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Judgment
K.K. Sasidharan, J.—This Writ Petition is directed against the common award of the Labour Court, Trichirapalli dated 11 January 1996 in
Industrial Dispute No. 25 to 27 of 1994 whereby and where under, the industrial dispute raised by the petitioners challenging their dismissal by the
second respondent was dismissed.
Background facts:
The petitioners were working in the second respondent establishment, having joined the service on 05.03.1984, 26.08.1985 and 05.03.1984
respectively. The petitioners were also involved in trade union activities to protect the interest of the workers.
During the month of November 1992, the second respondent Management introduced an incentive scheme which was found to be non-
beneficial to the workmen. Therefore, the union resorted to a joint action against the management. There was a demand for ex-gratia over and
above the statutory bonus. The Management immediately resorted to lockout under the guise of suspension of operation. It was followed by
conciliation proceedings and ultimately, a settlement was entered into between the parties on 1 December 1992 u/s 12(3) of the I.D. Act.
The dispute was settled and as agreed, the workmen reported for work on 3 December 1992. However, Mr. Ramesh, Personnel Manager of
the second respondent Company insisted that the workmen should sign the settlement deed u/s 18(1) as a condition for allowing them to enter the
factory. Individual workers were not willing for such a course as according to them, they would enter the factory, wear their uniforms, punch card
and then would proceed to sign the settlement. However, such a course was not agreeable to the management and as such, there was utter
confusion. The petitioners persuaded the workers to sign the settlement. They succeeded in convincing the workers and accordingly, they attended
the second shift. However, the management suspended the petitioners on 03.12.1992. The petitioners were issued charge sheet on 21.12.1992. In
the said charge sheet, it was alleged that the petitioners have resorted to strike inside the factory and threatened the workmen and disobeyed the
lawful orders of the superiors and thereby, committed an act subversive of discipline. The petitioners submitted their explanation. In the
explanation, they have also explained the circumstances leading to the confusion and expressed regret about what had happened. The explanation
was not accepted by the Management which resulted in issuing a second show cause notice. In the said notice, the Management stated that they
were not convinced with the explanation and as such, they intend to impose punishment of dismissal from service. The petitioners submitted their
explanation to the second notice wherein they have indicated that the incident was on account of the confusion and they were not responsible for
the same. Petitioners also pleaded leniency. However, the management was determined to dismiss them and accordingly, an Order of dismissal
was passed on 9 February 1993. However, no enquiry was conducted before such dismissal.
The petitioners raised industrial dispute in I.D. Nos. 25 to 27 of 1994 before the Labour Court. The Labour Court was of the view that there
was a clear admission of guilt in the explanation submitted by the petitioners and as such, there was no necessity to conduct an enquiry by the
second respondent and ultimately, the punishment imposed by the second respondent was confirmed. Feeling aggrieved, the dismissed workmen
are before this Court.
Submissions:
The learned Counsel for the petitioner has taken me through the explanation submitted by the petitioners to the show cause notice. According to
the learned Counsel, there was nothing like an admission in the explanation submitted by the petitioners so as to pass an Order of dismissal by the
management without conducting enquiry. The learned Counsel contended that the award of the Labour Court is perverse and the Court had
approved the punishment awarded by the management without independently considering the matter. It was his further contention that documents
were marked without examining witnesses and as such, the very procedure adopted by the Labour Court was against the labour jurisprudence.
The learned Counsel for the second respondent supported the award of the Labour Court. According to the learned Counsel, when the
petitioners themselves have admitted their misconduct, there was no question of the management conducting an enquiry in the matter. The factum
of admission of the charges as found in the explanation submitted by the petitioners were considered by the Labour Court and having convinced
that there was an admission of misconduct by the workmen themselves, the Labour Court concurred with the decision taken by the second
respondent. According to the learned Counsel, there was no necessity to conduct an enquiry in the subject matter in view of the admission made
by the petitioners with respect to the incident happened on 03.12.1992.
The core question:
The only question which arises for consideration in this Writ Petition is as to whether the explanation submitted by the petitioners to the show
cause notice issued by the second respondent contained an unequivocal admission of misconduct so as to enable the management to dismiss the
workmen without conducting enquiry.
Discussion:
The Petitioners were the office bearers of the employees union. The union was instrumental in arriving at a settlement with the management.
There was an unrest among the workers in the second respondent factory and ultimately, settlement was arrived at on 1 December 1992. The
petitioners being the office bearers of the Union signed the said settlement. There was a unanimous decision to reopen the factory on 3 December
1992. The petitioners along with the other workmen reached the factory at about 6.20 a.m. on 3 December 1992. As per the show cause notice,
petitioners were directed to proceed for reporting duty as they have already signed the settlement on 1 December 1992. All the other workmen
were asked to proceed to the lunch room to sign the settlement u/s 18(1) of the I.D. Act. According to the management, the petitioners refused to
resume work and they have incited the other workmen against signing the settlement on the ground that certain bilateral issues were also to be
settled. It was the case of the Management that the petitioners failed to obey the orders of the superiors and thereby acted in a violent manner and
ultimately, they were suspended. It was only after the suspension of the petitioners, the other workers agreed to sign the settlement and to resume
work. Accordingly, there was interruption of work and the factory could resume its function only from the second shift. According to the
management, the misconduct was serious in nature and show cause notice was accordingly issued. In the show cause notice dated 21 December
1992, there was no mention of the name of the workers who were prevented by the petitioners and the nature of orders passed by the
management to resume duty or to ease the situation. The petitioners have submitted their explanation. The third petitioner has submitted a detailed
explanation which contains an account of what has happened on the fateful day. Since the Order of dismissal was made solely on account of the
alleged admission made by the petitioners, it is necessary to consider the explanation for the purpose of ascertaining as to whether the explanation
contained an unequivocal and clear admission of misconduct.
The explanation submitted by the third petitioner (Mr. P. Kanagaraj) dated 28.12.1992 reads thus:
28/12/1992
From
P. Kanagaraj,
EMP No. 3025,
Moorco (I) Limited,
Viralimalai - 621 316.
To
Vice President,
Moorco (I) Limited,
Viralimalai - 621 316.
Sub : Explanation submitted for the letter written in English dated: 21/12/1992 and letter in Tamil dated: 23/12/1992 - Reg.
Sir,
I received your letter dated: 23/12/1992. I understood from your letter that you have placed me under suspension. On 01/12/1992, I signed in
12(3) settlement in the presence of Thiru. A.C.L. in my capacity as the Treasurer of the Welfare Association and in 18(1) settlement in my
capacity as the employee of the company and on the next day (i.e. 02/12/1992), myself and one Thiru. Sekar, went to the house of each and every
employee and told them that we had signed in 12(3) settlement and have entered into 18(1) settlement and told them to report for duty after signing
in the settlement. Accordingly, on 03/12/1992 the employees in the first shift came by the company bus and entered into the company at 6.20
A.M. The P.M. Moorco stood in front of the company gate, and stated that, only after signing 18(1) settlement, they should wear the uniform,
footwear, and enter the company to punch the card. The office bearers of the Employees union and the workers asked them to open the
Company, so that they could enter inside, punch the card, and then affix their signatures. I myself too told the P.M. to give the papers to me in
order to get the signatures from them. The P.M. refused to do so. Since a tensed situation arose at the entrance of the gate thereafter, being
helpless I, who have signed both in the 12(3), 18(1) settlements, was scared to enter the company leaving behind the employees of our Union and
so I did not enter. Subsequently, I came to know that another Union had conducted a General Body Meeting on 02/12/1992 and in that meeting
they have taken some decision or other I am not aware of the said decision. So, having thought that the issue would be magnified, I discussed with
Thiru. Nadimuthu, who was nearer me and with other employees. We were of the view that the issue was taken up by the office bearers and
members of the employees union. We three i.e. Myself, Sekar and Nadimuthu after consulting with each other, decided to report for duty. So, we
told the xomox P.M. that we wanted to speak with Thiru. T.K. Jayaram and Thiru. Arun Amudham, who are the representatives of the company.
Accordingly he consulted with the management, told that they have placed myself and Thiru. Sekar under suspension, showed the suspension
order, pasted the same at the entrance, and instructed us not to report for duty. He further told that, the others could report for duty the next day
for the first shift. We were helpless and could not proceed further. But, having thought that a similar situation should not arise in the second shift
also, myself, and one Thiru. Sekar told the other office bearers of our union namely Thiru. Balasubramaniam and Thiru. Paramasivam about the
incidents that took place and told them that such an issue should not arise in the second shift. They too, having agreed to the same reported for
duty for the second shift along with our members without raising any dispute. After witnessing the same the office bearers and members of other
association also reported for duty. After this occurrence, some of the workers who have to report duty the next day also affixed their signatures in
18(1) settlement on the same day after 3 P.M. and reported for duty the next day. Therefore, I humbly state that I have not involved in the various
activities as mentioned in your letter like, striking work, preventing the workmen from discharging their duties, inducing and threatening the
workmen from carrying out their duties, refusing to abide by the justifiable requests of the superiors and caused subversive of discipline. I also state
that I never intended to involve the members of our Union and other workmen in the said Acts. I regret to state that it is only my misfortune.
Therefore on my behalf and on behalf of the employees union I humbly request you to revoke my suspension order, and reinstate me. I also
humbly submit on behalf of me and the Union that such an incident will never take place in future.
Thanking you,
Sd/-xxx
P. Kanagaraj
Date : 28/12/1992
The explanation submitted by the first petitioner to the second show cause notice reads thus:
22/01/1993
Trichy.
From
P. Govindarajan,
Plot No. 31,
Rajeev Gandhi Nagar,
Trichy-12.
To
The President,
Moorco India Limited,
Chennai.
Sir,
Salutations.
Sir, you have mentioned that you have lost confidence in me and three others due to the occurrence that took place accidently at present and also
the incidents that had taken place before. Further more you have informed us that the Moorco Ltd., has made a huge production. From this, it is
clearly evident that you put forward both the merits and demerits with open mindedness. I feel that you have imposed maximum punishment on us.
Don''t put us in a similar situation hereinafter. I realise that the ''lock out'' of the company, affects the reputation of the company. At the same time,
you have increased the production of Xomox. Further, you have established a strict discipline, (i.e. to act in accordance with the rules and
regulations of the company). Further you have made the employees to understand what is meant by a Company.
At the same time, you have also created such a similar situation in Moorco. Further, you have established the firm decision of the Company with
regard to exgratia.
We have also understood the similar situation. The circumstances above have made us to realise the stability and principles of the company.
Therefore I request you to understand our situation and permit us to work.
Therefore, I request you to adhere to the regulations of the company that prevails at present continuously and to take steps to strive hard together
with the union leaders for the upliftment of the company.
So, only if it is done, the attention of the employees would not be diverted.
I believe that apart from the growth of the company, you would also take care of the upliftment of the life of the employees. Therefore, I humbly
request you to abandon the proposed dismissal brought out (alleged) against me, so that our families would not suffer.
Thanking you,
Yours truly,
Sd/-xxx
R. Govindarajan.
Note:
I requested Thiru. Ramesh, P.M. to permit me to talk to you in person. He also agreed to get an appointment from you. Due to unavoidable
circumstances, I was not able to talk with you. Hence I wrote down this letter to you mentioning the facts which I have in my mind.
Thanking you,
30/12/1992
The explanation submitted by the second petitioner reads thus:
30/12/1992
Trichy-12
From
M. Rajadurai,
Machinist,
Moorco (India) Limited,
Viralimalai - 621 316.
To
The Vice President,
Moorco (India) Limited,
Viralimalai - 621 316.
Sub : Your letter dated:21/12/1992 - Reg.
Sir,
Salutations !
I regret very much for the incident that took place unexpectedly on 03/12/1992. It happened unfortunately due to the confusion that arose amidst
the employees. My wish and desire is that I should work continuously in our company.
I hereby assure you that I will abide by the rules and regulations and discipline of the company and will work to your utmost satisfaction. Therefore
I humbly request you to revoke the disciplinary proceedings initiated against me and permit me to work continuously.
Thanking you,
Yours truly,
Sd/-xxx
M. Rajadurai
(Machinist)
Trichy-12
30/12/1992
The further explanation given by the first respondent reads as follows:
From
R. Govindarajan,
Turner,
Moorco India Limited,
Viralimalai.
To
The Vice President,
Moorco India Limited,
Viralimalai.
Sub : Explanation submitted to your
letter dated : 21/12/1992 - reg.
Sir,
Salutations !
I regret very much for the incident that took place unexpectedly on 03/12/1992. It happened unfortunately due to the confusion that arose amidst
the employees. My wise and desire is that I should work continuously in our company.
I hereby assure you that I will abide by the rules and regulations and discipline of the company and will work to your utmost satisfaction. Therefore
I humbly request you to revoke the disciplinary proceedings initiated against me and permit me to work continuously.
Thanking you,
Yours truly,
Sd/-xxx
Govindarajan.
These explanations were translated by the Official Translator of the High Court from Tamil as the learned Counsel for the petitioners seriously
disputed the translated version of the explanation submitted by the learned Counsel for the second respondent.
I have considered the explanations carefully and it is found from the detailed explanation submitted by the third petitioner that his attempt was
only to narrate the sequence of events that happened on 3 December 1992. The explanation shows that after the settlement on 1 December 1992,
petitioners have contacted the individual workers at their residence and informed them of the settlement and called upon them to sign the settlement
u/s 18(1) on 3 December 1992. According to the explanation, employees in the first shift arrived at the factory campus at about 6.20 a.m.
However, they were prevented by the Personnel Manager and he insisted that only after signing 18(1) settlement, they could enter the factory.
However, the office bearers of the employees union asked the management to open the factory so that they could enter inside, punch the card and
then affix their signature in the settlement. The third petitioner requested the Personnel Manager to give the settlement papers to him so as to enable
him to get the signature of the workers. However, the Personnel Manager refused to accept his request. Therefore, there was a tense situation
prevailing at the entrance of the gate and the third petitioner being the office bearer of the union was not prepared to resume work leaving behind
the employees. Accordingly, he discussed the matter with the other employees and called upon them to sign the settlement and to report for duty.
It was only on account of the persuasion of the petitioners, the workers signed the settlement and attended the second shift. After narrating the
sequence of events, the third petitioner has clearly stated that he was not involved in the activities as mentioned in the show cause notice and there
was no act of preventing the workmen from discharging their duties. It was only while concluding the explanation he has expressed regret as to
what had happened.
In the explanation submitted by the first respondent also, there was reference about the confusion created near the factory gate. There were
similar averments in the explanation submitted by the second petitioner also.
In the second show cause notice issued on 09.01.2003, there was no indication that the petitioners have admitted the misconduct. The
management has only communicated the proposed action to terminate their services and called upon the petitioners to submit their views. The
petitioners have again submitted their explanation which also contains reference about the confusion created on the reopening day and the
unfortunate events. The explanation submitted by the petitioners to the second show cause notice was considered by the management and an
Order of termination was passed as according to the second respondent, the misconduct was clearly admitted in the explanation submitted by the
petitioners.
The petitioners raised an industrial dispute before the Labour Court. Individual petitioners have filed claim petitions wherein it was clearly
stated that they have not admitted the allegations levelled against them by the Management. The claim petition also contains the details of the
incident that occurred on 3 December 1992. The petitioners have narrated the events which took place on the said day and according to them, the
entire incident has arisen out of confusion as the workers were not prepared to sign the settlement without allowing them to enter the factory.
Before the Labour Court, the second respondent has filed counter in answer to the contentions raised in the claim petition. Even in the said
statement, it was not the contention of the second respondent that there was a clear admission in the explanation submitted by the petitioners and
as such, there was no necessity to conduct an enquiry in the matter. In short, the defence taken by the second respondent for their failure to
conduct enquiry was only on account of the alleged admission made by the petitioners in their explanation to the show cause notice.
The Labour Court adopted a very strange procedure in marking the documents produced by the parties without examining the witnesses.
There is nothing indicated in the award to the effect that the parties have agreed to mark the documents by consent. The Labour Court found that
there was admission about the misconduct in the explanation submitted by the petitioners and as such, the second respondent was justified in
dismissing them without conducting enquiry. The Labour Court placed reliance on the documents marked on the side of the management to arrive
at a conclusion that the enquiry was not necessitated in the matter on account of the voluntary admission made by the petitioners. Though the
second respondent by way of abundant caution prayed for adducing evidence, there was no Order permitting them to adduce evidence as the
Labour Court was of the view that there was no necessity to lead evidence on account of the admission made by the petitioners.
The challenge made by the petitioners with respect to the alleged admission was not considered by the Labour Court. The Labour Court
adopted a novel method and arrived at a finding that the petitioners have admitted the charges, overlooking the averments in the claim statement to
the effect that it was not an admission and they have only explained the circumstances leading to the workers unrest on the fateful day and it was
only as a concluding remark they have expressed their regret.
Evidentiary value of Admission:
It is true that admission is a best piece of evidence which could be used against the maker of the statement. However, it is not possible to infer
admission from a statement. Admission to be used against the maker should be clear, unambiguous, unequivocal and without any scope for two
interpretations and it should lead to a clear conclusion of admission. While construing a document for the purpose of deciding as to whether there
was clear cut admission, the Court has to consider the entire text. It is not possible to take one or two sentences here and there and to come to a
conclusion that there was admission. There should be an express declaration to qualify it as an admission so as to bind the party.
Section 17 of the Indian Evidence Act deals with admission. As per the said provision, an admission is a statement whether it be oral or
documentary or contained in an electronic form, which suggests any inference as to any fact in issue or relevant fact.
Admission, though is a piece of evidence, it could be explained by the author. Admission made by a party has to be considered in the factual
context of the matter. It is open to the party to seek an opportunity to explain the admission as otherwise, the matters would be decided on the
basis of such admissions.
The alleged admission in the case on hand has to be considered in the light of the factual scenario. The petitioners were instrumental in arriving
at a settlement between the workers and the management. Admittedly, they have signed the statement on 1 December 1992. In their explanation,
they have also stated that individual workers were approached by them and they have been asked to sign the settlement on the date of reopening.
When the petitioners themselves have signed the settlement and they have also entered the factory for the purpose of resuming work, it was nothing
but cruel to allege that they were inciting the workers not to sign the settlement and the workers were in fact asking the petitioners not to resist
them from signing the settlement. The statement as contained in the charge sheet issued by the management shows that they were determined to
terminate the office bearers of the employees association. When there were two versions with respect to the incident in question, the Labour Court
should have considered the matter independently without placing reliance on the explanation. The explanation was given only by the petitioners.
Those explanations were interpreted by the management as clear cut admission of guilt and accordingly, enquiry was dispensed with. Before the
Labour Court, the petitioners contended that it was not an admission. In such circumstances, the Labour Court should have called upon the
Management to lead evidence. The short cut method adopted by the Court caused prejudice to the petitioners.
It is worth mentioning that neither in the show cause notice nor in the second show cause notice, there was mention about the details of the
incident and as also the identity of workers who were restrained by the petitioners. It is highly improbable that the petitioners who have signed the
settlement, incited other workers not to sign. In case decision to take action against the petitioners were on account of their action in stopping the
workers from signing the settlement, they could have at least indicated in the charge sheet, the name of the workers who were so resisted. The
explanation submitted by the petitioners with respect to the incident in question, coupled with the fact that the workers themselves signed the
settlement and attended the second shift clearly shows that the version given by the petitioners as to how the incident has happened appears to be
more probable.
The main documents before the Labour Court were the alleged inter departmental communication of the second respondent management.
However, there was no such reference about any of the report given by the watchman or the Personnel Manager of the factory in the proceedings
issued to the petitioners. Some of the documents attempted to be marked on the side of the second respondent was clearly objected to by the
petitioners and those documents were marked subject to objection. The explanation submitted by the petitioners were also marked as an exhibit,
without examining the petitioners who were very much available before the Labour Court. It is not as if the maker of the statement was no more.
The very dispute was raised by the petitioners who themselves submitted the explanation. It was taken as the basis for terminating their services
without enquiry. Therefore, the Labour Court should have given an opportunity to the petitioners to lead evidence. When it was the case of the
second respondent that in case the Labour Court was of the view that enquiry should have been conducted, they should be given an opportunity to
adduce evidence, the Labour Court should have first called upon the second respondent to adduce evidence. The question of petitioners adducing
contra evidence comes only later as the entire matter in such cases would be at large before the Labour Court. However, the Management for the
reasons best known to them, failed to examine any of the witnesses on their side to substantiate their contention about the misconduct committed
by the petitioners. The course of conduct adopted by the second respondent clearly shows that they want an Order of confirmation of the action
taken by them without giving an opportunity to the petitioners to expose the malafides of the management.
The charge sheets issued to the petitioners are no more than a cloak for attaining the object of the management and by dismissing the leaders of
the union who were instrumental in reaching a successful settlement for the benefit of the workers. In fact, the root cause for the confusion was
none other than Mr. Ramesh, Personnel Manager of the Company. It was his adamant attitude to get the signature of the workers in the
Memorandum of Settlement before punching the card which resulted in the workers'' protest. In any case, it cannot be said that the petitioners
were responsible for the state of affairs.
When the petitioners have clearly stated in their claim statement that there was no admission at their instance, the Labour Court should not
have permitted the second respondent to mark those statements without entering the witness box. Things would have been different in case the
petitioners refused to enter the witness box. There is no recital in the award of the Labour Court that the petitioners were called upon to adduce
evidence and it was only on account of their unwillingness, they were not examined.
When the Management has not conducted enquiry and terminated the services of the workmen and when there was a challenge to such
termination, the entire matter was at large before the Labour Court. The Labour Court has to consider independently as to whether the misconduct
alleged against the employees were proved. The Labour Court cannot be a silent spectator in a case like this where the management has
terminated the service of the workmen solely on the basis of an alleged admission in the explanation to the show cause notice. The Labour Court
was having jurisdiction to consider the evidence produced by the Management in support of their contention that the action taken was perfectly
correct and it does not call for interference. There should be clear evidence produced by the Management before the Labour Court in support of
their decision to dispense with the services of the employees without enquiry. The burden of proof was clearly on the management to show that the
workmen were indulged in such activities which were detrimental to the interest of the factory and as such, they were liable to be terminated. It was
not sufficient that they mark certain documents without giving an opportunity to the workmen to challenge the veracity of those documents. It is not
as if the petitioners have admitted the version given by the management with regard to their explanation. They have clearly stated in their claim
statement that there was no admission and they were only explaining the circumstances leading to the workers unrest.
The Labour Court relied on Exs. M. 25, 28, 69, 59 and 62 in support of its conlcusion that there was a clear cut admission on the part of the
petitioners with respect to the misconduct committed by them and that they regretted for the same. According to the Labour Court, an enquiry
would arise only if the incident alleged was not admitted. However, the petitioners have admitted the misconduct and expressed their regret and
therefore, it was needless on the part of the second respondent to order an departmental enquiry. The Labour Court also overruled the objection
made by the petitioners against marking certain documents by the Management, without a factual foundation.
Legal principles:
The principles governing the jurisdiction of the Tribunals while adjudicating disputes relating to dismissal or discharge, was indicated by the
Supreme Court in The Workmen of Firestone Tyre and Rubber Co. of India (Pvt.) Ltd. Vs. The Management and Others, , thus:
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 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 a 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 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 straightaway, 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 Management of Panitole Tea Estate v. Workmens within the judicial decision of a Labour Court or Tribunal.
In D.K. Yadav Vs. J.M.A. Industries Ltd., , the management invoked the provisions of the Certified Standing Orders to put an end to the
service of the employee and the tribunal found that it was not a termination or retrenchment under the Industrial Disputes Act. The matter was
ultimately taken to the Supreme Court. The Supreme Court by placing reliance on the earlier decisions observed that the Certified Standing Orders
have statutory force and therefore, it attracts the principles of natural justice. The following paragraphs would make the position clear:
The cardinal point that has to be borne in mind, in every case, is whether the person concerned should have a reasonable opportunity of
presenting his case and the authority should act fairly, justly, reasonably and impartially. It is not so much to act judicially but is to act fairly, namely,
the procedure adopted must be just, fair and reasonable in the particular circumstances of the case. In other words application of the principles of
natural justice that no man should be condemned unheard intends to prevent the authority from acting arbitrarily affecting the rights of the
concerned person.
It is a fundamental rule of law that no decision must be taken which will affect the right of any person without first being informed of the case and
giving him/her an opportunity of putting forward his/her case. An order involving civil consequences must be made consistently with the rules of
natural justice. In Mohinder Singh Gill v. Chief Election Commissioner the Constitution Bench held that ''civil consequences'' covers infraction of
not merely property or personal right but of civil liberties, material deprivations and non-pecuniary damages. In its comprehensive connotation
every thing that affects a citizen in his civil life inflicts a civil consequence. Black''s Law Dictionary, 4th edn., page 1487 defined civil rights are such
as belong to every citizen of the state or country ... they include ... rights capable of being enforced or redressed in a civil action.... In State of
Orissa v. (Miss) Binapani Dei this Court held that even an administrative order which involves civil consequences must be made consistently with
the rules of natural justice. The person concerned must be informed of the case, the evidence in support thereof supplied and must be given a fair
opportunity to meet the case before an adverse decision is taken. Since no such opportunity was given it was held that superannuation was in
violation of principles of natural justice.
The law must therefore be now taken to be well-settled that procedure prescribed for depriving a person of livelihood must meet the challenge
of Article 14 and such law would be liable to be tested on the anvil of Article 14 and the procedure prescribed by a statute or statutory rule or
rules or orders affecting the civil rights or result in civil consequences would have to answer the requirement of Article 14. So it must be right, just
and fair and not arbitrary, fanciful or oppressive. There can be no distinction between a quasi-judicial function and an administrative function for the
purpose of principles of natural justice. The aim of both administrative inquiry as well as the quasi-judicial inquiry is to arrive at a just decision and if
a rule of natural justice is calculated to secure justice or to put it negatively, to prevent miscarriage of justice, it is difficult to see why it should be
applicable only to quasi-judicial inquiry and not to administrative inquiry. It must logically apply to both.
Therefore, fair play in action requires that the procedure adopted must be just, fair and reasonable. The manner of exercise of the power and
its impact on the rights of the person affected would be in conformity with the principles of natural justice. Article 21 clubs life with liberty, dignity
of person with means of livelihood without which the glorious content of dignity of person would be reduced to animal existence. When it is
interpreted that the colour and content of procedure established by law must be in conformity with the minimum fairness and processual justice, it
would relieve legislative callousness despising opportunity of being heard and fair opportunities of defence. Article 14 has a pervasive processual
potency and versatile quality, equalitarian in its soul and allergic to discriminatory dictates. Equality is the antithesis of arbitrariness. It is, thereby,
conclusively held by this Court that the principles of natural justice are part of Article 14 and the procedure prescribed by law must be just, fair and
reasonable.
The Supreme Court in Sita Ram Bhau Patil Vs. Ramchandra Nago Patil (Dead) by Lrs. and Another, observed that when the contents of the
alleged admission to the reference has been made to decide the matter against the maker of such admission, are not unambiguous, it cannot be
accepted as an admission.
The Supreme Court in Kishori Lal Vs. Mst. Chaltibai, considered the evidentiary value of admission thus:
And admissions are not conclusive, and unless they constitute estoppel, the maker is at liberty to prove that they were mistaken or were untrue.
The Supreme Court in Nagubai Ammal and Others Vs. B. Shama Rao and Others, indicated the legal position pertaining to admission thus:
An admission is not conclusive as to the truth of the matters stated therein. It is only a piece of evidence, the weight to be attached to which must
depend on the circumstances under which it is made. It can be shown to be erroneous or untrue, so long as the person to whom it was made has
not acted upon it to his detriment, when it might become conclusive by way of estoppel.
In Rakesh Wadhawan and Others Vs. Jagdamba Industrial Corporation and Others, , the concept of admission was explained by the Supreme
Court thus:
Admission is only a piece of evidence and can be explained; it does not conclusively bind a party unless it amounts to an estoppel. Value of an
admission has to be determined by keeping in view the circumstances in which it was made and to whom.
The legal position regarding the procedure for marking document was explained by the Supreme Court in Narbada Devi Gupta Vs. Birendra
Kumar Jaiswal and Another, thus:
...The legal position is not in dispute that mere production and marking of a document as exhibit by the court cannot be held to be a due proof
of its contents. Its execution has to be proved by admissible evidence, that is, by the ''evidence of those persons who can vouchsafe for the truth of
the facts in issue''. The situation is, however, different where the documents are produced, they are admitted by the opposite party, signatures on
them are also admitted and they are marked thereafter as exhibits by the court.
The nature of departmental proceedings and the necessity to mark the document by examination of witnesses was indicated by the Supreme
Court in Roop Singh Negi Vs. Punjab National Bank and Others, , thus:
Indisputably, a departmental proceeding is a quasi-judicial proceeding. The enquiry officer performs a quasi-judicial function. The charges
levelled against the delinquent officer must be found to have been proved. The enquiry officer has a duty to arrive at a finding upon taking into
consideration the materials brought on record by the parties. The purported evidence collected during investigation by the investigating officer
against all the accused by itself could not be treated to be evidence in the disciplinary proceeding. No witness was examined to prove the said
documents. The management witnesses merely tendered the documents and did not prove the contents thereof. Reliance, inter alia, was placed by
the enquiry officer on the FIR which could not have been treated as evidence.
The distinction between burden of proof and onus of proof was indicated by the Supreme Court in Addagada Raghavamma and Another Vs.
Addagada Chenchamma and Another, thus:
There is an essential distinction between burden of proof and onus of proof: burden of proof lies upon the person who has to prove a fact and it
never shifts, but the onus of proof shifts.
The Supreme Court in Jagdish Prasad Saxena v. State of M.B. AIR 1961 SC 1070, considered the case of an employee who was removed
from service on the basis of an admission, without conducting enquiry and indicated the legal position thus:
...In such a case, even if the appellant had made some statements which amounted to admission it is open to doubt whether he could be
removed from service on the strength of the said alleged admissions without holding a formal enquiry as required by the Rules. But apart from this
consideration, if the statements made by the appellant do not amount to a clear or unambiguous admission of his guilt, failure to hold a formal
enquiry would certainly constitute a serious infirmity in the order of dismissal passed against him.
...but it is of the utmost importance that in taking disciplinary action against a public servant a proper departmental enquiry must be held against
him after supplying him with a charge-sheet, and he must be allowed a reasonable opportunity to meet the allegations contained in the charge-
sheet. ..... In our opinion, therefore, the High Court was in error in coming to the conclusion that no prejudice had been caused to the appellant as
a result of the respondents failure to hold an enquiry against him after supplying him with a charge-sheet. The departmental enquiry is not an empty
formality; it is a serious proceeding intended to give the officer concerned a chance to meet the charge and to prove his innocence. In the absence
of any such enquiry it would not be fair to strain facts against the appellant and to hold that in view of the admissions made by him the enquiry
would have served no useful purpose. That is a matter of speculation which is wholly out of place in dealing with cases of orders passed against
public servants terminating their services.
In Trambak Rubber Industries Ltd. Vs. Nashik Workers Union and Others, , the sole question before the Supreme Court was whether the
High Court in exercise of Article 226 and 227 of the Constitution of India was justified in reversing the award of the Industrial court and directing
reinstatement of 72 workers. The Supreme Court found that the material evidence were not considered by the Labour Court. In the said factal
context, the Supreme Court observed thus:
We are of the view that the High Court has not transgressed the limitations inherent in the grant of the writ of certiorari. The High Court had
rightly perceived the patent illegality in the impugned award warranting interference in exercise of its writ jurisdiction. The High Court is right in
pointing out that the material evidence, especially the admissions of the witness examined on behalf of the management were not considered at all.
Moreover, the conclusions reached are wholly perverse and do not reasonably follow from the evidence on record.
In Kuldeep Singh Vs. The Commissioner of Police and Others, , the Supreme Court observed that a document which was not mentioned in
the charge sheet could not be relied or even referred to by the disciplinary authority.
The Supreme Court in Moni Shankar Vs. Union of India (UOI) and Another, , observed that the tribunal is entitled to determine whether
relevant evidence was not considered or irrelevant evidence was not excluded and observed thus:
The departmental proceeding is a quasi-judicial one. Although the provisions of the Evidence Act are not applicable in the said proceeding,
principles of natural justice are required to be complied with. The courts exercising power of judicial review are entitled to consider as to whether
while inferring commission of misconduct on the part of a delinquent officer relevant piece of evidence has been taken into consideration and
irrelevant facts have been excluded there from. Inference on facts must be based on evidence which meet the requirements of legal principles. The
Tribunal was, thus, entitled to arrive at its own conclusion on the premise that the evidence adduced by the Department, even if it is taken on its
face value to be correct in its entirety, meet the requirements of burden of proof, namely, preponderance of probability. If on such evidences, the
test of the doctrine of proportionality has not been satisfied, the Tribunal was within its domain to interfere. We must place on record that the
doctrine of unreasonableness is giving way to the doctrine of proportionality. (See State of U.P. v. Sheo Shanker Lal Srivastava and Coimbatore
District Central Coop. Bank v. Employees Assn.)
We must also place on record that on certain aspects even judicial review of fact is permissible. (E v. Secy. of State for the Home Deptt.)
Before the Labour Court, the second respondent has attempted to mark certain documents which according to them were the report submitted
to the management by the gate keeper as well as the Personnel Manager. However, there was no reference about those reports anywhere in the
first show cause notice or in the second show cause notice as well as in the order of termination. Therefore, those documents were later introduced
by the second respondent to justify their stand. The Labour Court very mechanically allowed those documents to be marked without their being a
factual foundation for those documents in the initial proceedings.
The second respondent management terminated the services of the petitioners solely on the ground that there was an admission of misconduct
in the explanation submitted by them to the show cause notices. Therefore, no enquiry was conducted by them before taking the ultimate decision
to terminate the services of the petitioners. The interpretation of the explanation submitted by the petitioners assumes importance in this matter.
There is no two opinion on the point that there was no admission at all in the explanation submitted by the petitioners to the show cause notices. It
was only an act of narration of the events which actually happened on 3 December 1992 and the ultimate regret expressed by the petitioners
cannot be construed to be an admission. The entire statement has to be read together. The only possible conclusion from a close reading of the
explanation is that there was absolutely no admission. Therefore, the second respondent as well as the Labour Court misconstrued the explanation
submitted by the petitioners and arrived at a finding which is nothing but perverse, liable to be interfered with in this Writ Petition.
The relief:
Now the remaining question is as to what should be the ultimate relief to be granted to the petitioners. The petitioners were instrumental in
getting relief to the workers. The issue between the workers and the management was settled and the petitioners also signed the memorandum of
settlement. It was only as per the agreement reached between the parties that the petitioners have entered the factory to resume work. However,
the management was determined to see that the petitioners were terminated at any cost. The entire incident appears to be a stage managed one.
There was reference in the documents produced by the second respondent themselves which would prove the contention raised by the petitioners.
Even as per the documents filed by the second respondent, the Management insisted that workers have to sign the settlement first before entering
the factory and resume duty. Therefore, the explanation given by the petitioners appear to be more probable and the version given by the second
respondent is highly improbable. The second respondent succeeded in their attempt to silence the petitioners, being the labour leaders. The
petitioners are out of employment for the past many years. It is not the case of the second respondent that the petitioners are gainfully employed
elsewhere. Therefore, on a careful consideration of the entire factual matrix, I am of the view that there was no legal evidence much less acceptable
evidence to prove that the petitioners have indulged in an act of misconduct so as to remove them from service. The documents relied on by the
management for the purpose of dispensing with the enquiry does not contain an element of admission.
The incident was on 3 December, 1992. Therefore, there is no question of conducting a fresh enquiry after a period of sixteen yeas and 11
months.
In view of the long pendency of this litigation and in the facts and circumstances of the case, I am of the view that this is not a fit case to remit
the matter to the Labour Court or to give liberty to the Management to conduct an enquiry. Therefore, I am of the opinion that interest of justice
warrants an order of reinstatment.
Back wages:
It is true that whenever there is an Order of reinstatement, payment of backwges is not automatic. Several factors have to be taken into
consideration for arriving at a decision regarding back wages.
The Supreme Court in Surendra Kumar Verma and Others Vs. Central Government Industrial Tribunal-Cum-Labour Court, New Delhi and
Another, , indicated that normally in cases of unjustified termination of services, workmen are entitled to the relief of reinstatement with full back
wages even if some amount of hardship is suffered by the employer. The following paragraph would make the position clear:
Welfare statutes must, of necessity receive a broad interpretation. Where legislation is designed to give relief against certain kinds of mischief, the
court is not to make inroads by making etymological excursions. ''Void ab initio'', ''invalid and inoperative'' or call it what you will, the workmen
and the employer are primarily concerned with the consequence of striking down the order of termination of the services of the workmen. Plain
common sense dictates that the removal of an order terminating the services of workmen must ordinarily lead to the reinstatement of the services of
the workmen. It is as if the order has never been, and so it must ordinarily lead to back wages too. But there may be exceptional circumstances
which make it impossible or wholly inequitable vis-`-vis the employer and workmen to direct reinstatement with full back wages. For instance, the
industry might have closed down or might be in severe financial doldrums; the workmen concerned might have secured better or other employment
elsewhere and so on. In such situations, there is a vestige of discretion left in the court to make appropriate consequential orders. The court may
deny the relief of reinstatement where reinstatement is impossible because the industry has closed down. The court may deny the relief of award of
full back wages where that would place an impossible burden on the employer. In such and other exceptional cases the court may mould the relief,
but, ordinarily the relief to be awarded must be reinstatement with full back wages. That relief must be awarded where no special impediment in the
way of awarding the relief is clearly shown. True, occasional hardship may be caused to an employer but we must remember that, more often than
not, comparatively far greater hardship is certain to be caused to the workmen if the relief is denied than to the employer if the relief is granted.
The question of payment of back wages in the event of passing an order of reinstatement was considered by the Supreme Court recently in a
catena of decisions. The earlier view that payment of full back wages should be accompanied by an order of reinstatement was considered afresh
by the Supreme Court in the light of change in circumstances and it was held that the Court is not bound to grant back wages whenever there is an
order of reinstatement. The Supreme Court has also in a series of decisions held that those judgments relating to back wages, on account of illegal
retrenchment or termination may have no application to the cases where the termination was by way of punishment for misconduct in a
departmental enquiry and the Court confirmed the finding regarding misconduct but only interferes with the punishment by taking a view that it was
shockingly disproportionate and awards a lesser punishment resulting in reinstatement of the employee.
In J.K. Synthetics Ltd. Vs. K.P. Agrawal and Another, , the concept of back wages was considered by the Supreme Court in extenso and it
was held thus:
...Where the power under Article 226 or Section 11A of the Industrial Disputes Act (or any other similar provision) is exercised by any court
to interfere with the punishment on the ground that it is excessive and the employee deserves a lesser punishment, and a consequential direction is
issued for reinstatement, the court is not holding that the employer was in the wrong or that the dismissal was illegal and invalid. The court is merely
exercising its discretion to award a lesser punishment. Till such power is exercised, the dismissal is valid and in force. When the punishment is
reduced by a court as being excessive, there can be either a direction for reinstatement or a direction for a nominal lump sum compensation. And if
reinstatement is directed, it can be effective either prospectively from the date of such substitution of punishment (in which event, there is no
continuity of service) or retrospectively, from the date on which the penalty of termination was imposed (in which event, there can be a
consequential direction relating to continuity of service). What requires to be noted in cases where finding of misconduct is affirmed and only the
punishment is interfered with (as contrasted from cases where termination is held to be illegal or void) is that there is no automatic reinstatement;
and if reinstatement is directed, it is not automatically with retrospective effect from the date of termination. Therefore, where reinstatement is a
consequence of imposition of a lesser punishment, neither back wages nor continuity of service nor consequential benefits, follow as a natural or
necessary consequence of such reinstatement. In cases where the misconduct is held to be proved, and reinstatement is itself a consequential
benefit arising from imposition of a lesser punishment, award of back wages for the period when the employee has not worked, may amount to
rewarding the delinquent employee and punishing the employer for taking action for the misconduct committed by the employee. That should be
avoided. Similarly, in such cases, even where continuity of service is directed, it should only be for purposes of pensionary/retirement benefits, and
not for other benefits like increments, promotions, etc.
In J.K. Synthetics case, the Supreme Court culled out two exceptions from the normal rule that payment of back wages is not automatic with
an order of reinstatement. The relevant paragraph reads thus:
But there are two exceptions. The first is where the court sets aside the termination as a consequence of employee being exonerated or being
found not guilty of the misconduct. Second is where the court reaches a conclusion that the inquiry was held in respect of a frivolous issue or petty
misconduct, as a camouflage to get rid of the employee or victimise him, and the disproportionately excessive punishment is a result of such scheme
or intention. In such cases, the principles relating to back wages, etc. will be the same as those applied in the cases of an illegal termination.
This case is clearly an exceptional one as indicated by the Supreme Court in J.K. Synthetics case.
The petitioners were out of employment for the last 16 years. It is not the case of the management that they are gainfully employed elsewhere.
The petitioners were regular employees of the management, with eight years of service as on the date on which they were suspended from service
which led to their dismissal ultimately. There was no previous misconduct alleged against the petitioners. The second respondent mill is a unit of
Sanmar Engineering Corporation. The unit is stated to be a profit making one. The termination is found to be an act of victimization and the alleged
misconduct was a ruse to get rid of the petitioners from the service of the second respondent. Therefore, I do not find any exceptional
circumstances in this case to deny full back wages to the petitioners.
Conclusion:
In the result, the award in I.D. Nos. 25 to 27 of 1994 on the file of Labour Court, Trichy, dated 11 January 1996 is set aside. The second
respondent is directed to reinstate the petitioners into service with all benefits including continuity of service and full back wages. Back wages shall
be paid within a period of two months from the date of receipt of a copy of this Order.
The Writ Petition is allowed as indicated above. No costs.