Delhi High Court upholds termination of SBI employee who siphoned off deposits into his personal account

The Delhi High Court has observed that incidents of siphoning off of deposits made by senior citizens in a bank would lead to a loss of trust and faith in the system, which is not only a monetary loss but also a loss of goodwill of customers (Assistant General Manager State Bank of India v Ashok Kumar Bhatia).

. The observations were made by single-judge Justice Prathiba M Singh while upholding the termination of an employee of the State Bank of India (SBI) named Ashok Kumar Bhatia, accused of siphoning off deposits made by senior citizens into his personal account.

. Bhatia had joined the bank in 1983 and worked as a single-window operator dealing with the Senior Citizens Saving Scheme. He was terminated by the bank in May 2010 for making entries of customers in his personal accounts.

However, the termination was challenged by Bhatia before the Central Government Industrial Tribunal-cum-Labor Court (CGIT), arguing that there were several violations in the departmental inquiry by the bank. He argued that the inquiry was a sham and merely a legal formality which was violative of the principles of natural justice. It was submitted that his actions resulted in no monetary loss to the bank.

In December 2016, the CGIT held that the bank could not adequately discharge its burden to prove misconduct and reinstated Bhatia with full back-wages.

The order was challenged by the bank before the Delhi High Court.

. Justice Singh has said that the banking system is the backbone of a country's economy and therefore its employees and officials have a larger responsibility of ensuring its integrity to maintain the trust of millions of customers.

The Court held that the cheques and entries in the passbook as well as the transfer of money into Bhatia’s/his wife’s bank account is sufficient evidence to hold that he had used money for his own personal needs even though he returned it later with interest. It took note of the incident where one Surjeet Kaur gave a blank cheque to Bhatia by only putting the amount without the name of the payee.

. Justice Singh said that these two incidents are sufficient for the bank to have lost faith and confidence in Bhatia since he was misusing his status for his own personal benefit.

“Once there is a loss of confidence, that too by a Bank qua one of its officials, the standard on which such loss of faith/confidence is to be tested cannot be a very high standard. Even a suspicion or doubt, with some credibility or some evidence, would be sufficient to objectively uphold the dismissal from service. The Court cannot lose sight of the reality that customers who visit banks do develop friendly relationships with officials, however, such officials then have a larger duty and responsibility to safeguard their customers, as well as the interests of the bank, rather than to misuse their trust and faith in the banking system,” the Court said.

The question whether the bank suffered any loss as a consequence of his actions would not be relevant for the defense of the Respondent, the judge emphasised.

"In any event, this Court is of the opinion that the incidents which have surfaced, may just be those which have come to the knowledge of the officials of the Bank. Such incidents in any branch of a Bank would lead to a loss of trust and faith in the Bank, especially in the case of local customers as they can spread such incidents through word of mouth. Thus, the loss is not to be adjudged only monetarily but also in terms of the goodwill/ faith of the customers in the Bank, and the consequent loss of trust for a Bank. This by itself is sufficient. It is the clear conclusion of this Court that when there is loss of confidence, reinstatement ought not to be permitted,” the Court added.

. The Bench, however, directed the bank to pay ₹ 20 lakh as lumpsum payment to Bhatia as he had not received any monthly remuneration during the pendency of the petition, and would have superannuated only in 2023, and because the termination was held to be valid only through the instant order.

. Advocates Rajiv Kapur and Akshit Kapur appeared for the petitioner-bank, while Bhatia was represented by advocate AK Singh.

. [Read Judgment]

Delhi High Court upholds termination of SBI employee who siphoned off deposits into his personal account

Prashant Jha

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