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CHAPTER - 6
DELAYS AND OTHER DEFECIENCIES IN VIGILANCE MATTERS
DELAY IN FINALISATION OF DISCIPLINARY PROCEEDINGS HAMPER JUSTICE
6.1 Laws of Natural Justice demands that disciplinary proceedings are finalised in an expeditious manner. The delay in completion of proceedings invariably hampers the efforts to curb malpractices and mete out justice. It may, on the one hand, cause undue harassment to the officials who at the end of the proceedings are found to have been innocent of the charges framed against them and, on the other hand, it enables the guilty officers to evade punitive action for long periods of time. The delay in handling disciplinary cases has been on several occasions adversely viewed by the Courts also. There have in fact been instances where the proceedings initiated against the delinquent were quashed solely on the ground that there was inordinate delay in handling the disciplinary action. The Commission, therefore, considers it imperative that instances of suspect malpractices are followed up vigorously by the administrative authorities so that all the delinquents can be identified and proceeded against without delay. It is equally important that the formal proceedings once instituted are completed within the time frame laid down by the Government so that timely action can be taken against the delinquent. However, during the year under report, the Commission noticed that the delay in processing vigilance cases at various stages of investigation and inquiry is rather wide spread and a large number of organisations were not able to adhere to the normal time schedule prescribed for processing the disciplinary cases.
6.2 DELAY IN INVESTIGATION OF COMPLAINTS
DELAY IN INVESTIGATION LEADS TO LOSS OF VALUABLE EVIDENCE
The administrative authorities are required to complete investigation into a complaint normally within a period of three months. In case of Central Bureau of Investigation (CBI), the expected period for completion of an investigation is six months. However, the Commission has noticed that at the end of 1997 investigation reports were awaited in respect of as many as 1355 complaints forwarded to departmental vigilance units. Of these, 844 complaints (nearly 62.28%) were pending investigation for more than three years and 248 complaints (nearly 18.30%) for periods ranging between one and three years. The organisation-wise break-up of this pendency is given in ANNEXURE-VIII. Similarly, out of 9 complaints pending with the CBI for investigation and report, 4 complaints were pending for a period of more than three years. The Commission views with concern such inordinate delay in investigation of complaints. The failure to take timely action in investigating cases of misconduct often results in destruction of valuable evidence and sometimes even in loss of documents. This eventually facilitates officers to escape consequences of their misconduct.
6.3 DELAY IN HOLDING ORAL INQUIRY
TIME-FRAME FOR HOLDING ORAL ENQUIRY
6.3.1 In cases where the Commission had advised initiation of departmental proceedings against an erring official on the basis of preliminary investigation report, the disciplinary authority is required to issue a charge sheet to the delinquent within one month of the receipt of the Commissions advice. The charged officer (CO) in turn is given normally a period of ten days to submit his statement of defence denying or admitting the charge(s). If the CO in his written statement of defence does not admit the charge(s) and the proceedings have been initiated for imposition of a major penalty, the matter can be decided by the disciplinary authority only after holding an oral inquiry for which purpose he is required to appoint an Inquiry Officer (IO). The Commission while advising initiation of major penalty proceedings in suitable cases, normally advises the disciplinary authority whether to approach the Commission for nomination of one of its CDIs to hold the oral inquiry or whether the department can appoint its own officer as IO. Keeping in view the time frame prescribed for issuing of a charge sheet and obtaining written statement of defence from the CO, it should be possible for the disciplinary authority to make his reference to the Commission within two months of the receipt of the Commissions advice for initiation of major penalty proceedings.
DELAY IN APPROACHING COMMISSION FOR NOMINATION OF CDI
6.3.2 The Commission, however, notices that there are instances of delay in approaching the Commission for nomination of an IO. There were 157 cases at the end of the year under report in which the Commission having advised initiation of major penalty proceedings had also advised the department concerned to approach the Commission for nomination of a CDI as Inquiry Officer. But no further action could be taken in respect of these cases in the absence of any response from the department concerned. The organisation-wise break up of these cases is given ANNEXURE - IX.
DELAY IN APPOINTMENT OF CDI NOMINATED BY COMMISSION
6.3.3 There were another 51 cases which were more than three months old and in
which the disciplinary authorities had not issued orders appointing the CDI nominated by
the Commission as Inquiry Officers. Of these, 11 cases were more than one year old. The
organisation-wise break-up of these cases of delay in appointment of CDIs is given in ANNEXURE-X. The IO appointed by the disciplinary authority to
conduct the oral inquiry in a particular case is required to be furnished with the related
documents (photocopy of the charge sheet, reply of the charged officer, order of
appointment of the Presenting Officer and the listed documents/witnesses, etc.) to enable
him to hold the inquiry. These documents are required to be made available to the IO
immediately on his appointment as the IO. However, at the end of the year under report,
there is no case pending for more than three months, in which the Disciplinary Authorities
had not furnished the relevant documents to the CDIs appointed as Inquiry Officers.
6.4 DELAY IN IMPLEMENTATION OF COMMISSIONS ADVICE
LARGE NUMBER OF ADVICES PENDING IMPLEMENTATION
The Commission notes with concern that the disciplinary authorities in many cases have not been prompt in implementing the advice tendered by the Commission. There were at the end of the year under report as many as 1975 cases pending for over six months for implementation of the first stage advice and 1202 cases pending for over six months for implementation of the second stage advice. The organisation-wise break-up of these cases is given in ANNEXURE-XI. The Commission is of the considered view that delay in implementing its advice defeats the very purpose of effective follow up on the acts of omission and commission on the part of erring officials and, therefore, needs to be avoided at all costs.
6.5 ILLUSTRATIVE CASES OF DELAY, DEFICIENT INVESTIGAITON AND RELATED MATTERS
1. CENTRAL BOARD OF DIRECT TAXES
In this case, one Assistant Commissioner of Income Tax, while working as ITO during 1984-85 was alleged to have shown leniency/favouritism to an assessee (who, incidentally, was the sister of a senior Income Tax Officer) , by accepting the assessees returns for Assessment Year 1984-85 for a total income of Rs.1,21,533 only, as against an income of Rs.10,27,552 assessed in the previous year by his predecessor. The Department informed the Commission in February, 1993, that the officer had been issued a memo in March, 1992 regarding the alleged irregularities in the assessment. Later, in January, 1995, the Department came back to the Commission proposing closure of the case against the Assistant Commissioner of Income Tax. Perusal of the records pertaining to Assessment Year 83-84 revealed that the assessment had been completed by the predecessor ITO, after detailed investigation, under section 143 (3)/ 143 (2)(b) of the Income Tax Act, on a protective basis, at a total income of Rs.10,27,552. Later, the assessee filed the returns for 1984-85 under "Amnesty Scheme". The SPS ignoring the procedure, accepted the returned income at Rs.1.21 lakhs, after processing the same in a summary manner under section 143(1), overlooking some crucial aspects of the case pointed out in the proceedings of the previous Assessment Year. Though the additions made by the predecessor ITO could not be sustained during review before Income Tax Appellate Tribunal, yet, the conduct/act of the ITO in accepting the return was not wholly judicious. The Commission, therefore, advised in March, 1995 at least minor penalty action was called for against him.
A charge-sheet was accordingly served on the officer on 22/31.5.1995. The Department, however, did not follow up the matter and ultimately, the officer retired from service on 31.12.1996. The Department passed an order on 14.3.1997 conveying "Governments displeasure" to the officer.
The Department explained by saying that the delay was mainly on account of non-receipt of the officers reply to the charge-sheet, despite reminders.
This explanation of the Department is not tenable. A specified time-limit is laid down in CCS (CCA) Rules for submission of the defence reply, and if the Charged Officer failed to submit his reply within the said time-limit, the Department were at liberty to proceed against in the matter ex-parte; and the Department was under no obligation to wait indefinitely for the officers reply. What more, the Commission had also explained this to the Department in its advice dated 2.3.1994. Still, the Department did not evince sufficient interest, and waited for 18 months for the Charged Officers reply.
Thus, the inference is irresistible that the delay in processing/finalising the case was deliberate with a view to enabling the officer to escape punishment.
2. CENTRAL BOARD OF EXCISE & CUSTOMS
In May, 1993, the Commission received a complaint alleging massive evasion of excise duty by a Company by way of mis-declaration of finished goods in connivance with excise staff. It was alleged that the party was actually manufacturing and selling the polyster viscose yarn, but paying duty on 100% viscose yarn. The Commission forwarded this complaint in July, 1993 to the Department for investigation and factual report on the allegations.
The Department, after a cursory investigation came up in January, 1995 stating that the substance of the allegation against the party is correct and during the period 1.3.1992 to 27.2.1993, the party had cheated excise duty worth Rs.52.52 lakhs. In fact the preventive staff had conducted the search and detected the fact of duty evasion. Simultaneously the Department claimed that there is no lapse of connivance on the part of the Excise Range Officials as the party was functioning under Self-Removal Procedure. The Department was of the view that the allegations against the staff deserve to be closed.
The Commission found it plausible that the party had continuously mis-declared the goods with impunity, samples of
which are collected for checking chemical composition by the Range staff who monitor the activities. Since the position was contradictory, the Department was asked to investigate the matter further.
In April, 1995, the Department responded stating that altogether 18 samples were collected by the Range Superintendent and the Inspector during the period 1.3.1992 to 27.2.1993, but the chemical tests of the samples found to tally with the declaration furnished by the party. They also contended that the unit was audited by the Internal Audit and CERA during the period, but no discrepancy was ever detected.
The Commission found that the initial investigation, which revealed misdeclaration and evasion of duty worth Rs.52.52 lakhs, contradicts the stand of the Department in-as-much as all the samples found correct as per declaration. The Commission, therefore, asked the Department to investigate this issue further to book the defaulting Range staff. In November, 1997, the Department replied that the records of the case are not readily available with the Commissionerate as they have been submitted to CEGAT in connection with the appeal filed by the party for Departments duty demand of Rs.52.52 lakhs. They only suggested to initiate major penalty proceedings against the Sector Officer, but no action against any other staff. Thus, despite persistent effort from the Commission, the Department did not investigate the crucial issues prolonging since 1993, and majority of the Range staff were allowed to go scot-free.
3. DELHI DEVELOPMENT AUTHORITY
As many as 11 cases were received in the Commission against a senior official of the Horticulture Department of Delhi Development Authority (DDA), just one month before his retirement. It was observed that some of the cases emanated from complaints which were received in 1991-92. Some of the issues highlighted in the complaints related to serious financial irregularities, i.e. sanctioning of works much beyond delegated financial powers without any justification. However, DDA took four to five years to complete the investigation on these complaints. Ultimately, when investigations on these cases were completed in 1997, DDA initiated major penalty proceedings against the officer just before his retirement. Due to undue delay in investigation, not only the whole purpose of investigation was defeated but also the necessary preventive measures could not be taken in time to curb the malpractices prevalent in sanctioning of contracts/work in Delhi Development Authority.
4. DELHI DEVELOPMENT AUTHORITY
In 1993, an Inquiry Committee was constituted by Delhi Development Authority (DDA) to do technical audit of the works executed in Rohini Project, Delhi. The Inquiry Committee submitted its report on 5.8.1994 after inspecting 78 works. The lapses noticed in such cases mainly pertained to award of work at higher rates, execution of works without obtaining approval of the competent authority, deviations in works beyond the permissible limit, sub-standard execution of work and non-maintenance of measurement books.
The extent/nature of irregularities pointed out by the Committee indicates that matter was serious in nature but timely action was not taken by DDA to fix responsibility in the cases. Only few cases were referred to the Commission in September/October, 1997 when one Executive Engineer responsible for some of the lapses was on the verge of retirement. Some of the officials had already resigned/retired from service and no action was possible against them as the lapses were more than four years old.
Thus, instead of acting upon the recommendations of the Rohini Inquiry Committee, matters were allowed to be dragged, thereby defeating the very purpose for which it was constituted.
5. DELHI VIDYUT BOARD :
During 1997, the Commission received 67 cases from Delhi Vidyut Board (DVB) in which the inquiry proceedings had been conducted by departmental Inquiry Officers. These cases were generally technical in nature in which charges related to irregularities in the sanction of electric connections and in taking meter readings, non-submission of reports, non-maintenance of registers and misappropriation of stores materials etc. Out of these, in as many as 32 cases, the charges were held not proved by the Inquiry Officer on various grounds. A general examination of these cases revealed that the charged officials had been exonerated by the Inquiry Officer for untenable reasons. While in some cases proper appreciation of evidence was not done, in some cases the oral and documentary evidence adduced during inquiry were ignored and the charges were held as not proved.
However, when these cases were examined in the Commission, it was observed that sufficient oral and documentary evidence existed on record to substantiate the charges. The Commissions advice, in all these cases, was accepted by the Disciplinary Authority and major penalties imposed. It clearly indicated that the Inquiry Officers findings were not free from bias.
It is, therefore, felt that the disciplinary authorities need to take due care while appointing Inquiry Officers.
6. GOVERNMENT OF N.C.T. DELHI
This case speaks about government indifference in taking action against the charged officers who went unpunished and superannuated after facing the charges for about 20 years. The line of facts of the case are as follows:-
During 1975-77, the Proprietor of a business firm applied to the Industries Department of the Delhi Administration for an essentiality certificate to enable the firm to obtain an import licence for certain items. One Circle Inspector of the Industries Department submitted a note saying that he had verified the supply orders for the machinery purchased by the firm. On the basis of his verification report, the essentiality certificate was issued in favour of the firm. The import items allowed were meant only for captive consumption by the firm and the licencee was required to maintain proper books of accounts relating to the procurement and utilisation of the imported goods. During an investigation conducted by the Licensing Authority, it was found that the licence was issued to a ghost unit. The Controller of Imports and Exports then referred the matter to the CBI for further investigation. During its investigation, the CBI found that the firm imported items on 18 import licences and sold the goods in the open market at premium rates. It was also found that no factory ever existed at the site mentioned by the firm and no machinery had ever been purchased. The supply orders for the purchase of the machinery, submitted by the firm were forged. In connivance with the officials of the local office of the Industry department, a fraud was being perpetrated.
CBI concluded investigation and submitted its report to the Home Secretary of the Government of National Capital Territory, Delhi (GNCTD) in 1978. CBI proposed prosecution of 3 private persons and the concerned Circle Inspector of Industries Department. Further, suitable disciplinary action against the Joint Director (Industry), Assistant Director (Industry) and two Inspectors was also recommended. However, no action was taken by the GNCTD against the errant officials despite clear cut recommendations of the CBI in the case. CBI again sent a reminder in the case to the GNCTD in 1996 and the case was thereafter referred to the Commission in July, 1997. By this time, two main accused in the case had already retired from the service in the year 1984 and 1987 after getting all their due promotions. Action against them has, now, become time-barred.
Thus, failure to take action by the concerned Department for the last 20 years allowed the guilty officials to go scot-free.
7. GOVERNMENT OF N.C.T. DELHI
A compliant was received in the Commission against a Superintending Engineer and Chief Engineer of the Flood Control Department of the Government of National Capital Territory, Delhi, which was forwarded for investigation and report on 6.9.1989. The allegations made in the complaint were:
(a) The rates adopted in the work of desilting of Trunk Drain No.1 in Shahdara, were very high;
(b) Favours were bestowed on a contractor in the matter of work on the left forward band in Division No.IV of Flood Control Department; and
(c) Full payment was released to the contractor even before the work was completed.
The Department's investigation report in the case was received only on 11.10.1995 in which it was stated that the allegations could not be substantiated. However, on a perusal of the report, the Commission observed that out of the three allegations, the AC Branch, Delhi Administrations report in respect of allegations (b) and (c) were not convincing. The issue mentioned in allegation at (b) was also examined by the Chief Technical Examiner. It was revealed that the justification rate had been prepared incorrectly with the result that the justified cost was boosted up in order to justify the high rated tender. Regarding allegation (c), the Commission observed that since full payment was made to the contractor even before completion of work, favour was shown to the contractor. The Department was accordingly requested to examine these allegations afresh on 16.11.1995.
Subsequently, after a gap of 18 months, the Department intimated that both the officials had retired from service. Since the events pertain to 1989, the case has become time barred and no disciplinary action is possible now against the delinquent officials.
The manner in which the entire case was handled left an indelible impression that there was a deliberate attempt on the part of some officials not to put up relevant facts before the Commission. Although a report has been sought from the Government of National Capital Territory, Delhi on 10.6.1997 asking them to fix responsibility for this delay in investigating the case, nothing has been heard so far from the Department.
8. MINISTRY OF POWER
The Joint Parliamentary Committee (JPC) that looked into the security scam had observed serious irregularities in the issue of Capital Bonds and their private placement by the Power Finance Corporation, Delhi, in 1992. The approximate loss to the Corporation as a result of the transaction was Rs.9 crores. The Commission examined this matter further and consequently on 12.3.1996 advised the Ministry of Power to initiate disciplinary action against a former Chairman and Managing Director of the Power Finance Corporation. It was specifically pointed out to the Ministry that the case against the Chairman & Managing Director would become time-barred unless immediate action was initiated.
Despite this, the Ministry of Power showed no urgency in implementing the Commission's advice and chose to call for the comments of the Power Finance Corporation which was quite unnecessary at that belated stage when the case had already been examined in detail and all the necessary information and comments of the Chairman, Power Finance Corporation were already available with the Ministry in their files.
Later, from the perusal of Ministry's file, it was seen that the Commission's advice dated 12.3.1996 was not processed with a sense of immediacy by various officials of the Ministry of Power. Though the case was becoming time-barred on 27.3.1996, the Ministry decided on 26.3.1996 to call for the comments of the Power Finance Corporation. As a result, the case against suspected public servant became time-barred. Had the Ministry moved quickly to implement the Commission's advice it should have been possible to institute disciplinary proceedings against the official.
9. MINISTRY OF RAILWAYS
Based on an anonymous complaint alleging some serious irregularities in the matter of processing, execution and acceptance of some contract works in Vadodara Division, a preventive check was conducted by the Western Railway Vigilance. The check revealed some serious irregularities/lapses in respect of 3(three) tenders and the related contract works. In respect of the contract for constructions of CC apron, it was revealed that the work was awarded at a cost of Rs.26.14 lakhs as against the estimated cost of Rs.10 lakhs. It was found that in respect of certain NS items, the rates recommended and accepted were unreasonably high, in comparison to the last accepted rate. Even in respect of one item, the rate accepted was nearly 3 (three) times higher and in respect of another item, the rate accepted was nearly 7 to 8 times higher than prevalent market rate. It was established during investigation that the rate-analyses prepared in this case for TC proceedings were patently erroneous and apparently motivated to accept unreasonably high rates quoted by the contractor.
In respect of the second tender for painting work, the total cost recommended and accepted was of the order of Rs.3.97 lakhs, as against the estimated cost of Rs.1.5 lakhs. It was established during investigation that the main item of work in this case, i.e. cost of paint and quality of painting, was compared with the last accepted rate for a superior quality paint and painting work. It was also found that this comparison of the quoted rate was done with a superior quality item, only to justify the exorbitant rates received from the contractor.
In respect of the third contract for electro-logging of the tube well and cement grouting, it was established that the work was completed much earlier to the actual tendering process and award of the work and that the measurements entered in the records for completion of work, were fictitious.
Railway Board approached the Commission on 7.9.94, recommending pension-cut proceedings against the Sr.DEN (who acted as the Convenor Member of the TC) and 2 (two) IOWs, who were found responsible, prima-facie, for entering false entries in the MB and completing the work before it was awarded. Considering the seriousness of the allegations and that the Railway had suffered substantial loss, the Commission tendered its advice on 15.9.94, in agreement with Railway Board.
It was reported to the Commission in December96 that the case against both the IOWs had already got time-barred by the time Railway Board received Commissions advice (the transaction pertained to the period January to July90). In respect of the Sr.DEN, it was intimated that though Commissions advice was received in time, the Zonal Railway did not initiate action for issuing charge-sheet with the result that action against him was time-barred on 3.4.95. Railway Board explained that the official responsible for the delay, i.e. one Vigilance Inspector, was not aware about the rules for which the charge-sheet could not be served.
The Commission observed from the chronology of events that this case was investigated by the Zonal Railway some time in June92, but the case was finally referred to Railway Board by the Zonal Railway, complete in all respects in July93, and Railway Board approached the Commission for its advice on 7.9.94. The Commission had promptly tendered its advice on 15.9.94. Thus, there has been complete inertia on the part of the Zonal Railway and the Railway Board in realising that both the IOWs were retired and that the action against them would be time-barred. In case of the Sr.DEN, the Commission observed that the delay in action was apparently motivated as the Commission had disagreed with the recommendation of the Zonal Railway. Commissions advice as communicated to the Zonal Railway through speed-post on 19.9.94 for issuing charge-sheet to the Sr.DEN, but in-action finally led the prime-accused, go unpunished.
10. NATIONAL INDUSTRIAL DEVELOPMENT CORPN.
In a case in which the Chief Technical Examiner of the Commission had pointed out serious irregularities in the work of 1000 KVA Diesel Generating set with oil storage for Hindustan Cables Ltd., Naini, the Commission on 1.8.1994 advised initiation of major penalty proceedings against a General Manager of the National Industrial Development Corporation (NIDC). NIDC took almost three years before taking a decision to impose a minor penalty of censure, that too without consulting the Commission as per the prescribed procedure. It is thus clear that not only the NIDC substantially deviated from the Commissions advice for major penalty action against the officer where serious allegations were noticed against him but also it failed to consult the Commission before imposing a minor penalty of censure after considerable delay.
11. NEW INDIA ASSURANCE CO.LTD.
In a complaint received by the Commission it was alleged that serious irregularities were committed by certain officials of the New India Assurance Co. Ltd. in the matter of disposal of the salvages of two accidented vehicles. The Commission referred the matter, in February, 1994, to the Chief Vigilance Officer of the Company for necessary investigations. The CVO furnished a report in the matter in April, 1994: but the same was found to be wanting in many respects. Accordingly, the Commission wrote back to the CVO in May, 1994 requesting for proper scrutiny of the claims and furnishing a detailed report thereafter. The Company furnished yet another report in March, 1995. On perusal of this report, it was observed that the loss that has accrued to the company in the matter of disposal of the salvages was mainly on account of the failure of the concerned authorities in ensuring timely disposal of the material. The Commission, therefore, again wrote back to the CVO in April, 1996 requesting him to examine the matter afresh with a view to fixing responsibility for the said lapse. Unfortunately, there was no response from the company, despite repeated reminders, and it was only as late as in December, 1997 that the company came up again. According to the Company there was nothing irregular in the matter of disposal of the salvages in question: and hence the question of fixation of responsibility etc. did not arise.
From a perusal of the reports furnished by the Company from time-to-time, it has been observed by the Commission that the above stand did not follow logically from the facts and circumstances of the case: and, further, that the case has not been examined fully/properly with reference to the suspicious features which were apparent at the face of it. For example :
(i) Both the vehicles were owned by the same party/insured.
(ii) The Surveyor deputed to assess the salvage-value was the same in both instances.
(iii) Assessments of salvage values were grossly high-pitched in both cases.
(iv) The party which reportedly offered Rs.15 lakhs for the salvage of one vehicle made it a "conditional offer" by making it valid for one month only. This was unusual.
(v) The above offer was apparently missing from the Surveyors Report.
(vi) It was also intriguing to note that the party concerned was not contacted/approached for negotiations when the maximum offer received for the salvage, during public auction, was Rs.5 lakhs only.
(vii) Though ultimately the Company managed to get Rs.8.25 lakhs for the salvage, the name/identity of the purchaser has not been disclosed.
The Company had, however, totally ignored these suggestive and tell-tale evidences and had merely gone by the "position" as was available at the surface. In other words, no attempt whatsoever seems to have been made by the Company to piece together such circumstantial evidences and cause proper and detailed investigations into the case with a view to ascertaining the truth of the matter.
However, the incident was already too old and the Commission felt that there was no chance of getting at the truth of the matter at this distant point of time. Hence the Commission was constrained to treat the case as closed. This is thus, a case which has been badly delayed by the Company on the one hand, and poorly investigated, on the other.