JUDGMENT:

GOKHALE J.

1. This appeal seeks to challenge the judgment and order dated 25.01.2007 rendered by a Division Bench of Allahabad High Court allowing Civil Writ Petition No. 2846/2004 filed by the respondent. The respondent at the relevant time in 1997-99 was working as a Manager of a Branch of Punjab & Sind Bank in Kanpur and he was directed to be dismissed for misconduct after a departmental inquiry vide order dated 6th June, 2003. The respondent had challenged this order and two subsequent orders in his writ petition to the High Court and these orders have been set aside by the impugned judgment and order. Being aggrieved by the same, this appeal has been filed by the General Manager (P) on behalf of Bank.

2. Apart from setting aside order of dismissal, High Court directed the reinstatement of the respondent. The respondent moved a contempt petition for non-implementation thereof. This Court vide its order dated 7th May, 2007 has stayed the contempt proceedings. Subsequently, leave was granted on appellant's Special leave petition on 6th September, 2007. 3. Mr. Rajiv Nanda, learned Counsel has appeared for the appellant. The respondent has appeared in person.

Short facts leading to this appeal

4. As stated above, the respondent was working as a Manager of the appellant's Branch (earlier an extension counter) at Guru Nanak Girls Degree College, Sunder Nagar, Kanpur. In a vigilance inspection, it was found on 8th of March, 1999 that some 20 loans to the tune of Rs.16.48 lacs were disbursed to some persons against FDRs though the FDRs were in the names of altogether different persons. It was also seen that the withdrawals which were allowed, were far in excess over the amounts in the FDRs. All those entries were in the hand-writing of the respondent.

5. On 9th of March, 1999, when the Zonal Manager, Lucknow, telephonically made further inquiries with the respondent, immediately thereafter, the respondent left the Branch by leaving behind a letter of voluntary retirement dated 9th March, 1999 without handing over the charge of the articles and documents of the Branch to anybody else. He did not report for duty any time thereafter, although a telegram was sent to him on 11th March, 1999 that he should join immediately. He was, therefore, suspended on 12th March, 1999. An FIR was lodged on 13th March, 1999 and the respondent was arrested along with the Cashier Mr. K.P.Singh.

6. The appellant Bank issued a charge-sheet to the respondent containing the following charges :

(i) He sanctioned demand loan against twenty non-existent

FDR's amounting Rs.16.48 Lac to the fictitious persons. Thus he has misappropriated Rs.16.48 lac by way of sanctioning demand loans against non-existent FDRs without any security.

(ii) He has left the Branch on 9th March, 1999 without handing over the charge of articles and documents of Branch.

(iii) He has left his station of posting without authorization, and he is absconding from the services since 09.03.1999.

(iv) He stands a guarantor to the loan sanctioned to M/s Mark Tubes, at Branch office Gurgaon. The loan was sanctioned against his surety for which he has not obtained prior permission from the competent authority. The account turned into NPA account and he has not made sincere efforts to ensure the recovery of this loan amount, and

(v) He has taken guarantee of his wife named Mrs. Satvinder Kaur who has taken a loan from Bank of India, Tilak Nagar, New Delhi-110018 in the name of M/s Paper Products. He has never sought a permission from competent authority for standing as guarantor.

7. The inquiry could not start earlier since the respondent was in judicial custody till December, 2001. Thereafter, a full-fledged inquiry was conducted. During the inquiry, relevant documents were produced through the concerned officers. The material produced before the inquiry officer with respect to charge No.1 was that some 20 fictitious loans were sanctioned against non-existent FDRs. A chart to that effec