HC expounds: MD and CEO of Company is Competent Authority for initiation of Disciplinary Action against any officer for ‘minor penalties’ (Read Judgement)

Section 178 of the Companies Act, 2013 has no role to play with respect to the initiation of the disciplinary proceedings.”


The Delhi High Court was dealing with a Writ Petition filed by a Senior employee of Public limited company, claiming to be victimized by higher officials for raising voice against corrupt practices.

The facts of the case were that the petitioner, who is an officer of President level and senior most permanent employee of the company, Petronet LNG Limited, was the victim of highhandedness of corrupt officers present within the company. Since the petitioner was a whistle blower against the corruption and made various financial corruption charges against the respondent no.6, he being in the commanding position victimized the petitioner so that the petitioner be kept silence against the corruption.

The Petronet LNG Limited is a joint venture company formed by the Government of India to import LNG and set up LNG terminals.

Respondent no.6 issued a charge-sheet to the petitioner without any preliminary Inquiry. No Assisting Officer was allowed to defend the petitioner before the Inquiry Committee and the Inquiry Committee proceeded ex-parte and concluded the Inquiry against the petitioner by recording findings that all the three charges as levelled in the charge-sheet dated are proved.

The case of the petitioner was that the entire disciplinary proceedings are unconstitutional, void, wrong and against the principles of natural Justice and in contravention of provision of Article 311 of the Constitution of India.

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