Labour Courts have discretionary power under Section 11A of the Industrial Disputes Act to reduce penalties if deemed disproportionate to misconduct, considering factors like past conduct and absence of moral turpitude.

JUDGMENT

Vikas Mahajan, J. The question for consideration of this intra-court appeal is: Whether the Labour Court could reduce the penalty from `removal from service'1/2 to `stoppage of three increments with cumulative effect'1/2, in exercise of its discretionary jurisdiction under Section 11 A of the Industrial Disputes Act, 1947?

2. The admitted facts are: (i) the respondent was posted as Senior Assistant in the appellant/bank; (ii) while working with the appellant/bank, he had taken certain loans from different financial institutions/Thrift & Credit Societies without the approval of the competent authority and had also availed the facility of credit card from M/s. SBI Cards & Payment Services Pvt. Ltd., the outstanding against which, he failed to repay; and (iii) even the cheques issued by him towards the repayment of some of the credit facilities were returned unpaid by the drawee bank, with the objection "insufficient funds".

3. A chargesheet was issued against the respondent on 27.03.2006 by the appellant alleging major misconduct, enumerating the following charges:

"1. SBI Cards & payment Services Pvt. Ltd. have advised that you have not made the payment against the SBI Credit Card No.0004006661011723314 since January 2004 despite various communications from them and by Zonal Office/branch. The present outstandings there against are Rs.28,181.35.

2. You have issued undernoted cheques without maintain sufficient crediting your account which were returned with the objection `Insufficient Funds'1/2 by Shakti Nagar branch:

(i) Cheque No.572915 dated 18.01.2015 for Rs.11,020.00 favouring Northern India Paint Colour & Varsney Co. Ltd. returned on 12.05.2005.

(ii) Cheque No.110898 dated 15.06.2005 for Rs.1466.00 favouring G.E. Countrywide Consumers Financial Services Ltd. returned on 16.06.2005.

3. You have raised loan from Everglad Chit Funds Pvt. Ltd. without obtaining specific approval from the competent authority. In this connection, an attachment order issued on 27.09.2003 by Civil Judge, Tis Hazari, Delhi for attachment of your salary to the extent of Rs.59,495/- due to the decree holder M/s Everglad Chit Funds Pvt. Ltd. was received at out Shakti Nagar Branch. Monthly instalment of Rs.2000/- of your salary is being remitted to the court and Rs.20,000/- (Approx) have so far been appropriated.

4. You raised loan of Rs.50,000/- from Indian National Co-op (NA)Thrift & Credit Society Ltd. Hissar on 04.07.2003 without seeking prior permission of the bank. Further, you issued an Account Payee cheque no. 403411 dated 25.09.2004 drawn of SBI, GT Karnal Road, Delhi for Rs.77,240/- in favour of the above society. Before the cheque could be presented, you closed the account.You were served with a legal notice on 13.10.2004 under section 138/141 of Negotiable Instruments Act on 01.10.2005, Hisar and Delhi Police Officials came to Shakti Nagar branch with non-bailable warrants issued by Judicial Magistrate, Hissar to arrest you and took you away at 2:00 pm.

5. The total deduction from the salary is 81.07% against the Bank's extent instructions that total deductions will not be more than 60% of the gross salary.

6. You have raised loan from undernoted Thrift & Credit Societies whereas as per extent instructions an employee cannot be member of more than one T & C Society:

(i) Bank Staff Co-op Urban SE T& C Society Ltd., Hissar.

(ii) International Co-op Non Agriculture T & C Society Ltd., Hissar.

(iii) ECBE Staff Co-op Credit Society Ltd., Meerut.

(iv) Indian National Co-op Non. Agri. T & C Society Ltd., Hissar.

(v) Bhartiay State Bank Karyakarta Co-op T& C Society