Institute of Legal and Management Studies

The Supreme Court on Wednesday (Aug. 20) reiterated that writ courts can interfere with disciplinary inquiries only in cases of procedural irregularities or violation of natural justice.

The bench of Justices Rajesh Bindal and Manmohan allowed the State Bank of India's appeal, restoring the disciplinary authority's decision to remove a bank employee accused of corruption. The Court set aside the Patna High Court's order, holding that it wrongly interfered with the disciplinary inquiry despite no procedural irregularity or breach of natural justice.

In support, the court referred to the case of SBI v. Ajai Kumar Srivastava (2021), where it was held that “the power of judicial review in the matters of disciplinary inquiries, exercised by the departmental/appellate authorities discharged by constitutional courts under Article 226 or Article 32 or Article 136 of the Constitution of India is circumscribed by limits of correcting errors of law or procedural errors leading to manifest injustice or violation of principles of natural justice and it is not akin to adjudication of the case on merits as an appellate authority which has been earlier examined by this Court...”

It was the case where the Respondent-Ramadhar Sao, who joined SBI as a Class IV employee and later became an Assistant, faced allegations (2008–2010) of acting as a middleman for loan sanctions in return for bribes and remaining absent without authorization. An internal inquiry confirmed the charges, with loan recipients testifying against him.

The Disciplinary Authority dismissed him in 2011, but on appeal, the penalty was reduced to removal with superannuation benefits in 2012. Sao challenged this before the Patna High Court, which ordered his reinstatement with back wages. The dismissal of the Bank's intra-court appeal prompted the Bank to move to the Supreme Court

Setting aside the impugned decision, the judgment authored by Justice Bindal observed that the High Court erred in interfering with the disciplinary findings even when no case of violation of principle of natural justice was made out.

“It is not the case of the respondent that there was violation of principles of natural justice. Meaning thereby, due process was followed during the course of inquiry. The Inquiry Officer appreciated the evidence led by five loanees who categorically deposed that they had paid money to the respondents for coordinating sanction of their loans despite their documents being deficit.”, the court observed after founding that the Respondent-employee was involved in corrupt activities.", the court said.

Further, the Court stated that failure of the disciplinary authority to furnish detailed reasons in an order imposing punishment cannot be fatal to the disciplinary proceedings if the order imposing the punishment was passed after accepting the findings recorded by the Enquiry Officer. [Refer Boloram Bordoloi v. Lakhimi Gaolia Bank and Others (2021)]

“For the reasons mentioned above, in our opinion, the impugned orders passed by the Single Bench and the Division Bench of the High Court cannot be legally sustained. The same are liable to be set aside. Ordered accordingly. The order passed by the Appellate Authority dated 07.12.2012 imposing punishment of 'removal from service' with superannuation benefits stands restored.”, the court held.

Cause Title: STATE BANK OF INDIA & OTHERS VERSUS RAMADHAR SAO

Citation : 2025 LiveLaw (SC) 823

Click here to read/download the judgment

Appearance:

For Petitioner(s) : Mr. Sanjay Kapur, AOR Mr. Surya Prakash, Adv. Ms. Shubhra Kapur, Adv. Ms. Mahima Kapur, Adv. Ms. Akanksha Bhatia, Adv. Ms. Annu Mishra, Adv.

For Respondent(s) : Mr. Devashish Bharukha,Sr.Adv. Ms. Sarvshree,Adv. Ms. Rita Jha, AOR (Through V.C.)