"Banker’s Eye", “Some Evidence”, and the Outer Limits of Section 11‑A Review: Supreme Court restores compulsory retirement in Canara Bank v. Ganganarasimhaiah

Introduction

In The General Manager (P), Canara Bank v. Ganganarasimhaiah, 2025 INSC 1088 (Supreme Court of India, 9 September 2025), the Court revisits foundational principles that govern judicial and industrial adjudicatory review of disciplinary findings. The decision squarely addresses three core issues:

How far can an Industrial Tribunal, acting under Section 11-A of the Industrial Disputes Act, 1947, reappreciate evidence after it has upheld the fairness of a domestic enquiry?
What evidentiary standards apply in departmental proceedings—specifically, whether strict criminal trial standards or handwriting expert testimony are prerequisites to proving misconduct in banking irregularities?
Whether compulsory retirement deprives a workman of retiral benefits, and whether “no pecuniary loss to the bank” can justify interference with a proved misconduct finding.

The appellant, Canara Bank, challenged a Division Bench judgment of the Karnataka High Court (12.08.2022) that affirmed a Central Government Industrial Tribunal award (25.09.2019) setting aside the punishment of compulsory retirement imposed on the respondent (a sub-staff employee) and directing reinstatement with continuity but without back wages. The Supreme Court allowed the appeal, restored the disciplinary penalty of compulsory retirement, and clarified the legal principles limiting tribunal review and evidentiary expectations in disciplinary matters.

Background and Procedural History

Employment and postings: Respondent joined Canara Bank as daily wage sub-staff on 17.10.1990; confirmed as Duftry-cum-Cash Peon (Sub-Staff Leader) on 18.07.1992; posted at V.G. Doddi branch (11.11.1997 to 01.08.2004), then Bommasandra (from 02.08.2004).
Investigation and admissions (2004): The then Manager of V.G. Doddi branch reported serious irregularities (06.08.2004). In a preliminary enquiry, the respondent (24.07.2004) admitted to loans in his wife’s name obtained by pressurising the Manager without controlling office sanction, unauthorized entries in accounts (including SB A/c 1550 of a customer, Sri Ramakrishnaiah), and tampering with records (balancing book, control registers, subsidiary sheets, passbook omissions).
Suspension and charges: Suspension on 19.08.2004; chargesheet dated 28.04.2005 alleging unauthorized debits, manipulation of records, coercion of Manager to sanction loans to close relatives, and violations of the Canara Bank Service Code amounting to “gross misconduct”.
Enquiry and penalty: Enquiry Officer’s report (09.01.2006) held all charges proved. Disciplinary Authority (15.03.2006) imposed compulsory retirement, after show cause and hearing. Appellate Authority (22.11.2006) affirmed the penalty.
Industrial reference: The Central Government referred: “Whether the punishment of the compulsory retirement imposed on Shri Ganganarasimahaiah by the management of Canara Bank is legal and justified? If not, to what relief?”
Preliminary issue: The Tribunal decided (17.05.2013) that the domestic enquiry was fair and proper. This order was not challenged and attained finality.
Final award and High Court: Despite its earlier ruling on fairness, the Tribunal (25.09.2019) reappreciated evidence, found no direct proof that the respondent authored disputed entries, termed the penalty harsh, and ordered reinstatement without back wages. The Karnataka High Court (12.08.2022) affirmed, adding that the charges were “absurd”, stressing no financial loss and the father’s eligibility for loan.

Summary of the Judgment

The Supreme Court set aside the Tribunal’s award and the High Court’s affirmance, restored the Disciplinary Authority’s order of compulsory retirement, and clarified that:

Where the fairness of a domestic enquiry has been upheld and has attained finality, the Tribunal cannot act as an appellate forum to reappreciate evidence under Section 11-A, save to test for “no evidence”, perversity, or violation of natural justice.
Departmental proceedings are governed by the civil standard—preponderance of probabilities—not the criminal standard of proof. Strict rules of the Evidence Act, including insistence on handwriting expert testimony, do not apply.
In banking disciplinary matters, it is permissible for trained bank officers to form opinions by comparing signatures and entries with a “banker’s eye”. Such comparisons can constitute “some evidence”.
“No financial loss” is not a determinative defence in bank misconduct; loss of confidence and breach of trust suffice to sustain serious penalties.
Compulsory retirement does not deprive an employee of gratuity and other pensionary benefits; denial typically follows dismissal, not compulsory retirement.

Analysis

Precedents Cited and Their Influence

B.C. Chaturvedi v. Union of India, (1995) 6 SCC 749
The Court reaffirmed the classic “some evidence” and “limited judicial review” doctrine: courts and tribunals are not appellate bodies to reweigh evidence. Interference lies only for lack of jurisdiction, violation of natural justice, “no evidence”, or perversity. The Supreme Court relied on B.C. Chaturvedi to hold that the Tribunal erred by revisiting and reweighing evidence after the enquiry’s fairness had been upheld.
Standard Chartered Bank v. R.C. Srivastava, (2021) 19 SCC 281
Re-emphasized that tribunals cannot convert themselves into appellate courts under Section 11-A; the governing standard is preponderance of probabilities. The Supreme Court applied this to criticise the Tribunal’s demand for criminal-trial-type proof and its disregard of management evidence in favour of defence witnesses.
State of Rajasthan v. Heem Singh, (2021) 12 SCC 569
Articulated the “two ends of the spectrum” in judicial review: deference to the disciplinary authority vs. interference for no evidence/perversity. The Court used Heem Singh to explain that an initial threshold scrutiny for “some evidence” is permitted, but wholesale reappreciation is not.
Indian Overseas Bank v. Om Prakash Lal Srivastava, (2022) 3 SCC 803
Endorsed reliance on a “banker’s eye” to compare signatures/entries in bank disciplinary inquiries and cautioned High Courts against acting as appellate bodies absent jurisdictional errors. The Court invoked this to validate the Enquiry Officer’s and Disciplinary Authority’s reliance on ocular comparison and initials attributed to the respondent.
State Bank of Bikaner and Jaipur v. Nemi Chand Nalwaya, (2011) 4 SCC 584
Reinforced that loss of confidence is a decisive factor in banking discipline; courts should not interfere with findings unless perverse/no evidence. Also reiterated different standards between departmental and criminal proceedings. This underpinned the Court’s rejection of the High Court’s “no financial loss” rationale.
Deputy General Manager (Appellate Authority) v. Ajai Kumar Srivastava, (2021) 2 SCC 612
Emphasised the elevated standards of integrity for bank employees. The Court echoed this, reasoning that the respondent’s role in irregularities and benefit from unauthorised transactions justifies serious penalty.

Legal Reasoning

Finality of the preliminary finding on fairness bars later evidentiary relitigation
The Tribunal’s 17.05.2013 order held the domestic enquiry “fair and proper”; it attained finality. Having crossed the fairness threshold, the Tribunal’s remit narrowed to testing whether there was “some evidence” supporting the findings and whether the conclusions were perverse. By reweighing testimonies, faulting the non-examination of additional witnesses (after already holding the enquiry fair), and demanding more rigorous proof, the Tribunal exceeded its jurisdiction under Section 11-A.
“Some evidence” and the preponderance standard satisfied
The Disciplinary and Appellate Authorities relied on multiple management exhibits and admissions recorded contemporaneously, including: entries and alterations in the balancing book and SB key register in the respondent’s handwriting; initials on slips and ledger folios (e.g., SB 1550 of Sri Ramakrishnaiah); deliberate omissions in the passbook; the respondent’s own written admissions (24.07.2004 and 28.07.2004) acknowledging unauthorised debits, coercion to facilitate loans for close relatives, and making/omitting entries. On a preponderance of probabilities, this was adequate “some evidence” to sustain charges.
Strict rules of the Evidence Act do not apply; expert handwriting opinion is not a prerequisite
The Tribunal’s insistence on handwriting expert evidence and production of every register/subsidiary sheet mirrored a criminal trial approach. Disciplinary proceedings are civil in character, flexible in proof, and governed by preponderance. Bank officers, habituated to signature/entry verification, can draw reliable inferences by a “banker’s eye”; their trained ocular comparison may suffice as “some evidence”.
Beneficiary status, circumstantial chain, and admissions cumulatively supported liability
The Tribunal paradoxically found it “highly possible” that irregularities were committed by the Manager at the respondent’s instance and acknowledged the respondent as “beneficiary” of irregular sanctions, yet set aside the penalty for want of proof of authorship of entries. The Supreme Court rejected this inconsistency: departmental liability does not hinge solely on direct proof of authorship of every entry—admissions, circumstantial indicators of pressure/coercion, and beneficiary conduct can establish complicity on a preponderance standard.
“No financial loss” is immaterial where trust is impaired
The High Court’s reliance on “no loss to the bank” and the father’s eligibility for loans was legally irrelevant. In banking, the axis of discipline is depositor trust; unauthorised debits, manipulation of records, and pressuring managers undermine confidence, warranting serious penalties irrespective of realised pecuniary loss.
Proportionality and the choice of penalty
The Tribunal termed compulsory retirement “too harsh” and appeared to consider reinstatement necessary to secure retiral benefits. The Supreme Court corrected the legal premise: compulsory retirement does not forfeit gratuity/pension; only dismissal typically jeopardises such benefits. Given the gravity—unauthorised debits in a customer’s account, manipulation of control registers and balancing books, and coercion for familial loans—the penalty was proportionate. The fact that similarly placed staff (including the Manager) were also compulsorily retired reinforced parity and proportionality.

Impact and Prospective Significance

Sharper limits on Section 11‑A reappreciation: Once an enquiry’s fairness is affirmed, Industrial Tribunals must resist acting as appellate forums. The permissible lens is “some evidence” and perversity—not wholesale retrial or elevation of proof standards.
Operational endorsement of “banker’s eye”: In bank disciplinary cases, trained officers’ ocular comparison of signatures/entries may constitute valid “some evidence”. Tribunals need not insist on handwriting experts absent specific infirmities.
Loss of confidence over “no loss” arguments: The decision entrenches that integrity and depositor trust are central; absence of financial loss cannot neutralize serious process violations and manipulation of records.
Clarity on retiral benefits: Compulsory retirement preserves eligibility to gratuity and pension (as per applicable rules). Tribunals should not order reinstatement merely to secure retiral benefits when serious misconduct is proved.
Practical guidance for disciplinary authorities: Documented admissions, initials, routine banking comparisons, and circumstantial proof of beneficiary status provide a defensible evidentiary matrix. Meticulous narration in penalty orders and reasoned appellate orders, as in this case, will withstand review.
Drafting of awards and judgments: Industrial adjudicators and High Courts must align with B.C. Chaturvedi, Heem Singh, and Nemi Chand Nalwaya frameworks; avoid substituting conclusions; and articulate any interference strictly within “no evidence/perversity” contours.

Complex Concepts Simplified

Domestic enquiry: An internal fact-finding process by an employer to examine allegations of misconduct. It must be conducted by a competent authority, follow principles of natural justice (notice, opportunity to defend, unbiased enquiry), but is not bound by strict rules of the Evidence Act.
Section 11-A, Industrial Disputes Act, 1947: Empowers Labour Courts/Industrial Tribunals to set aside or modify disciplinary findings or punishment in industrial disputes. However, courts repeatedly hold that this power does not license an appellate-style reappreciation of evidence once fairness is upheld; interference is confined to cases of no evidence, perversity, or disproportionate penalty.
Preponderance of probabilities vs. proof beyond reasonable doubt: Departmental proceedings apply the civil standard (more likely than not), not the criminal standard. Therefore, circumstantial evidence, admissions, and trained observations can suffice; exhaustive corroboration is unnecessary.
“Some evidence” rule: If there is some relevant evidence that a reasonable person could accept as supporting the conclusion, disciplinary findings are generally immune from judicial interference.
“Perversity” in findings: A finding so irrational that no reasonable tribunal could reach it on the material; or where vital evidence is ignored; or the conclusion is contrary to the weight of evidence to the point of irrationality.
“Banker’s eye”: The trained ability of bank officers to compare signatures/entries through routine practice. Courts accept such comparisons as part of the evidentiary assessment in bank disciplinary enquiries.
Compulsory retirement vs. dismissal: Compulsory retirement separates the employee from service but, typically, preserves entitlement to terminal benefits (gratuity, pension), subject to rules. Dismissal is punitive and may entail forfeiture of such benefits.

Conclusion

Canara Bank v. Ganganarasimhaiah is a strong restatement of restraint in industrial adjudication over disciplinary matters and a practical calibration of evidentiary expectations in banking misconduct inquiries. The Supreme Court:

Reined in the Tribunal’s excessive reappreciation under Section 11‑A after fairness of enquiry had been conclusively upheld;
Affirmed that departmental proof proceeds on preponderance, not criminal standards, and that expert handwriting opinion is not indispensable where trained banking comparisons and admissions exist;
Re-centred “loss of confidence” as the fulcrum in banking discipline, rejecting “no loss” as a basis to dilute penalties;
Clarified that compulsory retirement preserves retiral benefits, eliminating a recurrent misconception that motivated the Tribunal’s relief.

For future cases, this judgment will likely curb adventurous reweighing of departmental evidence by Tribunals/High Courts, particularly in the banking sector, while encouraging disciplinary authorities to clearly record the evidentiary chain—admissions, initials, ledger entries, and trained ocular comparisons—to sustain findings. Its dual clarifications—on the evidentiary standard and on retiral benefits—render it a significant reaffirmation of service and industrial jurisprudence.