Natural justice mandates that authorities must consider employees' defenses in disciplinary matters, and imposition of dual penalties is impermissible when employees are not directly guilty under the findings of an inquiry.

JUDGMENT :

SUBHASH VIDYARTHI, J.

1. Heard Sri Piyush Asthana, the learned counsel for the petitioner, Sri Balram Yadav, the learned counsel for the opposite parties and perused the records.

2. By means of the instant petition filed under Article 226 of the Constitution of India, the petitioner has challenged the validity of an order dated 25.06.2009, passed by the Managing Director of U.P. Sahkari Gram Vikas Bank Ltd. imposing the punishments of stoppage of two annual increments in the salary with cumulative effect and recovery of 20% of the amount of loss in case the loan irregularly disbursed by the petitioner is not recovered. The petitioner had challenged the aforesaid order by filing an appeal. The Chief General Manager, Administration U.P. Sahkari Gram Vikas Bank Ltd. Lucknow has written a letter dated 12.08.2011 stating that the petitioner's appeal has been found to be not maintainable and has been disposed off by means of an order passed by the Prescribed Authority/Principal Secretary, Cooperative. However, a copy of any order passed by the Prescribed Authority/Principal Secretary, Cooperative has not been provided to the petitioner.

3. Briefly stated, facts of the case are that while the petitioner was working as an Accountant in U.P. Sahkari Gram Vikas Bank, Branch Kuwayan, District Shahjahanpur, disciplinary proceedings were instituted against him on 15.05.2008 on the allegations that a loan of Rs.1,50,000/- was sanctioned in favour of a farmer under a dairy scheme, a cheque for Rs.75,000/- was handed over to him on 09.01.2007 towards the first installment and the second installment of Rs.75,000/- was released on 11.01.2007 in violation of the guidelines issued by the Bank.

4. A charge-sheet was issued to the petitioner on 02.08.2008 containing two charges - (i) that he had not followed the time limit between disbursal of two installments of loan as per the directions of the head office and (ii) during local inspection by Senior Manager, buffaloes were not found as per the standards.

5. The petitioner submitted a reply dated 08/09.09.2008 stating that he had prepared and handed over the cheques as per the instructions of the Branch Manager. After disbursal of the first installment of loan, the Field Officer of the Bank had conducted an inquiry and had submitted a report that the farmer had purchased the buffaloes from the first installment and he had recommended disbursal of the second installment. This recommendation was approved by the Branch Manager and the petitioner was directed to prepare a cheque for Rs.75,000/- on 11.01.2007. The petitioner categorically stated that it was his duty to comply with the orders of the Branch Manager and he had prepared the cheques in compliance of this duty. Regarding second charge the petitioner submitted that the Senior Manager had made a verification and found the buffaloes to be not of the requisite standards but the petitioner is not guilty for it it because the project had been verified by the Field Officer and the Branch Manager. In the verification report submitted by the Field Officer it was not mentioned that the amount of loan had been misappropriated. The inquiry was to be done by the Field Officer and the Branch Manager and not by the petitioner who was working as an Accountant.

6. The inquiry officer submitted a report dated 06.11.2008, specifically stating that the petitioner does not appear to be guilty directly, but as the loan was given in an irregular manner, the petitioner cannot escape his responsibilities. Reg