A disciplinary authority must record specific reasons and provide an opportunity for a hearing when disagreeing with an enquiry officer's findings; failure to do so violates natural justice, especially when penalties cause permanent adverse financial impacts.

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ORDER DATED 08.12.2016 PASSED BY THE RESPONDENT NO.1 IN NO.KA VI PRA NI NI/B82/23513/2015-16 AS PER ANNEXURE-H CONFIRMING THE IMPUGNED ORDER DATED 29.04.2015 PASSED BY THE RESPONDENT NO.2 IN NO.KA VI PRA NI NI/B53/24920/2011-12 AS PER ANNEXURE-F; AND ETC.

THIS WRIT PETITION HAVING BEEN HEARD AND RESERVED FOR ORDERS ON 28/01/2026, COMING ON FOR PRONOUNCEMENT THIS DAY, THE COURT MADE THE FOLLOWING:

CORAM: HON'BLE MRS JUSTICE K.S. HEMALEKHA

C A V O R D E R

The petitioner has called in question the order dated 29.04.2015 passed by the disciplinary authority (Annexure-F) and the appellate order dated 08.12.2016 passed by the appellate authority (Annexure-H), whereby the petitioner has been imposed with the penalty of withholding of two annual increments with cumulative effect, recovery of ₹3,02,691/- at ₹10,000/- per month, treating the suspension period as leave without pay.

Brief facts:

The petitioner, while working as Assistant Executive Engineer between 04.10.2005 and 19.02.2007 was associated with execution of 8 kilometers 11 K.V. link line work from Chulaki sub-station to Hulikatti. Proceedings were initiated under Regulation 11 of the Karnataka Electricity Board Employees (Classification, Disciplinary Control and Appeals) Regulation, 1987 (‘Regulations 1987’ for short) alleging:

i. Failure to supervise work.

ii. Diversion of materials.

iii. Causing financial loss to ₹3,02,691/-.

The enquiry officer, by a report dated 06.07.2013 (Annexure-C), recorded that:

i. Negligence was proved only in respect of 5668 meters of rabit conductor valued at approximately ₹1,47,368/-.

ii. Alleged diversion of other materials was not fully established.

iii. No categorical finding of total financial loss of ₹3,02,691/- was recorded.

However, the disciplinary authority by order dated 29.04.2015 (Annexure-F) imposed recovery of ₹3,02,691/- along with other penalties. The appellate authority confirmed the same by order dated 08.12.2016 (Annexure-H).

Learned counsel for the petitioner submits that under Regulation 11A (2) of the Regulations 1987, the disciplinary authority is indeed vested with the power to disagree with the findings recorded by the enquiry officer. However, such power is not unfettered. It is contended that when disciplinary authority disagrees with the findings of the enquiry officer, it is mandatory to:

a. Record specific reasons for such disagreement.

b. Base its independent findings strictly on the evidence available on record and the charges framed.

c. Adhere to principles of natural justice.

In the present case, though the enquiry officer recorded limited findings regarding supervisory lapse, the disciplinary authority has travelled beyond the enquiry findings without recording cogent reasons or demonstrating as to how the evidence on record justifies a contrary conclusion. Learned counsel further submits that though respondent-board contends that withholding of increments with or without cumulative effect constitutes a minor penalty under Rule 9, such a contention is legally unsustainable.

Reliance is placed on the decision of the Apex Court in the case of Kulwant Singh Gill Vs. State of Punjab , AIR Online 1990 SC 177 (Kulwant Singh Gill), wherein, it has been held that:

ii. Withholding of increment simpliciter may fall within the minor penalty.

iii. However, withholding of increments with cumulative effect has a consequence of permanently reducing the employee's pay scale progression.

iv. The Court observed that when increments are withheld with cumulative effect, the “clock is put back”, in the time scale, and the employee suffers a permanent adverse impact on future earnings.

v. It is therefore contended that such penalty cannot be treated as a mere minor punishment in substance.

Learned counsel also places reliance upon the decision of the Madhya Pradesh