The Small Industries Development Bank of India (SIDBI),
and Delhi Jal Board each have four such cases and Mahanadi Coalfields Limited has protected its employees in three of those cases, according to CVC’s 2021 annual report.
Two such cases of failure to follow the advice of the probity watchdog to punish the corrupt were by
Limited, Indira Gandhi National Open University and North Delhi Municipal Corporation (now part of the Unified Municipal Corporation of Delhi), he said.
The commission observed that in 2021 there had been significant deviations from its advice, according to the report.
“Failure to accept the advice of the Commission or to consult the Commission vitiates the due diligence process and weakens the impartiality of the due diligence administration,” he said.
Giving details of such a case, the CVC said that while holding different positions, the then personnel manager had amassed enormous wealth disproportionate to his known source of income of 138.65%.
“He was found responsible for failing to intimidate or obtain Departmental clearance in accordance with applicable standards regarding the purchase of assets and investments made by him or his wife and the acceptance of gifts by his family members,” he said.
“The Commission issued its first stage opinion on March 7, 2012 for the initiation of major sanction proceedings against the then Chief of Staff. When offering a second stage opinion, the Commission had advised the imposition of a penalty under the Rail Service Rules (pension) against him,” the report said.
However, the disciplinary authority, namely the Board of Railways (staff), decided to close the case and dropped the charges against the officer, he said.
The CVC also brought to light a case of SIDBI that resulted in massive financial losses.
Between August 28, 2017 and November 27, 2017, officers working at the bank’s treasury and its management vertical placed a total amount of Rs 1,000 crore in the form of fixed deposits with two interdependent private financial institutions in eight branches, according to the report.
“By placing the above amount on deposit without obtaining quotes to compare or negotiate interest rates with the institutions, officials violated the terms of SIDBI’s Treasury Operations SOP (Standard Operating Procedure) Manual,” did he declare.
In fiscal 2018, officials allowed SIDBI deposits to be placed only with that particular financial institution without regard to other available deposit options, according to the report.
When the term of the deposits expired, when the bank requested its proceeds, the claims were not honored by the financial institutions despite repeated efforts, he said.
As a result, the bank is exposed to massive financial and reputational loss, according to the report.
“The Commission has recommended the imposition of a major sanction on two officials involved in the case. The Disciplinary Authority has ‘exonerated’ the two officials from the charges by deviating from the opinion of the Commission”, a- he added.
The CVC also cited a Bank of India case related to fraud in cash credit limit.
“One of the Bank of India officials authorized the credit to the borrower’s current account and assisted the private company in diverting the funds to other non-lending banks even though the OCC (open cash credit) account ) of the company is irregular in the industry,” he said.
At the request of a private company, Rs 27.90 crore was disbursed under a cash credit limit on various dates between June 2014 and February 2015, and Rs 4.58 crore was disbursed ( below term loan limit), according to the report.
Subsequently, the borrowing company diverted the working capital through a private sector bank where it managed its current account.
“The borrowing company also misappropriated the funds from the term loan to its subsidiary by submitting false invoices and embezzling the funds with a dishonest intent to deceive the bank,” he said.
The Central Bureau of Investigation had investigated the case and brought charges against one of the bank’s officials.
The bank, however, refused to grant sanctions for prosecution of its employee, according to the report.
During the examination of the cases received for opinion, the commission stated that it had found serious and important irregularities and shortcomings.
These range from a failure on the part of the disciplinary authority to follow established procedures for consulting the CVC and/or the Department of Personnel and Training in the event of disagreement, to delays in seeking advice and disregard or ignorance of the rules and regulations in conducting disciplinary proceedings, he added.