Judgement

VAIDIALINGAM, J.: This appeal, by special leave, by the State Bank of India, is against the award dated April 7, 1967 of the Industrial Tribunal, Chandigarh, setting aside the order of the appellant, discharging the services of the first respondent and directing his reinstatement with full back wages.

2. The first respondent joined the service of the appellant on June 13, 1955 as a Money Tester and was working in that capacity at the Ambala City Branch in July, 1960. On July 26, 1960, he was deputed to supervise the remittance of unissuable notes of Rs. 87,48,000/- from the Ambala City Branch to the Note Cancellation and Verification Sections of the Reserve Bank of India, Ludhiana for destruction. According to the appellant the procedure adopted for such purpose was: the currency notes intended to be carried for destruction to the concerned section of the Reserve Bank of India, are examined, counted and then tied in bundles with a label or slip attached to each packet containing the particulars including the initials of the examining officer. Each packet is then recounted by the Money Tester and the latter puts his initial on the label or slip in token of his having done the recounting, the idea being, that if any shortage is discovered subsequently, the person whose initials are found on the label or slip can be made liable to account for the deficiency, and be asked to make good the same. Accordingly, when the money was taken by the first respondent on July 6, 1960 and delivered to the Note Cancellation and Verification Section of the Reserve Bank of India, Ludhiana, officials therein noted a shortage of Rs. 100/- in the packet containing Rs. 10/- denomination notes. Such a deficiency was noted in the packet to which was tacked the label bearing the initials of R. K. Jain. The shortage was pointed out to R. K. Jain by officials of the Reserve Bank of India, and the packet was handed back to the former to enable him to satisfy himself regarding the shortage. R. K. Jain, under the guise of trying to unstitch the packet, tore off the label bearing his initials in spite of the protest made by the officials of the Reserve Bank of India. The torn label was picked up and as it contained the initials of R. K. Jain, the officials of the Reserve Bank of India kept the torn pieces intact. Later on, a verbal inquiry was made by the Superintendent of the Reserve Bank of India and R. K. Jain admitted the shortage by his letter dated July 29, 1960. In that letter, addressed to the Reserve Bank of India, R. K. Jain stated that while counting the packet containing the Rs. 10/- notes in which a shortage of Rs. 100/- was found, the slip was torn by him inadvertently and that he repasted the slip, after having confirmed the mutilation as desired by the officials of the Reserve Bank of India. Ambala City Branch of the appellant, addressed a letter dated August 13, 1960 to R. K. Jain regarding the reports made by the Currency Officer, Reserve Bank of India and the Superintendent in charge of the Reserve Bank of India, Ludhiana, regarding the shortage of Rs. 100/- In that letter, after referring to the counting of the packet by the first respondent and his tearing the label and repasting it, it is stated that the first respondent is responsible for the shortage as he has put his signature in the label in token of having recounted the packet and found it to be correct. It was further stated that the first respondent tore off the label because it contained his initials and this was done to avoid any liability or responsibility. These acts were stated to amount to gross misconduct and R. K. Jain was called upon to submit his explanation to the Head Office of the appellant. On August 16, 1960, the first respondent stated that the packet containing soiled notes was handled by several persons and counted more than once both in the Branch at Ambala as well as in the concerned section of the Reserve Bank of India, Ludhiana. After referring to the