Nobody knew or expected that appointment of RK Talwar as youngest Chairman of State Bank Of India on March 1, 1969 will write a unique chapter in banking history of the country and one individual would become a Lighthouse of Integrity for other bankers for decades to come. However it happened and he did that by the day of Aug. 4, 1976 when he was removed from office through a ‘Talwar Amendment’ i.e. an extra-ordinary amendment to the State Bank Of India Act passed by the then Parliament to facilitate his exit, barely 54 was he then. Indeed by the time at 5.30 pm on that day of reckoning when he coolly walked out of his office, history had been created.
Tenure of his Chairmanship of the bank was instrumental in transforming SBI into a dynamic organisation with multiple initiatives of innovative banking, revival of sick units, thrust on rural development, simplification of archaic procedures bequeathed by British-occupiers of the country, analysis of corporate annual reports, restructuring of entire organization etc., far ahead of his times. Intensely rooted in principles and ethics, he was renowned for his impeccable integrity and professional dynamism. Vehement opposition to arbitrariness, transparency in decisions and transactions were his buzzwords. Being a highly respected professional banker, he resolutely refused to compromise on principles so dear to his heart being a man of profound Adhyatmika disposition. Celebrated as nations most distinguished banker, RK Talwar delivered a golden era for State Bank Of India during his tenure. He chaired Committee on Customer Service in 1975, popularly known as Talwar Committee whose recommendations are followed and often quoted even now. Before expiring in 2002 while living like an ascetic, he headed IDBI too for a couple of years as well as Directorship of several companies.
His ‘Agni-Pariksha’ knocked at his door in the form of a sick cement company with mounting losses during post-1971 era when nations economy was in dire straits owing to refugee crisis followed by War-1971 with Pakistan. When they approached for rehabilitation assistance, SBI ostensibly followed their standard procedures and identified root-cause of sickness being gross mismanagement of the company by promoters. As a part of restructuring package, SBI insisted of a team of professional managers to be allowed to take over the company. Company resisted it and carried on till the last financial lifeline was available to them. After exhausting that lifeline too, they approached the Bank again for restructuring package but entire attrition boiled down again to the same old condition of management switchover to a team of professional managers. This time too, SBI stuck to their norms. However at this stage extra-ordinary promoter of the company bared his fangs and paws as he was a pal of Sanjay Gandhi, younger son of dreaded Prime Minister Indira Gandhi. As usual, Sanjay Gandhi summoned the then Finance Minister YB Chavan and ordered him to address the issue to the satisfaction of his friend. In most of such cases, issue ceased to be an issue right at that moment but here, it was a different situation altogether because Sanjay Gandhi was dealing with an unusual banker who was endowed with conscience as well as steel nerves.
Finance Minister instructed Chairman on phone to waive the condition of change of management intrinsic to the restructuring package. Chairman Talwar first called for details and held a meeting to satisfy himself with merits of the issue, then called Finance Minister to convey his decision in no uncertain terms. Minister then communicated explicitly to the Chairman to the effect that it was so desired by ‘highest authority’ of the land i.e. de facto Prime Minister Sanjay Gandhi, son of his mother Indira Gandhi. Chairman Talwar reiterated his position and declined to budge an inch. Sanjay Gandhi must have been astonished to hear his response as there was no one in the country by then who had guts to disobey him. On his orders, message was conveyed to the Chairman to come over to meet him, talk to him to sort out the issue ‘amicably’. Given his nerves that he possessed, Chairman Talwar turned down this call, conveyed to him that Sanjay Gandhi held no ‘Constitutional authority’, had no authority to summon him and he was answerable to Finance Minister only. Shocked and stunned, Sanjay Gandhi ordered Finance Minister to dismiss Chairman Talwar from service immediately.
Dilemma before the Finance Minister at that moment of reckoning was two-fold. First was tremendous reputation of the Chairman in country which could have led to backlash on his dismissal and the other was immunity enjoyed by Chairman against dismissal under SBI Act without an irrefutable cause. After lot of deliberations and brainstorming, it was decided to offer him an alternate assignment of Chairmanship of a Banking Commission to be constituted, dedicated to restructuring public sector banks. Without wasting a second, Chairman Talwar offered to accept the position being offered without quitting Chairmanship of SBI, assured him to shoulder both responsibilities concurrently. Finance Minister was aghast at smart and irreconciliable moves of Chairman Talwar. It was then that Chairman looked straight into eyes of the Minister and inquired whether he desired him to quit. Finance Minister responded with a heavy heart that he had highest regards for Talwars abilities and performance yet he had no other option except to seek Talwars resignation or sack him as ‘highest authority’ in the country had staked his prestige in the matter and such an extreme measure would be profoundly agonising for the Minister. Thereupon Talwar delivered his final verdict to the effect that he had absolutely no intention to quit and Minister was at liberty to proceed in the matter whichever way he wished to. And he walked out leaving behind the Minister distraught and miserable. Details of the meeting exceedingly infuriated de facto Prime Minister Sanjay Gandhi when communicated to him. He could not believe for a few moments that someone in the country had the gumption to tell him that he was just nobody and his self-ordained status just didn’t matter to Chairman Talwar at all, that too while holding an office appointed by the Government. Sanjay Gandhi ordered CBI to conduct exploratory investigation to some how trap him and prepare ‘extra-ordinary’ situation to facilitate Talwars dismissal.
In spite of hair-splitting combing of conduct and working of SBI Chairman, even best brains in CBI could not establish even a single offence or instance of misconduct. Even his frequent visits to Aurbindo Ashrama in Puducherry, his devotion to Maharshi Aurbindo or his appeal to large number of industrialists soliciting donations for Aurovillo Project could not be transformed into sufficient ground for his dismissal. His appeal for contribution was only in public domain, no personal solicitation was rendered by him at all and no industrialist could tell CBI that they had received a telephone call directly or indirectly coercing into donations. Much to the chagrin and discomfiture of CBI, what was discovered by them was that Chairman Talwar had only forwarded a general appeal to donate signed and issued by the then Prime Minister Indira Gandhi and a commendation letter issued for the project released by the then UN Secretary General U Thant to industrialists !! CBI lost all hopes to trap Talwar and reported so to de facto Prime Minister that Sanjay Gandhi was during that darkest era in nations history. Sanjay Gandhi was so enraged that he ordered Finance Minister to amend SBI Act to facilitate summary dismissal of RK Talwar from Chairmanship of SBI.
Amendment to the State Bank Of India Act was rushed through Parliament at a lightening speed that dismayed even the worst cynics in politics and it was dubbed ‘Talwar Amendment’. As if President Fakhruddin Ali Ahmad had been already standing at gates of Rashtrapati Bhavan eager to sign all draconian laws passed during Emergency-1975, he assented ‘Talwar Amendment’ too in the same melee with a remarkable swiftness. Thereafter Chairman Talwar was again summoned by the Finance Minister, placed the sword of dismissal on his neck and asked him to resign. RK Talwar being made of a different stuff altogether, flatly declined to resign knowing very well about the amendment and sounded Finance Minister to proceed with ‘His Masters Voice’. On Aug. 4, 1976 Chairman Talwar received a fax message from Finance Minister asking him to proceed on compulsory leave for the rest of his tenure after handing over the charge of Office of Chairman to Managing Director. It was a huge surprise for many as Government during Emergency-1975 holding all powers in their hands, could not muster courage to sack Talwar and ordered him to proceed on leave. RK Talwar quietly walked out of his Office alone, sharp at 5.30 pm, his usual time to leave Office, never to look back. None in the Bank could muster courage to accord him a dignified farewell or bid him adieu at the exit gate.
But by that moment of reckoning, the banker with steel nerves had created history to be recalled many times over in future, an order from his superior that he accepted with maximum tranquillity and poise, as a stoic who had unmitigated faith in divine will.