Disposed

Bijay Kumar v. Bank of Baroda and 2 Others

Allahabad HC2 Sept 2025WRIA/10221/2025

Case brief

AI extract

What is this about?

A bank officer challenged a disciplinary order reducing him from MMG/S-III to JMG/S-I over irregularities in sanctioning 25 cash credit and term loan accounts, upheld in appeal. The High Court found the charges proved and no procedural irregularity, but held the quantum of punishment disproportionate given his clean record and short remaining service.

What did the court decide?

Punishment order set aside; matter remitted to Disciplinary Authority to reconsider quantum and award minor punishment.

Bijay Kumar Vs Bank of Baroda and 2 Others — Banking and Recovery | Allahabad HC (2025)

¶1

HIGH COURT OF JUDICATURE AT ALLAHABAD

¶2

WRIT - A No. - 10221 of 2025

Bijay Kumar

.....Petitioner(s)

Versus

Bank Of Baroda And 2 Others

¶7

	.....Respondent(s)
Counsel for Petitioner(s)	: Jainendra Kumar Mishra, Sr. Advocate
Counsel for Respondent(s)	: Anadi Krishna Narayana

¶8

Court No. - 5

¶9

HON'BLE SAURABH SHYAM SHAMSHERY, J.

¶10

Heard Sri H.N. Singh, learned Senior Advocate assisted by Sri Jainendra Kumar Mishra, learned counsel for petitioner and Sri Ashok Kumar Lal, learned counsel for respondents.

¶11

Petitioner was posted as Middle Management Group/Scale – III from 23.04.2018 to 11.01.2021 as Senior Manager, SSI Panki Branch, Kanpur, Bank of Baroda located at Metro Region, Lucknow Zone, Lucknow and he was served with a memo dated 30.11.2022 along with article of charges and statement of allegations that he has not discharged his duties with devotion and diligence and has not taken all possible steps to ensure and protect the interest of bank and conduct different acts which are likely to cause substantial loss to bank.

¶12

According to statement of allegations, various irregularities were alleged in as many as 25 Cash Credit and Term Loan accounts. Irregularities were mentioned in detail in statement of allegations that required protection were not taken by petitioner in sanction of term loan and cash credit, such as nature of trade from the prospective borrower was not verified, proper inspection report was not submitted, cash credit/term loan was sanctioned on basis of incomplete or partial filled applications, during sanction, inspection report was not submitted in proper format, documents were not verified, valuation of property was not properly assessed, due diligence was not followed while considering loan application, physical inspection was not conducted properly, granted prior proposal/appraisal in a casual manner, business experience of proprietor was not carefully assessed, etc.

¶13

Petitioner submitted his reply before Inquiry Authority and thereafter findings of Inquiry Authority were placed before Disciplinary Authority and Disciplinary Authority vide order dated 04.04.2024 has considered all allegations by referring allegations, findings of Inquiry Authority, submission of petitioner on findings and after referring due observations, he was awarded major punishment of "Reduction to a lower grade/scale i.e. from MMG/S-III to JMG/S-I and be placed at the Basic Pay of Rs. 62480/(as per revised basic w.e.f 01.11.2022) scale in JMG/S-I" upon Mr. Bijay

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WRIA No. 10221 of 2025

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Kumar, EC No. 66207, Senior Manager, from the date of this order" and observations of Disciplinary Authority. Some observations made by Disciplinary Authority are mentioned hereinafter :-

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"My Observations:
The Prosecution, to substantiate the
allegation, has produced the exhibit MD/A-1-1
having 3 pages, which is copy of the MSE Loan
Application form of M/s MTND Food Products
Pvt. Ltd along with google search report
about the company. MD/A1-3, which is copy of
F-135 submitted by the director of the
Company Mr Manish Tripathi. MD/A1-4, which is
copy of Appraisal Note.

¶18

On perusal of the aforementioned exhibits/
documents, the undersigned observe that in
point no. 8 of application form, activity is
not mentioned and was left blank. On Farm No.
135, activity is mentioned as Sabji Masala
etc. On Appraisal Note, activity is mentioned
as trading and manufacturing of Besan, Sattu
and as per page 3 of MD-A/1-1, which is
google search report, main activity of
company mentioned as Manufacture of other
non-alcoholic beverages. It clearly shows
that the CSO did not exercise due diligence
while accepting loan application for
recommendation.

¶19

However, the CSO in his defence, submitted
that he has appraised that the borrower was
engaged in manufacturing of Sattu, besan and
Sabji Masala also fall within the broader
ambit of Food & Argo activity. The above
contention of the CSO is not tenable, as
Sattu/Besan & Sabji Masala are two distinct
items, also Food & Agro Activities cover a
broad range of activities related to food

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WRIA No. 10221 of 2025

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production, processing, distribution, and
consumption, as well as agricultural
practices, Including cultivation, harvesting,
and animal husbandry. It's a vast sector. The
CSO himself was not clear about the purpose
or activity for which he received the loan
application/Form No. 135 and for which he
recommended the loan.

¶23

Hence, on the basis of above facts and
evidences, the undersigned concur with the
views of IA and holds the Allegation No. 1(1)
as Proved.

¶24

My Observations:

¶25

The Prosecution, to substantiate the
allegation, has referred the exhibit MD/A-1-
2, which is copy of Pre-sanction Inspection
Report dated 25.10.2020 carried out by the
CSO. On perusal of the above mentioned
documents, the undersigned observes that the
CSO carried out pre-sanction inspection in
casual manner and submitted an incomplete
report that lacked essential information
necessary for making a credit decision. The
documents provided clearly Indicate that the
pre-sanction inspection conducted by the CSO
was not thorough and did not adhere to the
proper format as per the Bank's guidelines.
Various requisite information essential for
taking credit decision were missing, such as
details about the business location. land and
building requirements, machinery needs, raw
material suppliers, power and water supply
requirements, and the number of workers
needed for operation. Also not visited to the
business place of the borrower company.
However the contention of the CSO that "he

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WRIA No. 10221 of 2025

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prepared pre sanction inspection of the
accounts Incorporating all the relevant
information as made available to him and
leave out rudimentary Information thereof",
clearly indicate that he never visited
business place/residential address of the
borrower and prepared the pre-sanction
inspection report without carrying out proper
due diligence.

¶29

He further accepted that he did not gather
any information regarding the business unit
other than the proposal presented before hirn
for preparation of the report as most of the
units were in the initial stage, and were
established in the Rania Industrial Area with
very basic amenities.

¶30

Based on the above mentioned facts and
evidences, it is evident that the CSO carried
out pre-sanction inspection in casual manner,
wherein various requisite informations which
required for taking credit decision were
missing. Thus, the undersigned concur with
the views of IA and holds the Allegation No.
1(2) as Proved.

¶31

My Observations:

¶32

The Prosecution, to substantiate the
allegation, has produced the document MD/A-1-
4, which is copy of Appraisal Note which is
not in prescribed format as mentioned in
Circular Number BCC:BR:112:576 dated
01.10.2020. On perusal of the aforementioned
Appraisal Note, It is evident that it was
prepared in casual manner. Its lacks comments
on the analysis of financial ratios, proper
assessment of the Term Loan is also lacking.
Appraisal does not address Managerial

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WRIA No. 10221 of 2025

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competence, Financial viability and Economic
viability of the project. Term Loan of 155.00
lakh recommended by him without any details
of how much amounts allocated for land,
building and Plant and machinery.
Additionally, the nature of the machinery to
be purchased by the firm remains unspecified.
Further, the Appraisal Note lacks details of
Compliance of environmental/ social/
statutory requirements. Collectively, these
aspects Indicate a casual approach in the
recommendation process, raising concerns
about a potential threat to the Bank's
interest.

¶36

However, the CSO, in his defense, submitted
that he processed and appraised proposals
without hindrance, drawing information from
various sources such as financials, field
visits. project viability, and other loan
prerequisites. He further stated that the
final decision on approving or rejecting
proposals lles with the sanctioning
authority. If any information is missing, it
should be highlighted by the sanctioning
authority for necessary amendments.

¶37

Otherwise, it should be assumed that the
proposal had been processed according to the
expectations of sanctioning authority.

¶38

The above arguments of the CSO indicate that
he is attempting to save himself by shifting
the responsibility of his actions onto the
Sanctioning Authority, which is not
acceptable. Being a senior officer in Scale-
ill cadre and having almost extensive
experience of more than -25-years of service
in the Bank, he cannot justify his casual

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WRIA No. 10221 of 2025

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approach in the recommendation process of the
proposal. Further, proper assessment of
credit facilities is the most important
factor to derive limit, which cannot be
ignored and being a recommending authority,
he cannot be excused for his negligence.
Keeping in view of the above facts and
evidences, the undersigned concur with the
view of IA and holds the Allegation no. 1(4)
as proved.

¶42

My Observations:

¶43

The PO, to substantiate the allegation,
produced copy of screen shots of statement of
TL A/c No. 06/6912 and CC A/c No. 05/3843 of
borrower M/s MTND Food Product Pvt Ltd from
the period of 09.11.2020 to 11.11.2020, which
annexed as MD/A-1-5 (page no. 1 to 4). PO
also adduced MD/A-1-5 (Page 5-6), which
displays the CSO's user ID used for a
disbursement transaction, and MD/A-1-5 (page
7) having Banker's Cheque detail. On perusal
of the above mentioned documents, it is
evident that on 09.11.2020, the CSO disbursed
Rs. 30.00 lakh from the Term Loan A/c No.
06/6912 of the borrower and credited the
proceeds in borrower's CC A/c No. 05/3843 and
thereafter, on 10.11.2020, Rs. 10.00 lakh
transferred to the debit of SB A/c No.
316001/22551 of Ms. Kiran Tripathi and
credited the proceeds to CC A/c No. 05/3843
of M/s MTND Food Private Limited.
Subsequetly, banker's cheque for Rs. 40.00
lakh was issued in favour of Mr. Samir Verma.
The prosecution also adduced evidence in the
form of MD/A-1-2(Page-3), which is copy of
Udyam Registration Certificate No. UDYAM-UP-

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WRIA No. 10221 of 2025

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43-0004132 in which date of incorporation of
the company mentioned as 14/10/2020 and MD/A-
1-2 (Page 7 to 18), which is copy of sale
deed no. 8598 dated 10/11/2020 in which it is
clearly mentioned as the seller of the
property received a sum of Rs. 5.50 lakh
through Cheque No. 193329 dated 10.10.2020
(prior to date of incorporation of company)
and Rs. 6.55 lakh through Cheque No. 193330
dated 20.10.2020 as advance payment.This
clearly indicates that the CSO failed to ensure
source of funds from borrowers. The CSO, in his
defence, has submitted that the sanctioning
authority wields exclusive and unbridled power of
disbursement, which itself absolve him (CSO) from
the allegations. The above submission of the CSO
is absolutely illogical, as in this case the CSO,
being credit officer, has disbursed the term loan
for purchase of property in the name of company
without ascertaining source of funds/margin which
were earlier paid by the Director of the company
(before incorporation of company) to the seller
of the property.

¶47

Based on the aforementioned facts and evidences,
the undersigned concur with the views of IA and
holds the Allegation No. 1(5) as Proved.
My Observations:

¶48

On perusal of the documents presented by the
Prosecution annexed as MD/A-1-6 which are the
screen shot/ statement/transaction of
disbursement dated 22.12.2020 from the TL A/c
No. 06/6912 of the company and proceeds
transferred to M/s Maruti Nandan Multiple
Services Enterprises through DD for purchase
of Pulp Lizer machine and the above
disbursement was made by the CSO vide his

¶49

WRIA No. 10221 of 2025

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User ID-BK066207. It confirms that the CSO
disbursed 10 lakh and issued DD of same
amount without obtaining/ensuring any margin
money. Preseriting Officer also refers to
MD/A-1-7, (page 3 and 4) advance money
receipt copy, seen mismatch in amounts in
words and figures (Amount in figures
mentioned as 3,93,004.00 and in words
mentioned as INR Twelve lakh Eighty Six
thousand Three hundred only), and genuineness
of the advance receipt is also not verified.
However, the CSO, in his defence, has
repeated his earlier statement that the
sanctioning authority wields exclusive and
unbridled power of disbursement, which has
already been addressed and disposed-off by
the undersigned.

¶52

Hence, on the basis of above facts and
evidences, the undersigned concur with the
views of IA and holds the Allegation No. 1(7)
as Proved.

¶53

My Observations:

¶54

PO referred the exhibit valuation report
dated 26.10.2020 of Er. P. C. Dubey and also
referred valuation report of the property
carried out by M/s Shanti Construction &
Associate dated 24.12.2021. On perusal of the
above mentioned documents, it is evident that
on 26.10.2020, Er. P. C. Dubey has assessed
the value of land property as Market Value-
146.43 lakh, Realizable Value-37.14 lakh &
Distress sale value-123.22 lakh. Branch has
again carried out valuation of the property
from M/s Shanti Construction & Associate who
assessed the Market value of land property is
123.75 lakh + Construction Value 15.43 lakh,

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WRIA No. 10221 of 2025

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thus total value of property is Rs. 39.18
lakh. And hence, there is negative variance
in the value of land to the tune of Rs. 22.68
lakh, which clearly shows that the CSO did
not independently assess the property's value
before recommending the limit sanction.

¶58

However, the CSO in his defence, accepted
that during his tenure as credit officer he
assessed the valuation as provided by the
ampaneled valuer of the bank on 26.10.2020.
But he questioned the need for the fresh
valuations report dated 24.12.2021 after his
transfer from the branch. The question raised
by the CSO is not correct and is not within
his purview. Further, such a decline in land
property value within 14 months is not
observed generally, especially after
construction has taken place on that
property. Which shows that the genuineness of
valuation of property was not verified by the
CSO independently before recommending of
credit facility. As per guidelines Branch
Official must visit the site and get
satisfied with the genuineness of valuation
of the security. Keeping in view the above
mentioned facts and evidences, I concur with
the views of IA and hold the Allegation No.
1(9) as Proved."

¶59

Finally, Disciplinary Authority passed the punishment order by a very detailed order dated 04.04.2024.

¶60

An appeal thereof was dismissed vide order dated 29.03.2025.

¶61

Learned Senior Advocate appearing for petitioner has submitted that it is not a case of the respondents that due to alleged irregularities or carelessness of petitioner, some financial loss was caused. Allegations are that it may likely to cause loss to bank. It is not a case of respondents that petitioner has not even conducted inspection or failed to discharge his duties absolutely contrary to procedure rather case of respondents is that petitioner has not taken absolute care and has not followed the procedure strictly, therefore,

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WRIA No. 10221 of 2025

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certain irregularities were erupted.

¶65

Learned Senior Advocate has further submitted that petitioner may be a sanctioning authority but forms have to be scrutinized by his lower officers also. He has further submitted that on basis of proved charges imposing a major punishment is disproportionate and petitioner may be awarded a minor punishment so that he may be remained careful in future.

¶66

Per contra, learned counsel for respondents-Bank has submitted that on basis of inquiry report and order passed by Disciplinary Authority and Appellate Authority, petitioner has repeatedly remained careless and has not acted diligently to protect the interest of bank. Errors committed could not be considered as minor rather it may be considered as major and in case proper scrutiny was made, probably cash credit or term loan sanction to such borrowers which may not result in default accounts. Actual loss is not necessary in such cases. It is duty of petitioner to ensure that all precautions are undertaken before any loan is sanctioned.

¶67

Learned counsel for respondent-Bank has further submitted that punishment is not shockingly disproportionate.

¶68

I have considered above submissions and perused the records.

¶69

On the basis of material available, it is not much disputed that petitioner has not discharged his duties with due diligence and various irregularities were committed which were noted in impugned orders and are not much disputed. It is also not much disputed that in such cases, actual loss is not necessary likelihood of loss would be relevant.

¶70

Court also takes note that learned Senior Advocate for petitioner has not able to show any irregularity in decision making process, therefore, only question left for consideration is in regard to quantum of punishment.

¶71

In order to consider whether punishment awarded can be modified, Court takes note that it may be a case that petitioner was failed to undertake responsibilities as provided in Regulation 3 of Bank of Baroda Officer Employees (Conduct) Regulations, 1976 which are quoted below :-

¶72

" General

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3. (1) Every officer employee shall, at all times
take all possible steps to ensure and protect the
interests of the bank and discharge his duties
with utmost integrity, honesty, devotion and
diligence and do nothing which is unbecoming of
an officer employee.

¶74

(2) Every officer employee shall maintain good
conduct and discipline and show courtesy and
attention to all persons in all transactions and
negotiations.

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WRIA No. 10221 of 2025

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(3) No officer employee shall, in the performance
of his official duties or in the exercise of
powers conferred on him , act otherwise than in
his best judgment except when he is acting under
the direction of his official superior. Provided
wherever such directions are oral in nature the
same shall be confirmed in writing by his
superior official.

¶78

(4) Every officer employee shall take all
possible steps to ensure the integrity and
devotion to duty of all persons for the time
being under his control and authority."

¶79

Court also takes note relevant provisions of Regulations, 1976 and its Clause-IV which provide penalty i.e. minor penalties and major penalties :-

¶80

" 4. PENALTIES

¶81

The following are the penalties, which may be
imposed on an officer employee, for acts of
misconduct or for any other good and/or

¶82

sufficient reasons.

¶83

MINOR PENALTIES

¶84

(a) Censure,

¶85

(b) Withholding of increments of pay with or
without cumulative effect;

¶86

(c) Withholding of promotion:

¶87

(d) Recovery from pay or such other amount as may
be due to him of the whole or part of any
pecuniary loss caused to the Bank by negligence
or breach of orders;

¶88

(e) Reduction to a lower stage in the time scale
of pay for a period not exceeding 3 years,
without cumulative effect and not adversely
affecting the officer's pension.

¶89

MAJOR PENALTIES

¶90

(f) Save as provided for in (e) above reduction
to a lower stage in the time scale of pay for a

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WRIA No. 10221 of 2025

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specified period, with further direction as to
whether or not the officer will earn increments
of pay during the period of such reduction and
whether on the expiry of such period the
reduction will or will not have the effect of
postponing the future increments of his pay,

¶94

(g) Reduction to a lower grace or post;

¶95

(h) Compulsory retirement;

¶96

(i) Removal from service, which shall not be a
disqualification for future employment;

¶97

(j) Dismissal, which shall ordinarily be a
disqualification for future employment.

¶98

Explanation:

¶99

The following shall not amount to a penalty
within the meaning of this regulation namely:-
(i) withholding of one or more increments of an
officer employee on account of his failure to
pass a prescribed departmental test or
examination in accordance with the terms of
appointment to the post, which he holds.

¶100

(ii) Stoppage of pay of an officer employee at
the efficiency bar in a time scale, on the ground
of his unfitness to cross the bar;

¶101

(iii) non promotion, whether in an officiating
capacity or otherwise of an officer employee, to
a higher grade or post for which he may be
eligible for consideration but for which he is
found unsuitable after consideration of his case;
(iv) reversion to a lower grade or post, of an
officer employee officiating in a higher grade or
post, on the ground that he is considered, after
trial to be unsuitable for such higher grade or
post, or on administrative grounds unconnected
with his conduct;

¶102

(v) reversion to his previous grade or post, of
an officer employee appointed on probation to

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WRIA No. 10221 of 2025

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another grade or post, during or at the end of
the period of probation, in accordance with the
terms of his appointment or rules or orders
governing such probation;

¶106

(vi) reversion of an officer employee to his
parent organization in case he had come on
deputation;

¶107

(vii) termination of the service -
(a) of an officer employee appointed on
probation, during or at the end of the period of
probation, in accordance with the terms of his
appointment, or the rules or orders governing
such probation;

¶108

(b) of an officer employee appointed in a
temporary capacity otherwise than under a
contract or agreement, on the expiration of the
period for which he was appointed, or earlier in
accordance with the terms of his appointment;

¶109

(c) of an officer employee appointed under a
contract or agreement, in accordance with the
terms of such contract or agreement; and
(d) of an officer employee on abolition of post;
(viii) retirement of an officer employee on his
attaining the age of superannuation in accordance
with the rules and orders governing such
superannuation.
(ix) termination of employment of a permanent
officer employee by giving 3 month's notice or on
payment of 3 months' pay and allowances in lieu
of notice;

¶110

(x) termination of employment of an officer
employee on medical grounds, if he is declared
unfit to continue in bank's service by the bank's
medical officer."

¶111

As referred above, petitioner was awarded major penalty of reduction of a lower grade of the post whereas considering that petitioner has left with

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WRIA No. 10221 of 2025

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few years of his service and except the allegations involved in present case, he has never faced any disciplinary action, quantum of punishment may be modified.

¶115

Therefore, Court is of the view that quantum of punishment can be reconsidered by the Disciplinary Authority that in given circumstances, on basis of proved charges and taking note of above referred observations of this Court, a minor punishment be awarded to petitioner.

¶116

Accordingly, only for purpose of reconsideration of quantum of punishment, matter is remitted back to Disciplinary Authority and impugned order whereby punishment was awarded is set aside. Accordingly, impugned orders are also set aside.

¶117

Writ petition stands disposed of with above observations.

¶118

(Saurabh Shyam Shamshery,J.)

¶119

September 3, 2025

¶120

N. Sinha

¶121

Digitally signed by :- NIRMAL SINHA High Court of Judicature at Allahabad

Bijay Kumar v. Bank of Baroda and 2 Others

Case brief

What is this about?

What did the court decide?

Bijay Kumar v. Bank of Baroda and 2 Others

Case brief

What is this about?

What did the court decide?

What the court decided

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