not have any doubt that most of the customers that gave
donations to the Trust Fund must have felt obliged to do so because of favours
received or expected to be received by them. Even if no coercive methods were
employed by the members of the Association to collect donations , the customers
must have felt morally pressurised that otherwise their interests would not be
properly taken care of or would be jeopardised or neglected by the officers
with whom they were compelled to deal in the course of their business. Very
shortly after the formation of the Trust Fund , complaints began pouring in
against the collection of funds for the Association Trust Fund by the officers
of the bank. The All- India Bank Depositors' Association complained to the
Central Minister incharge of banking as follows :
"We are receiving complaints that some
bank employees are pressurising customers for donations for various activities
which have nothing to do with the bank as such.
For instance these funds are demanded for
conferences , for helping the family of deceased employees , etc. Where
customers fail to respond , they begin to face problems and difficulties in
their banking transactions.
You are aware of the hostile public attitude
towards bank employees and the costs imposed on the economy as a result of poor
service and frequent disruption of work.
Without allowing the situation to deteriorate
further the public expect the Government to take remedial steps. This is an
opportunity for the Government to prove that it is responsive to public
criticism. " 770 The Management of the Canara Bank also received numerous
complaints. Feeling rightly disturbed by the complaints received , the
Management called upon the Association to furnish particulars of the
collections made by the officers and sent the following telex message to the
Association:
"This is with reference to the Canara
Bank officers Association Trust Fund formed by the association for which an
appeal also has been issued to the public for donations.
We also learn that funds are being collected
from the bank's clients as was from the public and the (- staff by way of
donations and coupons. Usage of the name of Canara Bank for a Trust of such
type has led to the impression amongst our clients that the bank is also having
a role and interest in this Trust. Apart from other reasons we are afraid that
the usage of the bank's (I name in a Trust which is not formed by the bank
besides creating complications may become a bad precedent for some others to
form similar trusts. While we have no objection for your collecting funds from
our own officers we request you not to collect funds from customers and the
public. We also request you to kindly furnish to us the particulars of
collections already made by you from the bank's clients and from the public as
we intend referring the matter to our Board at its next meeting and the
Ministry for their consideration." The Board of Directors discussed the
matter and confirmed the action of the bank. They also looked with disfavor on
the collection of funds from customers by the Association. They desired the
bank to convey the information to the Ministry for appropriate action and
follow-up measures. Thereupon the Bank addressed a detailed letter to the
Government of India seeking guidance after setting forth the objects of the
Trust , etc. and the action taken by them till then. The response of the
Government was immediate " and categoric.
The Government said:- "Please refer to
your letter No. IRS/l. 2220. TPM dated 18 6.1982 regarding Canara Bank
Officers' Association Trust Fund. We would request you to pursue this matter
seriously. Even as members of the Association the 771 employees cannot solicit
funds from the public. This is clearly a misuse of their office. We would like
to be informed of the further developments in the matter." In addition to
writing to the Chairman of the bank as aforesaid , the Government also wrote to
the Chairman , Indian Banks' Association , Bombay a letter which was extracted
in paragraph 12 of the writ petition and which has also been quoted by us
earlier. In turn the Indian Bank's Association addressed the Chief Executives
of all public sector Banks and told them:
"In one of the member banks in the
public sector the officers' Association had formed a trust and taken exemption
under section 80-G of the Income Tax Act for receiving donations to the fund.
On the question of the propriety of creating such trusts and collecting funds
from the public , the Government is of the view that it would constitute a
clear misuse of their office by the employees. We have been requested by the
Government to advise all public sector banks to ensure that such trusts are not
set up.
We reproduce overleaf a copy of the
communication received by us from the Banking Division for your information and
necessary action." It is clear from what has been stated above that the
writ petition in this Court and the writ petition filed in the Bombay High
Court which led upto the special leave petition are retaliatory actions
consequent on the displeasure expressed by the Management and , on account of
the Management , by the Board of Directors and the Central Government. We are
of the firm opinion that no employee of a nationalised Bank or any , other
Public Sector Corporation should engage himself in collecting 'donations' for
any trust or other organisations from persons with whom he comes into contact
in the course of his employment. It is not desirable. It is likely to lead to
unhealthy practices and harmful results , intended or unintended. In the world
of commerce , quid pro quo and not charity is the rule. Those in a position of
advantage by reason of their office have to be very wary. Otherwise , they may
unsuspectingly walk into traps. That is why the Central Civil Services
(Conduct) Rules , 1964 , for example , provide that no Government servant shall
772 except with the previous sanctions of the Government or of prescribed
authority , ask for or accept contributions to , or otherwise associate himself
with raising of any funds or other collections in cash or in kind in pursuance
of any object whatsoever. (Rule 12). It is a rule of prudence. It is a rule of
commonsense. it is born of wisdom gained by experience. We fully endorse the
raison d'etre behind the rule. We also endorse what has been said by the bank
in its telex message to the officers' Association , by the Government in its
letters to the bank and to the Indian Banks' Association and by the Indian
Banks' Association to the Chief Executives of all Public Sector Banks , all of
which we have extracted earlier in this judgment.
The question , therefore , is what has to be
done with the Canara Bank Officers' Association Trust Fund. First , an
injunction on the same lines as that which was in force during the pendency of
the writ petition in this Court shall issue , that is , the officers of the
Canara Bank , their agents or nominees are restrained from directly or
indirectly recovering or manipulating to get any fund or contribution to the
Trust Fund. Second , no officer of the Canara Bank shall be permitted to hold
the office of life trustee , trustee or any other office of the Canara Bank
Officers' Association Trust Fund. Third , the Union of India , who has been
impleaded as a party shall be entitled to nominate five trustees who are not
connected with the Canara Bank to administer the Canara Bank Officers'
Association Trust Fund. Fourth , the trustees nominated by the Union of India
shall administer the Trust Fund in accordance with the provisions of the Bombay
Public Trusts Act and the deed of trust by which the Canara Bank Officers'
Association Trust Fund was created. Fifth , the trustees appointed by the Union
of India shall hold office until appropriate arrangements are made by the
Charity Commissioner , Maharashtra on an application to be moved by the Central
Government within six months from today. Sixth , there shall be an enquiry by
the CBI into the conduct of the five trustees in relation to the Trust Fund and
such further action as may be necessary may be taken by the CBI. Any further
direction which may be necessary may be sought from the High Court of Bombay.
M.L.A. Petitions dismissed.
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