STATE BANK OF INDIA versus C.B. DHALL

Citation: [1997] SUPP. 6 S.C.R. 416 · Decided: 11-12-1997 · Supreme Court of India · Bench: SUJATA V. MANOHAR · Disposal: Disposed off
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Judgment (excerpt)

A 
STATE BANK OF INDIA 
v. 
C.B. DHALL 
DECEMBER 11, 1997 . 
B 
(SUJATA V. MANOHAR AND D.P. WADHWA, JJ.] 
Seivice Law : 
State Bank of India (Supeivisory Staff) Se1vice Rules, 1975 : Rules 
C 20-A and 20-B. 
Sanction to retire-Withholding of-In case of erstwhile Imperial Bank 
of India (/BJ) employees-Pennissibility of-Person who was initially 
recmited as Cashier in July 1939 in the erstwhile /BI became an employee of 
State Ba11k of /11dia (SB/) upon its constitution in 1955--Employee promoted 
D as Head Cashier in SB/ in July 1956-His date of retirement was 28-5-1970 
but was granted extension in service for seven years up to 30-6-1977-Dwi11g 
" extended f/eriod charge sheet was served 011 him 011 24-JJ-1975-After 30-6-
1977 decision was taken to withhold sanction to retire him and to f oifeit the 
Bank's contribution to his provident jimd:-Held: Withholding of sanction for 
E retirement pennissible in view of Rr. 20-A a11d 20-B-Fwther, in order to avail 
of retiremmt be11efits under the mies and regulatiollS framed for erstwhile /Bl 
employees, sa11ctio11 to retire under R.20-A mandat01y-Decisio11 to withhold 
sanction to retire and to fo.jeit Ba11k's cont1ibution to employee's provident 
fund held valid-State Ba11k of /11dia (S11b-Acco1111taltls and Head Cashiers) 
Seivice Rules, 1959--State Bank of India rlct, 1955, S.43-fmperial Bank of 
F 
fl!dia Act, 1920. 
Imperial Bank of India Employees' Pension and Guarantee Fw1d 
(Rules and Regulatio11s) : Rule 7, Pe11sio11-Foifeit11re of-Held : Implies 
foif eiture of Bank's contribution to pension fund and illferest accruing there-
G 011. 
Imperial Bank of India Employees' Provide11t Fund Rules : Rules 18 
and 20. 
Rule 18-He/d : Applies whei1 an employee is dismissed from service 
'H but does not apply when sanction to retire an employee is withheld--Foifeiture 
416 
,. 
S.B.L v. C.B. DHALL 
417 
of Bank's cont1ibution towards provident fund--Fo1feited amount detem1ined A 
at after holding enquiry against the employee-The forfeited amount repre-
sented the liability incun·ed by the employee to the Bank-Forfeiture was in 
accordance with R.2(}-ffence upheld. 
State Bank of India (Supervisory Staff) Se1vice Rules, 1975 : 
Validity of-Held : 17ie Service Rules have been framed in exercise of 
statutory power under S.43 of the State Bank of India Act, 1955-Hence valid. 
The respondent was appointed as Cashier in the Imperial Bank of 
India in July 1939 and became an employee of State Bank of India (SBI) 
in 1955 upon its constitution. The respondent was promoted as Head 
Cashier by the SBI in July 1956. Under the State Bank of India (Sub-Ac-
countant and Head Cashiers) Service Rules, 1959 the respondent was due 
to retire on 28-5-1970. H,owever, the respondent was granted extension in 
service for seven years np to 30-6-1977. 
During the extended period the respondent was served with a Charge 
Sheet on 24-11-1975. Enquiry proceedings were initiated against the 
respondent After 30-6-1977 a decision under Rule 11 of the Imperial Bank 
of India Pension and Guarantee Fund (Rules and Regulations) was taken 
B 
c 
D 
to withhold sanction to retire the respondent and to forfeit the Bank's E 
contribution to the respondent's provident fund under Imperial Bank of 
India Employees' Provident Fund ~oles. The High Court allowed the writ 
petition filed by the respondent challenging the aforesaid decision. Hence 
this appeal. 
Disposing of the appeal, the Court 
F 
HELD : 1. In view of Rules 20-A and 20-B of the State Bank of India 
(Supervisory Staff) Service Rules, 1975 withholding of sanction to retire 
an employee of the erstwhile Imperial Bank of India (IBI) is permissible. 
Further, in order to avaii of retirement benefits under the Imperial Bank 
of India Employees' Pension and Guarantee Fund (Rules and Regulations) G 
and the Imperial Bank of India Employees' Provident Fund Rules framed 
for erstwhile IBI employees sanction to retire an employee is mandatory 
under Rule 20-A of the Service Rules. Moreover, the Service Rules had 
been framed by the State Bank of India in exercise of its statutory powers 
under Section 43 of the State Bank of India Act, 1955. Hence, the decision H 
418 
SUPREME COURT REPORTS (1997) SUPP. 6 S.C.R. 
A to withhold sanction to retire the respondent is valid and permissible. 
(426-F-H; 427-A-B; 429-C-D] 
State Bank of India v. A.N. Gupta, (1997) 6 SCALE 303, held inap-
plicable. 
B 
T. Narsiah v. State Bank of India, (1978) 2 LW 173, referred to.
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