WA/3047/2023 of THE MANAGING DIRECTOR Vs N. Bhagavathsingh on 1 September 2026

J U D G M E N T

(Judgment of the Court was made by S.M.Subramaniam, J.) The Tamil Nadu Water Supply and Drainage Board is the appellant before this Court. The respondent filed a writ petition challenging the order of recovery passed based on the audit objections to recover the financial loss occurred to the Board on account of missing materials. The writ court allowed the writ petition applying the ratio laid down in the case of State of Punjab Vs. Rafiq Masih (White Washer) reported in (2015) 4 SCC 334.

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2. The learned Senior Counsel Mr.S.Ravindran, appearing on behalf of the appellants, would mainly contend that the said judgment cannot be applied to the present case, as this is not a case of recovery arising out of wrong fixation of pay or excess payment of salary. Thus, the application of the judgment cited supra by the Writ Court is incorrect. He would further contend that, during audit verification, the authorities found that certain materials in the Depot were missing and objections were raised. Since the said objections were not ratified, an order of recovery was issued to recover the financial loss caused to the Board. Thus, there is no infirmity in recovering the financial loss in such circumstances and no enquiry need to be conducted.

3. Mr.A.Edwin Prabakar, learned counsel appearing on behalf of the respondent would oppose by stating that the alleged missing of materials, even as per the impugned order, took place in the year 1988. The respondent, who was holding the post of Assistant Executive Engineer, retired from service on 31.12.2012. The recovery order was passed one year after the retirement, without conducting any enquiry and therefore, the order impugned cannot be sustained.

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4. This Court is of the considered view that applying the ratio laid down by the Hon’ble Supreme Court in the case of State of Punjab Vs. Rafiq Masih (White Washer) reported in (2015) 4 SCC 334 may not be relevant in respect of the facts in the present case. However, the facts would show that the alleged missing materials were found from the year 1988 onwards. However, audit objection was raised at a later point of time. Meanwhile, the respondent was allowed to retire from service on 31.12.2012 without prejudice to the actions initiated based on the audit objections. Further, show cause notice was issued in the year 2015. Thereafter, the recovery order was passed. The determination of financial loss is not assessed in the manner known to law. Dispensing with the enquiry would cause prejudice to the interest of the respondent, who was holding the post of Assistant Executive Engineer.

5. No doubt, financial loss caused directly on account of missing materials may be recovered from the Officer, who was in-charge of the Depot or in-charge of the materials concerned. In such circumstances, show cause notice would be sufficient calling explanation, based on which, an order of recovery may be issued. However, in certain cases where the material losses cannot be determined due to the

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complex nature of the facts and efflux of time, then enquiry need not be dispensed with, since, in the absence of an enquiry, it would not be possible to fix responsibility on the officials concerned. In normal cases, where financial losses are identified, such losses are recovered proportionately from the officials who are all responsible for the missing materials.

6. In the present case, missing materials were not identified from the year 1988 and till the date of retirement of the respondent, no order of recovery was passed. After three years from the date of retirement, show cause notice was issued. One cannot expect that an officer, after three years from the date of his/her retirement, will be in a position to give an effective explanation, defending his/her case in respect of missing materials of the Board from the year 1988 onwards. In such circumstances, enquiry has to be conducted to ascertain the correct facts and to fix responsibility, which was not done in the present case. Therefore, though the writ Court arrived at the right conclusion, application of law and the judgment cited supra, are incorrect.

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7. In view of the facts and circumstances, the decision of the writ court setting aside the impugned order of recovery is confirmed. Consequently, the writ appeal stands dismissed. No costs. Consequently, connected civil miscellaneous petition is closed. [S.M.S., J.] [K.G.R., J.]

01.09.2026 Index : Yes Speaking Order : Yes Neutral Citation : Yes / No TK To

1. The Managing Director Tamil Nadu Water Supply and Drainage Board No.31, Kamarajar Salai, Chepauk, Chennai – 600 005.

2. The Executive Engineer Rural Water Supply Division Ganesh Nagar, Near Law College Hostel, Near Mattuthavani Bus Terminal, Madurai – 625 007.

3. The Executive Engineer Project Division No.2/2, ASS Soundarapandian Road, Virudhunagar – 626 001.

4. The Executive Engineer Rural Water Supply Ex-Servicemen Building, Collectorate Complex, Ramnad – 623 503.

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S.M.SUBRAMANIAM, J. AND KRISHNASWAMY GOVINDARAJAN, J. TK

W.A.NO.3047 OF 2023 01.09.2026

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