Chapter 1 - Vigilance SetUp
1.1 Role of Vigilance in Banks
Risk taking is an integral part of the business of banking. The purpose of vigilance activity in Public Sector Banks (PSBs) is not to stifle such ability or obstruct the achievement of organizational goals and objectives but to enhance the managerial effectiveness, both at micro as well as at the macro levels. Considering the special needs of Banking and in order to address the problems faced in the day to day functioning, the special chapter on vigilance management for Public Sector Banks has been prepared and rules clearly defined by the Central Vigilance Commission.
1.2 Central Vigilance Commission-Role and Functions
The monitoring of the vigilance activities, implementation of the anti-corruption measures in the Public sector, maintenance of purity, integrity and probity in the public sector viz, Public Sector Undertakings, Central Government Departments, Ministries and Public Sector Banks is done by the Government through Central Vigilance Commission. It acts as the apex body for exercising general superintendence and control over the vigilance matters in administration. The Commission exercises a general check and supervision over vigilance cases and anti corruption work in the organizations within its jurisdiction
The Commission was set up in 1964 on the recommendations of the Sanathanam Committee i.e., Committee on Prevention of Corruption. The functions of the commission are advisory in nature. The Commission has been converted into a statutory body w.e.f 25.8.1998 through the CVC Ordinance. Presently the Commission has its status based on an executive order dated 4.4.1999.
1.3 Jurisdiction & cut off level
The Commissions jurisdiction is co-terminus with the executive powers of the Union. It can undertake any inquiry into any transaction in which a public servant is suspected or alleged to have acted for an improper or corrupt purpose; or cause such an inquiry or investigation to be made into any complaint of corruption, gross negligence, misconduct, recklessness, lack of integrity or other kinds of mal-practices or misdemeanours on the part of a public servant. The Commission tenders appropriate advice to the concerned Disciplinary Authority in all such matters.
For practical considerations, the Commission has restricted its jurisdiction to the officers of the rank of scale III and above in the public sector banks. However, in composite cases involving officials who fall in the Commissions jurisdiction along with others who do not, the case as a whole has to be referred to the Commission for its advice. Such composite references enable the Commission to take an overall view of the individual accountabilities in the transaction.
Where a reference has been made to the Commission in respect of officers not within the jurisdiction of the Commission and award staff by virtue of it being a composite case, it will be not necessary to approach the Commission for second stage advice in respect of such officials provided the Commissions advice has been accepted by the Banks.
The officials working/recruited directly in the Banks subsidiaries are also covered under the Vigilance setup of the parent Bank.
1.4 Consultation mechanism
Cases of officials of the rank of scale III and above, as well as of others who do not fall within the CVCs jurisdiction but by virtue of being involved in a composite case as mentioned in para 1.3 above are required to be referred to the commission. All references to Central Vigilance Commission by the Bank shall be through the CVO/Vigilance Cell.
1.4.1 First stage reference
The Disciplinary Authority on considering the investigation report decides on the basis of the facts disclosed in the preliminary enquiry, whether the complaint should be dropped or warning/caution administrated or regular departmental proceedings launched for minor or major penalty as the case may be. The decision of DA at this juncture is considered to be Tentative and complete records of the case along with Tentative Decision of the DA is required to be referred to CVC for officials within its jurisdiction. The Commission will examine the matter and tender its first stage advice which is considered by the DA before proceeding further.
1.4.2 Second stage reference
On conclusion of the Enquiry proceedings and before passing any final order, the DA is required to consult CVC for its Second Stage Advice along with complete case records. CVC will examine the case records, including the Enquiry Report and tender its Second Stage Advice which is required to be considered by the DA before passing final orders.
1.4.3 Other references
Advice of CVC is also required to be obtained when the Commission has referred a particular matter to the Bank.
1.4.4 Reference to CVC for Reconsideration
If the Disciplinary Authority (DA), in a case, does not propose to accept the Commissions advice, the case may be referred back to the Commission, with prior approval of the Chairman & Managing Director. The Commissions advice is necessary regardless of whether the disciplinary authority proposes to take severer or lighter action than that recommended by the Commission, Decisions taken in a manner, other than that mentioned above are treated as cases of non-acceptance of the Commissions advice and reported in the Commissions annual report which is presented to the Parliament. As a rule, the Commission entertains only one request for reconsideration which is to be referred to the Commission within one month of receipt of first stage advice and two months receipt of CVCs second stage advice.
1.4.5 Disagreement with the CVC
When the DA decides to disagree with the advice of the Commission in any particular case, the matter is required to be placed to the CMD with whose approval, the CVC is to be advised giving the reasons for disagreement.
1.4.6 Vigilance Set-up in the Bank
The primary responsibility for maintenance of purity, integrity and efficiency in an organization vests with the Chief Executive. The Chief Vigilance Officer extends assistance in all matters pertaining to vigilance and provides a link between the Bank and the CVC.
The Vigilance set-up of the Bank is headed by the Chief Vigilance Officer (CVO).
Hitherto, the Vigilance Cell of the Bank has been functioning from the Vigilance Cell at Head Office. The Bank has now decided to set up Zonal Vigilance Units under the Chief Vigilance Officer to accelerate the disposal of Complaints and Vigilance cases.
As per the revised system approved henceforth, all cases where vigilance angle is perceived is required to be referred to the CVO for its first & second stage advice. CVO is the final authority in deciding the of Vigilance angle in any particular case.
2. Role & functions of Chief Vigilance Officer
The role of Chief Vigilance Officer can broadly be divided into two parts:
The primary role of the Chief Vigilance Officers is to assist the Management of the Bank in formulation, implementation and review of Banks policy on all vigilance matters. The Chief Vigilance Officer also acts as a link between the Bank and the Central Vigilance Commission and other outside agencies like Central Bureau of Investigation, Ministry of Finance and the Reserve Bank of India in so far as vigilance activities are concerned.
Chief Vigilance Officer also has its role in location of sensitive spots and regular and surprise inspection of such spots along with proper scrutiny of personnel who are posted to such places. He is also to examine the desirability or otherwise of continuing or transferring employees posted thereat and ensure that those officials whose integrity is beyond doubt are posted at such places. Chief Vigilance Officer is also to draw up and maintain the Agreed List and List of Officers of Doubtful Integrity for keeping proper surveillance over the officials whose integrity is doubtful.
It is the responsibility of the Chief Vigilance Officer to see that the Banks comments on CBIs final report are sent within the prescribed period to CBI. With regard to complaints which are looked into departmentally, Chief Vigilance Officer is to ensure that the investigations are completed promptly and within the prescribed time limits of CVC. Chief Vigilance Officer is also to ensure that in respect of a complaint, where a report is required to be submitted to the Ministry or CVC, the same is sent expeditiously.
Vigilance clearance within the Bank is also sought from the C.V.O and while considering the names of top executives of the Bank for Board level appointments as well as for the posts of Chief Vigilance Officers, vigilance clearance from the C.V.O is sought. C.V.O. is also authorised to decide upon the existence of vigilance angle in any particular case. Hence all cases are required to be sent to Chief Vigilance Officer for its advice.
Although the discretion to place a government servant under suspension when a disciplinary proceedings against him is either pending or is contemplated is of the DA, the Chief Vigilance Officer is expected to assist the DA in the proper exercise of this discretion. The C.V.O is also expected to ensure that in all cases where an official has remained under suspension for more than six months, the case is reviewed with a view to see whether the suspension could be revoked or whether there is a case for either increasing or decreasing the subsistence allowance.
The Chief Vigilance Officer also has the responsibility that the rules with regard to disciplinary proceedings are followed scrupulously. He is also to ensure that the vigilance cases are disposed of within the time schedule prescribed by CVC. He is also expected to look into causes of delay in disposal and suggest corrective steps.