Section 138 proceedings arising from private borrowing did not justify the disciplinary charge memo.

The petitioner, a middle-school Headmaster, allegedly borrowed ₹8,00,000 from a private individual and issued a cheque that was dishonoured for insufficiency of funds.

A prosecution under Section 138 of the Negotiable Instruments Act, 1881, followed.

The first respondent issued a charge memo under Rule 17(b) of the Tamil Nadu Civil Services (Discipline and Appeal) Rules, alleging violations of Rule 64-A(1) and Rule 21 of the Tamil Nadu Government Servants’ Conduct Rules, 1973, on the ground that the petitioner had borrowed the money without informing the Department and was involved in the proceedings.

The petitioner sought certiorari to quash the charge memo dated 10 March 2025.

Whether the charge memo issued against the petitioner on the basis of his borrowing and the related Section 138 proceedings should be quashed

Whether the Court should follow its earlier decision quashing a similar charge memo arising from a Section 138 matter

Rule 17(b) of the Tamil Nadu Civil Services (Discipline and Appeal) Rules provides the disciplinary procedure invoked against the petitioner; the alleged misconduct was framed as a breach of Rule 64-A(1) and Rule 21 of the Tamil Nadu Government Servants’ Conduct Rules, 1973.

In Kaushalya Devi Massand v. Roopkishore Khore, (2011) 4 SCC 593, the Supreme Court observed that an offence under Section 138 of the Negotiable Instruments Act is, in substance, almost a civil wrong given criminal overtones and is not equivalent in gravity to offences under the Penal Code or other criminal offences.

The Court also relied on its prior decision in W.P.(MD) No.22823 of 2024, which followed earlier decisions quashing similar charge memos in Section 138-related matters.

The Court treated the present matter as materially similar to W.P.(MD) No.22823 of 2024, in which a similar charge memo had been quashed.

That decision, in turn, relied on the characterisation of Section 138 proceedings as arising from a commercial transaction and on prior rulings concerning disciplinary action based on such proceedings.

Finding no reason to depart from that approach, the Court followed the earlier decision and quashed the impugned charge memo.

No costs were ordered, and the connected miscellaneous petition was closed.