DRACONIAN RULE OF CONTRIBUTORY NEGLIGENCE A DEMOCLE’S SWORD

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 DRACONIAN RULE OF CONTRIBUTORY NEGLIGENCE

A DEMOCLE’S SWORD 

(By M.R.MEENAKSHISUNDARAM, Retired Supervisor, SBCO, Chennai GPO) 

PREAMBLE

Department of Post is a very big organisation with multifarious functions and spread over the entire country. Due to the vast business turnover as well the huge size of the human resources employed in the day to day functioning, there will be some losses to the organisation at times. Any enterprise this size will have some unscrupulous and shady characters amidst the staff. There will be losses due to frauds, theft and burglary, excess payments and compensation to be paid in consumer cases. Even so the loss due to these aspects is negligible compared to the revenue accrued through business. In Nationalised Banks million and millions of money is written off as loss due to bad debts. But in our department not even a single paise is allowed to be written off as the Administration is very keen in recovering the loss from its employees whether the employee is directly responsible or not. In my 39 years of service in this Department, I came across almost all type of cases of recoveries towards pecuniary loss and dealt with them. It is my humble opinion that the bureaucracy usually acts in an inhuman way to recover the loss though they have powers to write off the loss. For instance the Director of Postal Services has power to write off any excess payments in Savings Accounts and there is no monitory limit. In my experience I was able to convince a DPS to accord sanction to write off some minus balances in Savings Accounts as they were pending more than 10 years and the Chief Postmaster was trying to recover the excess payments from the staff who has no part in the transactions. The problem with the present staff is that they don’t want to familiarise with necessary rules of the Branch where they work. In spite of their superior academic qualifications, the present staff’s knowledge in departmental ruling is dismal and so the Administration is able to capitalise on the lack of knowledge and impose punishment of recovery without much difficulty. With current level of shortage of staff in Post Offices and the unwanted decentralisation of Accounting system, there is bound to be a lot of frauds as well as short comings/lapses on the part of the operative staff due to heavy workload. If this state of affairs continues, almost all the staffs have a permanent column in their pay bill under recovery towards Audit Objections. The Rule of recovery is a draconian rule though the rule was introduced with good intentions and the Administration utilises this rule to impose recovery unilaterally to all employees without any sympathy. First of all we have to understand the implication of this rule and then try to tackle it. Here are some aspects of the Rule:

1. WHAT IS CONTRIBUTORY NEGLIGENCE? 

As per Rules Contributory Negligence is an action on the part of a Government servant that caused a pecuniary loss to the Government. As per Rule 11(iii) of the CCS (CCA) Rules, 1965, if an act on the part of the Government servant caused pecuniary loss to the Government, the Government may order recovery from his pay of the whole or part of the any pecuniary loss caused by him to the Government by negligence or breach of orders. This rule clearly states that recovery from a Government servant can be ordered only if he caused the loss due to his negligence or breach of orders.

For example, if a Government servant looses Government money entrusted to him for safekeeping or disbursement, then it can be construed as negligence and so the recovery can be ordered. If a Government servant pays out money without proper voucher or through a defective voucher to another person, then it can be construed as a payment made in breach of orders and the penalty of recovery can be enforced. It is further defined in Rule 106 & 107 of P&T Manual Volume III as follows:

(i)                Rule 106 of P&T Vol. III states: (a). General Conditions: - In the case of proceedings relating to recovery of pecuniary losses caused to the Government by negligence or breech of orders by a Government servant, the penalty of recovery can be imposed only when it is established that the Government servant was responsible for a particular act or acts of negligence or breech of orders or rules and that such negligence or breech caused the loss.

(ii)              Rule 107 of P&T Vol. III states: In the case of loss caused to the Government, the competent disciplinary authority should correctly assess in a realistic manner the contributory negligence on the part of an officer, and while determining any omission or lapses on the part of an officer, the bearing of such lapses on the loss considered and the extenuating circumstances in which the duties were performed by the officer, shall be given due weight.

(iii)           Manner in which charge- sheet to be framed (DG P&T letter No. 114/176/78-Disc.II, dated 13.02.1981.)

“ It should be clearly understood by all the disciplinary authorities that while an official can be punished for good and sufficient reasons, the penalty of recovery can be awarded only if the lapses on his part have either led to the commission of the fraud or misappropriation or frustrated the enquiries as a result of which it has not been possible to locate the real culprit. It is, therefore, obligatory that the charge sheet should be quite elaborate and should not only indicate clearly the nature of lapses on the part of the particular official but also indicate the Modus - operandi of the frauds and their particulars and how it can be alleged that but for the lapses on the part of the official, the fraud or misappropriation could be avoided or that the successful enquiries could be made to locate the stage at which the particular fraud had been committed by a particular person.”

2. How this Rule’s interpretation is being done in India Post?

Whenever a pecuniary loss occurs in the Department, the Administration immediately harps upon this Rule if the official who caused the loss did not make good the loss. For instance, if a Branch Postmaster or a Sub Postmaster defrauds Public money, the Administration does not take any serious action to recover the money from him. Instead it process the case to find out the short comings of other connected or even unconnected officials and try to throw the blame on them to enforce recovery to make good the loss. Though many Courts have frowned upon this type of action of the Administration, the practice is still being followed by the Administration. If there is a fraud at the Sub Office, the Administration looks for the lapses on the part of the Head Office staff to fix the blame and to recover the pecuniary loss. In all cases where the official directly responsible does not make good the loss, the recovery of the loss is being ordered from the other officials who are not directly responsible for the loss in violation of the Rules and orders.

3. How the Administrative Machinery is used?

Whenever the Administration decides to impose the recovery on the officials other than the one who committed the misconduct, the investigating officer will be sent to obtain statements from the officials pointing out their shortcomings and almost succeed in obtaining confession statements. If the official is weak minded and afraid of disciplinary action, the investigating officer/Divisional Administration play upon their weakness and obtain their willingness to credit their alleged share of the loss. In case of officials who are to go on retirement or voluntary retirement, the Administration uses coercion to get their willingness to credit the share as a precondition to accord necessary permission for retirement. The investigating officers use threats or lull the official to confide in them to get a confession statement. Practically all form of tactics is resorted to by the Administration without any conscience or sympathy to achieve their goal.

4. How the Government servant reacts to this action?

The reaction of the Government servant is first outrage and then defeatism. Whenever an investigating officer approaches the Government servant with some records and point out some lacunas in his day today work and how he failed to follow certain provisions in some rule. The Government servant immediately go on the defensive and try to explain how the shortage of staff and overburden of work in his seat have led to such omissions. This is exactly what the investigating officer requires. He advises the Government servant to give his statement admitting his omissions and his inability to detect some irregularities in a transaction while he processed it. The Government servant gives a statement on the above lines and prays to be excused as the omissions occurred due to heavy workload. Only a few knowledgeable Government servants ask for time to give a statement and demand that all the records for perusal before giving a statement or try to get some advise from a knowledgeable person before committing anything in writing.

5. What is the Legal Position in these types of cases?

The CATs and High Courts normally set aside the order of recovery if the Government servant is not directly responsible or there is no evidence of abetting to the loss. In some cases, the CATs have upheld the orders of recovery in spite of the fact the fraud or loss occurred at a place other than the place of work of the Government servant. This is mainly due to the views taken by the Administrative Member of the CATs who was once a bureaucrat and normally rule in favour of the Government. There is no guarantee that all cases will succeed in the Legal Forum. This is mainly due to the fact that the Government servant has admitted his omissions initially and so the Courts take it as a proof and refrain from interfering with the punishments. So the entire disciplinary proceeding as well as the legal proceedings revolves around the statement of the Government servant. In some cases the Courts have set aside the order of recovery, but advise the Department to impose any other minor punishment for the omission/lapse.

 

6. What is the normal process in such cases?

a)     Whenever a case comes to light, the Administration access the amount of recovery that can be imposed on the Government servants and send the investigating officers to obtain confession statements.

b)     Next stage of the Contributory Negligence proceedings is the issue of show cause notice to the Government servant asking him whether he is willing to credit the whole/share of the pecuniary loss alleged to have been caused due to his negligence without prejudice to any disciplinary action likely to be taken in future. Some Government servants may opt to credit the whole amount or in easy instalments with a hope that he/she can avoid disciplinary proceedings. Most of the Government servants used to refuse to credit the amount and face the disciplinary proceedings.

c)     In such cases, charge sheet under Rule 16 of the CCS (CCA) Rules, 1965 will be issued and the Government servant will be asked to submit his representation within 10 days from the receipt of the memo of charge. Normally the Government servant submits his representation stating the extenuating circumstances that led to the omission on his part and request for exoneration. The Disciplinary Authority used to observe that his representation is not satisfactory and imposes the penalty of recovery. If the Government servant prefers an appeal, the appeal is normally rejected as these types of cases are initially discussed with Circle Administration and their views obtained prior to taking any action for recovery. This is how 80% of the Contributory Negligence cases are being processed. 

7. How to safeguard from such cases?

 

a) Whenever an investigating officer approaches for a statement from a Government servant, the official should demand to see the vouchers or records that are to be the evidence for the disciplinary proceeding to find out to what extent his action on such transaction to be construed as misconduct. The Government servant has every right to ask for time to give his statement and he cannot be forced to give a statement then and there that can be used against him. It is a must that the Government servant takes a copy of the statement given by him while giving such statement. If the investigating officer objects or refuse to grant time, the Government servant can write a statement stating that he wants to peruse the records, consult necessary rules and ask for time to give his statement. Then the investigating officer has no other option except to grant his request. Some investigating officers may even refuse to accept such statement and will report to the Disciplinary Authority that the Government servant refused to give his statement. So to avoid such traps, if the investigating officer refuses to accept the statement, the Government servant should send the statement to the Disciplinary Authority through proper channel to avoid the exploitation by the investigating officer. Then he can give his statement after two or three days. It is well settled Law that nobody should be forced to testify against himself and refusal to give statements couldn’t be construed as a misconduct or misbehaviour. A few know about the above fact and so the investigating officers used to threaten the Government servant that refusal to give a statement will be viewed seriously and punishment will be imposed. Even most of the investigating officers and Disciplinary Authorities are not aware of the above fact. So the statement is the most vital factor in a disciplinary proceeding and the Government servant should be very careful while a statement is recorded from him. The following points though not exhaustive will help in giving a proper statement. 

i) First ensure that you are on duty on the date/dates of the alleged incidents. 

ii) Peruse the documents that are the basis of the allegation and find out whether the same are handled by you. 

iii) Check the necessary rules/procedures from the Departmental Volumes and find out the extent of your negligence, if any. 

iv) Never write a statement as per the dictation of an investigating officer even if you trust him implicitly. 

v) Always consult a knowledgeable person before giving a statement and act on his advise to avoid any future complication. 

vi) Never trust the Administration in these matters, as it will only look after its own interest. 

vii) Always take notes on the evidences shown to you and take a copy of your statement.

b) Whenever a memo of charge is issued under Rule 16 of CCS (CCA) rules, 1965 to a Government servant, he can ask for perusal of documents that are relied by the Disciplinary Authority to sustain the allegation under Rule 16 (1)(b) of CCS (CCA) rules, 1965 and normally this request will be accepted by the Disciplinary Authority. During perusal take notes from the evidences to include the same in your representation against the allegation. If the Disciplinary Authority is relying on the statements of other persons , request for an oral inquiry under Rule 16 (1)(b) of CCS (CCA) rules, 1965 and the Disciplinary Authority will reject the request stating that he does not consider an inquiry necessary in the case as he is vested with discretionary powers. Though the request is refused, this action on the part of the Government servant will help him when he approaches the CAT for redressal. Whenever a memo of charge is received, it is always advisable to consult a knowledgeable person before submitting a reply. In all cases, the recovery is unavoidable, as the Disciplinary Authority has already made up its mind to impose the recovery. But submission of a proper representation against the allegation will be helpful when the Government servant approaches the CAT for remedy. If you are convinced that the recovery is unjust, it is better to take the help of a knowledgeable person in preparing your representation to the memo of charge or your appeal as these two will be the deciding factor in the Court of Law.

8. TYPES OF CASES UNDER THIS RULE

a) Savings Bank frauds at Branch Post Office or Sub Post Office:

The HO SB Ledger Assistant and APM (SB) are the victims. Non-verification of signature between the SB3 and SB7, non-checking of BAT or DLT or non-furnishing of necessary certificates in the proper format and non-detection of any alteration or correction made in the SB7 and not calling for the Pass Book for entry of Interest from the SO are some of the points on which the allegation is based.

b) Savings Certificates frauds at Sub Post Office:

The HO SB Ledger Assistant and APM (SB) are usually charged with non-maintenance or improper maintenance of the HO Stock Register for Certificates supplied to the SOs. Failure to check whether the certificates were properly signed or payment to messenger made on proper authorisation are some of the points of allegation.

c) Transit of Cash between SO and HO:

The Mail Bag containing cash and valuables is sent from HO to SO through Bus and there is always likelihood of loss of the bag or pilfering of the bag during transit. In such cases the case is reported to Police and the loss of money recovered from the SPM or Treasurer of SO/HO under some pretext that the weight of the bag & seal was not checked or the bag was not opened before the SPM etc.

d)    Excess payments or Minus Balance in SB Accounts:

The improper maintenance of list of clearance of cheques and non-verification of balance in the Account before allowing the cheque for payment results in Excess payments or Minus Balance in SB Accounts.

e)     Withdrawal of cash by the SPM from the Bank and non-accounting of the same:

The PA and the APM of the Accounts Branch at HO entrusted with the work of scroll maintenance charged with the allegation that they failed to watch the serial No. of the cheque and non-tallying the scroll received from the bank every month.

f)      Theft/Burglary in Post Offices

The SPM/Treasurer will be the victims. The basis for allegation will be non-occupation of quarters provided or non-checking of locking arrangement on the doors of the PO or the Cash Chest etc. There is a Rule that says that the SPM provided with quarters should sleep in the Office as if he is a security guard of the PO. This is the most ridiculous rule as the SPM is also a normal human being and has his own domestic obligations to his family. I defended a case of burglary recently in which the investigating officer obtained contradictory statement from the SPM to implicate the Treasurer in Police Station and force him to credit the entire loss. The SPM thought that he was clever. But what happened was the SPM was proceeded on the verge of retirement and he was forced to credit half of the loss before his date of retirement. It came to light during another burglary in the same PO, the duplicate keys of the Cash Chest that are ought to be in the custody of the SSPOs was used during the burglaries. It is evident from the above fact that somebody in the Divisional Office colluded with the criminal element and burgled the PO. Neither the then SSPOs or ASPOs or the PA responsible for safe keeping of the duplicate keys were touched and the SPM and Treasurer have been made scapegoats for the burglary.

g)    Compensation ordered by Consumer Courts:

The Consumer Courts do not accept the rules made by the Government of India and in all cases order compensation to the Public for deficiency of service. Normally this amount should be bourn by the department. But in our department, the amount of compensation ordered is recovered from the officials who have processed the transaction as per rules even though there is no wilful deficiency on their part. I heard a rumour that in a PLI claim case the court ordered compensation and the amount has to be recovered from the DPS/APMG and the amount was drawn from Welfare Fund and paid to the complainant. If this can be done for a highly paid officer, what harm in paying the compensation from Welfare Fund in case of low paid officials who were not actually at fault and who is also a member of the fund.

9. Here are some of the Judgements:

RECOVERY

1. (A) Post Office Savings bank manual Volume-I- Rule 9(1), 31(2)(iii), 48(ii),

92(2) and 120(6)-Recovery-Charge of failure to detect the on going fraud at

the relevant time by other staff members which resulted in pecuniary loss to

Govt. - None of the applicants was charged with misappropriating any amount

nor it was alleged that their integrity was doubtful-Even no detailed enquiry

was held-Order of recovery of loss along with interest quashed.

(B) Central Civil Services (Classification, Control and Appeal) Rules, 1965 -

Rule 11(3)--Recovery-Unless the persons concerned is directly responsible for

misappropriating any amount or for causing any pecuniary loss to the Govt.--

No recovery can be made from him.

(Smt. Kalpana Shinde and others v Union of India - OA Nos. 344/2003, 353/03, 354/03, 355/03 & 357/03-decided on 22.11.2004- CAT, Jabalpur Bench (Circuit at Gwalior) -ATJ 2005(1)-45)

2. R.Balakrishnan v Union of India & others - OA 1496 of 1992 decided on 02.12.93 - CAT, Madras Bench - 166 Swamy's Case Law Digest 1994 I.

"Unless and until the quantum of the pecuniary loss caused by negligence is properly assessed and quantified, there can be no punishment of recovery from pay".

EPILOGUE

Till the year 1985, the Appellate Authorities have sympathetically considered the appeal petitions and used to reduce the amount of recovery considerably. I had the satisfaction of some of the punishment of recoveries set aside by Member (P) while deciding the Revision Petition. The power of revision is now transferred to Chief PMGs and all the Revision Petitions are being rejected now without any mercy as the Disciplinary Authority and Appellate Authority have direct access to the Revising Authority to exert their influence to uphold their decisions. An official can be punished for his fault but he should not be made to suffer for the misconduct of another person. It should be the endeavour of all Trade Unions to bring in necessary changes to this unscrupulous and inhuman imposition of punishment upon the Government servants who are not directly responsible for the loss. I want to enlighten this aspect of the Disciplinary Proceedings to all the Government servants and errors, if any, is my sole responsibility. I will be happy to receive your valuable comments (whether negative or positive) and suggestions for improvement of this thesis.  

All India Savings Bank Control Employees Union-A.P.Circle, Thanks to Mr M.R.MEENAKSHISUNDARAM, Retired Supervisor, SBCO, Chennai GPO and http:// sapost.blogspot.in for this valuable Article.