Lack of profit or loss due to misconduct by employee is not a valid defence

Supreme Court: Explaining the scope misconduct by employees, the bench of RK Agrawal and AM Sapre, JJ said that there is no defense available to a delinquent to say that there was no loss or profit resulting in a case when officer/employee is found to have acted without authority.

The Court was hearing the case where the appellant, an assistant with LIC, was suspended for his alleged misconduct as he had, in discharge of his duties, issued as many as seven receipts including special premium receipts to the policyholders without receiving any premium amount from them. The appellant, in substance, admitted the issuance of receipts by him and also admitted non-receipt of the amount against any of these receipts from any of the policyholders. He, however, contended that such mistake occurred on his part due to heavy pressure of workload on him and some family circumstances/worries that were troubling him during those days.

Rejecting the contention of the appellant, the Court said that an employee, in discharge of his duties, is required to exercise higher standard of honesty and integrity. In a case where he deals with the money of the depositors and customers, it is all the more necessary for him to be more cautious in his duties because he deals with the money transactions for and on behalf of his employer.

It was further held that every such employee/officer is, therefore, required to take all possible steps to protect the interest of his employer. He must, therefore, discharge his duties with utmost sense of integrity, honesty, devotion and diligence and must ensure that he does nothing, which is unbecoming of an employee/officer. Any dereliction in discharge of duties whether by way of negligence or with deliberate intention or with casualness constitutes misconduct on the part of such employee/officer. [Mihir Kumar Hazara v. Life Insurance Corporation, 2017 SCC OnLine SC 1068, decided on 11.09.2017]

 

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