The Allahabad High Court has ruled that a confessional statement allegedly made to the police cannot be the sole basis for imposing a major penalty like dismissal in a departmental proceeding. In a case involving a State Bank of India (SBI) employee dismissed over a Rs. 55 lakh fraud, the Court, finding a complete lack of independent evidence, set aside the dismissal order, terming it a “case of no evidence.”
The judgment was delivered by Justice Saurabh Shyam Shamshery in the case of Jag Pal Singh vs. Union of India and 3 Others. The Court quashed the dismissal order dated June 20, 2018, passed by the SBI’s Disciplinary Authority and the subsequent undated appellate order, directing that the petitioner be reinstated with continuity of service and 1/4th of his back wages.
Background of the Case
The petitioner, Jag Pal Singh, was a cashier at the Gonda branch of the State Bank of India. He became embroiled in legal trouble after an FIR was lodged on June 20, 2024, by a customer, Asha Pundir, alleging the fraudulent withdrawal of Rs. 55 lakhs from her bank account. The petitioner was named as an accused during the investigation, arrested on November 26, 2014, and subsequently released on bail on February 9, 2015. A criminal trial against him is still pending.
Concurrently, the bank initiated disciplinary proceedings against him. A departmental charge-sheet dated February 28, 2015, accused him of three main irregularities:
- Breaching the bank’s confidentiality.
- Committing fraud through complicity.
- Causing a financial loss of Rs. 55.20 lakhs and irreparable damage to the bank’s reputation.
The Inquiry Officer, in a report dated October 9, 2015, found all three charges to be “substantiated.” The findings heavily relied on a police diary report (Dex-1/110-130) which purportedly contained the petitioner’s admission of sharing the customer’s account information with fraudsters. The Disciplinary Authority, based on this report, dismissed the petitioner from service on December 10, 2015.
This dismissal was challenged in an earlier writ petition, and a Coordinate Bench of the High Court on March 21, 2018, quashed the order. The Court found that the Disciplinary Authority had failed to record reasons or properly consider the petitioner’s reply, remanding the matter for a fresh decision with specific directions.
Following the remand, the Disciplinary Authority passed a new order on June 20, 2018, once again imposing the penalty of “dismissal from service without notice.” This second dismissal order and the subsequent rejection of his appeal became the subject of the present writ petition.
Arguments of the Parties
Counsel for the Petitioner, Sri Satyendra Chandra Tripathi, argued that the Disciplinary Authority had failed to comply with the High Court’s earlier directions in “letter and spirit.” The primary contention was that the entire disciplinary action was founded upon the petitioner’s alleged confession to the police, which is inadmissible as the sole piece of evidence in a departmental inquiry. It was submitted that no independent witness was examined, and crucial evidence like the video recording of the alleged confession was never produced.
Reliance was placed on the Supreme Court’s judgment in Roop Singh Negi vs. Punjab National Bank and others, (2009) 2 SCC 570, where it was held:
“The purported evidence collected during investigation by the investigating officer against all the accused by itself could not be treated to be evidence in the disciplinary proceeding. No witness was examined to prove the said documents.”
Counsel for the Respondent-Bank, Sri Pankaj Srivastava, countered that the High Court’s directions had been strictly followed. He argued that the scope of judicial review in departmental proceedings is very limited and that the standard of proof required is “preponderance of probabilities,” not the stricter standard of “beyond reasonable doubt” applicable in criminal trials. He contended that as long as the findings are supported by some evidence, the High Court should not re-appreciate it.
Court’s Analysis and Decision
Justice Shamshery, after perusing the record, found that while the procedural directions from the previous High Court order were followed, the substantive basis of the punishment remained flawed.
The Court observed that the findings on the charges were almost exclusively based on the petitioner’s alleged confession to the police. On the first charge of breaching confidentiality, the Court noted, “it is only based on a statement of petitioner recorded before Police in investigation.” On the second charge of fraud, the finding was based on the testimony of a witness (PW-1) who merely stated that the petitioner had confessed his guilt to the police.
The judgment firmly establishes a critical legal principle:
“The statement made before Police Authorities cannot be made a sole ground to punish petitioner in a departmental proceedings. Inquiry ought to have been conducted by considering independent evidence but it appears that in present case the departmental proceedings were proceeded only on basis of statements recorded during investigation including of the petitioner.”
The Court clarified the doctrine of “preponderance of probability,” stating, “Preponderance of probability does not mean that entire proceeding would be made on probabilities only. There must be some evidence to support the allegations levelled against delinquent employee.”
Citing the Supreme Court’s decision in United Bank of India vs. Biswanath Bhattacharjee, (2022) 13 SCC 329, the Court reiterated that a punishment order can be interfered with if it is based solely on a confessional statement made to the police without any other material.
Concluding that there was “absolutely no material on record that petitioner was directly or indirectly committed alleged fraud,” the Court deemed it a “case of no evidence.” The Court held:
“The impugned order is failed in the test of preponderance of probability since it was based only on alleged confessional statement made by petitioner before Police, which cannot be read in its entirety against the petitioner in a disciplinary proceeding without any independent support.”
Consequently, the writ petition was allowed, and the impugned dismissal order of June 20, 2018, and the appellate order were set aside. The Court granted the bank liberty to proceed afresh or await the outcome of the pending criminal trial. On the issue of relief, the Court, while noting the “no work no pay” principle, awarded the petitioner 1/4th of his salary for the period he was out of service and ordered continuity in service.
