- 1 - HC-KAR NC: 2025:KHC:46046-DB WA No. 1725 of 2024 C/W WA No. 1732 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 12TH DAY OF NOVEMBER, 2025 PRESENT THE HON'BLE MR. JUSTICE D K SINGH AND THE HON'BLE MS. JUSTICE TARA VITASTA GANJU WRIT APPEAL NO. 1725 OF 2024 (S-RES) C/W WRIT APPEAL NO. 1732 OF 2024 (S-RES) IN WA No. 1725/2024 BETWEEN: 1. THE BOARD OF DIRECTORS KARNATAKA RURAL INFRASTRUCTURE DEVELOPMENT LTD., REPRESENTED BY ITS MANAGING DIRECTOR, CHINNASWAMY STADIUM, GATE NO.18, RAJ BHAVAN ROAD, BANGALORE-560 001. 2. THE MANAGING DIRECTOR, KARNATAKA RURAL INFRASTRUCTURE DEVELOPMENT LTD., CHINNASWAMY STADIUM, GATE NO.18, RAJ BHAVAN ROAD, BANGALORE-560 001 …APPELLANTS (BY SRI. NATARAJU T., ADVOCATE) AND: 1. SRI B R NAGARAJ S/O. LATE B.N. RAMACHANDRAIAH, AGED ABOUT 78 YEARS, Digitally signed by VASANTHA KUMARY B K Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:46046-DB WA No. 1725 of 2024 C/W WA No. 1732 of 2024 EARLIER ASSISTANT DIRECTOR, NOW ASSISTANT EXECUTIVE ENGINEER (RTD.) KARNATAKA RURAL INFRASTRUCTURE DEVELOPMENT LTD, HEAD OFFICE, BANGALORE, R/A. NO.12, 6TH A CROSS, MARENAHALLI EXTENSION, SUBBANNA GARDEN, VIJAYANAGARA, BANGALORE-560 040 …RESPONDENT (BY SRI. SREEDHAR G BIDRE, ADVOCATE FOR SRI. RAGHAVENDRA G GAYATHRI, ADVOCATE) THIS WRIT APPEAL IS FILED UNDER SECTION 4 OF THE KARNATAKA HIGH COURT ACT PRAYING TO, SET ASIDE THE ORDER DATED 26.07.2024 PASSED BY THIS HON'BLE COURT IN WP No. 22003/2012 (S), IN THE INTEREST OF JUSTICE AND EQUITY. IN WA NO. 1732/2024: BETWEEN: 1. THE BOARD OF DIRECTORS KARNATAKA RURAL INFRASTRUCTURE DEVELOPMENT LTD., REPRESENTED BY ITS MANAGING DIRECTOR, CHINNASWAMY STADIUM, GATE NO. 18, RAJ BHAVAN ROAD, BANGALORE-560 001. 2. THE MANAGING DIRECTOR KARNATAKA RURAL INFRASTRUCTURE DEVELOPMENT LTD., CHINNASWAMY STADIUM, GATE NO. 18, RAJ BHAVAN ROAD, BANGALORE-560 001. ...APPELLANTS (BY SRI. NATARAJU T., ADVOCATE) - 3 - HC-KAR NC: 2025:KHC:46046-DB WA No. 1725 of 2024 C/W WA No. 1732 of 2024 AND: 1. SRI. C. G. NANJARAJ S/O. LATE R. S. GANGADHARAPPA, AGED ABOUT 59 YEARS, DEPUTY DIRECTOR, KARNATAKA RURAL INFRASTRUCTURE DEVELOPMENT LTD., HEAD OFFICE, BANGALORE, R/AT NO. 711, SHIVA KRUPA, 15TH A MAIN, MIG A SECTOR, III PHASE, NEAR SESHADRIPURAM COLLEGE, YELAHANKA NEW TOWN, BANGALROE-560 106. ...RESPONDENT (BY SRI. SHREEDHAR G BIDRE FOR SRI. RAGHAVENDRA G. GAYATRI., ADVOCATE) THIS WRIT APPEAL IS FILED UNDER SECTION 4 OF THE KARNATAKA HIGH COURT ACT PRAYING TO, SET ASIDE THE ORDER DATED 26.07.2024 PASSED BY THIS HON'BLE COURT IN WP No-22002/2012 (S-RES) IN THE INTEREST OF JUSTICE AND EQUITY. THESE APPEALS, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE D K SINGH and HON'BLE MS. JUSTICE TARA VITASTA GANJU - 4 - HC-KAR NC: 2025:KHC:46046-DB WA No. 1725 of 2024 C/W WA No. 1732 of 2024 ORAL JUDGMENT (PER: HON'BLE MR. JUSTICE D K SINGH) The present writ appeals have been filed impugning the common judgment and order dated 26.07.2024 passed by the learned Single Judge in W.P.No.22002/2012 c/w W.P.No.22003/2012 filed by the petitioners. 2. For the sake of convenience, the parties are referred to as per their rankings in the writ petitions. 3. The petitioners were working as Deputy Director and Assistant Director respectively in the Karnataka Rural Infrastructure Development Limited (for short 'the KRIDL'). The KRIDL wanted to expand its presence beyond Karnataka and with the aforesaid ambition, it took up the execution of tender works outside the State in respect of of Madana Distributory of Narmada Valley Development Authority (for short 'the NVDA') in Panagar, Jabalpur District, Madhya Pradesh. The KRIDL entered - 5 - HC-KAR NC: 2025:KHC:46046-DB WA No. 1725 of 2024 C/W WA No. 1732 of 2024 into the contract dated 05.11.2004 for the said Madana Distributory Work of the NVDA. 4. The said KRIDL does not have at its disposal men and machinery to execute the work, the work was assigned on sub- contract to private contractors for execution of the said project. 5. An agreement of Association between the private contractors and KRIDL for execution of the work allotted by the NVDA was executed on 28.02.2005. Clause 12 of the said agreement of the Association dated 28.02.2005 would specifically provide that the Project Managers (the petitioners) of KRIDL earlier known as (Karnataka Land Army Corporation) at their discretion would provide advances to M. Channaiah, the Associate Contractor, if required and that should be deducted from the subsequent running bills. - 6 - HC-KAR NC: 2025:KHC:46046-DB WA No. 1725 of 2024 C/W WA No. 1732 of 2024 6. In exercise of the aforesaid discretion, the total advances given to the Associate Contractor were for Rs.4,79,00,000/-. 7. It appears that the associate contractors of the KRIDL could not execute the work and therefore, the NVDA rescinded the contract on 23.07.2007 on the ground that there was enormous delay in implementing the project by KRIDL. 8. The KRIDL has instituted the arbitration proceedings claiming more than Rs.12,00,00,000/- against NVDA. An award has come to be passed and challenging the said award an appeal under Section 34 is pending before the High Court. 9. The two petitioners were issued charge sheet containing 7 charges wherein charge No. 6 was for giving advances to the associate contractors without adequate security. - 7 - HC-KAR NC: 2025:KHC:46046-DB WA No. 1725 of 2024 C/W WA No. 1732 of 2024 10. The enquiry officer has found only charge number 6 proved against the petitioners, but the other charges have not been found proved. On the basis of charge No.6 having been proved, the disciplinary authority has inflicted the punishment on the petitioners for recovery of a sum of Rs.69,94,837/- from them at 50% each i.e, Rs.34,97,418/-. 11. The said punishment order came to be challenged by the petitioners in W.P.No.22002/2012 (S-RES) and W.P. No. 22003/2012 (S-RES). The learned Single Judge vide impugned judgment and order dated 26.07.2024 has allowed the writ petitions of the petitioners and set aside the punishment inflicted on the petitioners. 12. The learned counsel for the appellants submits that the petitioners had paid advances to the associate contractors without taking prior permission from the Managing Director. It is further submitted that adequate security was not taken before making payment of - 8 - HC-KAR NC: 2025:KHC:46046-DB WA No. 1725 of 2024 C/W WA No. 1732 of 2024 advances. The next submission, advanced by learned counsel for the appellants is that the amount paid as advances were required to be recovered from the running bills. However, the running bills would not match the advances. 13. We have considered the submissions made by learned counsel for both the parties. 14. We have taken note of clause 12 of the Associate Agreement referred to above. The advances were to be given at the sole discretion of the project manager and there was no requirement of taking prior permission from the Managing Director of the KRIDL. There was also no requirement for taking any security before giving advances to the associate contractor, under the terms and conditions of the associate contractor referred to above. It is not in dispute that before the running bills could be cleared, the NVDA had rescinded the contract and - 9 - HC-KAR NC: 2025:KHC:46046-DB WA No. 1725 of 2024 C/W WA No. 1732 of 2024 therefore, the amount was not recovered from the associate contractors from their running bills. 15. For their inefficiency, incapability and failure to execute the contract outside the State, the higher authorities in the KRIDL cannot fasten the liability on the petitioners. There is no charge, which would suggest that the advances were given for some extraneous consideration or for mala fide reasons. Charge number 6 is only for not taking adequate security from the associate contractors, which is not a requirement for advancing the money to the contractors under the agreement mentioned above. 16. We are therefore, of the view that the learned Single Judge has rightly set aside the impugned punishment imposed on the petitioners dated 13.09.2011 whereby each petitioner had been saddled with recovery of Rs.34,97,418/-. - 10 - HC-KAR NC: 2025:KHC:46046-DB WA No. 1725 of 2024 C/W WA No. 1732 of 2024 17. Having considered the aforesaid submissions and our findings thereon, we do not find any error in the impugned judgment and order dated 26.07.2024 passed by the learned Single Judge and therefore, we dismiss both the appeals. 18. In view of dismissal of both the appeals, pending interim applications, if any, stands rejected in the above two appeals. Sd/- (D K SINGH) JUDGE Sd/- (TARA VITASTA GANJU) JUDGE NG List No.: 1 Sl No.: 13