Jammu & Kashmir High Court rules that dismissal without formal investigation and witness statements violates Officer Service Manual; distinguishes bank dismissal powers from Constitutional Article 311(2)(c)
In a significant judgment delivered on August 29, 2026, the Jammu & Kashmir and Ladakh High Court has quashed the dismissal order of Saadut Hussain Pampori, a Deputy General Manager at J&K Bank, holding that the dismissal was not sustainable in law due to non-compliance with mandatory procedural requirements under Clause 12.29 of the Officers Service Manual (OSM).
Justice Sanjay Dhar's judgment provides critical clarity on the distinction between the dismissal powers available to constitutional functionaries under Article 311(2)(c) of the Constitution and the limited powers granted to bank executives under Clause 12.29 of the OSM. The decision emphasizes that while the President or Governor may dismiss employees without inquiry in the interest of state security, bank officials must comply with stricter preconditions.
The Case Background
Pampori, who served as a Computer Engineer since 1995 and rose to Deputy General Manager, was placed under suspension on April 15, 2024. On July 15, 2024, he was summarily dismissed based on an allegation that he was involved in anti-national activities. The bank invoked Clause 12.29 of the OSM, which permits dismissal without departmental inquiry when an investigation establishes involvement in terrorist or anti-national activities, subject to advice from a competent Government authority.
The petitioner challenged the dismissal on the grounds that no formal investigation had been conducted as mandated by Clause 12.29, and no FIR had been registered against him. The government authorities relied on "discreet verification" and information from "sensitive and credible sources," claiming this constituted investigation under the Clause.
The Court's Critical Findings
Justice Dhar identified four mandatory conditions that must be satisfied before invoking Clause 12.29:
- 1. A formal investigation must be conducted by a State/UT/Central Investigating Agency
- 2. The employee must be found involved in terrorist or anti-national activities through this investigation
- 3. This investigation must be followed by advice from a competent Government authority (not below the rank of Principal Secretary or Director General of Police)
- 4. Only then can the employee be dismissed without departmental proceedings
The Court made a crucial distinction between "investigation" and "discreet verification." Investigation, as defined through judicial precedent, comprises: proceeding to the spot, ascertainment of facts and circumstances, discovery of suspected offenders, collection of evidence, examination of witnesses, and recording statements. Mere gathering of information from sources or conducting discreet inquiries without formal evidence collection does not constitute investigation under Clause 12.29.
Distinguishing from Article 311(2)(c)
A cornerstone of the judgment is the clear demarcation between constitutional powers and bank powers. Under Article 311(2)(c), the President or Governor may dispense with inquiry in the interest of state security without any requirement of prior investigation or formal findings. However, Clause 12.29 imposes these preconditions precisely because bank officials, unlike constitutional functionaries, cannot be entrusted with such drastic powers without safeguards.
The Court observed: "While the President and the Governor are high constitutional functionaries and, therefore, they can be trusted with the drastic power of dispensing with the services of an employee without holding an inquiry in appropriate cases, the same level of trust cannot be reposed in an officer of the level of Managing Director and CEO of a bank."
What the Evidence Actually Showed
The confidential report relied upon by authorities was based on "information received from sensitive and credible sources" and "discreet enquiries." The material consisted of tweets allegedly posted on a hashtag campaign #TortureKashmir. However, this material was not collected through any formal investigation involving witness statements or systematic evidence gathering.
The Court found that the information from sources was "largely based upon general reputation of a person and not on any tangible material or evidence." Critically, the report did not demonstrate that any formal investigation had recorded witness statements or undertaken systematic fact-finding as required by Clause 12.29.
Implications of the Judgment
This judgment has far-reaching implications:
- 1. Procedural Safeguard: It establishes that even in matters involving national security, bank employees cannot be dismissed arbitrarily; formal investigation with evidence collection and witness statements is mandatory.
- 2. Limited Judicial Review: While acknowledging that courts cannot reappreciate confidential security material, the judgment asserts that courts can examine whether procedural preconditions have been met.
- 3. Investigation Definition: The Court clarifies that investigation under Clause 12.29 is broader than FIR-based investigation but narrower than mere discreet verification, requiring systematic collection of evidence and witness statements.
- 4. Constitutional Distinction: The judgment rejects the respondents' argument that bank dismissal powers are analogous to constitutional powers, reinforcing that different provisions require different procedural safeguards.
Liberty for Fresh Action
Justice Dhar granted the respondents liberty to proceed afresh in two ways:
- 1. Conduct a proper investigation complying with all requirements of Clause 12.29 before seeking Government advice and dismissing the employee, or
- 2. Initiate a regular departmental inquiry as originally contemplated
The petitioner has been relegated to his status prior to dismissal and shall be entitled to all consequential benefits.
Significance
This judgment represents an important balance between national security imperatives and individual rights. While acknowledging that some dismissals on security grounds may proceed without full departmental inquiry, the Court ensures that such extraordinary powers are exercised only after proper investigation and evidence collection. It prevents the misuse of security clauses through mere suspicion or discreet verification without formal investigation.
The decision reinforces the principle that even in sensitive matters, procedural regularity and adherence to prescribed conditions are essential foundations for administrative action.
Statutory Provisions : Clause 12.29 of the Officers Service Manual (OSM), Article 311(2)(c) of the Constitution of India, Section 2(j) of the Bharatiya Nyaya Sanhita (BNSS), Code of Criminal Procedure, 1973
