The court ruled that the disciplinary findings against the petitioner were legally unsustainable as they contradicted existing circulars allowing loans above Rs.8 lakhs, highlighting essential compliance for fair disciplinary proceedings.

ORDER :

HEMANT CHANDANGOUDAR, J.

The challenge in this writ petition is to the order dated 30.11.2015 passed by the first respondent in G.O.(2D) No.38, Micro, Small and Medium Enterprises [EII(2)] Department. By the said order, the petitioner was imposed with the punishment of stoppage of one increment for a period of two years with cumulative effect for the proved charges. It was also observed that the punishment would affect his pension and would include any leave period, if any, spent by him before the period of punishment was completed.

2. The petitioner, while working as Joint Director of Industries and Commerce / formerly Special Officer, TAICO Bank, Egmore, Chennai, was issued with a charge memo dated 21.06.2010 along with a statement of allegations , alleging that while discharging his duties as Managing Director, TAICO Bank, he had sanctioned loans in excess of Rupees Eight Lakhs, contrary to the circular governing the sanction of loans. The petitioner submitted his explanation denying the charges. As the explanation was found to be unsatisfactory, a departmental enquiry was initiated. The Enquiry Officer submitted a report holding that Charge Nos. 2, 7, and 9 were proved, and that Charge No.10 was partly proved.

3. The petitioner was thereafter issued with a second show cause notice calling upon him to explain as to why the enquiry report should not be accepted and appropriate punishment should not be imposed. The petitioner submitted his explanation to the Disciplinary Authority. The Disciplinary Authority passed an order, which was challenged before this Court. This Court set aside the said order and directed the Disciplinary Authority to pass a speaking order. Pursuant thereto, the Disciplinary Authority passed the impugned order.

4. The learned counsel for the petitioner submitted that the petitioner had sanctioned the loans strictly in conformity with the circulars governing the sanction of loans. Despite bringing the relevant circulars to the notice of the Disciplinary Authority, the same were not considered. The Disciplinary Authority proceeded to hold that the petitioner had sanctioned House Building Advances exceeding Rupees Eight Lakhs, which, according to the Authority, was not permissible under the circulars. On that basis, it was concluded that the sanction of loans was contrary to the guidelines issued by the management, and the impugned order was passed.

5. The learned counsel for the petitioner further submitted that the petitioner had submitted a detailed explanation in respect of the charges held to be proved, clearly demonstrating that the sanction of loans was strictly in accordance with the circulars in force. However, without considering the said circulars, the Disciplinary Authority passed the impugned order, which is legally unsustainable.

6. In response, the learned Government Pleader appearing for the respondents submitted that as per the circular dated 03.07.2008, specific guidelines were issued, under which, for construction or purchase of a ready- built house within Municipal limits, only 75% of the cost of the property or Rs.8.00 lakhs, whichever is less, is eligible. Similarly, for construction or purchase of a ready-built house or flat within Municipal limits and adjacent Town Panchayats, the sanction is limited to 75% of the cost of the property or Rs.8.00 lakhs, whichever is lower.

7. It was further submitted that contrary to the said ci