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TMI Blog2018 (11) TMI 1952X X X X Extracts X X X X X X X X Extracts X X X X ..... such actions and committed such omissions which showed lack of care, caution, or reasonable judgment and were grossly negligent in nature". In an elaborate order dated 30th July 2016, the Disciplinary Authority discussed in detail the findings in the Inquiry Report and concluded that the Appellant "did reckless financing", "did not care for the rules and procedures of the Bank", "misused his position" and ultimately concluded that his acts were "unbecoming of an officer". The Disciplinary Authority held that the ends of justice would be met by inflicting upon the Appellant the punishment of compulsory retirement. 4. Soon after the Disciplinary Authority passed the above order on 30th July 2016, a criminal case was registered by the Central Bureau of Investigation ('CBI') in Ghaziabad on 28th September 2016 under Sections 420, 468, and 471 IPC read with Sections 13(2) and 13(1)(d) of the Prevention of Corruption Act 1988 ('PC Act'). 5. Two consequential actions followed. One was that in the pension payment order dated 10th July 2017, there was a cut in the pension payable to the Appellant. However, that does not form the subject matter of the present appeal since, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9;s pension, the impugned judgment of the learned Single Judge is set aside and it is clarified that this issue relating to the cut in pension will be decided on merits by the High Court of Judicature at Allahabad in the writ petition pending before it. 10. Mr. Trideep Pais, learned counsel for the Appellant, has on instructions confined his challenge to the judgment of the learned Single Judge to the extent that forfeiture of the entire gratuity payable to the Appellant has been upheld. He submits that there was no remedy available to the Appellant under the PG Act regarding the forfeiture of gratuity. He referred to Section 4(6)(b) thereof and submitted that, in order to justify the forfeiture of the gratuity, it was incumbent that the act for which his services had been terminated should constitute an offence involving moral turpitude. Relying on the decision of the Supreme Court in Union Bank of India v. C.G. Ajay Babu (2018) 9 SCC 529, he submitted that what should constitute an offence involving moral turpitude was in the realm of criminal law and it was for a criminal court to decide that issue. He submitted that after the order was passed by the Disciplinary Authority, onl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or loss to, or destruction of, property belonging to the employer shall be forfeited to the extent of the damage or loss so caused; (b) the gratuity payable to an employee may be wholly or partially forfeited - (i) if the services of such employee have been terminated for his riotous or disorderly conduct or any other act of violence on his part, or (ii) if the services of such employee have been terminated for any act with constitutes an offence involving moral turpitude, provided that such offence is committed by him in the course of his employment. 15. There are, therefore, three grounds on which gratuity payable to an employee whose services have been terminated can be forfeited by the employer. The first is contained in Section 4(6)(a) PG Act where the reason for such forfeiture is that the act, wilful omission or negligence of the employee which is the reason for the termination has caused "any damage or loss to, or destruction of, property belonging to the employee". In such a case, the forfeiture will be only to the "extent of the damage or loss so caused". In other words, unless there is a quantification of the damage or loss caused to the bank in the present case, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which he is charged and whether such conviction attains finality. A further question would then arise as to whether the offences for which the Appellant is ultimately convicted would involve moral turpitude, as is mentioned in sub-clause (ii) of Section 4(6)(b) PG Act as discussed hereinbefore. Therefore, at this stage, it would be premature for the respondent-Bank to conclude that the acts for which the Appellant's services were terminated constitute offences involving moral turpitude. 20. The Supreme Court has, in C.G. Ajay Babu (supra), interpreted Section 4(6) PG Act as under: "15. Under sub-Section (6)(a), also the gratuity can be forfeited to only to the extent of damage or loss caused to the Bank. In case, the termination of the employee is for any act or wilful omission or negligence causing any damage or loss to the employer or destruction of property belonging to the employer, the loss can be recovered from the gratuity by way of forfeiture. Whereas under sub-Clause (b) of sub-Section (6), the forfeiture of gratuity, either wholly or partially, is permissible under two situations- (i) in case the termination of an employee is on account of riotous or disorderly co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... referred to in sub-clause (ii) of Section 4(6)(b) PG Act is that which is punishable in law which, in this case, would be the penal laws invoked by the CBI, viz. the IPC and the PC Act. Again, as pointed out by the Supreme Court, "it is not for the bank to decide whether an offence has been committed. It is for the Court". It is for this reason that the Supreme Court has observed that "forfeiture of gratuity is permissible only if the termination of an employee is for any misconduct which constitutes an offence involving moral turpitude, and convicted accordingly by a court of competent jurisdiction". (emphasis supplied) 22. The decision in C.G. Ajay Babu (supra), therefore, clearly explains that the action of forfeiting the gratuity payable to an employee cannot be taken at the stage when there is no final determination that such acts of the employee in fact constitute an offence involving moral turpitude. That determination can only be made by a criminal court and, thereafter, that determination must attain finality. 23. The net result, as far as the present case is concerned, is that the impugned decision of the respondent-Bank in forfeiting the entire gratuity of the Appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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