JUDGMENT

R.C. Lahoti, J.-Leave granted in SLP (C) No.15370/1997.

2. Rajbir Singh Khanna, respondent No.1 was commissioned in the Indian Army on 8.2.1964. In June 1989, when he was holding the rank of Colonel, he was posted as Deputy Commandant of 61 Infantry Brigade deployed in Sri Lanka. At that time Brigade Commander was Brigadier Jaspal Singh, respondent No. 2. On 22.1.1990, 7.2.1990 and 9.2.1990 respectively three Courts of Inquiries were ordered to investigate certain financial irregularities in the sale of VCPs belonging to HQ 61 Infantry Brigade and movement of 5 other ranks of HQ 61 Infantry on temporary duties from operational area to Jammu, the home place of respondent No.1. The irregularities were noticed by Brigadier Jaspal Singh. On 6.2.1990 Brigadier Jaspal Singh also issued warning letter to respondent No.1 putting him on adverse report under paras 80 and 81 of Special Army Order 3/S/89. Though the respondent No.1 replied to the warning letter dated 6.2.1990, Brigadier Jaspal Singh was not convinced and directed staff Court of Inquiry to be held for ascertaining the facts. On 14.3.1990 Brigadier Jaspal Singh endorsed an adverse report on the respondent No. 1 which st