Supreme Court: Bank cannot deny promotion to an employee merely because a disciplinary inquiry is pending

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Published 26 October 2026

Case: BANK OF INDIA & ORS. Versus S.M. KAMAL PASHA & ORS.
Court: Supreme Court of India
Citation: 2026 LiveLaw (SC) 1084
Source: LiveLaw

Bottom Line Up Front (BLUF)

In BANK OF INDIA & ORS. Versus S.M. KAMAL PASHA & ORS., 2026 LiveLaw (SC) 1084, the Supreme Court held that a bank cannot deny promotion to an employee solely due to a pending disciplinary inquiry, unless the rules specifically permit it. The Court applied principles related to promotion and disciplinary proceedings.

Ratio Decidendi · Legal Principle Established

A bank cannot deny promotion to an employee merely on the ground that a disciplinary inquiry is pending against them, unless the relevant service rules or regulations explicitly provide for such denial during the pendency of an inquiry.

Practice & Procedural Impact for Advocates

Advocates representing employees facing disciplinary inquiries should scrutinize service rules to challenge promotion denials. Litigants should be aware that a pending inquiry alone may not be a valid ground for promotion denial without specific rule provisions.

Key Legal Takeaways

1Promotion cannot be denied solely due to a pending disciplinary inquiry.
2Specific service rules are required to deny promotion based on a pending inquiry.
3Banks must adhere to their own rules regarding promotions and disciplinary actions.

The Legal Issue The core legal issue before the Supreme Court was whether a bank could deny promotion to an employee solely on the ground that a disciplinary inquiry was pending against them, even if the inquiry had not concluded or resulted in any adverse findings.

Court's Reasoning The Supreme Court, in BANK OF INDIA & ORS. Versus S.M. KAMAL PASHA & ORS., 2026 LiveLaw (SC) 1084, held that the mere pendency of a disciplinary inquiry cannot be a ground to deny promotion to an employee. The Court emphasized that for such a denial to be valid, the service rules or regulations governing the bank's employees must specifically stipulate that promotion can be withheld during the pendency of a disciplinary inquiry. In the absence of such an explicit provision, the bank's action of denying promotion was deemed unsustainable. The Court's reasoning aligns with the principle that an employee's career progression should not be unduly hampered by unproven allegations or inquiries that have not reached a conclusive stage.

What Follows Following this judgment, banks and other public sector undertakings must review their service rules concerning promotions and disciplinary proceedings. If they intend to deny promotion based on a pending inquiry, they must amend their rules to explicitly include such a provision. Employees against whom disciplinary inquiries are pending can now challenge promotion denials if the relevant rules do not specifically permit such a denial.