In Brief
An officer of Punjab National Bank was compulsorily retired as a major penalty after a disciplinary enquiry into loan-granting irregularities, and denied gratuity, employer's provident fund contributions, and pension. The High Court's Single Judge awarded gratuity and provident fund contributions; the Division Bench reversed this, citing loss to the Bank. The Supreme Court allowed the officer's appeal, holding that compulsory retirement (a distinct penalty from dismissal) does not automatically forfeit gratuity. Forfeiture requires proof of actual quantifiable loss per the Gratuity Act, 1972—neither found in the enquiry report nor substantiated before denying the benefits. The Gratuity Act overrides bank regulations, and natural justice requires an opportunity to respond before forfeiture.
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