J&K Bank MD Cannot Dismiss Employee Without Inquiry By Equating His Powers With Governor Under Article 311(2)(c): High Court

The Court observed that while the President and Governor are high constitutional functionaries, the same level of trust cannot be reposed in an officer of the level of Managing Director and CEO of a bank.

The Court was hearing a writ petition filed by Saadut Hussain Pampori, a Deputy General Manager of the Jammu & Kashmir Bank, challenging his dismissal from service under Clause 12.29 of the Officers Service Manual on the basis of advice tendered by the Director General of Police regarding his alleged involvement in anti-national activities.

A Bench of Justice Sanjay Dhar, while quashing the impugned order, observed,

"Therefore, the contention of the respondents that the powers of the Managing Director and CEO of the respondent-Bank under Clause 12.29 of the OSM are in pari-materia with the powers of the President of the Governor under Article 311(2) clause (c) of the second proviso of the Constitution is wholly misconceived."

The Court further observed,

"There appears to be a definite purpose behind the choice of language used in Clause 12.29 of the OSM and that adopted in Article 311(2)(c) of the Constitution. While the President and the Governor are high constitutional functionaries and, therefore, they can be trusted with the drastic power of dispensing with the services of an employee without holding an inquiry in appropriate cases, the same level of trust cannot be reposed in an officer of the level of Managing Director and CEO of a bank."

Assailing his termination Pampori had contended that no FIR was registered against him, no investigation was conducted by any State/UT/Central Investigating Agency, and the conditions prescribed in Clause 12.29 of the OSM for invoking the drastic powers were not fulfilled. The respondents contended that the impugned order was based upon discreet investigation conducted by the J&K Police, and that Clause 12.29 of the OSM is in pari-materia with Article 311(2)(c) of the Constitution.

Court's Observation:

The Court examined the scope of judicial review in matters relating to dismissal of an employee in the interests of security of the State without holding an inquiry. The Court relied upon Union of India v. Balbir Singh (1998) 5 SCC 216 and A.K. Kaul v. Union of India, observing that the scope of judicial review under Article 311(2)(c) is very limited, and the Court can interfere only if the order is malafide or based on extraneous or irrelevant considerations.

However, the Court distinguished Article 311(2)(c) of the Constitution from Clause 12.29 of the OSM. The Court conducted a comparative analysis of the two provisions and found a stark distinction between them.

The Court observed,

"Article 311(2) clause (c) of second proviso, does not contemplate holding of an inquiry or an investigation before the President or the Governor records satisfaction that, in the interest of security of the State, it is not expedient to hold an inquiry in respect of an employee who is sought to be dismissed from service whereas, in Clause 12.29 of the OSM, certain preconditions have been laid down before the Managing Director of the respondent-Bank can invoke the power to dismiss the services of an employee of the Bank without holding an inquiry."

The Court identified the preconditions under Clause 12.29 of the OSM: (i) investigation conducted by a State/UT/Central Investigating Agency; (ii) finding of involvement in terrorist/anti-national activities; (iii) advice by competent authority not below the rank of Principal Secretary or Director General of Police; and (iv) dismissal without inquiry on the basis of such advice.

The Court observed,

"Unless the aforesaid conditions are fulfilled, an employee of the respondent-Bank cannot be removed or dismissed from service without holding a departmental inquiry. Thus, there is a clear distinction between the power under Article 311(2)(c) of the Constitution and the power exercisable by the Managing Director and CEO of the respondent Bank under Clause 12.29 of the OSM."

The Court held that the Managing Director and CEO of a bank cannot be trusted with the same level of drastic power as the President or Governor. The Court remarked,

"While the President and the Governor are high constitutional functionaries and, therefore, they can be trusted with the drastic power of dispensing with the services of an employee without holding an inquiry in appropriate cases, the same level of trust cannot be reposed in an officer of the level of Managing Director and CEO of a bank."

In light of this finding and considering the other merits, the High Court quashed the impugned order and relegated the petitioner to the status which he was holding immediately prior to the passing of the impugned order. The Court gave liberty to the respondents to proceed afresh after fulfilling the requirements of Clause 12.29 of the OSM, or in the alternative, to proceed with the departmental inquiry against the petitioner.

Case Title: Saadut Hussain Pampori v. UT of J&K and Others

Citation: 2026 LiveLaw (JKL) 326

Appearances

Petitioner: Mr. Shariq J. Reyaz, Advocate; Ms. Humaira Sajad, Advocate

Respondents: Mr. Mohsin Qadiri, Sr. AAG; Ms. Maha Majeed, Assisting Counsel

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