In Brief
Canara Bank dismissed an employee, Lalit Popli, for fraudulently withdrawing Rs. 1,07,000 from a customer's account through forgery. Three supervisors were found negligent in the same incident and penalised with recovery orders, which they paid. The bank later recovered the loss amount from Popli's gratuity and provident fund. Popli challenged this, arguing the bank had already recovered the loss from the three supervisors. The High Court allowed his writ petition, finding double enrichment. The Supreme Court reversed this, holding that Rule 12 of the Gratuity Rules and Clause 19 of the Provident Fund Regulations expressly permit recovery of financial loss from terminal benefits. Popli, as the direct author of fraud, bore primary responsibility, unlike the supervisors who were merely negligent. The appeal was allowed and the writ petition dismissed.
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