Bank Officers Must Act Strictly Within Delegated Authority, Says Division Bench
JAMMU, AUGUST 20 ::
The High Court of Jammu & Kashmir and Ladakh has ruled that mens rea, or a deliberate intention to commit wrongdoing, is not an essential requirement for establishing misconduct in departmental disciplinary proceedings.
A Division Bench comprising Justice Rajesh Sekhri and Justice Sindhu Sharma observed that an unauthorised act by a bank employee can constitute misconduct even when the employee claims to have acted in good faith or with an intention to benefit the institution.
The Court emphasized that officers working in banking institutions are required to exercise their powers strictly within the limits of the authority delegated to them. This obligation assumes greater significance in the banking sector as banks handle and safeguard public money.
The Division Bench made the observations while allowing an appeal filed by J&K Grameen Bank against a judgment of the Single Bench, which had quashed disciplinary proceedings initiated against a former bank officer.
The High Court held that the absence of any mala fide intention, financial loss to the bank or personal gain to the employee would not, by itself, wipe out the violation committed by an officer who acted beyond the authority vested in him.
The Bench observed that service discipline cannot depend solely upon the intention behind an unauthorised act. An employee holding a responsible position is expected to remain within the framework of the rules and powers prescribed for the post.
The Court accordingly restored the disciplinary action imposed upon the former bank officer and upheld the penalty of reduction of pay to the lowest stage of Officer Scale-I.
However, the Bench also directed the bank to release the officer’s superannuation benefits, noting that the alleged financial loss had not been quantified by the institution.
The ruling thus draws a clear distinction between the question of misconduct under service rules and the issue of actual financial loss, making it clear that an unauthorised exercise of official power may attract disciplinary consequences even where no personal benefit or quantified monetary loss is established.
The judgment is significant for the banking sector, reiterating that officials entrusted with public funds must strictly adhere to the limits of their delegated powers and cannot rely solely on good intentions as a defence for actions contrary to prescribed service rules.(KNC)