Punjab & Haryana High Court Awards ₹3 Lakh Compensation to Bank Employee’s Son, Rules SBI Wrongly Denied Compassionate Appointment

Case Name: Mukesh Kumar v. State Bank of India and Others
Date of Judgment: January 6, 2015
Citation: CWP No. 17161 of 2003
Bench: Hon’ble Mr. Justice Satish Kumar Mittal and Hon’ble Mr. Justice Deepak Sibal

Held: The Punjab & Haryana High Court held that the State Bank of India acted arbitrarily and unreasonably in denying compassionate appointment to the petitioner, son of a deceased bank employee, under its scheme for dependents of employees dying in harness. Justice Deepak Sibal, speaking for the Division Bench, ruled that Clause 10 of the Bank’s scheme—which required assessment of the family’s financial condition—was valid but that its application in this case was unjustified. The Court found that the Bank’s presumption of financial stability based on retiral benefits and an assumed interest income was erroneous and contrary to the humanitarian purpose of compassionate appointment.

Summary: The petitioner’s father, Rajinder Parshad, a Teller in the State Bank of India at Hisar, died of cancer on November 1, 2000, leaving behind aged parents, a widow, two college-going sons, and an unmarried daughter. The petitioner applied in December 2000 for appointment on compassionate grounds under the Bank’s existing scheme. The local branch recommended his case, but higher authorities rejected it, citing Clause 10 of the scheme, which required consideration of the family’s financial condition. The Bank stated that the family had received ₹3.63 lakh as terminal benefits, was entitled to ₹4,963 per month as family pension, owned a house, and would earn ₹2,500 per month from interest, thereby disqualifying them from consideration.

The Court examined Clause 10 and upheld its legality, observing that assessment of financial condition is a valid and rational criterion. However, on applying it to the facts, the Bench held that the Bank’s decision was unsustainable. It noted that the family’s only income was the pension and that the retiral amount was insufficient to meet immediate obligations such as the marriage of the daughter and education of the two sons. The presumption that the lump-sum amount could yield monthly interest income was found to be “imaginary and unrealistic.” The Bench remarked that the Bank had treated the bereaved family “rather callously” and ignored the very objective of the compassionate appointment policy — to help the family tide over the sudden crisis following the death of the sole breadwinner.

Decision: While refraining from directing appointment due to the passage of 14 years since the death, the High Court held that the rejection of the petitioner’s claim was illegal and arbitrary. To balance equities, it awarded ₹3,00,000 as compensation, payable within three months, with 9% annual interest in case of delay. The writ petition was accordingly disposed of.