Gujarat High Court
Divisional Controller vs Mohanbhai Lakhabhai Makwana on 13 September, 2024
NEUTRAL CITATION
C/SCA/11540/2015 JUDGMENT DATED: 13/09/2024
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 11540 of 2015
With
R/SPECIAL CIVIL APPLICATION NO. 56 of 2017
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE HEMANT M. PRACHCHHAK
=======================================
1 Whether Reporters of Local Papers may be Yes
allowed to see the judgment ?
2 To be referred to the Reporter or not ? Yes
3 Whether their Lordships wish to see the fair No
copy of the judgment ?
4 Whether this case involves a substantial No
question of law as to the interpretation of the
Constitution of India or any order made
thereunder ?
=======================================
DIVISIONAL CONTROLLER
Versus
MOHANBHAI LAKHABHAI MAKWANA & ANR.
=======================================
Appearance:
MR HARDIK C RAWAL(719) for the Petitioner(s) No. 1
HCLS COMMITTEE(4998) for the Respondent(s) No. 1
MR VB KUNDAN SINGH(3021) for the Respondent(s) No. 1
RULE SERVED for the Respondent(s) No. 2
=======================================
CORAM:HONOURABLE MR. JUSTICE HEMANT M.
PRACHCHHAK
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Date : 13/09/2024
ORAL JUDGMENT
1. Special Civil Application No. 11540 of 2015 is filed by the
petitioner – employer under Articles 226 and 227 of the
Constitution of India with the following years:-
“(A) be pleased to allow this petition.
(B) be pleased to issue a writ of certiorari or any other
appropriate writ, order or direction by quashing and setting
aside the impugned judgment / order / award dated 17-7-
2014 passed by the Labour Court, Surendranagar in
Reference (I.T.) No. 7 of 2011 and also be pleased to quash
and set aside order dated 3-12-2013 on exhibit 63 passed
by the Labour Court, Surendranagar.
(C) pending admission, hearing and final disposal of this
petition, be pleased to stay the operation, implementation,
execution and enforcement of the impugned order dated
17-7-2014 passed by the Labour Court, Surendranagar in
Reference (I.T.) No. 7 of 2011 and also be pleased to quash
and set aside order dated 3-12-2013 on exhibit 63 passed
by the Labour Court, Surendranagar.
(D) be pleased to pass such other and further orders may
be deemed just and proper looking to the facts and
circumstances of the case and in the interest of justice.”
2. Special Civil Application No. 56 of 2017 is filed by the
petitioner – workman under Articles 226 and 227 of the
Constitution of India with the following years:-
“(A) Pleased to allow this petition.
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(B) Pleased to issue a writ of certiorari or any other
appropriate writ order or direction by enhancing or
modified the back wages from 25 percent to 100 percent in
award dated 17-07-2014 passed by the Labour Court,
Surendranagar in Reference (I.T.) No. 7 of 2011.
(C) Pleased to direct the respondent no.1 to make the
payment of back wages within two weeks from the date of
the order of this Hon’ble Court.
(D) Pleased to pass such other and further orders
deemed just and proper in favour of the petitioner looking
to the facts and circumstances of the case in the interest
of justice.”
2. For the sake of brevity and convenience, the parties are
referred to as “employer” and “workman”.
3. Since both the petitions are filed against the same award
and Special Civil Application No.56 of 2017 has been ordered to
be placed with Special Civil Application No.11540 of 2015, the
facts of Special Civil Application No.11540 of 2015 are
considered as a lead matter and both the petitions are being
disposed of by this common judgment.
4. Facts of the present case are that the workman was
working as a conductor in Godhra Division in 1994 and when the
bus was on the route from Dhangdhra to Tikar and the same was
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reached near the Village : Amarapur, it was intercepted by the
checking squad and it was found that seven passengers were
travelling from Halwad to Amarapur without tickets though the
fair was collected to the tune of Rs.12.25. For the alleged
misconduct, a charge-sheet was issued and the departmental
inquiry was conducted against the workman. On 15.07.1995, the
workman was served with the office order No.51/95, D.Case No.
277 / 94 imposing imposed punishment upon him and he
removed from the services. Though the workman had worked for
a period of 12 years, by way of aforesaid punishment order, he
was dismissed from the services. The workman has challenged
the said order by filing Reference before the Labour Court,
Surendranagar and the final order came to be passed below
Exhibit 76 whereby the Labour Court has partly allowed the
reference and ordered to reinstate the workman in service with
25% back wages from 17.02.1998 till the date of the age of
superannuation of the workman and all the consequential
benefits were also to be extended to the workman. That
originally, the Reference was filed before the Labour Court,
Godhra and on filing of the application on 18.01.2011, the
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Reference came to be transferred from Labour Court, Godhra to
Labour Court, Surendranagar vide communication No.1450 dated
27.04.2011 and thereafter, the Labour Court, Surendranagar
decided the reference.
5. The Labour Court has considered the oral as well as
documentary evidence on record and ultimately passed, the
impugned award.
6. Heard Mr.Hardik Rawal, learned counsel appearing for the
employer and Mr.V. B. Kundan Singh, learned counsel appearing
for the workman at length.
7. Mr.Hardik Rawal, learned counsel appearing for the
employer has submitted the same facts which are narrated in the
memo of petition and has submitted that the workman was
appointed as a daily wager in 1990 and, thereafter, his service
came to be confirmed, so prior thereto, he was appointed. He
has submitted that after confirmation, he was posted on regular
post as conductor and on 02.08.1994, the workman was on duty
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from Dhrangdhra to Tikar route and while the bus reached near
the Village: Amarapara, it was intercepted by the checking squad
and seven passengers were found without tickets though the fair
was collected by the workman to the tune of Rs.12.25 each. He
has submitted that for the alleged misconduct, the charge-sheet
came to be issued against the workman and the departmental
inquiry was conducted and after full-fledged inquiry, the
Disciplinary Authority passed an order and dismissed the
workman from the service, for which the workman has raised the
dispute in 1998 by filing reference before the Labour Court,
Godhra, which came to be transferred to the Labour Court,
Surendranagar. He has submitted that during the pendency of
the said Reference, the Labour Court has passed an order on
03.12.2013 below Exhibit 63 holding that the departmental
inquiry initiated against the workman was perverse and illegal.
He has submitted that the final award was passed by the Labour
Court, which is unjust, illegal and against the facts of the present
case. He has submitted that after confirmation of the service of
the workman, within seven years, though the 30 offences were
registered against the workman, he faced the punishment
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imposed for the alleged offences which were mentioned in the
default card and also in the service book produced before the
Labour Court, however, the Labour Court has ignored the said
default mentioned in the service book and has discarded the
relevant material evidence adduced by the employer on very
flimsy ground and, therefore, the finding recorded by the Labour
Court is unjust and illegal and not sustainable in the eyes of law.
He has submitted that the employer has produced relevant
documentary evidence i.e. copy of the service book, copy of the
default card etc., but the Labour Court has completely
overlooked and ignored the same and impugned award came to
be passed. Mr.Rawal, learned counsel has submitted that the
workman has initially challenged the order passed by the
Conciliation Officer before the Civil Court at Khambhalia by filing
Regular Civil Suit No. 48 of 1995 whereby the Civil Court stayed
the order of dismissal of the workman upto 09.08.1995 and the
same was continued on 31.03.1997. He has submitted that
against the order passed by the Civil Court, the employer has
preferred Civil Appeal No. 67 of 1997 before the District Court,
Surendranagar whereby the District Court vacated the interim
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relief granted by the Civil Court vide order dated 16.02.1998
and, thereafter, the suit came to be dismissed. He has submitted
that thereafter, the workman had preferred Reference before the
Labour Court and so the workman has with a view to misguiding,
filed different proceedings before the different Courts
challenging the impugned action of the dismissal. Mr.Rawal,
learned counsel has pressed into service of the decisions of the
Hon’ble Supreme Court and urged that the impugned award
passed by the Labour Court is erroneous and illegal. He has
submitted that though the Conciliation Officer, Godhra has, while
allowing the approval application, approved the dismissal order
and without considering the said facts, the Labour Court,
Surendranagar has held the inquiry as perverse and the order of
dismissal was passed by the Disciplinary Authority is held illegal.
He has submitted that once the approval allowed granted by the
Conciliation Officer, the Labour Court ought to have interfered
with the order of punishment imposed upon the workman.
Mr.Rawal, learned counsel has urged to allow the petition filed by
the employer and to dismiss the petition filed by the workman.
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8. Per contra, Mr.V. B. Kundan Singh, learned counsel has
submitted that the Labour Court has rightly passed the
impugned award holding the disciplinary proceedings as
perverse and held the inquiry proceedings as illegal after
considering the submissions and the record produced before the
Labour Court. He has submitted that relying upon such facts,
order of dismissal was quashed by the Labour Court and order of
reinstatement with 25% back wages was passed which is just
and proper and on the contrary, the workman has filed Special
Civil Application No.56 of 2017 challenging the impugned award
praying that instead of 25% back wages, the workman is entitled
for 100% back wages once the Court came to the conclusion that
the inquiry held to be illegal and perverse then the impugned
order of punishment passed by the Disciplinary Authority is also
required to be quashed and set aside. He has submitted that the
charge-sheet issued by the employer with regard to the alleged
incident of 02.08.1994, wherein it was alleged that while the
workman was on duty on the route from Dhrangadhra to Tikar,
the bus was intercepted by the checking squad at
Ghanshyampur Village where six passengers travelling from
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Khambhalia to Salaya, the amount of Rs.2.50 each was collected
by the workman but the tickets were not issued, however, the
unpanched tickets were recovered. He has submitted that on the
same route, Rs.1.25 collected from the two passengers i.e.
Rs.2.50, but not issued the tickets and for that, the charge-sheet
was issued for the alleged misconduct and at the time of
departmental inquiry, the employer has referred and relied upon
the past history and the records of the workman by the
Disciplinary Authority, while passing the order of dismissal order,
which fact is unjust, illegal and against the settled principles of
law since it was not the part of the charge-sheet and, therefore,
it cannot be referred to and relied upon by the Disciplinary
Authority during the course of the inquiry while passing the order
of punishment. He has submitted that the workman is under the
bona fide impression challenged the impugned order before the
Civil Court and, therefore, under such circumstances, it cannot
be said that the workman approached with Labour Court with a
delay of more than seven years as during the said period the
workman has already approached the Civil Court and filed the
suit.
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8.1 Mr.Singh, learned counsel has referred to and relied upon
the affidavit-in-reply filed on behalf of the workman. The para –
4 of the affidavit-in-reply reads as under:-
“4. The respondent submits that above stated period i.e.,
from the date of dismissal (14/15-7-1995) to
implementation order of dismissal (17-2-98) was consumed
in legal proceedings and as per sec. 14 of the Limitation Act
1963 such period is excluded therefore there is no such
delay in preferring Reference. All the records of
proceedings were before the Labour Court and petitioner
has not raised question of delay before that Court, for the
first time petitioner is raising such question deliberately
before this Hon’ble Court concealing the real facts of the
case hence petitioner’s contention is not maintainable the
eye of law. However, sec. 14 of the Limitation Act, 1963
reproduced hereinbelow for ready reference:
“14. Exclusion of time of proceeding bona fide in court
without jurisdiction.-
(1) In computing the period of limitation for any suit the
time during which the plaintiff has been prosecuting with
due diligence another civil proceeding, whether in a court
of first instance or of appeal or revision, against the
defendant shall be excluded, where the proceeding relates
to the same matter in issue and is prosecuted in good faith
in a court which, from defect of jurisdiction or other cause
of a like nature, is unable to entertain it.
(2) In computing the period of limitation for any application,
the time during which the applicant has been prosecuting
with due diligence another civil proceeding, whether in a
court of first instance or of appeal or revision, against the
same party for the same relief shall be excluded, where
such proceeding is prosecuted in good faith in a court
which, from defect of jurisdiction or other cause of a like
nature, is unable to entertain it.
(3) Notwithstanding anything contained in rule 2 of Order
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XXIII of the Code of Civil Procedure, 1908 (5 of 1908), the
provisions of sub-section (1) shall apply in relation to a
fresh suit instituted on permission granted by the court
under rule 1 of that order, where such permission is
granted on the ground that the first suit must fail by reason
of a defect in the jurisdiction of the court or other cause of
a like nature.
Explanation: For the purposes of this section-
(a) in excluding the time during which a former civil
proceeding was pending, the day on which that proceeding
was instituted and the day on which it ended shall both be
counted;
(b) a plaintiff or an applicant resisting an appeal shall be
deemed to be prosecuting a proceeding;
(c) misjoinder of parties or of causes of action shall be
deemed to be a cause of a like nature with defect of
jurisdiction.”
8.2 Mr.Singh, learned counsel has submitted that the petition
filed by the employer being meritless deserves to be dismissed
and the petition filed by the workman deserves to be allowed.
8.3 In support of his submissions, Mr.Singh, learned counsel
has relied upon the following decisions:-
(1) Dineshbhai Dhudabhai Patel rendered in Special Civil
Application No. 11518 of 2020 dated 07.02.2022 by
this Court (Coram: Hon’ble Mr. Justice Biren
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Vaishnav);
(2) State of Uttarakhand and others Vs. Smt. Sureshwati
rendered in Civil Appeal No. 142 of 2021 dated
20.01.2021 by the Hon’ble Supreme Court;
(3) Kuldeep Singh Vs. The Commissioner of Police and
others reported in (1999) 2 SCC 10;
(4) Basistha Muni Mishra Vs. Union of India and others
rendered in WRIT (C) No. 57858 of 2016 dated
15.05.2023 by the High Court of Allahabad;
(5) Sandeep Kumar Vs. GB Pant Institute of Engineering
and Technology Ghurdauri and others rendered in
Civil Appeal Nos. 004989 – 004990 / 2024 dated
16.04.2024 by the Hon’ble Supreme Court;
9. Mr.Rawal, learned counsel has referred to and relied upon
the affidavit-in-rejoinder. The relevant paragraphs of the
rejoinder reads as under:-
“I say and submit that in pursuance to the impugned award
dated 17-7-2014 (which was published on 1-10-2014), a
legal opinion was sent by the panel advocate appearing
before the Labour Court, Surendranagar. As per the same
the Learned Advocate Mr. S.J. Mehta has opined that an
appeal / petition should be filed. Relying upon the same thePage 13 of 46
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Divisional Controller, Godhra by its letter no.
DC/Godhra/Court/32 dated 25-3-2015 submitted the details
and concurred with the opinion of the Learned Advocate.
Based upon the same a detailed note was prepared by the
Labour Officer on 27-3-2015. The Labour Officer relying
upon the opinion of the Learned Advocate as well as the
Divisional Controller, the financial burden of Rs. 3,73,632/-,
the misconduct of collecting fare and not issuing tickets to
seven passengers and past 30 defaults opined for the filing
of appeal on 27-3-2015. The file was thereafter sent to the
Chief Labour Officer and as per the note after considering
the aforesaid details, financial burden and past 30 defaults,
the Chief Labour Officer opined for filing of appeal before
this Hon’ble Court on 27- 3-2015. The file was thereafter
sent to the legal department and the legal advisor
concurred with the same on 30-3-2015 after going through
the earlier notes, judgment and the reasons thereof. The
file was thereafter sent to the Executive Director (Vigilance)
who ordered filing of appeal on 31-3-2015. I crave leave of
this Hon’ble Court to refer the entire form and the file at
the time of hearing of this petition. I say and submit that on
preliminary inquiry of the record / affidavit in reply certain
lacuna / negligence / defects have been found and I assure
that corrective as well as disciplinary actions will be taken.
In light of above facts the petitioner may be permitted to
bring following facts to the notice of this Hon’ble Court.
A. In pursuance to the misconduct of not issuing tickets
after collecting fare a charge sheet dated 12-8-1994 was
issued by the competent authority, Rajkot.
B. The workman replied to the charge sheet on 26-8-
1994 and also remained present on 17-10-1994 along with
Shri Juvansinh Barad (who was permitted to be the
representative of the workman). The reporter of the case
Mr. I.K. Vyas was cross examined by the representative of
the workman and after holding of the inquiry a show cause
notice was issued along with the findings to the workman.
C. In pursuance to the aforesaid show cause notice
dated 7- 11-1994 the respondent workman preferred
Regular Civil Suit No. 3028 of 1994 before the Court of Civil
Judge (S.D.) at Rajkot and the Learned Judge was pleased
to stay further disciplinary action against the respondent
for 15 days (unfortunately the said fact was not brought to
the notice of the officers of the Central Office at the time of
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Court). Thereafter dismissal order dated 14/15-7-1995 was
passed by the Divisional Traffic Officer (Competent
Authority), Godhra and an approval application was also
filed before the Conciliation Officer, Godhra on the same
date and one months notice pay was paid. The Conciliation
Officer, Godhra by order dated 1-9-1995 granted approval
to the order of dismissal by holding that the principles of
natural justice are complied with and after hearing the
workman the order is passed. The respondent workman
again filed Regular Civil Suit No. 48 of 1995 before the
Court of the Learned Civil Judge (J.D.) at Khambalia and by
order dated 29-7-1995 the order was dismissal was stayed
upto 9-8-1995 which was confirmed on 31-3-1997. The
petitioner filed appeal No. 67 of 1997 before the District
Court, Jamnagar and by order dated 16-2-1998 the Learned
District Judge was pleased to vacate the stay granted by
the Trial Court. It is indeed a matter of regret and
misfortune that the aforesaid facts were not brought to the
notice of the officers taking decision for filing appeal before
this Hon’ble Court. I say and submit that a strict view of the
same shall be taken after collecting / receiving all the
documents from the Rajkot Division / the concerned District
Court / Trial Court. The Reference was thereafter
transferred from Labour Court, Godhra to Labour Court,
Surendranagar in which the workman challenged the
departmental inquiry and requested that the same may be
decided as preliminary issue. Before the Labour Court
charge sheet, report of the reporter, statement of the
passengers and show cause notice were produced but the
papers regarding inquiry were not produced. As the Xerox
copies of the above mentioned documents were produced
the Learned Judge on several reasons held the inquiry to be
unjust and against the principles of natural justice by order
dated 03-12-2013 and kept the matter for further hearing
on 26-12-2013 for leading evidence. After 26-12-2013 a
copy of service book was produced on record by the
petitioner to prove the past misconducts as well as the
holding of inquiry. The Learned Judge of the Labour Court
was pleased to pass the impugned judgment and award
dated 17-2-2014 and was pleased to direct payment of 25%
of backwages from 17-2-1998 till the date of retirement
(31-3-2013) and also the retirement benefits. I say and
submit that by virtue of three separate legal proceedings
before the Civil Court and approval application proceedings
before the Conciliation Officer there is a probability of
production of inquiry papers before the concerned Court /
Authority. I say and submit that all efforts shall be made toPage 15 of 46
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trace out / receiving the record from Rajkot Division or Civil
Courts and the same shall be produced before this Hon’ble
Court.”
9.1 Mr.Rawal, learned counsel has submitted that during the
pendency of the proceedings, the workman has already reached
to the age of superannuation and he was paid retiral benefits. It
is also submitted that against the employer, many proceedings
were filed by the workmen before the different Courts and,
therefore, the employer is unable to get complete and proper
details and, therefore, it has missed that even the workman has
filed Regular Civil Suit No. 302 of 1994 before the Civil Court,
Rajkot on the basis of the charge-sheet and the show-cause
notice issued on the basis of the checking made on 02.08.1994
wherein the Civil Court, Rajkot has granted stay for a period of
15 days and since it was not within the knowledge of the
employer, it has passed the order of dismissal on 14/15.07.1995
and on the basis thereof, the employer moved an application
before the Conciliation Officer, Godhra for approval and the
authority allowed the application for approval and unfortunately
such fact was not brought in the original petition before the
Court and thereafter by way of subsequent event, the said fact
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was brought to the notice of the concerned Court. He has
submitted that so far as the prayer with regard to enhancement
of the back wages from 25% to 100% from the date of award till
the date of superannuation is concerned, the Labour Court has
rightly exercised the jurisdiction vested with it and, therefore, no
any infirmity or illegality committed by the Labour Court.
10. I have considered the submissions made on behalf of the
learned counsel appearing for both the sides and the documents
and the decisions cited at the Bar. I have also perused the
impugned award passed by the Labour Court and the orders by
the concerned authorities. It reveals from the material on record
that though there are serious charges levelled against the
workman, the Labour Court, after considering the facts and
default card, ought to have considered the fact that it is now well
settled and there is series of the decisions of the Hon’ble
Supreme Court that if there is default or allegation of
misappropriation or pilferage by the conductor, though he has
collected the fairs and not issued the tickets, the same is viewed
seriously. It is not material that the charge is for the lessor
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amount or the higher amount. The act of pilferage is required to
be seen and harsh action is required to be taken into
consideration.
11. It is worthwhile to refer to the decisions of the Hon’ble
Supreme Court in the case of Uttar Pradesh State Road
Transport Corporation Vs. Vinod Kumar reported in (2008)
1 SCC 115 wherein the Hon’ble Supreme Court has held in para
– 10 as under:-
“10. As stated in the preceding paragraphs, the
respondent had confined his case only to the conclusions
reached by the Enquiry Officer as well as the quantum of
punishment. Therefore, since the respondent had not
challenged the correctness, legality or validity of the
enquiry conducted, it was not open to the Labour Court to
go into the findings recorded by the Enquiry Officer
regarding the misconduct committed by the respondent.
This Court in a number of judgments has held that the
punishment of removal/dismissal is the appropriate
punishment for an employee found guilty of
misappropriation of funds; and the Courts should be
reluctant to reduce the punishment on misplaced
sympathy for a workman. That, there is nothing wrong in
the employer losing confidence or faith in such an
employee and awarding punishment of dismissal. That, in
such cases, there is no place for generosity or misplaced
sympathy on the part of the judicial forums and interfering
with the quantum of punishment. Without burdening the
judgment with all the judgments of this Court on this point,
we may only refer to a recent judgment in Divisional
Controller, N.E.K.R.T.C. V/s. H. Amaresh, 2006 6 SCC 187,
wherein this Court, after taking into account the earlier
decisions, held in para 18 as under:-
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“In the instant case, the mis-appropriation of the funds by
the delinquent employee was only Rs. 360.95. This Court
has considered the punishment that may be awarded to
the delinquent employees who mis-appropriated the funds
of the Corporation and the factors to be considered. This
Court in a catena of judgments held that the loss of
confidence is the primary factor and not the amount of
money mis-appropriated and that the sympathy or
generosity cannot be a factor which is impermissible in
law. When an employee is found guilty of pilferage or of
mis-appropriating the Corporation’s funds, there is nothing
wrong in the Corporation losing confidence or faith in such
an employee and awarding punishment of dismissal. In
such cases, there is no place for generosity or misplaced
sympathy on the part of the judicial forums and interfering
therefore with the quantum of punishment. The judgment
in Karnataka State Road Transport Corporation V/s. B.S.
Hullikatti, 2001 2 SCC 574 was also relied on in this
judgment among others. Examination of the passengers of
the vehicle from whom the said sum was collected was
also not essential. In our view, possession of the said
excess sum of money on the part of the respondent, a fact
proved, is itself a mis-conduct and hence the Labour Court
and the learned Judges of the High Court misdirected
themselves in insisting on the evidence of the passengers
which is wholly not essential. This apart, the respondent
did not have any explanation for having carried the said
excess amount. This omission was sufficient to hold him
guilty. This act was so grossly negligent that the
respondent was not fit to be retained as a conductor
because such action or inaction of his was bound to result
in financial loss to the appellant irrespective of the
quantum.” [Underlining is ours]
12. In the case of Ruston and Hornsby India Limited Vs.
T.B.Kadam reported in (1976) 3 SCC 71 wherein the Hon’ble
Supreme Court has held and observed in para – 7 and 8 as
under:-
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“7. Coming now to the other points in the case: the
decisions of this Court establish clearly that a workman is
dismissed as a result a domestic enquiry the only power
which the Labour Court has is to consider whether the
enquiry was not proper and if it was so no further question
arises. If the enquiry was not proper the employer and the
employee had to be given an opportunity to examine their
witnesses. It is not the duty of the Enquiry officer in this
case to seek permission of the police constable’s superiors.
It was the respondent’s duty to have him properly
summoned. He did not even apply to the Enquiry Officer
requesting him to seek the permission of the police
constable’s superiors. It is therefore wrong on the part of
the Labour Court to have held that the enquiry against the
respondent was not a proper enquiry. Once this conclusion
is reached there was no room for the summoning and
examination of the police constable by the Labour Court.
The question regarding the Jurisdiction exercised by an
Industrial Tribunal in respect of a domestic enquiry held by
the management against a worker has been elaborately
considered by this Court in its decision. in D. C. M. V/s.
Ludh Budh Singh, (1972 (3) SCR-29) and the principles that
emerge out of the earlier decisions of this Court have been
set out in that decision . The decision of this Court in
Workmen V/s. Firestone Tyre & Rubber Co. (1973) (3) SCR
587) also sets out the principles that emerge from the
earlier decisions. In Tata Oil Mills, Co. Ltd. V/s. Its Workmen
(1964) (7) SCR 555) it was argued that where the
employee is unable to lead his evidence before the
domestic Tribunal for no fault of his own, an opportunity
should be given to him to prove his case in proceedings
before the Industrial Tribunal. This Court held that this
contention was not well founded. It was pointed out that
the Enquiry Officer gave the employee, ample opportunity
to lead his evidence and the enquiry had been fair. It was
also pointed out that merely because the witnesses did not
appear to give evidence in support of the employee’s case
it could not be held that he should be allowed to lead such
evidence before the Industrial Tribunal and if such a plea
was to be upheld no domestic enquiry would be effective
and in every case the matter would have to be tried afresh
by the Industrial Tribunal. It was pointed out that findings
properly recorded at the enquiries fairly conducted were
binding on the parties, unless it was known that the said
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findings were perverse, or were not based on any
evidence. We are not able to agree with the Labour Court
in this case that the findings of the domestic enquiry are
either perverse or not based on any evidence.
8. We therefore come to the conclusion that there was
no failure on the part of the Enquiry Officer to give a
reasonable opportunity to the respondent workman, that
the enquiry was fair and the Labour Court had. therefore
no right to examine the witness on behalf of the workman
and based on that evidence to upset the finding arrived at
the domestic enquiry .We also hold that the punishment
imposed in the circumstances is one in which the Labour
Court cannot interfere. The result is that the appeal will
have to be allowed and the award ,of the Labour Court set
aside.”
13. In the case of Manojkumar M.Kishori Vs. Gujarat State
Road Transport Corporation reported in 2016 (2) CLR 753,
this Court has held and observed in para – 30, 31, 32 and 33 as
under:-
“30. It is also appropriate and relevant to refer and take
into account the observation by Hon’ble Apex Court in the
case of U.P.State Road Transport Corporation Vs. Suresh
Chand Sharma (Supra), where the Hon’ble Apex Court
observed that“13. The Labour Court recorded a finding of fact that in
respect of both the mis-conducts the passengers were
found travelling without tickets and they had already paid
fare to the employee/Conductor. Thus, it is not a case
where the said employee could not issue the ticket and
recover the fare from the travelling passengers, rather the
finding has been recorded that after recovering the fare
from the passengers, he did not issue tickets to them.
Thus, there was an intention to mis-appropriate the fare
recovered from the passengers who were found travellingPage 21 of 46
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without tickets at both the times.
14. The High Court dealt with the matter in a most cryptic
manner. Relevant/main part of the judgment of the High
Court reads as under:
“5…The Inspector in the cross-examination has also stated
on oath that the cash was not checked. The learned
counsel for the petitioner further submitted that when the
bus was checked, ten passengers were boarded on the bus
and they were drunk and they were also denying taking
the tickets. The learned Tribunal has not considered this
fact at all. I find force in the contention of the learned
counsel for the petitioner. The learned Tribunal ought to
have considered this fact that neither the passengers were
examined, nor the cash was checked. Therefore, the order
of the learned Tribunal cannot be sustained in the eye of
law.”
(Emphasis added)
15. The High Court has decided the Writ Petition only on
the ground that the passengers found without tickets, had
not been examined and the cash with the employee was
not checked. No other reasoning has been given
whatsoever by the Court.
16. In State of Haryana & Anr. Vs. Rattan Singh AIR 1977
SC 1512, this Court has categorically held that in a
domestic enquiry, complicated principles and procedure
laid down in the Code of Civil Procedure, 1908 and the
Indian Evidence Act, 1872 do not apply. The only right of a
delinquent employee is that he must be informed as to
what are the charges against him and he must be given
full opportunity to defend himself on the said charges.
However, the Court rejected the contention that enquiry
report stood vitiated for not recording the statement of the
passengers who were found travelling without ticket. The
Court held as under:
“5… We cannot hold that merely because statements of
passengers were not recorded the order that followed was
invalid. Likewise, the reevaluation of the evidence on the
strength of coconductor’s testimony is a matter not for the
court but for the administrative tribunal. In conclusion, we
do not think courts below were right in over-turning the
finding of the domestic tribunal.”
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17. In view of the above, the reasoning so given by the
High Court cannot be sustained in the eye of law. More so,
the High Court is under an obligation to give not only the
reasons but cogent reasons while reversing the findings of
fact recorded by a domestic tribunal. In case the judgment
and order of the High Court is found not duly supported by
reasons, the judgment itself stands vitiated. (Vide State of
Maharashtra Vs. Vithal Rao Pritirao Chawan, AIR 1982 SC
1215; State of U.P. Vs. Battan & Ors. (2001) 10 SCC 607);
Raj Kishore Jha Vs. State of Bihar & Ors. AIR 2003 SC 4664;
and State of Orissa Vs. Dhaniram Luhar AIR 2004 SC 1794.
18. In State of West Bengal Vs. Atul Krishna Shaw & Anr.
AIR 1990 SC 2205, this Court observed that (SCC P.421
P.7)
“7… Giving of reasons is an essential element of
administration of justice. A right to reason is, therefore, an
indispensable part of sound system of judicial review.”
In State of Uttaranchal & Anr. Vs. Sunil Kumar Singh Negi
AIR 2008 SC 2026, this Court held as under (SCC P. 208
para 11):
“11. ‘8 Right to reason is an indispensable part of a sound
judicial system; reasons at least sufficient to indicate an
application of mind to the matter before Court. Another
rationale is that the affected party can know why the
decision has gone against him. One of the salutary
requirements of natural justice is spelling out reasons for
the order made”.
19. In Raj Kishore Jha (supra), this Court observed as under
(SCC p.527 Para 19):
“19.Before we part with the case, we feel it necessary to
indicate that non-reasoned conclusions by appellate Courts
are not appropriate, more so, when views of the lower
Court are differed from. In case of concurrence, the need
to again repeat reasons may not be there. It is not so in
case of reversal. Reason is the heartbeat of every
conclusion. Without the same, it becomes lifeless”.
In fact:
“47….reasons are the links between the material, the
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foundation for these erection and the actual conclusions.
They would also administer how the mind of the maker was
activated and actuated and their rational nexus and
synthesis with the facts considered and the conclusion
reached”.
(Vide Krishna Swami V. Union of India SCC P.637 para 47)
20. Therefore, the law on the issue can be summarized to
the effect that, while deciding the case, court is under an
obligation to record reasons, however, brief, the same may
be as it is a requirement of principles of natural justice.
Non-observance of the said principle would vitiate the
judicial order. Thus, in view of the above, the judgment and
order of the High Court impugned herein is liable to be set
aside.
21. We do not find any force in the submissions made by
Dr. J.N. Dubey, learned Senior counsel for the employee
that for embezzlement of such a petty amount,
punishment of dismissal could not be justified for the
reason that it is not the amount embezzled by a delinquent
employee but the mens rea to misappropriate the public
money.
22. In Municipal Committee, Bahadurgarh Vs. Krishnan
Bihari & Ors., SCC P.715 Para 4, this Court held as under:-
“4 In a case of such nature – indeed, in cases involving
corruption – there cannot be any other punishment than
dismissal. Any sympathy shown in such cases is totally
uncalled for and opposed to public interest. The amount
misappropriated may be small or large; it is the act of
misappropriation that is relevant.”
Similar view has been reiterated by this Court in Ruston &
Hornsby (I) Ltd. Vs. T.B. Kadam, AIR 1975 SC 2025; U.P.
State Road Transport Corporation Vs. Basudeo Chaudhary
& Anr., (1997) 11 SCC 370; Janatha Bazar (South Kanara
Central Cooperative Wholesale Stores Ltd.) & Ors. Vs.
Secretary, Sahakari Noukarara Sangha & Ors., (2000) 7
SCC 517; Karnataka State Road Transport Corporation Vs.
B.S. Hullikatti, AIR 2001 SC 930; and Regional Manager,
R.S.R.T.C. Vs. Ghanshyam Sharma, (2002) 10 SCC 330.
23.In N.E.K.R.T.C. Vs. H. Amaresh, AIR 2006 SC 2730; and
U.P.S.R.T.C. Vs. Vinod Kumar, (2008) 1 SCC 115, this Court
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held that the punishment should always be proportionate
to the gravity of the misconduct. However, in a case of
corruption/misappropriation, the only punishment is
dismissal.”
31. In this background the situation, which emerges in
the present case is as under:
(a) Inquiry is found to be legal fair.
(b) The learned Labour Court has also found that findings
of the Inquiry Officer are just, correct and legal and they
are not perverse.
(c) The allegations against the petitioner are of
misappropriation of the amount/tickets fair inasmuch as
according to the charge-sheet, the petitioner received the
amount towards the ticket fair, but did not issue ticket to
four passengers. Such allegations/charge of
misappropriation is of serious and grave nature.
(d) Past record of the petitioner reflects total 16 defaults
out of which 12 defaults are in respect of the misconduct of
similar nature.
(e) The statements of two passengers recorded by the
squad bring out that the passengers mentioned in their
statements asserted that they had paid fair but tickets
were not issued.
(f) Besides other material and evidence, the clinching
evidence is the petitioner’s statement where the petitioner
himself admitted that he had received the amount, but not
issued tickets. In his statement, the petitioner also
accepted that the statements of the passengers were
recorded in his presence.
32. In view of the said details and facts, the petitioner’s
contention that since cash bag was not checked the
findings should be aside, cannot be sustained.
33. Now, so far as above charge is concerned, it is to be
noted that the learned Labour Court has taken into account
and discussed above mentioned aspect including past
service record of the petitioner, the statements of the
passengers and the learned Labour Court has also taken
into account the fact that the bus was checked after it had
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travelled for about 50 to 60 Kms. from Ahmedabad i.e.
starting destination and therefore, there was no
justification for not issuing tickets after receiving the
amount/fair. Having considered all aspects, the learned
Labour Court reached to the conclusion that the penalty
imposed by the Disciplinary Authority is just and proper
and commensurate with proved misconduct. The learned
Labour Court reached to the conclusion that there was no
justification to interfere with the order of the Authorities.
Consequently, the learned Labour Court dismissed the
Reference.”
14. In the case of U.P. State Road Transport Corporation
Vs. Suresh Chand Sharma reported in (2010) 6 SCC 555, the
Hon’ble Supreme Court has held and observed in para 14 to 20
and 23 and 24 as under:-
“14. The High Court dealt with the matter in a most cryptic
manner. Relevant/main part of the judgment of the High
court reads as under:
“5. . . . . The Inspector in the cross-examination has also
stated on oath that the cash was not checked. The learned
counsel for the petitioner further submitted that when the
bus was checked, ten passengers were boarded on the bus
and they were drunk and they were also denying taking
the tickets. The learned Tribunal has not considered this
fact at all. I find force in the contention of the learned
counsel for the petitioner. The learned Tribunal ought to
have considered this fact that neither the passengers were
examined, nor the cash was checked. Therefore, the order
of the learned Tribunal cannot be sustained in the eye of
law.”(Emphasis added)
15. The High Court has decided the Writ Petition only on
the ground that the passengers found without tickets, had
not been examined and the cash with the employee was
checked. No other reasoning has been given whatsoever
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by the Court.
16. In State of Haryana and Anr. Vs. Rattan Singh AIR 1977
sc 1512, this Court has categorically held that in a
domestic enquiry, complicated principles and procedure
laid down in the Code of Civil Procedure, 1908 and the
Indian Evidence act, 1872 do not apply. The only right of a
delinquent employee is that he must be informed as to
what are the charges against him and he must be given
full opportunity to defend himself on the said charges.
However, the Court rejected the contention that enquiry
report stood vitiated for not recording the statement of the
passengers who were found travelling without ticket. The
Court held as under:
“we cannot hold that merely because statements of
passengers were not recorded the order that followed was
invalid. Likewise, the re-evaluation of the evidence on the
strength of co-conductor’s testimony is a matter not for the
court but for the administrative tribunal. In conclusion, we
do not think courts below were right in over-turning the
finding of the domestic tribunal. ”
17. In view of the above, the reasoning so given by the
High court cannot be sustained in the eye of law. More so,
the High court is under an obligation to give not only the
reasons but cogent reasons while reversing the findings of
fact recorded by a domestic tribunal. In case the judgment
and order of the high Court is found not duly supported by
reasons, the judgment itself stands vitiated. (Vide State of
Maharashtra vs. Vithal Rao Pritirao Chawan, AIR 1982 SC
1215; State of u. P. Vs. Battan and Ors. (2001) 10 SCC
607); Raj Kishore Jha vs. State of Bihar and Ors. AIR 2003
SC 4664; and State of orissa Vs. Dhaniram Luhar AIR 2004
SC 1794.
18. In State of West Bengal Vs. Atul Krishna Shaw and Anr.
AIR 1990 SC 2205, this Court observed that “giving of
reasons is an essential element of administration of justice.
A right to reason is, therefore, an indispensable part of
sound system of judicial review. “
19. In State of Uttaranchal and Anr. Vs. Sunil Kumar Singh
negi AIR 2008 SC 2026, this Court held as under:
“right to reason is an indispensable part of a sound judicial
system; reasons at least sufficient to indicate anPage 27 of 46
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application of mind to the matter before Court. Another
rationale is that the affected party can know why the
decision has gone against him. One of the salutary
requirements of natural justice is spelling out reasons for
the order made”.
20. In Raj Kishore Jha (supra), this Court observed as
under:
“before we part with the case, we feel it necessary to
indicate that non-reasoned conclusions by appellate courts
are not appropriate, more so, when views of the lower
Court are differed from. In case of concurrence, the need
to again repeat reasons may not be there. It is not so in
case of reversal. Reason is the heartbeat of every
conclusion. Without the same, it becomes lifeless”.
21. Thus, in view of the above, the contention raised on
behalf of the employee that punishment of dismissal from
service was disproportionate to the proved delinquency of
the employee, is not worth acceptance.
22. The appeal preferred by the Corporation i. e. Civil
Appeal No.3086 of 2007 is allowed. The judgment and
order of the High court dated 7.9.2005 is hereby set aside
and the Award of the labour Court dated 28.4.1995 is
restored. The appeal preferred by the employee i. e. Civil
Appeal No.3088 of 2007 is hereby dismissed. No order as
to costs.”
15. In the case of Uttar Pradesh State Road Transport
Corporation Vs. Gajadhar Nath reported in (2022) 3 SCC
190, the Hon’ble Supreme Court has held and observed in para –
4 to 11 as under:-
“4. The scope of an adjudicator under the Industrial
Disputes Act, 19474 may be noticed. The domestic inquiry
conducted can be permitted to be disputed before thePage 28 of 46
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Tribunal in terms of Section 11A of the Act. This Court in a
judgment reported as Workmen of M/s Firestone Tyre and
Rubber Co. of India (P.) Ltd. v. Management & Ors., (1973)
1 SCC 813 held that in terms of Section 11A of the Act, if a
domestic inquiry has been held and finding of misconduct
is recorded, the authorities under the Act have full power
and jurisdiction to reappraise the evidence and to satisfy
themselves whether the evidence justifies the finding of
misconduct. But where the inquiry is found to be defective,
the employer can lead evidence to prove misconduct
before the authority. This Court held as under:
“32. From those decisions, the following principles broadly
emerge :-
(1) The right to take disciplinary action and to decide upon
the quantum of punishment are mainly managerial
functions, but if a dispute is referred to a Tribunal, the
latter has power to see if action of the employer is
justified.
(2) Before imposing the punishment, an employer is
expected to conduct a proper enquiry in accordance with
the provisions of the Standing Orders, if applicable, and
principles of natural justice. The enquiry should not be an
empty formality.
(3) When a proper enquiry has been held by an employer,
and the finding of misconduct is plausible conclusion
flowing from the evidence, adduced at the said enquiry,
the Tribunal has no jurisdiction to sit in judgment over the
decision of the employer as an appellate body. The
interference with the decision of the employer will be
justified only when the findings arrived at in the enquiry
are perverse or the management is guilty of victimisation,
unfair labour practice or mala fide.
(4) Even if no enquiry has been held by an employer or if
the enquiry held by him is found to be defective, the
Tribunal in order to satisfy itself about the legality and
validity of the order, had to give an opportunity to the
employer and employee to adduce evidence before it. It is
open to the employer to adduce evidence for the first time
justifying his action, and it is open to the employee to
adduce evidence contra.
(5) The effect of an employer not holding an enquiry is that
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the Tribunal would not have to consider only whether there
was a prima facie case. On the other hand, the issue about
the merits of the impugned order of dismissal or discharge
is at large before the Tribunal and the latter, on the
evidence adduced before it, has to decide for itself
whether the misconduct alleged is proved. In such cases,
the point about the exercise of managerial functions does
not arise at all. A case of defective enquiry stands on the
same footing as no enquiry.
(6) The Tribunal gets jurisdiction to consider the evidence
placed before it for the first time in justification of the
action taken only, if no enquiry has been held or after the
enquiry conducted by an employer is found to be
defective.
(7) It has never been recognised that the Tribunal should
straightway, without anything more, direct reinstatement
of a dismissed or discharged employee once it is found
that no domestic enquiry has been held or the said enquiry
is found to be defective.
(8) An employer, who wants to avail himself of the
opportunity of adducing evidence for the first time before
the Tribunal to justify his action, should ask for it at the
appropriate stage. If such an opportunity is asked for, the
Tribunal has no power to refuse. The giving of an
opportunity to an employer to adduce evidence for the first
time before the Tribunal is in the interest of both the
management and the employee and to enable the Tribunal
itself to be satisfied about the alleged misconduct.
(9) Once the misconduct is proved either in the enquiry
conducted by an employer or by the evidence placed
before a Tribunal for the first time, punishment imposed
cannot be interfered with by the Tribunal except in cases
where the punishment is so harsh as to suggest
victimisation.
(10) In a particular case, after setting aside the order of
dismissal, whether a workman should be reinstated or paid
compensation is, as held by this Court in The Management
of Panitole Tea Estate v. The Workmen, 1971-1 SCC 742
within the judicial decision of a Labour Court or Tribunal.”
5. The question as to whether the employer is required to
seek liberty to prove misconduct in the written statement
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or could lead evidence at a later stage was considered by a
Constitution Bench of this Court in a judgment reported as
Karnataka State Road Transport Corporation v. Smt.
Lakshmidevamma & Anr., AIR 2001 SC 2090. Therein this
Court was examining a conflict, if any, between two
judgments reported Shambhu Nath Goyal v. Bank of
Baroda & Ors., (1983) 4 SCC 491 and Rajendra Jha v.
Presiding Officer, Labour Court, Bokaro Steel City, District
Dhanbad & Anr., 1984 Supp. SCC 520. The majority opinion
of the Court noticed that the right of a management to
lead evidence before the Labour Court or the Industrial
Tribunal in justification of its decision under consideration
by such Tribunal or Court is not a statutory right. This is
actually a procedure laid down by this Court to avoid delay
and multiplicity of proceedings in the disposal of disputes
between the management and the workman.
“17. Keeping in mind the object of providing an opportunity
to the management to adduce evidence before the
Tribunal/Labour Court, we are of the opinion that the
directions issued by this court in Shambhu Nath Goyal’s
case need not be varied, being just and fair. There can be
no complaint from the management side for this procedure
because this opportunity of leading evidence is being
sought by the management only as an alternative plea and
not as an admission of illegality in its domestic inquiry. At
the same time, it is also of advantage to the workmen
inasmuch as they will be put to notice of the fact that the
management is likely to adduce fresh evidence, hence,
they can keep their rebuttal or other evidence ready. This
procedure also eliminates the likely delay in permitting the
management to make belated application whereby the
proceedings before the Labour Court/Tribunal could get
prolonged. In our opinion, the procedure laid down in
Shambhu Nath Goyal’s case is just and fair.
18. There is one other reason why we should accept the
procedure laid down by this Court in Shambhu Nath
Goyal’s case. It is to be noted that this judgment was
delivered on 27th of September, 1983. It has taken note of
almost all the earlier judgments of this Court and has laid
down the procedure for exercising the right of leading
evidence by the management which we have held is
neither oppressive nor contrary to the object and scheme
of the Act. This judgment having held the field for nearly
18 years, in our opinion, the doctrine of stare decisis
require us to approve the said judgment to see that a long-
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standing decision is not unsettled without strong cause.”
6. Now on merits, keeping in view the principles of law,
learned counsel for the appellants-employer contended
that the Indian Evidence Act, 18729 applies to all judicial
proceedings in or before any Court. Since the domestic
inquiry is not by a Court, therefore, strict rules of the
Evidence Act are not applicable to such domestic inquiry.
Reliance is placed upon a three-Judge Bench of this Court
reported as State of Haryana & Anr. v. Rattan Singh,
(1977) 2 SCC 491 wherein in respect of a conductor who
was found to have not issued tickets, this Court held as
under:
“4. It is well settled that in a domestic enquiry the strict
and sophisticated rules of evidence under the Indian
Evidence Act may not apply. All materials which are
logically probative for a prudent mind are permissible.
There is no allergy to hearsay evidence provided it has
reasonable nexus and credibility. It is true that
departmental authorities and Administrative Tribunals
must be careful in evaluating such material and should not
glibly swallow what is strictly speaking not relevant under
the Indian Evidence Act. For this proposition it is not
necessary to cite decisions nor text books, although we
have been taken through case-law and other authorities by
counsel on both sides. The essence of a judicial approach
is objectivity, exclusion of extraneous materials or
considerations and observance of rules of natural justice.
Of course, fairplay is the basis and if perversity or
arbitrariness, bias or surrender of independence of
judgment vitiate the conclusions reached, such finding,
even though of a domestic tribunal, cannot be held good.
However, the courts below misdirected themselves,
perhaps, in insisting that passengers who had come in and
gone out should be chased and brought before the tribunal
before a valid finding could be recorded. The ‘residuum’
rule to which counsel for the respondent referred, based
upon certain passages from American Jurisprudence does
not go to that extent nor does the passage from Halsbury
insist on such rigid requirement. The simple point is, was
there some evidence or was there no evidence – not in the
sense of the technical rules governing regular court
proceedings but in a fair commonsense way as men of
understanding and worldly wisdom will accept. Viewed in
this way, sufficiency of evidence in proof of the finding by a
domestic tribunal is beyond scrutiny. Absence of anyPage 32 of 46
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evidence in support of a finding is certainly available for
the court to look into because it amounts to an error of law
apparent on the record. We find, in this case, that the
evidence of Chamanlal, Inspector of the Flying Squad, is
some evidence which has relevance to the charge levelled
against the respondent. Therefore, we are unable to hold
that the order is invalid on that ground.”
7. In a judgment reported as U.P. State Road Transport
Corporation v. Suresh Chand Sharma, (2010) 6 SCC 555
this Court set aside the order of the High Court wherein the
writ petition was allowed holding that the passengers
without tickets have not been examined and cash with the
employee was not checked. This Court relied upon the
judgment of this Court in Rattan Singh and found that the
punishment of dismissal from service was not
disproportionate to the proved delinquency of the
employee.
8. The Division Bench of the Allahabad High Court to which
the learned Single Bench was bound in a judgment
reported as U.P. State Road Transport Corporation through
M.D. & Ors. v. Rajendra Prasad, 2019 SCC OnLine All 5152
allowed the appeal of the employer wherein the Tribunal
returned a finding that 16 passengers who were without
tickets at the time of inspection were not examined.
Therefore, the punishment order was set aside being in
contravention of the principles of natural justice. The
Division Bench of the High Court held as under:
“24. In view of the above, we find no substance in the
argument raised by the learned counsel for the
claimant/respondent to the effect that the passengers
were required to be examined during enquiry and
accordingly, we hold that the finding with regard to
examination of passengers given by the Tribunal is
perverse being contrary to the Law and being so is
unsustainable. It is also for the reason that the enquiry
officer after examining the witnesses including
claimant/respondent held that the charge levelled against
the claimant/respondent found proved.
xx xx xx
37. Further, in the present case, claimant/respondent-
Rajendra Prasad is a conductor of the bus and he was
entrusted with the duty to collect the ticket from thePage 33 of 46
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passengers travelling in the bus and deposit the same with
the Corporation however in the present case, from the
material on record, the position which emerges out is to
the effect that he collected the fair from 16
passengers/persons but did not deposit the same.”
9. On the other hand, learned counsel for the respondent-
workman argued that the statement of the Inspector does
not inspire confidence as he had not recorded the names
and addresses of the passengers. It is not the case of the
workman that the passengers were required to be
examined but at least there should have been some
evidence that there were passengers who were found
travelling without any ticket. Since the basic evidence is
not available on record, therefore, the finding of the
Tribunal cannot be said to be illegal or unwarranted which
was rightly not interfered with by the High Court.
10. We find that the order of the Tribunal and that of the
High Court are clearly erroneous and not sustainable in
law. The representative of the employer has not been
cross-examined on the question that he has not inspected
the bus on 12.11.1998. He has deposed that when he tried
to record the statements of the passengers, the conductor
misbehaved with him and used unruly words. Even that
part of the statement has not been disputed in the
crossexamination. Therefore, the fact that the Inspector
was not able to record the names and addresses of the
passengers cannot be said to be unjustified. Since the
passengers are low-fare paying passengers, they might
have been hesitant to get involved in the issues of any
action against the conductor. The Inspector had found that
17 passengers were not issued tickets and such statement
of the Inspector has also not been disputed in the
crossexamination. The Tribunal or the High Court could not
reject the evidence led by the employer in respect of
misconduct of the workman before the adjudicator. Still
further non lodging of FIR cannot be the circumstance
against the witness examined by the employer. The
initiation of criminal proceedings against an employee or
not initiating the proceedings has no bearing to prove
misconduct in departmental proceedings.
11. Therefore, we find that the order of removal from
service cannot be said to be unfair and unjust in any
manner which would warrant an interference at the hands
of the Tribunal and the High Court. The three reasons
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recorded by the Tribunal are absolutely perverse and not
supported by any evidence. The Tribunal had misapplied
the basic principles of law and the High Court has
thereafter wrongly confirmed the order.”
16. In the case of Rajasthan State Road Transport
Corportion Vs. Bajrang Lal reported in (2014) 4 SCC 693,
the Hon’ble Supreme Court has held and observed in para – 18 to
21 as under:-
“18. The appellate court committed a grave error by
declaring the enquiry as non-est. The termination order as
a consequence thereof, stood vitiated though there is no
reference to any material fact on the basis of which such a
conclusion was reached. The finding that copy of the
documents was not supplied to the respondent/plaintiff,
though there is nothing on record to show that how the
documents were relied upon and how they were relevant
to the controversy involved, whether those documents had
been relied upon by the enquiry officer and how any
prejudice had been caused by non-supply of those
documents, is therefore without any basis or evidence.
When the matter reached the High Court in Second Appeal,
the High Court refused to examine the issue at all by
merely observing that no substantial question of law was
involved and the findings of fact, however erroneous,
cannot be disturbed in Second Appeal.
19. With all respect, we do not agree with such a
conclusion reached by the High Court, as Second Appeal,
in exceptional circumstances, can be entertained on pure
questions of fact. There is no prohibition for the High Court
to entertain the Second Appeal even on question of fact
where factual findings are found to be perverse.
20. In Ibrahim Uddin (Supra), this Court held:
“65. In Suwalal Chhogalal V/s. CIT, (1949) 17 ITR 269 (Nag)
the Court held as under: (ITR p. 277)Page 35 of 46
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“A fact is a fact irrespective of evidence by which it is
proved. The only time a question of law can arise in such a
case is when it is alleged that there is no material on which
the conclusion can be based or no sufficient material.
67. There is no prohibition to entertain a second appeal
even on question of fact provided the Court is satisfied that
the findings of the courts below were vitiated by non-
consideration of relevant evidence or by showing
erroneous approach to the matter and findings recorded in
the court below are perverse. [Vide Jagdish Singh V/s.
Natthu Singh, AIR 1992 SC 1604, Prativa Devi V/s. T.V.
Krishnan, (1999) 5 SCC 353, Satya Gupta V/s. Brijesh
Kumar, (1998) 6 SCC 423, Ragavendra Kumar V/s. Firm
Prem Machinery & Co., AIR 2000 SC 534, Molar Mal V/s.
Kay Iron Works (P) Ltd., AIR 2000 SC 1261, Bharatha Matha
V/s. R. Vijaya Renganathan, (2010) 11 SCC 483 and Dinesh
Kumar V/s. Yusuf Ali, (2010 12 SCC 740]
68. In Jai Singh V/s. Shakuntala, AIR 2002 SC 1428, this
Court held that (SCC p. 638, para 6) it is permissible to
interfere even on question of fact but it may be only in
“very exceptional cases and on extreme perversity that the
authority to examine the same in extenso stands
permissible-it is a rarity rather than a regularity and thus in
fine it can be safely concluded that while there is no
prohibition as such, but the power to scrutiny can only be
had in very exceptional circumstances and upon proper
circumspection”. Similar view has been taken in Kashmir
Singh V/s. Harnam Singh, AIR 2008 SC 1749.”
21. As regards the question of disproportionate
punishment is concerned, the issue is no more res-integra.
In U.P State Road Transport Corporation V/s. Suresh Chand
Sharma, (2010) 6 SCC 555, it was held as under:
“22. In Municipal Committee, Bahadurgarh V/s. Krishnan
Behari, AIR 1996 SC 1249 this Court held as under: (SCC p.
715, para 4)
“4. . In a case of such nature-indeed, in cases involving
corruption-there cannot be any other punishment than
dismissal. Any sympathy shown in such cases is totally
uncalled for and opposed to public interest. The amount
misappropriated may be small or large; it is the act of
misappropriation that is relevant.”
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Similar view has been reiterated by this Court in Ruston &
Hornsby (I) Ltd. V/s. T.B. Kadam, AIR 1975 SC 2025, U.P.
SRTC V/s. Basudeo Chaudhary, (1997) 11 SCC 370, Janatha
Bazar (South Kanara Central Coop. Wholesale Stores Ltd.)
V/s. Sahakari Noukarara Sangha, (2000) 7 SCC 517,
Karnataka SRTC V/s. B.S. Hullikatti, AIR 2001 SC 930 and
Rajasthan SRTC V/s. Ghanshyam Sharma, (2002) 10 SCC
330.”
17. In the case of Divisional Controller, Karnataka State
Road Transport Corporation Vs. M.G.Vittal Rao reported in
(2012) 1 SCC 442 wherein the Hon’ble Supreme Court has held
and observed in para – 31 as under:-
“31. The instant case requires to be examined in the light
of the aforesaid settled legal proposition and keeping in
view that judicial review is concerned primarily with the
decision making process and not the decision itself. More
so, it is a settled legal proposition that in a case of
misconduct of grave nature like corruption, theft, no
punishment other than the dismissal may be appropriate.
(Vide: Pandiyan Roadways Corpn. Ltd. (supra); and U.P.
State Road Transport Corporation V/s. Suresh Chand
Sharma, (2010) 6 SCC 555).”
18. In the case of Karnataka State Road Transport
Corporation Vs. B. S. Hullikath reported in (2001) 2 SCC
574, the Hon’ble Supreme Court has held and observed in para –
6 and 7 as under:-
“6. It is misplaced sympathy by the labour courts in such
cases when on checking, it is found that the busPage 37 of 46
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conductors have either not issued tickets to a large
number of passengers, though they should have, or have
issued tickets of a lower denomination knowing fully well
the correct fare to be charged. It is the responsibility of the
bus conductors to collect the correct fare from the
passengers and deposit the same with the Company. They
act in a fiduciary capacity and it would be a case of gross
misconduct if knowingly they do not collect any fare or the
correct amount of fare.
7. In our opinion, the order of dismissal should not have
been set aside, but we are informed that in the meantime
the respondent has already superannuated. We, therefore,
on the special facts of this case, do not set aside the order
of reinstatement, but direct that the respondent would not be
entitled to any back wages at all but he would be entitled to
the retiral benefits.”
19. In the case of Divisional Controller, N.E.K.R.T.C. Vs. H.
Amaresh reported in (2006) 6 SCC 187, the Hon’ble Supreme
Court has held and observed in para – 18, 19 and 20 as under:-
“18. In the instant case, the mis-appropriation of the
funds by the delinquent employee was only Rs. 360.95.
This Court has considered the punishment that may be
awarded to the delinquent employees who mis-
appropriated funds of the Corporation and the factors to
be considered. This Court in a catena of judgments held
that the loss of confidence as the primary factor and not
the amount of money mis-appropriated and that the
sympathy or generosity cannot be a factor which is
impermissible in law. When an employee is found guilty of
pilferage or of mis-appropriating a Corporation’s funds,
there is nothing wrong in the Corporation losing
confidence or faith in such an employee and awarding
punishment of dismissal. In such cases, there is no place
for generosity or misplaced sympathy on the part of the
judicial forums and interfering therefore with the quantum
of punishment. The judgment in Karnataka State Road
Transport Corpn. V/s. B.S. Hullikatti, 2001 2 SCC 574 was
also relied on in this judgment among others. ExaminationPage 38 of 46
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of passengers of vehicle from whom the said sum was
collected was also not essential. In our view, possession of
the said excess sum of money on the part of the
respondent, a fact proved, is itself a mis-conduct and
hence the Labour Court and the learned Judges of the High
Court misdirected themselves in insisting on the evidence
of the passengers which is wholly not essential. This apart,
the respondent did not have any explanation for having
carried the said excess amount. This omission was
sufficient to hold him guilty. This act was so grossly
negligent that the respondent was not fit to be retained as
a conductor because such action or inaction of his was
bound to result in financial loss to the appellant
irrespective of the quantum.
19. In this context, it is useful to refer to the findings of
the domestic tribunal which has already been extracted
above in paragraph (supra). Before the Inquiry Officer Exh.
M1-M4 were marked, which have not been refuted nor was
the veracity of witness decided. The Inquiry Officer has
stated that he has carefully examined the evidence of
MW.1 and the documents marked which fully reveals that
the delinquent has committed not only misconduct but
misappropriated the cash. MW 1 was not cross examined
by the delinquent employee. In reply, the delinquent has
simply denied the charges stating it baseless. The Inquiry
Officer, on a careful consideration of all aspects of the
case, unhesitantly held that the delinquent was guilty of
the charges and that all the charges have been proved.
20. Once a domestic Tribunal based on evidence comes to
a particular conclusion normally it is not open to the
tribunal and courts to substitute their subjective opinion in
place of the one arrived at by the domestic tribunal.”
20. In the case of Bharat Heavy Electricals Ltd Vs. M.
Chandrasekhar Reddy reported in (2005) 2 SCC 481, wherein
the Hon’ble Supreme Court has held and observed in para 11,
15, 18, 20 and 26 as under:-
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“11. Question then is whether the misconduct alleged
against is so serious or grave as to create a genuine lack
of confidence in respondent by the appellant.
15. The Labour Court while exercising its discretion
recorded that though the confidence of the employer on
the respondent is shaken still it gave 3 reasons for
exercising its discretion, they are :-
(A) No instance of earlier misconduct are spelt.
(B) It appears the respondent is an active participant in
the cultural activities and for common cause of the
employees.
(C) Therefore, it felt the punishment of dismissal from
service is harsh, in the facts and circumstances of the
case.
18. In our opinion with no stretch of imagination either
the extenuating circumstances recorded by the Labour
Court or the exercise of its discretion could be termed
either as reasonable or judicious. In our opinion even the
learned Single Judge and the Division Bench erroneously
held that the Labour Court had unlimited jurisdiction u/s.
11A of the Act. It is because of the above erroneous legal
foundation as to the vastness of power vested with the
Labour Court, the High Court accepted the interference by
the Labour Court in the award of punishment. Thus, the
Labour Court as well as the High Court fell in error in
granting the relief to the respondent which is challenged
in this petition.
20. In Francis Klein & Company Private Ltd. (supra) this
Court held :-
“…In our view when an employer loses confidence in his
employee, particularly in respect of a person who is
discharging an office of trust and confidence, there can be
no justification for directing his reinstatement.”
..Even this direction is not a valid direction because if
once the company has lost confidence in its employee, it
is idle to ask them to employ such a person in another job.
What job can there be in a company which a person can
be entrusted with and which does not entail reposing of
confidence in that person..”
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26. That apart the reasons given by the Labour Court to
reduce the penalty are reasons which are not sufficient for
the purpose of reducing the sentence by using its
discretionary power. The fact that the misconduct now
alleged is the first misconduct again is no ground to
condone the misconduct. On the facts of this case as
recorded by the Labour Court the loss of confidence is
imminent, no finding has been given by the courts below
including Labour Court that either the fact of loss of
confidence or the quantum of punishment is so harsh as
to be vindictive or shockingly disproportionate. Without
such finding based on records interference with the award
of punishment in a domestic inquiry is impermissible.”
21. In the case of Gujarat State Road Transport
Corporation Vs. Ibrahimbhai Validam Patel reported in
2023 LawSuit (Guj) 2125, this Court has held and observed in
para – 4 as under:-
“[4] Learned advocate Mr. H.S. Munshaw for the
petitioner submitted that the Labour Court could not have
quashed and set aside the order of punishment imposed
under section 11A of the Industrial Disputes Act, 1947
(For short “the ID Act”) whereby service of the respondent
was terminated. It was submitted that the Labour Court
could have considered the disproportionality of the
punishment by substituting the order of punishment and
instead of termination, any lesser punishment of
stoppage of increment with future effect could have been
imposed in the facts of the case.
4.1) It was submitted that it is not disputed by the
respondent workman that tickets were not issued to the
passengers till their destination arrived. It was therefore,
pointed out that in such circumstances, when the Labour
Court has found that the punishment was
disproportionate to the charges levelled against thePage 41 of 46
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respondent workman, the same ought to have been
substituted.
4.2) It was also submitted that the inquiry officer after
conducting the inquiry has found the charges levelled
against the respondent as proved and therefore, the
Labour Court could not have interfered in the findings
arrived at by the inquiry officer.
4.3) It was submitted that during the course of inspection
it was found that the respondent did not issue the tickets
to two passengers though amount of fare was collected. It
was therefore, submitted that the Labour Court ought to
have passed an order of substitution of punishment
instead of quashing and setting aside the order of
punishment while exercising powers under section 11A of
the ID Act.
4.4) In support of his submission, reliance was placed on
decision in case of U.P. State Transport Corporation v.
Vinod Kumar, 2008 1 SCC 115, wherein it is held as
under:
“10.As stated in the preceding paragraphs, the
respondent had confined his case only to the conclusions
reached by the Enquiry Officer as well as the quantum of
punishment. Therefore, since the respondent had not
challenged the correctness, legality or validity of the
enquiry conducted, it was not open to the Labour Court to
go into the findings recorded by the Enquiry Officer
regarding the misconduct committed by the respondent.
This Court in a number of judgments has held that the
punishment of removal/dismissal is the appropriate
punishment for an employee found guilty of
misappropriation of funds; and the Courts should be
reluctant to reduce the punishment on misplaced
sympathy for a workman. That, there is nothing wrong in
the employer losing confidence or faith in such an
employee and awarding punishment of dismissal. That, in
such cases, there is no place for generosity or misplaced
sympathy on the part of the judicial forums and
interfering with the quantum of punishment. Without
burdening the judgment with all the judgments of this
Court on this point, we may only refer to a recent
judgment in Divisional Controller, N.E.K.R.T.C. V/s. H.
Amaresh, 2006 6 SCC 187, wherein this Court, after
taking into account the earlier decisions, held in para 18Page 42 of 46
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as under:-
“In the instant case, the misappropriation of the funds by
the delinquent employee was only Rs. 360.95. This Court
has considered the punishment that may be awarded to
the delinquent employees who mis-appropriated the
funds of the Corporation and the factors to be considered.
This Court in a catena of judgments held that the loss of
confidence is the primary factor and not the amount of
money misappropriated and that the sympathy or
generosity cannot be a factor which is impermissible in
law. When an employee is found guilty of pilferage or of
mis-appropriating the Corporation’s funds, there is
nothing wrong in the Corporation losing confidence or
faith in such an employee and awarding punishment of
dismissal. In such cases, there is no place for generosity
or misplaced sympathy on the part of the judicial forums
and interfering therefore with the quantum of
punishment. The judgment in Karnataka State Road
Transport Corporation V/s. B.S. Hullikatti, 2001 2 SCC 574
was also relied on in this judgment among others.
Examination of the passengers of the vehicle from whom
the said sum was collected was also not essential. In our
view, possession of the said excess sum of money on the
part of the respondent, a fact proved, is itself a mis-
conduct and hence the Labour Court and the learned
Judges of the High Court misdirected themselves in
insisting on the evidence of the passengers which is
wholly not essential. This apart, the respondent did not
have any explanation for having carried the said excess
amount. This omission was sufficient to hold him guilty.
This act was so grossly negligent that the respondent was
not fit to be retained as a conductor because such action
or inaction of his was bound to result in financial loss to
the appellant irrespective of the quantum.”
[Underlining is ours]
11.Respectfully agreeing and following the aforesaid
decision of this Court, we accept this appeal and set aside
the judgment of the High Court as well as the order
passed by the Labour Court. Consequently, the order
passed by the Punishing Authority dismissing/removing
the respondent from service is restored. No costs.”
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22. Considering the facts of the case as well as submissions
made by learned counsel for the respective parties, it appears
that the Labour Court while exercising powers under section 11A
of the ID Act has quashed and set aside order of punishment
imposed by the employer after conducting the departmental
inquiry in accordance with law without there being any justifiable
reason instead of substituting the punishment as the Labour
Court has found that the quantum of punishment is
disproportionate to the charges which are proved during the
course of departmental inquiry. Under such circumstances, the
impugned award passed by the Labour Court is absolutely illegal,
unjust and perverse. Though in 1995, the Conciliation Officer has
granted approval of the action of the employer, the Labour Court
has not considered said fact, while passing the impugned award
below Exhibit 68, however, it has to consider the fact that the
impugned inquiry is perverse and, therefore, the inquiry held to
be illegal and consequences thereof the order of dismissal was
quashed and set aside and directed the employer to reinstate the
workman in service with 25% back wages. At this juncture, it is
required to be noted that since the employee already
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reached at the age of superannuation and, therefore, there is no
question of reinstatement in service and so far as the order of
dismissal is concerned, before that the workman was paid all his
retiral dues and, therefore the same is not required to be
recovered now by initiating any recovery proceedings. So far as
other and further consequential benefits are concerned, the
same are not required to be extended in favour of the workman.
23. Considering the aforesaid facts and the decisions of the
Hon’ble Supreme Court and perusing the impugned award, it
appears that the Labour Court has committed an error while
passing the impugned order and, therefore, interference is
required to be called for. Hence, Special Civil Application No.
11540 of 2015 filed by the employer deserves to be allowed and
Special Civil Application No. 56 of 2017 filed by the workman
deserves to be dismissed.
24. In the result, Special Civil Application No. 11540 of 2015
filed by the employer is allowed. The impugned award dated
17.07.2014 passed by the Labour Court, Surendranagar in
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Reference (I.T.) No. 7 of 2011 and the order dated 03.12.2013 on
exhibit 63 passed by the Labour Court, Surendranagar are
hereby quashed and set aside. Though the retiral benefits has
already been paid to the workman, the same shall not be
recovered by initiating any recovery proceedings. There shall be
no order as to costs.
Special Civil Application No. 56 of 2017 filed by the
workman is dismissed. Rule is discharged. Interim relief, if any,
granted earlier shall stand vacated forthwith. There shall be no
order as to costs.
(HEMANT M. PRACHCHHAK,J)
V.R. PANCHAL
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