Disciplinary Charge Sheet Quashed Where Bank Failed To Await CVC Advice; Retirement Benefits Directed

A bench of Justices Abhay S. Oka and Augustine George Masih heard an appeal by a retired Deputy General Manager of a public sector bank challenging a chargesheet and the continuation of disciplinary proceedings after the bank had acknowledged a "vigilance angle" and sought first-stage advice from the Central Vigilance Commission (CVC). The appeal arose from a Special Leave Petition against the Division Bench and Single Judge orders of the Allahabad High Court that had refused to quash the chargesheet.

The Court allowed the appeal and held that the respondent bank could not lawfully serve the chargesheet after having itself acknowledged the need to obtain CVC first-stage advice but before receiving and considering that advice. The Court found the bank’s conduct arbitrary and unjustified, particularly given the appellant’s long, unblemished service and the proximity to his date of superannuation. The Court, in its reasoning, observed: "Thus, the respondent-Bank accepted that Regulation 19 of the 1976 Regulations was applicable and therefore, first-stage advice of the CVC was sought. Even before getting the first stage advice, on 10th June 2019, the charge sheet was kept ready which was served upon the appellant on 18th June 2019. In this case, the Respondent Bank itself accepted the necessity of seeking first-stage advice from the CVC. Therefore, it was not open for the Bank to serve the charge sheet without receiving and considering the first stage advice by the CVC." The Court further noted that "the actions of the respondent-Bank are mala fide and arbitrary" and quashed the disciplinary proceedings and the charge sheet. The Court directed that the appellant was entitled to all retiral benefits but "shall not be entitled to any back wages."

Background The appellant had served the Union Bank of India for about 34 years and was to retire on 30 June 2019. The bank suspended him on 21 August 2018, alleging casual sanctioning of credit facilities in multiple accounts. Show-cause notices were served in January and March 2019. The bank filed affidavits in earlier High Court proceedings acknowledging that the matter had a vigilance angle and stating that first-stage advice of the CVC had been sought in terms of Regulation 19 of the Union Bank of India Officers Employees’ (Discipline & Appeal) Regulations, 1976. Despite those affidavits, an ante-dated chargesheet dated 10 June 2019 was served on the appellant on 18 June 2019 before the bank received the CVC’s advice.

The appellant challenged the chargesheet before the Allahabad High Court; a Single Judge earlier quashed the suspension as arbitrary but later dismissed the writ challenging the chargesheet. The Division Bench affirmed that it was not necessary to obtain CVC advice before issuing a chargesheet. On appeal, the Supreme Court observed that because the bank had itself acknowledged the applicability of Regulation 19 and had sought first-stage advice, it could not then serve the chargesheet without waiting for and considering that advice. The Court found the timeline and conduct — seeking CVC advice only nine months after suspension and serving a chargesheet twelve days before superannuation — unfair to the employee. The Court quashed the disciplinary proceedings, directed payment of all retiral benefits due to the appellant within three months, and specified that the appellant would not be entitled to back wages. The Court observed that almost six years had elapsed since superannuation and it would be unjust to permit resumption of proceedings.

Case No.: Civil Appeal No.7039 of 2025 (arising out of Special Leave Petition (C) No.26933 of 2019); Citation: 2025 INSC 744 Case Title: A.M. Kulshrestha v. Union Bank of India and Ors. Appearances: For the Petitioner(s): [Not indicated in the judgment] For the Respondent(s): [Not indicated in the judgment]