Introduction:

The High Court of Jammu & Kashmir and Ladakh has quashed the dismissal of a Deputy General Manager of the Jammu & Kashmir Bank, holding that termination of an employee without conducting an inquiry is an exceptional and drastic measure that can be resorted to only when the conditions prescribed under the governing service rules are strictly fulfilled. The Court found that the Managing Director and Chief Executive Officer of the Bank could not invoke Clause 12.29 of the Officers Service Manual merely on the basis of information gathered through discreet enquiries when the clause specifically contemplated an investigation and a finding regarding the employee’s involvement in terrorist or anti-national activities.

Justice Sanjay Dhar delivered the judgment in a writ petition filed by Saadut Hussain Pampori against the Union Territory of Jammu & Kashmir and other respondents. The petitioner had challenged an order dated July 15, 2024, by which he was dismissed from the services of the Jammu & Kashmir Bank with immediate effect. The dismissal was ordered by invoking Clause 12.29 of the Officers Service Manual, purportedly on the basis of advice tendered by the Director General of Police concerning the petitioner’s alleged involvement in terrorist and anti-national activities.

The case raised an important question concerning the balance between institutional security and procedural safeguards available to an employee facing an allegation of serious anti-national activity. While the law recognises that situations concerning the security of the State may justify dispensing with a conventional departmental inquiry, such power is not unrestricted. The authority exercising that power must act within the limits of the provision that confers it.

The petitioner had entered the services of the respondent-Bank as a Computer Engineer on June 16, 1995. Over the course of his career, he rose through the organisational hierarchy and eventually attained the position of Deputy General Manager. He had therefore served the Bank for several decades before the impugned dismissal brought his employment to an abrupt end.

The termination was not preceded by a regular departmental inquiry. Instead, the Bank relied upon Clause 12.29 of the Officers Service Manual, which permits action in specified circumstances involving an employee’s alleged involvement in terrorist or anti-national activities. The provision, however, contains conditions concerning the nature of the investigation, the finding of involvement and the advice of a competent authority.

The petitioner contended that none of those foundational requirements had been satisfied. According to him, no FIR had been registered against him and no investigation had been carried out by any State, Union Territory or Central investigating agency. He therefore argued that the Managing Director and CEO lacked jurisdiction to invoke Clause 12.29 and dismiss him without inquiry.

The respondents defended the termination by asserting that the decision was based upon discreet investigation undertaken by the J&K Police. They claimed that the information gathered through such enquiries established the petitioner’s direct involvement in anti-national activities and justified the exceptional action taken against him.

The High Court was consequently required to determine what the expression “investigation” means in the context of Clause 12.29 and whether discreet enquiries and intelligence inputs could satisfy the requirement of that provision. The Court also examined the extent of judicial review available in matters concerning dismissal in the interests of State security and considered the Supreme Court’s jurisprudence concerning Article 311(2)(c) of the Constitution.

While acknowledging the importance of State security, Justice Sanjay Dhar ultimately concluded that the extraordinary power exercised by the Bank authorities could not be sustained because the statutory or regulatory preconditions for invoking it had not been fulfilled. The Court accordingly quashed the dismissal while leaving the respondents free to proceed afresh in accordance with Clause 12.29 or, alternatively, to conduct a regular departmental inquiry.

Arguments of the Parties:

On behalf of the petitioner, Advocates Shariq J. Reyaz and Humaira Sajad challenged the legality of the dismissal order primarily on the ground that the authorities had acted without jurisdiction and in violation of the conditions prescribed under Clause 12.29 of the Officers Service Manual.

The petitioner argued that dismissal without an inquiry was an exceptional measure and could not be treated as an ordinary disciplinary mechanism. According to the petitioner, the Bank had deprived him of his employment without giving him an opportunity to respond to the allegations or contest the material relied upon against him.

A central submission was that the requirements of Clause 12.29 had not been fulfilled. The petitioner maintained that there was no FIR registered against him and, more importantly, no investigation had been conducted by any State, Union Territory or Central investigating agency in the manner contemplated by the provision.

The petitioner contended that information gathered through intelligence sources or discreet enquiries could not be equated with an investigation. An investigation, in its ordinary legal sense, involves a structured process of collecting material and evidence, examining persons acquainted with the facts and reaching a conclusion on the basis of that material. The petitioner argued that none of these steps had been demonstrated in his case.

The petitioner also questioned the reliance placed upon the advice of the Director General of Police. He submitted that an advisory or intelligence report could not, by itself, substitute the investigation and finding expressly contemplated under Clause 12.29.

The petitioner therefore asserted that the Managing Director and CEO of the Bank had exercised a power which was not available to them in the absence of the necessary jurisdictional facts. Since the foundational requirements of the clause had not been established, the impugned dismissal was liable to be quashed.

The respondents, represented by Senior Additional Advocate General Mohsin Qadiri and Maha Majeed, defended the decision and sought dismissal of the writ petition.

The respondents maintained that the petitioner’s involvement in anti-national activities had been established through discreet investigation conducted by the J&K Police. According to their case, the information received from sensitive and credible sources, coupled with verification and material gathered during discreet enquiries, provided sufficient basis for concluding that the petitioner was involved in activities prejudicial to national interests.

The respondents also relied upon material relating to posts associated with the hashtag campaign “#TortureKashmir”. According to the respondents, this material formed part of the broader assessment that led the competent police authorities to advise action against the petitioner.

The respondents essentially argued that matters involving national security cannot always be assessed through the same procedural framework applicable to ordinary disciplinary proceedings. Information relating to anti-national activity may arise from confidential sources, intelligence inputs and discreet verification, and requiring the authorities to disclose the source or subject such material to the conventional processes of a departmental inquiry could, according to their position, undermine legitimate security interests.

The respondents therefore sought to sustain the dismissal as an action taken in the interests of institutional and national security. Their case was that the police authorities had undertaken sufficient verification to reach the conclusion that the petitioner was involved in anti-national activities and that the Bank had acted upon the advice received from the competent authority.

The dispute thus centred on whether the term “investigation” in Clause 12.29 could encompass discreet enquiries and intelligence gathering or whether the provision required a more formal evidentiary exercise involving collection of material and recording of statements. The respondents favoured the former interpretation, while the petitioner insisted that the latter was necessary before such an extraordinary power could be exercised.

Court’s Judgment:

Justice Sanjay Dhar allowed the writ petition and quashed the impugned dismissal order. The Court’s reasoning proceeded from the exceptional nature of dismissal without an inquiry and the need to strictly comply with the conditions attached to the exercise of such power.

The Court first recognised that dismissal of an employee without conducting a regular inquiry is a drastic measure. Such a power can undoubtedly exist in circumstances involving the security of the State, but the existence of such a power does not mean that an authority can exercise it whenever allegations concerning national security are made.

The Court observed that dismissal without inquiry is a drastic step that must be taken only in rare and appropriate cases. The significance of this observation lies in the distinction between the seriousness of an allegation and the legal requirements for acting upon it. Even an allegation as grave as involvement in anti-national activities cannot, by itself, dispense with procedural requirements where the governing service provision has prescribed specific conditions.

The Court examined Clause 12.29 of the Officers Service Manual in detail. It found that the provision required certain conditions to exist before the Managing Director and CEO could exercise the power of dismissal without holding an inquiry.

The Court understood the clause as contemplating an investigation conducted by a State, Union Territory or Central investigating agency, followed by a finding concerning the employee’s involvement in terrorist or anti-national activities and advice from a competent authority of the prescribed level, including an authority not below the rank of Principal Secretary or Director General of Police.

The Court’s interpretation of the word “investigation” became central to the outcome.

The respondents had relied upon information received from sensitive and credible sources and discreet enquiries conducted by the police. The Court, however, held that such intelligence gathering could not automatically be treated as an “investigation” within the meaning of Clause 12.29.

The Bench clarified that it was not necessary to conclude that investigation under Clause 12.29 could only arise after registration of an FIR. The Court recognised that the provision operates in a specialised context and therefore its reference to investigation cannot necessarily be confined to conventional FIR-based criminal proceedings.

However, the Court drew a clear line between information gathering and investigation. It held that, to qualify as an investigation under Clause 12.29, the investigating agency must undertake an exercise involving the collection of material or evidence and the recording of statements of persons acquainted with the relevant facts. On the basis of that material, the involvement of the employee in anti-national activities must then be established.

The Court therefore rejected the proposition that a discreet enquiry, without more, satisfies the requirement of an investigation.

The Bench explained that information obtained from sources and discreet enquiries does not necessarily involve the collection of evidence or recording of witness statements. Consequently, such material cannot automatically substitute the investigation expressly contemplated by Clause 12.29.

This distinction was particularly important because the impugned dismissal had been based upon the material forwarded by the competent authorities rather than upon a demonstrated investigation satisfying the requirements of the service provision.

The Court examined the report of the Special Director General, Criminal Investigation Department. It found that the report referred to discreet verification but did not demonstrate that any investigation of the nature required by Clause 12.29 had actually been undertaken.

The Court observed that the report did not indicate that the authorities had undertaken the process of collecting material or recording statements of persons acquainted with the facts. In the absence of such a process, the report of discreet verification could not substitute the mandatory requirement of investigation.

The judgment also addressed the broader issue of judicial review in cases involving security of the State.

The Court relied upon the Supreme Court’s decision in Union of India v. Balbir Singh, (1998) 5 SCC 216. In that case, the Supreme Court had recognised that judicial review of the satisfaction of the competent authority under Article 311(2)(c) of the Constitution is limited. Courts generally do not substitute their own assessment for that of the competent authority in matters involving State security and can interfere in appropriate circumstances, including where the decision is mala fide or based upon extraneous or irrelevant considerations.

The J&K High Court, however, found an important distinction between Article 311(2)(c) and Clause 12.29 of the Officers Service Manual.

Article 311(2)(c) is a constitutional provision under which the President or Governor may dispense with the inquiry requirement where satisfied that it is not expedient to hold an inquiry in the interests of the security of the State. The constitutional design entrusts that exceptional power to very high constitutional authorities.

Clause 12.29, by contrast, vested the relevant power in the Managing Director and CEO of a bank. The Court found that this difference in the identity and status of the authority exercising the power was significant.

The Bench observed that there appeared to be a definite purpose behind the different language used in Article 311(2)(c) and Clause 12.29. While the Constitution entrusts the President and Governor, as high constitutional functionaries, with the exceptional power to dispense with an inquiry in appropriate cases, the same level of trust could not automatically be assumed in respect of the Managing Director and CEO of a bank.

This distinction led the Court to conclude that the preconditions contained in Clause 12.29 had to be scrupulously satisfied before the Bank’s authorities could exercise the extraordinary power of dismissal without inquiry.

The Court’s reasoning is important because it prevents the concept of State security from becoming an unrestricted justification for dispensing with procedural safeguards. Where the power is conferred by a specific service rule and that rule prescribes conditions for its exercise, those conditions cannot simply be ignored because the allegations happen to concern national security.

The Court did not hold that every allegation involving anti-national activity must necessarily result in a regular departmental inquiry. Instead, it recognised that Clause 12.29 itself provides a mechanism through which the requirement of a conventional inquiry may be avoided in appropriate circumstances. But the authorities must first satisfy the requirements prescribed by that very provision.

The Court then considered the actual material relied upon against the petitioner. The competent authority’s report referred to information obtained from sensitive and credible sources, discreet enquiries and material relating to posts associated with the “#TortureKashmir” hashtag campaign.

The Court did not treat the existence of such information as legally irrelevant. Instead, it held that the manner in which the information was collected and converted into a finding was crucial. Intelligence inputs or discreet verification may provide the basis for initiating an appropriate process, but they cannot automatically be treated as the investigation required under Clause 12.29.

The Court therefore found that the respondents had failed to establish the jurisdictional foundation necessary for invoking the clause.

Another important aspect of the judgment is that the Court did not insist upon an FIR as an absolute prerequisite. It expressly recognised that investigation under Clause 12.29 need not necessarily be restricted to FIR-based proceedings. This approach gives the provision sufficient flexibility to operate in matters where sensitive information may not immediately translate into registration of a conventional criminal case.

At the same time, the Court insisted upon a substantive process of investigation. There must be collection of relevant material, examination or recording of statements where appropriate, and an actual finding based upon that material. This requirement prevents the word “investigation” from being reduced to a mere label attached to intelligence gathering.

The Court accordingly concluded that the Special DG, CID report referring to discreet verification could not satisfy the requirement. Since the necessary investigation had not been shown to have taken place, the Managing Director and CEO of the Bank had no basis to invoke Clause 12.29 and dismiss the petitioner without an inquiry.

The impugned dismissal order was therefore quashed.

However, the Court did not bring the matter to an end by granting the petitioner an absolute immunity from further action. Instead, it balanced the interests of the employee and the institution by relegating the petitioner to the status that he occupied immediately before the dismissal order.

At the same time, the Court granted liberty to the respondents to proceed against the petitioner afresh, provided they complied with the requirements of Clause 12.29. Alternatively, the respondents were permitted to proceed with a departmental inquiry in accordance with law.

This direction is significant. The Court’s judgment was not an adjudication that the allegations against the petitioner were false or that he could never face disciplinary action. Rather, the Court held that the particular route adopted by the Bank was legally unsustainable because the mandatory conditions for invoking the exceptional provision had not been fulfilled.

The decision therefore preserves the authority of the Bank and competent agencies to take appropriate action while ensuring that the extraordinary power of dismissal without inquiry is exercised within the limits prescribed by the governing service rules.

The judgment also reinforces a broader principle of administrative law: when an authority exercises a power that has serious consequences for an individual’s employment and reputation, it must demonstrate that the conditions precedent to the exercise of that power have been satisfied.

National security is undoubtedly a compelling governmental interest, and courts ordinarily exercise restraint when examining decisions taken on that ground. But judicial restraint does not mean judicial abdication. Where the authority has acted beyond the limits of the rule under which it claims power, the Court retains the jurisdiction to examine whether the legal requirements have been fulfilled.

In the present case, the High Court found that the distinction between intelligence inputs, discreet enquiries and a legally sufficient investigation was decisive. The respondents may have possessed information concerning the petitioner, but the material placed before the Court did not establish that the investigation contemplated by Clause 12.29 had been conducted.

The judgment consequently establishes an important procedural safeguard against the misuse of exceptional disciplinary powers. It makes lear that a rule permitting dismissal without inquiry cannot b