The Bombay High Court has set aside orders of the Labour Court and Industrial Court that had declared the findings of a disciplinary inquiry against a bank employee to be “perverse.” The Court held that there was sufficient material on record to support the inquiry officer’s conclusions and observed that bringing police personnel to a bank office over a transfer-related grievance could amount to misconduct.
Justice Sandeep V. Marne delivered the judgment on June 18, 2026, in a petition filed by Abhyudaya Co-operative Bank Ltd. challenging concurrent findings of the labour forums.
Background of the Case
The dispute arose from disciplinary proceedings initiated against Smita Virendra Patil, an employee whose services had been absorbed into Abhyudaya Co-operative Bank following the merger of Citizens Cooperative Bank with the petitioner bank.
In 2012, Patil was transferred from the bank’s Accounts Department in Mumbai to its Vashi Branch. The bank alleged that after being relieved from her earlier posting, she brought two police personnel to the bank’s office and complained that the transfer was intended to harass her. The bank further alleged that she made complaints to several authorities, including the Banking Ombudsman, RBI, Human Rights Commission, Chief Minister and others, thereby damaging the institution’s reputation.
A departmental inquiry found the charges proved, following which the bank dismissed her from service in January 2015.
Labour Court and Industrial Court Findings
The Labour Court held that the inquiry itself was fair and proper but concluded that the inquiry officer’s findings were perverse and unsupported by evidence. The Industrial Court later upheld that view while dismissing the bank’s revision application.
Aggrieved by these findings, the bank approached the High Court.
Court’s Observations
Examining the evidence, the High Court noted that the employee had not disputed bringing police personnel to the bank’s office. The Court found that the evidence of the bank manager indicated that the police questioned him regarding the employee’s transfer.
Justice Marne observed:
“The very act of the Respondent approaching police and complaining about her transfer to Vashi Branch constitutes misconduct.”
The Court held that if an employee is dissatisfied with a transfer order, established internal remedies and representations should ordinarily be pursued. It found that bringing police personnel to the workplace and subjecting a bank officer to questioning could reasonably be viewed as misconduct.
At the same time, the Court clarified that the allegation that the employee had personally misbehaved with the manager was not proved on the available evidence.
Regarding complaints made to various external authorities, the Court noted that employees have a right to raise service-related grievances. However, it observed that the issue was not whether every complaint amounted to misconduct, but whether the Labour Court was justified in holding that no misconduct could arise from such conduct.
The Court stated:
“Mere making complaints to various authorities does not amount to misconduct” could not be accepted as a blanket proposition in the facts of the case.
The judgment further emphasized that in domestic disciplinary inquiries, charges are tested on the standard of “preponderance of probabilities” and not “proof beyond reasonable doubt.” The Court held that labour forums cannot re-evaluate the adequacy of evidence where some evidence exists to support the inquiry officer’s conclusions.
Decision
Allowing the writ petition, the Bombay High Court set aside the Labour Court’s order dated September 1, 2023, and the Industrial Court’s order dated June 11, 2024. The Court held that the inquiry officer’s findings, except on the allegation of misbehaviour with the manager, were supported by evidence and could not be termed perverse.
The Court directed the Labour Court to proceed with the remaining issues, including examining whether the punishment of dismissal was legally justified and proportionate to the misconduct, without being influenced by the High Court’s observations on that aspect.
It also requested expeditious disposal of the pending complaint, preferably within six months.
Case Details:
Case Title: Abhyudaya Co-operative Bank Ltd. v. Smita Virendra Patil
Case Number: Writ Petition No. 10929 of 2024
Judge: Justice Sandeep V. Marne
Decision Date: June 18, 2026
