JUDGMENT:

S.B. SINHA, J.

1. Leave granted.

2. Respondent-Corporation was constituted under the State Financial Corporations Act, 1951 (1951 Act). Appellant was appointed as Trainee Assistant Manager in the Corporation in June 1983. She was promoted and posted as Branch Manager at Chikkaballapur Branch. A disciplinary proceeding was initiated against her in April, 1996. The imputation of charges against her pertained to sanction and disbursal of amount of loan in four cases. As many as four charges were framed against her. The disciplinary proceeding was initiated by the Managing Director of Corporation, wherein one Sri B. Rudregowda, a legal advisor of the company, was appointed as an Enquiry Officer on 4th July, 1996.

3. A finding of guilt was arrived at by the said Enquiry Officer, a copy whereof was made available to the appellant. The records of the disciplinary proceeding were placed before the Board of Directors of the Corporation. By an order dated 9th June, 1998 a penalty of dismissal from services was imposed upon her. Appellant preferred an appeal thereagainst before the Board itself on or about 4th December, 1998. The said appeal was treated to be a petition for review which by reason of an order dated 2nd March, 1999 was dismissed. Aggrieved by and dissatisfied therewith, the appellant filed a writ petition before the High Court of Karnataka at Bangalore. By reason of a judgment and order dated 23rd June, 2005 a learned Single Judge of the said Court dismissed the writ petition. An intra court appeal was preferred thereagainst which has been dismissed by a Division Bench of the said High Court by reason of the impugned judgment and order dated 22nd February, 2006.

4. Mr. Basava Prabhu S. Patil, learned counsel appearing on behalf of the appellant, principally raised two contentions before us :-

i) Having regard to clause (3) of Regulation 41 of Karnataka State Financial Corporation (Staff) Regulations, 1965 a Legal Advisor could not have been appointed as an Enquiry Officer; and

ii) In the absence of any provision in the Regulations unlike Rule 13 of the Central Civil Service (Classification, Control and Appeal) Rules, 1965, the Managing Director of the Corporation could not have transferred the proceeding to the Board of Directors.

5. Ms. Kiran Suri, learned counsel appearing on behalf of the respondents, on the other hand, urged :-

i) Appointment of a Legal Advisor is permissible under clause (3) of Regulation 41 of the Regulations; and

ii) As a major penalty was proposed to be imposed, the Board of Directors only was the competent authority therefore in terms of the Regulations.

6. Before adverting to the rival contentions of the parties as noticed hereinbefore, we may notice that the terms and conditions of appointment and service of the staff of the Corporation are governed by the 1951 Act and the Regulations framed thereunder known as Karnataka State Financial Corporation (Staff) Regulations, 1965 (for short the Regulations).

7. Officers of the Corporation are classified in three groups, namely Class A; Class B and Class C. Appellant was a Category `A' officer. Chapter IV of the Regulations deals with conduct, discipline and appeals. Regulation 26 deals with the liability of an employee to abide by the Regulations and the orders. Regulation 28 enjoins a duty upon the employee to promote the interest of the Corporation. Regulation 41 deals with penalties which reads as under :-

“41. Penalties – (1)"Without prejudice to the provisions of other Regulations, an employee who commits