Pragathi Gramin Bank vs B. Narappa

B.S. Patil, J.—1. Respondent was working as a Junior Clerk in the petitioner-Pragathi Gramin Bank at Chandrabanda Branch. He was served with a charge-sheet dated 17.01.1986 alleging dishonest manipulation of records with a mala fide intention and misappropriation of the stock belonging to the Bank.

A disciplinary enquiry was initiated against him. It appears notice of the enquiry was not duly served on the delinquent. However, the Bank, treating the service as effective proceeded with the enquiry ex parte. Enquiry Officer recorded findings holding that the delinquent was guilty of the charges levelled. Accepting the findings of the Enquiry Officer, respondent was dismissed from service vide order dated 15.07.1987. Subsequently, respondent-employee approached the Central Government, which is the appropriate Government, seeking reference of the dispute. The Central Government referred the dispute for adjudication to the Industrial Tribunal, vide its order dated 05.09.2005.

A preliminary issue was raised regarding fairness of the disciplinary enquiry conducted by the Bank. The Industrial Tribunal vide order dated 6th September 2007 held that enquiry was not fair and proper. Whereupon a memo was filed by the Bank seeking permission to lead evidence. Another memo was filed seeking rejection of the reference on the ground that it was referred after a delay of nearly 18 years.

The Tribunal dismissed the memo filed by the Bank seeking permission to lead evidence placing reliance on the judgment of the Apex Court in the case of Karnataka State Road Transport Corporation v. Lakshmidevamma , (2001)5 SCC 433 holding that as no request had been made and no liberty was sought for leading evidence while filing objection to the claim statement, the management was precluded from making such a request after it was found that the enquiry was not fair and proper.

Insofar as delay was concerned, though a separate order was not passed on the memo, the Tribunal found that as per the case pleaded by the employee, immediately after the dismissal order, he had approached the second party requesting for his reinstatement and 2nd party gave him assurance that his request would be considered if he was acquitted by the criminal court; as such, with a fond hope of a favourable judgment by the criminal court, he waited for a long time and after the judgment in the criminal case acquitting him was passed on 09.08.1999, he submitted a representation dated 27.09.1999 to the Bank requesting for his reinstatement; as no action was taken despite submitting repeated representations, he was constrained to issue notice through his advocate on 24.05.2004 addressed to the management; even thereafter there was no response, therefore, he was constrained to file a petition before the Assistant Labour Commissioner and the Conciliation Officer on 09.07.2004; the same ended in failure due to the rigid stand taken by the management; thereafter, the Central Government referred the matter to the Industrial Tribunal on 22.12.2004.

In the light of the above defence taken and keeping in mind the acquittal of the employee by the criminal court and as also the conciliation proceedings which ended in failure, the Tribunal has set aside the order of dismissal particularly because enquiry conducted was found to be not fair and proper and no evidence had been adduced by the management before the Industrial Tribunal. However, keeping in mind the delay that occurred in referring the matter to the industrial Tribunal and the omission on the part of the employee in raising the dispute immediately, the Industrial Tribunal disallowed backwages for the entire period, while granting relief of reinstatement with continuity of service. The management was directed to issue order of reinstatement within 30 days from the date the award was published, failing which the management was held liable to pay salary and wages from such date i.e., 30 days from the date of publication of the award.

Learned counsel for the petitioner has contended that the Tribunal has misconstrued the ratio laid down in the judgment in the case of LAKSHMIDEVAMMA inasmuch as even in the absence of liberty sought by the management while filing the written statement to lead evidence before the Tribunal, discretion of the Tribunal to grant permission to lead evidence in a given case was not taken away. His next submission is that reference itself was liable to be dismissed on account of long and inordinate delay of 18 years in raising the dispute. He has lastly contended that as on today respondent employee has been out of employment for nearly 30 years and in view of the changed circumstances and the conditions of service as also altered duties and responsibilities of the post which the petitioner has to discharge in case he is ordered to be reinstated, it was not in the interest of the Bank to reinstate the respondent. He has also placed reliance on the judgment in the case of State Bank of India and Anr. v. Bela Bagchi & Ors. , (2005)7 SCC 435, to contend that a Bank officer is required to exercise higher standard of honesty and integrity as he dealt with money of the depositors and the customers; he is required to take all possible steps to protect the interests of the Bank and to discharge his duties with utmost integrity and therefore, even where no loss was caused to the Bank due to the dishonest act of the employee, the Apex Court found that direction for reinstatement was unsustainable because of the nature of duties discharged by the employee of the bank, keeping in mind the discipline to be maintained in the bank.

Counsel appearing for the respondent-employee has strongly relied on the judgment in the case of Karan Singh v. Executive Engineer, Haryana State Marketing Board , (2007) 14 SCC 291 to contend that there is no power vested with the Industrial Tribunal to reject the reference on the ground of delay and therefore, mere fact that reference was delayed cannot enure to the benefit of the petitioner-bank. He has also pointed out that delay had been satisfactorily explained particularly because the criminal case was pending till the year 1999 and once the criminal court acquitted the petitioner, the appropriate government examined the matter and referred the case after the conciliation proceedings had failed. He also submits that the Tribunal has correctly understood the ratio laid down in Lakshmidevamma''s case.

Upon hearing the learned counsel for both parties and on careful perusal of the entire materials on record, I am of the view that as laid down by the Apex Court in Karan Singh''s case Industrial Tribunal could not have examined the validity of reference on the ground that appropriate Government had referred the dispute after long delay. If at all petitioner/Bank was aggrieved by the order of reference, it ought to have challenged the order of reference. Having not chosen to assail the order of reference, it is not open for the Bank to contend that reference itself was bad in law because of delay. At any rate, the Tribunal has considered the question of delay while moulding the reliefs. Because of delay, the Tribunal has disallowed back-wages.

Insofar as dismissal of the memo filed by petitioner/Bank seeking permission to lead evidence, as rightly contended by Sri. Harsha Desai, learned counsel for the Bank, that in Lakshmidevamma''s case, referred supra, Constitution Bench of the Apex Court, by a majority judgment has held that even where Management did not seek liberty while filing written statement to adduce evidence before the Tribunal, power and discretion of the Tribunal to grant such permission in appropriate cases by applying its judicious mind was not taken away. Therefore, the Tribunal committed an error in dismissing the memo filed without applying its mind to the facts and circumstances and without recording any reason whether a case had been made out for exercise of its discretion to grant permission to the Management to lead evidence, after it found the enquiry not fair and proper. Such an exercise having not been done, in the normal circumstances, I would have remitted the matter back to the Industrial Tribunal to examine the said aspect of the matter again. However, in the facts of the present case, I am dissuaded to adopt such a process, because such a procedure, if adopted, would only protract the litigation and may not possibly put an end to the long standing dispute.

In addition, as rightly contended by the Bank, having regard to the nature of charges leveled against the official, keeping in mind the discipline required to be maintained in Banking sector to instill confidence and trust in the minds of customers, ends of justice would be met if the award passed by the Tribunal is modified and the employee is ordered to be paid a lump-sum amount in lieu of the relief of reinstatement and continuity of service with all consequential benefits, except back-wages which has been now ordered by the Tribunal. The award of Industrial Tribunal was passed on 09th August 2011. Direction issued by the Tribunal to reinstate the respondent/employee has come into effect on the expiry of 30 days of publication of the award. However, the said award has been stayed by this Court.

Keeping in mind the provisions of Section 17-B of the Industrial Disputes Act and also the fact that the employee has got still five years of service left, coupled with the fact that his reinstatement after a lapse of 30 years from the date of dismissal from service would not be in the interest of the Bank and also having regard to the need for efficient performance of duties by the employees in the Bank, I am persuaded to hold that, an amount of Rs. 6,00,000/- shall be paid as lump-sum compensation to the respondent/employee in lieu of all benefits. Hence, the following order is passed:

ORDER

"(i) The Writ Petition is disposed of.

(ii) Award passed by the Industrial Tribunal is modified; Direction issued for re-instatement with other benefits is modified;

(iii) Respondent/employee is held entitled for payment of a sum of Rs. 6,00,000/- (Rupees Six Lakhs only) in full and final settlement of his claim by the Bank;

(iv) Said amount shall be paid within thirty days from the date of receipt of a copy of this order;

(v) If the amount is not paid within thirty days, the said amount shall carry interest at the rate of 9% per annum from that date."