Disciplinary actions must adhere to principles of natural justice, and failure to provide relevant evidence undermines the validity of proceedings.

ORDER :

1. The challenge in this writ petition is to the order dated 08.05.2014 passed by the first respondent, confirming the order dated 09.11.2013 passed by the second respondent. By the order dated 08.05.2014, the petitioner was imposed with the punishment of reduction to a lower grade, as envisaged under Regulation 4(g) of the Corporation Bank Officer Employees’ (Discipline and Appeal) Regulations, 1982, on the finding that Charge Nos. 1 and 2 stood proved.

2. The petitioner, while serving as Senior Manager/Chief Manager, Chennai – Personal Banking Branch, was issued a charge memo dated 03.03.2012. The charge memo, along with the statement of allegations, reads as follows:

“Article of Charge No.1

That the Executive, in gross abuse of his official position, in utter violation of CHOME Scheme guidelines and in connivance with the builder viz., Shri.Kathiresan G., continuously sanctioned / disbursed a large number of CHOME loans to certain employees of the Corporation, by not conducting proper due diligence exercise about the builder and not ensuring proper appraisal/pre/post sanction verification of the loans and allowed the funds to be siphoned off by the builder in a large number of accounts; that consequently, as on 31.12.2011, 144 loan accounts which have been classified as Non-Performing Assets (NPAs) with aggregate balance outstanding Rs.509.86 Lakh (exclusive of uncharged interest and other charges) became difficult of recovery and that, thereby, the Executive exposed the Bank to huge financial risk and consequences, besides causing reputation loss to the Bank.

Article of Charge No.2

That the Executive, in abuse of his official position, by submitting misleading/incorrect/false information to the Sanctioning Authority at Head Office, obtained sanctions for deviation proposals from time to time, in respect of certain CHOME loans and thereafter granted a large number of CHOME loans to certain employees of the Corporation, in violation of the conditions stipulated under sanction orders for deviations and that a number of such loans turned to NPAs, with huge outstanding balance (as mentioned at charge No.1 above) and thereby, he failed to protect the interest of the Bank.

Article of Charge No.3

That in abuse of his official position, the Executive connived with the common builder of CHOME loans granted to certain employees of the Corporation, in siphoning off of a large amount of the loan proceeds and as part of illegal gratification for extending undue accommodation to the builder, the Executive secured a job for his spouse in the company promoted by the builder and in that regard, while seeking post facto approval for permitting his spouse to take up employment in the company with which he has official dealings, willfully suppressed from the Competent Authority, certain material facts as to the Official dealings the Company had with the Bank and thereby, acted in a manner detrimental to the Bank’s interest.”

3. In response to the aforesaid memorandum of charges, the petitioner denied the allegations. Consequently, a departmental enquiry was initiated against him. The Enquiry Officer, after recording the statements of the management witnesses and the statement of the petitioner, and upon considering the documents placed on record, returned a finding that Charge Nos. 1 and 2 stood proved, while Charge No. 3 was not proved.

4. Thereafter, the second respondent issued a second show cause notice, calli