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Supreme Court: Delayed Payment Not Always Contempt, But Bank Must Pay for Protracted Litigation

20Sep

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Supreme Court

Supreme Court: Delayed Payment Not Always Contempt, But Bank Must Pay for Protracted Litigation

The Supreme Court declined to initiate contempt proceedings, finding the delayed payment of dues, while a violation, was not wilful. It reinforced that contempt jurisdiction cannot be used to adjudicate new claims like pension, which were not part of the original decree. The Court, however, awarded compensatory costs for the protracted litigation. Facts Of The Case: A.K. Jayaprakash, a manager at Nedungadi Bank Ltd., was dismissed from service in 1985 on grounds of alleged irregularities in sanctioning loans and delays in reporting. He challenged this dismissal under the Tamil Nadu Shops and Establishment Act, 1947. The Deputy Commissioner of Labour initially set aside the dismissal and ordered his reinstatement. This decision was repeatedly challenged by the Bank, first in the Madras Hi...

Supreme Court Slams “Ad-hocism”: Orders Regularization of Employees After 30+ Years of Service

This Supreme Court judgment reaffirms that the State, as a constitutional employer, cannot deny regularization of perennial work performed by long-serving ad hoc employees. Arbitrary refusals to sanction posts based on financial constraints violate Articles 14, 16, and 21. The Court mandated the creation of supernumerary posts for regularization, emphasizing that outsourcing cannot justify exploitation or circumvent the duty to provide fair and secure employment. Facts Of The Case: The appellants were engaged as daily wage employees (Class-III Driver and Class-IV Peons/Attendants) by the U.P. Higher Education Services Commission between 1989 and 1992. They performed regular, perennial duties essential to the Commission's functioning. In 1991, the Commission itself resolved to create four...

Supreme Court Curbs “Prove Prejudice” Rule: A Landmark Win for Natural Justice

The Supreme Court ruled that violating mandatory procedural safeguards in disciplinary inquiries, like failing to question an employee on adverse evidence, inherently constitutes prejudice. Relying on undisclosed material, such as a vigilance report, to enhance punishment also violates natural justice. No independent proof of prejudice is required for such fundamental breaches. Facts Of The Case: The appellant, K. Prabhakar Hegde, was a senior officer and Zonal Head of Vijaya Bank (which later merged with Bank of Baroda). In 1999, he was served with notices alleging irregularities in sanctioning temporary overdrafts to various parties. Formal disciplinary proceedings were initiated against him in 2001. An inquiry officer was appointed, who submitted a report holding the charges proved. N...