Mere Possession Of Bank's Stationery By Employee Without Proof Of Prejudice Not Misconduct: Calcutta High Court

Holding that mere recovery of bank stamps, blank passbooks and letterheads from an employee's residence, without proof of any actual prejudice to the bank, cannot amount to “acts prejudicial to the interest of the bank”, the Calcutta High Court dismissed an intra-court appeal filed by Bank of Baroda and upheld reinstatement of a dismissed workman with full back wages.A Division Bench of Justice Lanusungkum Jamir and Justice Rai Chattopadhyay refused to interfere with a Single Judge's order which had set aside the Labour Tribunal's grant of lump-sum compensation and instead directed reinstatement with consequential benefits.The employee had been posted at the Bhawanipur branch of the bank before being transferred to Ballygunge. In November 2000, during a police raid at his residence, a rubber stamp, blank letterheads and passbooks of the bank were allegedly recovered. A chargesheet was issued alleging “gross misconduct” under the bipartite settlement for doing acts prejudicial to the bank's interest. Following a departmental enquiry, the Disciplinary Authority removed him from service in February 2004. Though he was later acquitted in the criminal case, the departmental penalty was upheld in appeal.Upon an industrial dispute being raised, the Central Government Industrial Tribunal-cum-Labour Court found the termination illegal but awarded only ₹2 lakh as lump-sum compensation. Challenging this, the workman approached the writ court, which directed reinstatement with full back wages. The bank then filed the present intra-court appeal.Before the Division Bench, the bank argued that unauthorized possession of official materials for nearly eleven months created a likelihood of misuse and was inherently prejudicial to its interest. It relied on decisions of the Supreme Court of India to contend that once a domestic enquiry is upheld, courts should not substitute their view, and that compensation instead of reinstatement is an acceptable remedy.Rejecting the contention, the High Court noted that although possession of the materials was admitted, there was no evidence whatsoever to show that the employee had misused them or caused any loss, damage, or reputational harm to the bank. The Court emphasized that the bank failed to produce “any fact or figure or material” demonstrating actual prejudice.The Bench observed that mere recovery of articles from the employee's custody, without proof of adverse impact, cannot automatically establish misconduct under the clause relating to acts prejudicial to the bank's interest. The explanation offered by the workman — that the items were inadvertently carried during transfer — was not convincingly rebutted by the employer.Holding that the Single Judge's order suffered from no “gross, apparent or palpable illegality”, the Court declined to interfere in appeal. The bank's appeal was dismissed, with a direction that any superannuation benefits or compensation already paid be adjusted against the back wages.Case Title: The Chairman and Managing Director, Bank of Baroda & Ors. v. Sri Jyotirmoy Basu & Anr.Case No.: MAT 737 of 2025 with I.A. No. CAN 1 of 2025Click here to read order

Mere Possession Of Bank's Stationery By Employee Without Proof Of Prejudice Not Misconduct: Calcutta High Court

Srinjoy Das

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