Dismissed¶200

Sri Chidananda v. the Upalokayukta

Karnataka HC30 Jun 2026WA/1168/2025

Case brief

AI extract

What is this about?

Acquittal in corruption case versus departmental enquiry; benefit of doubt versus clean acquittal on merits; G.M. Tank exception distinguished; preponderance of probabilities; trap, phenolphthalein hand-wash, recovery mahazar, chemical examination report; Karnataka Lokayukta / Upalokayukta enquiry; KPTCL Assistant Executive Engineer dismissed; judicial review limited to natural justice, some evidence, perversity, proportionality (Umesh; C. Nagaraju); writ appeal dismissed.

What did the court decide?

None; the writ appeal was dismissed and the dismissal of the appellant from service, along with the enquiry findings, stands upheld. ¶200

Sri Chidananda Vs the Upalokayukta — Corruption | Karnataka HC (2026)

What the court decided

AI extract

Outcome

None; the writ appeal was dismissed and the dismissal of the appellant from service, along with the enquiry findings, stands upheld.

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Issue for consideration

Whether the appellant's acquittal by the Criminal Court, on the very same set of allegations and identical material, renders the findings of the disciplinary enquiry and the dismissal from service unsustainable in law. +1 more

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Court's answer

An acquittal in a criminal case does not, by itself, preclude the employer from initiating or continuing disciplinary proceedings; disciplinary proceedings are governed by the standard of preponderance of probabilities, not proof beyond reasonable doubt, and the strict rules of evidence applicable to criminal trials do not govern them.

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Ratio / Principle

The exception carved out in G.M. Tank, Ram Lal and subsequent decisions (attracted only where the evidence is identical and the Criminal Court records a clear acquittal on merits by completely disbelieving the prosecution case) does not benefit the appellant, because the acquittal rested on the benefit of doubt arising from contradictions in the trap evidence and the probability of the hand-loan defence, and not on any categorical finding that the demand and acceptance of illegal gratification was false.

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Key takeaways

The disciplinary authority independently appreciated the evidence, and after considering the very same admissions of PW1 expressly rejected the hand-loan defence as an afterthought, inherently improbable and unsupported by independent material; the finding of misconduct on the standard of preponderance of probabilities was supported by the trap evidence (recovery mahazar, photographs, seizure, hand-wash test and chemical examination report), and the disciplinary findings cannot be faulted merely because of the criminal acquittal.ratio¶195
Judicial review over disciplinary findings is confined to compliance with natural justice, existence of some evidence, observance of statutory rules, perversity and proportionality of penalty; measured on that yardstick there was no infirmity in the learned Single Judge's refusal to interfere with the order of dismissal, and the appeal was dismissed.ratio¶200

Detailed headnote1 paragraphs

Writ Appeal (GM-KLA) under Section 4 of the Karnataka High Court Act dismissed by Division Bench (judgment per K.S. Hemalekha J.; Vibhu Bakru, CJ., on the Bench), affirming the Single Judge's refusal to quash the Lokayukta departmental enquiry report (30.08.2014), the Upalokayukta recommendation and KPTCL's dismissal of an Assistant Executive Engineer trapped for Rs. 1,500. Held: a criminal acquittal under the Prevention of Corruption Act, 1988 on the same allegations does not preclude disciplinary action, since departmental proceedings proceed on preponderance of probabilities; the G.M. Tank / Ram Lal / Maharana Pratap Singh exception (identical evidence plus a clean acquittal on merits wholly disbelieving the prosecution) was inapplicable because the acquittal rested on benefit of doubt - contradictions in trap testimony and a probable hand-loan defence - not on a categorical finding that demand and acceptance were false. The enquiry officer independently evaluated PW1's admissions, rejected the loan defence for cogent reasons, and relied on corroborative trap material (recovery mahazar, phenolphthalein hand-wash, chemical examination report). Following Umesh and C. Nagaraju, judicial review was confined to natural justice, some evidence, statutory compliance, perversity and proportionality; no infirmity was found.

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NC: 2026:KHC:33357-DB WA No. 1168 of 2025

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 30^TH DAY OF JUNE, 2026

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PRESENT

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THE HON'BLE MR. VIBHU BAKHRU, CHIEF JUSTICE

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AND

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THE HON'BLE MRS. JUSTICE K.S. HEMALEKHA

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WRIT APPEAL NO.1168 OF 2025 (GM-KLA)

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BETWEEN:

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SRI CHIDANANDA S/O. DAYANANDA SHETTIGAR AGED ABOUT 42 YEARS KEB QUARTERS, NEAR T.B. CIRCLE, DODDABALLAPUR - 561 203 BANGALORE (R) DISTRICT.

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…APPELLANT

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(BY SRI. S.M. CHANDRASHEKAR, SENIOR ADVOCATE FOR SRI. S. KALYAN BASAVARAJ, ADVOCATE)

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Digitally signed by C K LATHA Location: High Court of Karnataka

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AND:

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THE UPALOKAYUKTA M.S. BUILDING DR. B.R. AMBEDKAR VEEDHI, BANGALORE - 560 001 REPRESENTED BY ITS REGISTRAR.

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ADDITIONAL REGISTRAR ENQUIRIES - 3 KARNATAKA LOKAYUKTA M.S. BUILDING DR. B.R. AMBEDKAR VEEDHI BANGALORE - 560 001.

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KARNATAKA POWER TRANSMISSION CORPORATION LIMITED KAVERI BHAVAN, K.G. ROAD,

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BANGALORE - 560 009 REPRESENTED BY ITS MANAGING DIRECTOR.

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…RESPONDENTS

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THIS WRIT APPEAL IS FILED UNDER SECTION 4 OF THE KARNATAKA HIGH COURT ACT PRAYING TO SET ASIDE THE ORDER DATED 13.06.2025 IN W.P. NO.21835/2015 ON THE FILE OF THE LEARNED SINGLE JUDGE OF THIS HON'BLE COURT DISMISSING THE W.P. FILED BY THE PETITIONER SEEKING QUASHING OF THE ORDER PASSED BY THE RESPONDENT NO.2 DATED 30.08.2014 AND THE RECOMMENDATION LETTER DATED 30.09.2014 ISSUED BY THE RESPONDENT NO.1 IN NO.Lok/ARE3/ENQ-33/2010 (ANNEXURE-A).

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THIS APPEAL COMING ON FOR PRELIMINARY HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

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CORAM: HON'BLE MR. VIBHU BAKHRU, CHIEF JUSTICE and HON'BLE MRS. JUSTICE K.S. HEMALEKHA

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ORAL JUDGMENT

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(PER: HON'BLE MRS. JUSTICE K.S. HEMALEKHA)

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This appeal is directed against the order dated 13.06.2025

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passed by the learned Single Judge in Writ Petition No. 21835/2015 [GM-KLA], whereby the writ petition filed by the appellant came to be dismissed upholding the enquiry report dated

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30.08.2014, the recommendation dated 03.09.2014 and the

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dismissal order dated 18.03.2015.

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The appellant in the writ petition had assailed,

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(i) the enquiry report dated 30.08.2014 submitted by the Additional Registrar of Enquiries - 3, Karnataka Lokayukta (respondent No. 2),

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(ii) the recommendation dated 03.09.2014 issued by the Upalokayukta (respondent No. 1), and

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(iii) the consequential order dated 18.03.2015 passed by the disciplinary authority dismissing the appellant from service.

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Brief facts:

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3. The appellant joined the services of Karnataka Power Transmission Corporation Limited [KPTCL] in the year 2007 as an Assistant Executive Engineer (AEE) [hereinafter also referred to as the ' delinquent officer ]' and was posted to the O&M Sub-Division, BESCOM, Gudibande Taluk. An electrical contractor lodged a complaint before the Karnataka Lokayukta alleging that the appellant demanded illegal gratification of ₹ 500 each for processing three applications for electrical connections, totaling ₹ 1,500. When the complainant approached the Lokayukta Police, a

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trap was arranged and the appellant was allegedly caught accepting ₹ 1,500. Consequently, an FIR was registered under Sections 7 and 13 (1) (d) read with Section 13 (2) of the Prevention of Corruption Act, 1988 and a criminal case was instituted.

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4. During the criminal trial, the appellant pleaded that the amount recovered was towards repayment of a hand loan earlier advanced to the complainant and not illegal gratification. By order dated 30.03.2013, the Criminal Court acquitted the appellant, holding that the prosecution had failed to prove the charge beyond reasonable doubt.

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5. Independently of the criminal prosecution, the Lokayukta recommended initiation of disciplinary proceedings. KPTCL entrusted the departmental enquiry to the Upalokayukta (respondent No.1), who nominated the Additional Registrar of Enquiries-3, Karnataka Lokayukta (respondent No. 2) as the enquiry officer. The enquiry officer submitted a report holding the appellant guilty and Upalokayukta recommended his dismissal from service. By acting upon the enquiry report and recommendation, KPTCL, by the decision of its Board taken on 18.03.2015, resolved

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to dismiss the appellant from service, the dismissal order being issued on 07.05.2015.

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The findings of the enquiry officer - (respondent No. 2):

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6. The enquiry officer held that the charge against the delinquent officer stood proved for the following reasons:

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(i) The complainant-PW1 consistently deposed that the delinquent officer demanded ₹ 1,500 for sanctioning electricity connection and that, pursuant to the demand he approached the Lokayukta and participated in the trap proceedings.

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(ii) PW1 evidence regarding the pre-trap procedures, payment of the tainted currency and recovery of the amount was found reliable.

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(iii) The enquiry officer relied upon the trap proceedings wherein the tainted currency notes were recovered from the delinquent officer.

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(iv) The recovery mahazar, photographs, seizure of records and chemical examination report were considered as corroborative evidence supporting the complainant's version.

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(v) The evidence of the shadow witness (PW2), and the investigation officer (PW3) substantially corroborated the complainant regarding the trap proceedings, recovery of currency notes and conduct of the accused officer. It was observed that although the shadow witness had not overheard the conversation, he corroborated the material events surrounding the trap.

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(vi) The delinquent officer admitted receipt of ₹ 1,500 but contended that it represented repayment of a hand loan advanced to the complainant. It was observed that this defence was improbable and inconsistent.

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(vii) It was observed that in the written defence the delinquent officer had simultaneously pleaded that the complainant had borrowed ₹ 1,500 from him and repaid the same on the day of trap and the complainant bore a grudge against him because of prior and present incidents. According to the enquiry officer both explanations could not co-exist and therefore lacked credibility.

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(viii) Though the complainant admitted in cross-examination that he had borrowed ₹ 1,500 from the delinquent officer, the

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enquiry officer held that these admissions could not outweigh

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the evidence given in examination-in-chief and appeared to have been made for extraneous reasons. It was held that once receipt of money stood admitted and the defence of hand loan was not probabilised, the inference that followed was that the amount had been received as illegal gratification towards the three pending applications/files.

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(ix) The enquiry officer rejected the plea raised by the delinquent officer with regard to the findings of the Criminal Court, observing that the criminal proceedings do not determine findings in departmental enquiry.

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(x) The enquiry officer concluded that the charges levelled against the delinquent officer were proved and recommended the same to the disciplinary authority.

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7. Pursuant to the report submitted by the enquiry officer, the Upalokayukta (respondent No. 1) issued recommendation. Consequently, the disciplinary authority dismissed the appellant from service. Assailing the same, the delinquent officer approached the learned Single Judge.

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Findings of the learned Single Judge

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8. The learned Single Judge framed the following 5 points for consideration :

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"1. Whether the decision of the learned Trial Court dated 30.03.2013 is binding upon the Respondent No.3-Authority and subsequently the Disciplinary Committee?

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2. Whether the Disciplinary Proceedings initiated by Respondent No.3-Authority can run parallelly to the criminal proceedings before the learned Trial Court?

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3. Whether the recommendation letter dated 03.09.2014 issued by Respondent No.1-Upalokayukta and the subsequent entrustment of investigation to the Additional Registrar Enquiries, Karnataka Lokayukta can be held to be valid in law?

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4. Whether the decision taken by the Respondent No.3-Board Committee dated 18.03.2015 dismissing the Petitioner from service, requires any interference at the hands of this Court?

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5. What order?"

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9. The learned Single Judge concluded that,

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(i) An acquittal in criminal case does not conclude or bind disciplinary proceedings.

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(ii) The disciplinary proceedings can run parallel to the criminal proceedings.

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(iii) The recommendation of Upalokayukta and the entrustment of enquiry to the Additional Registrar of Enquiries were authorized by Karnataka Lokayukta Act and the Karnataka Electricity Board Regulations.

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(iv) The departmental enquiry was fair, legal and supported by evidence.

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(v) The dismissal order dated 18.03.2015 suffered from no legal infirmity warranting interference.

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In view of the aforesaid findings, the learned Single Judge dismissed the petition by the impugned order.

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Findings in Criminal Proceedings

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The Criminal Court acquitted the accused of charges under the Prevention of Corruption Act, 1988 on the following reasons:

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i. The Court found that the prosecution failed to prove ‘beyond reasonable doubt’ that the accused demanded or accepted a bribe’.

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ii. There were significant discrepancies between the testimonies of the complainant (PW.1) and the shadow witness (PW2) regarding how the money was handled.

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a. PW.1 testified that he placed the money on a table and left, while PW.2 claimed the accused received it by hand and put it in his pocket.

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b. Witnesses also contradicted each other on who actually retrieved the money from the accused pocket.

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c. PW.1 was unable to correctly identify the denominations of the currency notes used in the trap.

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iii. The Court accepted the accused defence that the money was a repayment of ` 1,500 loan, he had previously given to PW.1 on humanitarian grounds. PW.1 admitted to receiving such loans from the accused.

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iv. One of the alleged beneficiaries (PW.5) turned hostile, denying that he had given a statement to the Lokayukta Police or that the accused had demanded any bribe.

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v. The prosecution has failed to produce the tape recording used to prove the alleged demand, which the Court viewed as fatal to its case.

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vi. The other two applicants for electrical connection were not examined as witnesses.

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vii. While the prosecution must prove the guilt ‘beyond reasonable doubt’, the accused only needs to prove his defence by a ‘preponderance of probabilities’, which the Court felt that he successfully did in his case.

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Contentions of the appellant

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11. The principal contention of the learned Senior Counsel appearing for the appellant is that the appellant was acquitted by the Special Court after a full-fledged trial on the very same set of allegations which formed the basis of the departmental proceedings. It is submitted that the Criminal Court upon an elaborate appreciation of the oral and documentary evidence, found that the prosecution has failed to establish the demand and acceptance of an illegal gratification beyond reasonable doubt. Particular reliance is placed on the admissions elicited from PW1 by the complainant, during cross examination, wherein he has admitted that he had borrowed a sum of ₹ 1,500 from the appellant and that the amount paid on the date of the trap was towards repayment of the said hand loan, and that he had entered the office of the appellant and kept the money on the table without any conversation regarding demand of illegal gratification. It is therefore

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contended that the essential ingredient of demand was held to be unproved by the Criminal Court.

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11.1. It is further contended that the Criminal Court accepted the defence that the amount recovered from the appellant represented repayment of a hand loan, whereas the disciplinary authority, without any additional or independent evidence, erroneously discarded the very same defence and arrived at a contrary finding. It is therefore contended that the findings recorded in the disciplinary enquiry, being at variance with those of the criminal court on identical material, are unsustainable in law.

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Findings and conclusions

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12. The settled proposition of law is that the principles governing disciplinary proceedings are distinct from those applicable to criminal trials. In a criminal prosecution, the burden of proof lies upon the prosecution to establish the guilt of the accused beyond reasonable doubt, and the accused enjoys the benefit and presumption of innocence. On the contrast, the object of disciplinary enquiry is to ascertain whether an employee has committed misconduct in breach of the service rules governing the employer-employee relationship. The standard of proof in such

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proceedings is not the proof beyond reasonable doubt, but proof on the touchstone of preponderance of probabilities. Consequently, the strict rules of evidence applicable to the criminal proceedings do not govern the disciplinary proceedings. It is therefore well settled that an acquittal in a criminal case does not, by itself preclude the employer from initiating or continuing disciplinary proceedings.

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13. At the same time the Supreme Court has carved out a limited exception to the aforesaid rule. In G. M. Tank vs State of Gujarat and Others¹ which has been followed in Ram Lal vs State of Rajasthan and Others² and Maharana Pratap Singh vs The State of Bihar and Others³ it has been held that where charges, witnesses, evidence, and circumstances in the criminal trial and the departmental enquiry are identical or substantially similar, and the Criminal Court records a clear acquittal on merits after completely disbelieving the prosecution case, it may be unjust, unfair and oppressive to sustain the disciplinary punishment, particularly where the enquiry is founded on no additional or independent evidence.

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1 (2006) 5 SCC 446

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2 (2024) 1 SCC 175

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3 Civil Appeal No. 5497/2025, DD 23.04.2025

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14. Equally, the Supreme Court in the case of State of Karnataka and Another vs Umesh⁴ , reiterated that the departmental proceedings are independent of the criminal prosecution, and that misconduct is to be assessed on the standard of preponderance of probabilities. It was held at paragraph Nos.17 to 24 as under :

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" 17. In a judgment of a three-Judge Bench of this Court in State of Haryana v. Rattan Singh [(1977) 2 SCC 491], V.R. Krishna Iyer, J. set out the principles which govern disciplinary proceedings as follows: (SCC p. 493, para 4)

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“ 4. It is well settled that in a domestic enquiry the strict and sophisticated rules of evidence under the Evidence Act, 1872 may not apply. All materials which are logically probative for a prudent mind are permissible. There is no allergy to hearsay evidence provided it has reasonable nexus and credibility . It is true that departmental authorities and Administrative Tribunals must be careful in evaluating such material and should not glibly swallow what is strictly speaking not relevant under the Evidence Act. For this proposition it is not necessary to cite decisions nor text books, although we have been taken through case-law and other authorities by counsel on both sides. The essence of a judicial approach is objectivity, exclusion of extraneous materials or considerations and observance of rules of natural justice. Of course, fairplay is the basis and if perversity or arbitrariness, bias or surrender of independence of judgment vitiate the conclusions reached, such finding, even though of a domestic tribunal, cannot be held good. However, the courts below misdirected themselves, perhaps, in insisting that passengers who had come in and gone out should be chased and brought before the tribunal

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4 (2022) 6 SCC 563

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before a valid finding could be recorded. The “residuum” rule to which counsel for the respondent referred, based upon certain passages from American Jurisprudence does not go to that extent nor does the passage from Halsbury insist on such rigid requirement. The simple point is, was there some evidence or was there no evidence — not in the sense of the technical rules governing regular court proceedings but in a fair commonsense way as men of understanding and worldly wisdom will accept. Viewed in this way, sufficiency of evidence in proof of the finding by a domestic tribunal is beyond scrutiny. Absence of any evidence in support of a finding is certainly available for the court to look into because it amounts to an error of law apparent on the record. We find, in this case, that the evidence of Chamanlal, Inspector of the Flying Squad, is some evidence which has relevance to the charge levelled against the respondent. Therefore, we are unable to hold that the order is invalid on that ground.”

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(emphasis in original and supplied )

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These principles have been reiterated in subsequent decisions of this Court including State of Rajasthan v. B.K. Meena [(1996) 6 SCC 417]; Krishnakali Tea Estate v. Akhil Bharatiya Chah Mazdoor Sangh [(2004) 8 SCC 200; Ajit Kumar Nag v. Indian Oil Corpn. Ltd. [(2005) 7 SCC 764] and CISF v. Abrar Ali [(2017) 4 SCC 507].

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In the course of the submissions, the respondents placed reliance on the decision in Union of India v. Gyan Chand Chattar [(2009) 12 SCC 78]. In that case, six charges were framed against the respondent. One of the charges was that he demanded a commission of 1% for paying the railway staff. The enquiry officer found all the six charges proved. The disciplinary authority agreed with those findings and imposed the punishment of reversion to a lower rank. Allowing the petition under Article 226 of the Constitution, the High Court observed that there was no evidence to hold that he was guilty of the charge of bribery since the witnesses only said that the motive/reason for not making the payment could be the expectation of a commission amount. The respondent placed reliance on the

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following passages from the decision: (SCC pp. 85 & 87, paras 21 & 31)

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“ 21. Such a serious charge of corruption requires to be proved to the hilt as it brings both civil and criminal consequences upon the employee concerned. He would be liable to be prosecuted and would also be liable to suffer severest penalty awardable in such cases. Therefore, such a grave charge of quasi-criminal nature was required to be proved beyond the shadow of doubt and to the hilt. It cannot be proved on mere probabilities.

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31. … wherein it has been held that the punishment should always be proportionate to the gravity of the misconduct. However, in a case of corruption, the only punishment is dismissal from service. Therefore, the charge of corruption must always be dealt with keeping in mind that it has both civil and criminal consequences.”

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The observations in para 21 of Gyan Chand Chattar case [ Union of India v. Gyan Chand Chattar , (2009) 12 SCC 78] are not the ratio decidendi of the case. These observations were made while discussing the judgment of the High Court. The ratio of the judgment emerges in the subsequent passages of the judgment, where the test of relevant material and compliance with natural justice as laid down in Rattan Singh [ State of Haryana v. Rattan Singh , (1977) 2 SCC 491] was reiterated: ( Gyan Chand Chattar case [(2009) 12 SCC 78], SCC p. 88, paras 35-36)

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“ 35. … an enquiry is to be conducted against any person giving strict adherence to the statutory provisions and principles of natural justice. The charges should be specific, definite and giving details of the incident which formed the basis of charges. No enquiry can be sustained on vague charges. Enquiry has to be conducted fairly, objectively and not subjectively. Finding should not be perverse or unreasonable, nor the same should be based on conjectures and surmises. There is a distinction in proof and suspicion. Every act or omission on the part of the delinquent cannot be a misconduct. The

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authority must record reasons for arriving at the finding of fact in the context of the statute defining the misconduct.

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36. In fact, initiation of the enquiry against the respondent appears to be the outcome of anguish of superior officers as there had been an agitation by the railway staff demanding the payment of pay and allowances and they detained the train illegally and there has been too much hue and cry for several hours on the railway station. The enquiry officer has taken into consideration the non-existing material and failed to consider the relevant material and finding of all facts recorded by him cannot be sustained in the eye of the law .”

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(emphasis supplied)

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On the charge of corruption, the Court observed in the above decision that there was no relevant material to sustain the conviction of the respondent since there was only hearsay evidence where the witnesses assumed that the motive for not paying the railway staff “could be” corruption. Therefore, the standard that was applied by the Court for determining the validity of the departmental proceedings was whether ( i ) there was relevant material for arriving at the finding; and ( ii ) the principles of natural justice were complied with.

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In Karnataka Power Transmission Corpn. Ltd. v. C. Nagaraju [(2019) 10 SCC 367], this Court has held: (SCC p. 371, para 9)

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“ 9. Acquittal by a criminal court would not debar an employer from exercising the power to conduct departmental proceedings in accordance with the rules and regulations. The two proceedings, criminal and departmental, are entirely different. They operate in different fields and have different objectives. In the disciplinary proceedings, the question is whether the respondent is guilty of such conduct as would merit his removal from service or a lesser punishment, as the case may be, whereas in the criminal proceedings, the question is whether the offences registered against him under the PC Act are established, and if established,

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what sentence should be imposed upon him. The standard of proof, the mode of inquiry and the rules governing inquiry and trial in both the cases are significantly distinct and different.”

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The Court also held that: ( C. Nagaraju case [ Karnataka Power Transmission Corpn. Ltd. v. C. Nagaraju , (2019) 10 SCC 367], SCC p. 372, para 13)

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“ 13. Having considered the submissions made on behalf of the appellant and Respondent 1, we are of the view that interference with the order of dismissal by the High Court was unwarranted. It is settled law that the acquittal by a criminal court does not preclude a departmental inquiry against the delinquent officer. The disciplinary authority is not bound by the judgment of the criminal court if the evidence that is produced in the departmental inquiry is different from that produced during the criminal trial. The object of a departmental inquiry is to find out whether the delinquent is guilty of misconduct under the conduct rules for the purpose of determining whether he should be continued in service. The standard of proof in a departmental inquiry is not strictly based on the rules of evidence. The order of dismissal which is based on the evidence before the enquiry officer in the disciplinary proceedings, which is different from the evidence available to the criminal court, is justified and needed no interference by the High Court.”

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In the exercise of judicial review, the Court does not act as an appellate forum over the findings of the disciplinary authority. The court does not reappreciate the evidence on the basis of which the finding of misconduct has been arrived at in the course of a disciplinary enquiry. The Court in the exercise of judicial review must restrict its review to determine whether:

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( i ) the rules of natural justice have been complied with;

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( ii ) the finding of misconduct is based on some evidence;

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( iii ) the statutory rules governing the conduct of the disciplinary enquiry have been observed; and

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( iv ) whether the findings of the disciplinary authority suffer from perversity; and

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( v ) the penalty is disproportionate to the proven misconduct.

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However, none of the above tests for attracting the interference of the High Court were attracted in the present case. The Karnataka Administrative Tribunal having exercised the power of judicial review found no reason to interfere with the award of punishment of compulsory retirement. The Division Bench of the High Court exceeded its jurisdiction under Article 226 and trenched upon a domain which falls within the disciplinary jurisdiction of the employer. The enquiry was conducted in accordance with the principles of natural justice. The findings of the enquiry officer and the disciplinary authority are sustainable with reference to the evidence which was adduced during the enquiry. The acquittal of the respondent in the course of the criminal trial did not impinge upon the authority of the disciplinary authority or the finding of misconduct in the disciplinary proceeding.

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For these reasons, we allow the appeals and set aside the impugned judgment and order of the High Court of Karnataka at the Kalaburagi Bench dated 29-11-2017 in Umesh v. State of Karnataka [2017 SCC OnLine Kar 4973]. The petition instituted by the respondent under Article 226 of the Constitution shall stand dismissed. The finding of misconduct and the punishment of compulsory retirement are restored."

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15. The Apex Court in Umesh (supra) observed that the recovery of tainted money established in the departmental enquiry may, by itself, be sufficient to sustain the finding of misconduct, notwithstanding the acquittal of the employee in the criminal case.

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The Apex Court held that in the exercise of judicial review, the court does not act as an appellate forum over the findings of the disciplinary authority. The Court does not re-appreciate the evidence on the basis of which the findings of misconduct has been arrived at in the course of the disciplinary enquiry and the Court in exercise of the judicial review must restrict its review to determine whether:

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(i) the rules of natural justice have been complied with;

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(ii) the finding of misconduct is based on some evidence;

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(iii) the statutory rules governing the conduct of disciplinary enquiry have been observed; and

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(iv) whether the findings of the disciplinary authority suffer from perversity; and

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(v) the penalty is disproportionate to the proven misconduct.

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16. Similarly in Karnataka Power Transmission Corporation

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Limited vs C. Nagaraju and Another⁵ , the Supreme Court observed that the acquittal by Criminal Court does not automatically invalidate or bar disciplinary proceedings on the same allegations. The disciplinary authority is not bound by a

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criminal acquittal, where the evidence produced in the 5 (2019) 10 SCC 367

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departmental enquiry is different from that produced at the criminal trial, since two proceedings differ in objective, procedure and standard of proof, (proof beyond reasonable doubt versus preponderance of probabilities). It was held that M. Paul Anthony vs Bharat Gold Mines Limited⁶ and G.M.Tank (supra) - permitting the departmental action to be set aside on the strength of the acquittal - is attracted only where the evidence in both proceedings is identical and the Criminal Court has recorded an honourable acquittal on merits by wholly disbelieving the prosecution case.

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17. In Union of India and Others vs Gyan Chand Chattar⁷ which also was taken note by the Supreme Court in Umesh 's case, wherein it was held that the departmental enquiry must be founded on specific, definite and clear charges supported by proper evidence; findings cannot rest on vague charges, hearsay conjecture or surmise. There is a distinction between suspicion and proof. Charges involving corruption, given their quasi-criminal character and civil/criminal consequences, must be proved "to the hilt". While corruption, once proved, warrants no sympathy and

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6 (1999) 3 SCC 679

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7 (2009) 12 SCC 78

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permits no punishment short of dismissal, an enquiry that fails to establish the charge with real evidence cannot sustain a major penalty.

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18. In the instant case, the appellant cannot derive any benefit from the exception carved out by the Supreme Court in G.M Tank, Ram Lal and the other subsequent decisions. The acquittal recorded by the Criminal Court was not founded upon a categorical finding that the prosecution case of demand and acceptance of illegal gratification was false. On the contrary, the acquittal rested on the benefit of doubt arising from certain contradictions in the trap evidence and the loan defence having been held probable, and not upon any categorical finding that the demand and acceptance of illegal gratification was false. In particular, weight was given to the admissions elicited from PW1 during his crossexamination wherein he admitted that he had borrowed ₹ 1,500 from the appellant and that the amount paid on the date of trap was towards the repayment of the said hand loan. On that basis the Criminal Court extended the benefit of doubt to the accused.

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19. The departmental enquiry, however, after considering the very same admissions, expressly rejected them. The enquiry officer

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held that the complainant's evidence in examination-in-chief and the complaint - Ex. P1 consistently established the demand and acceptance of illegal gratification, that the admissions made during cross-examination were an afterthought and appeared to have been made for extraneous reasons, and the defence of repayment of a hand loan was inherently improbable and unsupported by any independent material.

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20. Consequently, the enquiry officer concluded that the amount received by the appellant constituted an illegal gratification with respect to the three pending applications. The enquiry findings are also supported by evidence relating to the trap proceedings. The complainant lodged a complaint before the Lokayukta alleging demand of ₹ 1,500 as an illegal gratification. Pursuant thereto, the Lokayukta Police secured two independent panch witnesses, conducted the pre-trap formality by smearing three currency notes of ₹ 500 each with phenolphthalein powder. The Lokayukta Police prepared the entrustment mahazar and entrusted the complainant to hand over the tainted currency only upon demand. The shadow witness accompanied the complainant. After the pre-arranged signal was given, the Lokayukta Police entered the office,

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recovered the tainted currency from the right pocket of the appellant’s trousers, conducted the hand wash test which turned pink, and seized the relevant records. The chemical examination report confirmed the presence of phenolphthalein on the hand washes, the recovered currency notes and trousers worn by the appellant. These circumstances were accepted by the enquiry officer as corroborative to the complainant's version and sufficient to establish misconduct on preponderance of probabilities.

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21. In the aforesaid facts and circumstances, the acquittal recorded by the Criminal Court does not enure to the benefit of the appellant in the disciplinary proceedings. The case does not fall within the narrow exception, since the Criminal Court did not render a clean acquittal on merits by completely disbelieving the prosecution case, on the contrary, the disciplinary authority independently appreciated the evidence, rejected the defence of repayment of hand loan on cogent reasons and recorded a finding of misconduct on the standard of preponderance of probabilities. The disciplinary findings therefore cannot be faulted merely because the appellant came to be acquitted in the criminal

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25 -

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proceedings. The findings recorded by the enquiry officer are based on evidence.

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22. We find no infirmity in the view taken by the learned Single Judge in declining to interfere with the order of dismissal. The appeal is devoid of merits and is accordingly dismissed.

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Sd/(VIBHU BAKHRU) CHIEF JUSTICE

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Sd/(K.S. HEMALEKHA) JUDGE

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CKL List No.: 1 Sl No.: 8

Sri Chidananda v. the Upalokayukta

Case brief

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Sri Chidananda v. the Upalokayukta

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