5 min readNew DelhiUpdated: May 18, 2026 01:29 PM IST
Supreme Court Canara Bank news: The Supreme Court has held that courts exercising judicial review should ordinarily refrain from dictating the nature of punishment to be imposed in disciplinary proceedings, setting aside a Calcutta High Court direction that barred Canara Bank from dismissing or removing a former manager from service.
A bench of Justices Dipankar Datta and Satish Chandra Sharma was hearing a civil appeal filed by Canara Bank against a 2025 judgment of the Calcutta High Court in the case concerning a former bank manager who had challenged disciplinary proceedings culminating in his dismissal from service.
Justices Dipankar Datta and Satish Chandra Sharma took exception to the high court’s direction restraining the authority from removing the manager.
“Law is well settled that courts should observe restraint while interdicting orders of punishment and that, in exercise of judicial review, no court ought to ordinarily interfere with the punishment imposed by the disciplinary authority or substitute its own judgment therefor,” the Supreme Court said on May 10.
HC had ordered reconsideration
- The dispute arose from disciplinary proceedings initiated against the man while he was serving as a manager at the Canara Bank.
- Following the inquiry, he was dismissed from service.
- His departmental appeal and review petition were also rejected in October 2017 and December 2018, respectively.
- He subsequently approached the Calcutta High Court, and a single judge dismissed his plea on July 18, 2024, finding no merit in the challenge to the disciplinary action.
- However, a division bench partly allowed his intra-court appeal on August 27, 2025.
- The Calcutta High Court held that an investigation report favourable to the employee had not been considered during the inquiry process and also found the punishment to be “shockingly disproportionate”.
- It remitted the matter to the disciplinary authority for reconsideration while directing that any punishment imposed should be short of dismissal or removal from service.
SC · Justices Dipankar Datta & Satish Chandra Sharma · Canara Bank vs former manager · May 10, 2026
What is judicial review in disciplinary proceedings?
When an employee challenges a workplace punishment — such as dismissal — in court, the court exercises "judicial review." This means examining whether the process was fair and lawful. It does NOT mean the court can replace the employer's decision with its own, or tell the employer what punishment to impose.
"No court ought to ordinarily interfere with the punishment imposed by the disciplinary authority or substitute its own judgment therefor." — Supreme Court of India, May 10, 2026
What courts CAN do — and what they cannot
Courts CAN
Permissible judicial review
- Examine if procedure was followed fairly
- Check if all evidence was considered
- Assess if punishment is "shockingly disproportionate"
- Remand matter for fresh consideration
- Direct authority to consider mitigating factors
Courts CANNOT
Prohibited judicial overreach
- Cap or dictate the nature of punishment
- Bar dismissal or removal as an option
- Substitute court's own judgment for employer's
- Tie hands of disciplinary authority
- Pre-decide the outcome of fresh proceedings
In this case: Calcutta HC directed that any fresh punishment must fall "short of dismissal or removal" — SC held this was impermissible. Authority must be free to impose dismissal if warranted, after considering mitigating factors: years of service, past conduct, degree of diligence and financial loss to bank.
Supreme Court objects to curb on punishment
- Appearing for the Canara Bank, advocate Rajesh Kumar Gautam argued that the investigation report referred only to charge number 2 and had no connection with charge number 1, which had already been proved.
- He contended that the high court could not legally restrict the disciplinary authority from imposing dismissal or removal if warranted by the findings.
- Counsel for the employee, Ravi Kumar Tomar, defended the high court judgment and submitted that the doctrine of proportionality had to be kept in mind while imposing punishment.
- The Supreme Court agreed with the Canara Bank’s objection, specifically taking exception to the high court’s direction restraining the authority from imposing dismissal or removal.
- The division bench “ought not to have tied the hands of the Disciplinary Authority”, the apex court said, adding that if Charge No. 2 was found proved upon reconsideration, the authority must remain free to decide the appropriate punishment in accordance with law.
‘Consider mitigating factors’
While restoring the disciplinary authority’s discretion, the Supreme Court also underlined that relevant mitigating circumstances must be considered before imposing any penalty afresh.
The top court said factors such as the employee’s years of service, past conduct, degree of diligence expected from him, and the extent of financial loss suffered by the Canara Bank should be examined before arriving at a decision on punishment.
Clarifying that it had expressed no opinion on the merits of the allegations, the Supreme Court disposed of the appeal and asked the disciplinary authority to take an expeditious decision, given the long lapse of time since the original dismissal order.
The court said the disciplinary authority must remain free to independently assess both the charges and the appropriate penalty after reconsidering the materials on record related to the Canara Bank employee.
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Andhra Pradesh High Court refuses to save SBI employee fired over fraud
The Andhra Pradesh High Court had dismissed a plea filed by a former State Bank of India (SBI) customer relationship officer challenging his termination from service following allegations of financial embezzlement.
Justice Harinath N was dealing with a plea of a former employee who was terminated on the allegations of embezzling funds in connivance with an assistant manager of the branch.
“The legal position with respect to exercising the power of judicial review is settled. Unless and until any illegality or procedural irregularity which would shock the conscience of the court or tribunal, the discretion can be exercised,” the court said in its May 8 order.
Justices Dipankar Datta and Satish Chandra Sharma took exception to the high court’s direction restraining the authority from removing the manager.