Pendency Of Criminal Case Doesn't Automatically Bar Continuation Or Conclusion Of Departmental Proceedings : Chhattisgarh HC

Background Facts

The respondent was employed with the Chhattisgarh Rajya Gramin Bank. He had been promoted to the position of Branch Manager. Serious allegations of financial irregularities and misappropriation of the Bank's funds surfaced during his tenure as the Branch Manager at the Pasta branch. Therefore, a criminal case was registered against him for offences under Sections 409, 420, and 120-B of the IPC.

Further, the Bank initiated a departmental enquiry against him under its disciplinary jurisdiction. The Bank asserted that the enquiry was conducted with due procedure, including communication of charges, examination of witnesses, and providing an opportunity for cross-examination.

The respondent filed Writ Petition seeking a stay on the departmental proceedings on the grounds that a criminal trial on the same allegations was pending. It was directed by the Single Judge that no final order be passed in the disciplinary proceedings. However, the Bank continued with the enquiry process. It submitted an enquiry report, issued a show-cause notice, and granted a personal hearing to the respondent. Only the final order from the disciplinary authority remained pending.

The Single Judge allowed the petition. It directed that the Bank could proceed with the departmental proceedings only after the conclusion of the criminal trial. Aggrieved by the same, the Bank filed the Appeal against the Single Judge order.

It was submitted by the appellant Bank that a criminal case was pending against the respondent, which was at the verge of completion, as only the evidence of the Investigating Officer remained to be recorded. It was further contended that the departmental proceedings had already been permitted to continue pursuant to the order passed by the Single Judge, with the observation that no final order shall be passed at that stage. However, since the criminal trial was nearing completion and the respondent has already laid down his defence, it was urged that the appellant be permitted to pass the final order in the departmental proceedings.

On the other hand, the respondent opposed the arguments and the prayer advanced on behalf of the appellant. It was contended that the pendency of the criminal case ought to be taken into consideration before permitting the appellant to pass the final order in the departmental proceedings.

Findings of the Court

It was observed by the court that the mere pendency of a criminal case does not operate as an automatic bar to the continuation or conclusion of departmental proceedings. The judgment of the Supreme Court in State Bank of India and Ors. Vs. P. Zadenga was relied upon wherein it was observed that while it may be desirable or advisable in certain circumstances to stay disciplinary proceedings pending a criminal trial, it is not a matter of course. It was held by the Supreme Court that a stay should only be for a reasonable period, and that the prolonged duration of a criminal trial cannot be used by an employee to indefinitely delay departmental proceedings. It was further held that an acquittal in a criminal case does not, by itself, result in the closure of departmental proceedings against a delinquent employee.

Further the Supreme Court's decision in Stanzen Toyotetsu India Private Limited v Girish V. and Others was relied upon wherein it was held that the courts must be mindful that departmental proceedings cannot be suspended indefinitely or unduly delayed.

It was held by the court that the appellant-Bank was at liberty to proceed with passing the final order in the already concluded departmental proceedings against the respondent. With the aforesaid observations and directions, the writ appeal filed by the appellant-Bank was disposed of by the court.

Case Name : Chhattisgarh Rajya Gramin Bank & Ors. vs. Piyush Verma

Case No. : WA No. 688 of 2025

Counsel for the Appellants : Sabyasachi Bhaduri, Advocate

Counsel for the Respondents : Rishikant Mahobia, Advocate