Sarjoo Prasad v. Regional Manager, State Bank Of India
1978-12-21
S.K.CHOUDHURI, VISHWANATH MISHRA
body1978
DigiLaw.ai
Judgment S.K.CHOUDHURI and VISHWANATH MISHRA JJ. 1. This is an application under Articles 226 and 227 of the Constitution of India for issuance of a writ of certiorari quashing the order contained in Annexure 4 of the writ petition. 2. The petitioner employed as Messenger-cum-Farrash of the State Bank of India (hereinafter called "the Bank") was appointed on 11-5-1970 and was posted at Bagaha sub-office of the said Bank. He was confirmed in due course and was transferred in the same capacity to Bettiah branch of the same Bank. On 29th September, 1973 one Suresh Singh, who had no Savings Bank Account in the said Bank, managed to withdraw a sum of Rs. 6,000/- on the basis of a forged withdrawal form. The matter was detected that very day. This petitioner was suspected to have some hand in the matter. As appears from the charge-sheet (Annexure 1 to the petition) he had left the Bank earlier than his usual time in order to escape detection. He was also sent for but he evaded. Certain blank forms and stamps pertaining to Savings Bank Accounts were also found in his house. The petitioner was asked to show cause why disciplinary action should not be taken against him for the charges mentioned above. The cause was shown (vide Annexure 2 to the writ petition) in which all the charges were denied. Ultimately the Bank decided to hold enquiry and fixed a date for it (vide Annexure 3 to the writ petition). The Cashier and the Savings Bank Counter Clerk were also proceeded against in the same enquiry. Ultimately, so far the petitioner is concerned, no charge was established against him. The Bank, however, in view of the suspicious circumstances did not consider it expedient to retain the petitioner in service and so decided to discharge him and, accordingly he was discharged with one months pay and allowances in lieu of notice, with immediate effect on 25th May, 1976 through the order contained in Annexure 4 to the writ petition. 3. This writ petition was filed on the 30th June, 1976. A supplementary affidavit on behalf of the petitioner was also filed om the 30th August, 1976.
3. This writ petition was filed on the 30th June, 1976. A supplementary affidavit on behalf of the petitioner was also filed om the 30th August, 1976. Taking both of therm together it has been contended that the petitioner was not given any opportunity of being heard in the final stage of the proceeding before the discharge order was passed: nor were the necesssay papers containing evidence etc. were given to him. Further it has been pleaded that his discharge was a case of retrenchment and the order was illegal and without jurisdiction inasmuch as, the discharge order was not accompanied with any compensation required under the law. On these grounds the order contained in Annexure 4 has been challenged. 4. A counter-affidavit was filed on behalf of the respondents to say that the enquiry was made in accordance with the award of All India Industrial Tribunal (Bank Disputes), Bombay, popularly known as "Shastry Award" which was later approved by the National Industrial Tribunal (Bank Disputes) through another award popularly known as "Desai Award". It is said that all the formalities of the enquiry were observed and the order of discharge against the petitioner was passed under paragraph 521 (1) (c) of the "Shastry Award" which was approved by, "Desai Award" also in Chapter XVIII. The maintainability of this writ petition has, however, been challenged on the ground that the, petitioner did not exercise his right of appeal and did not get the matter decided by raising an Industrial Dispute to which he was entitled. The petitioners claim that it was a case of retrenchment and that he was entitled to compensation has also been challenged. It was also argued that the State Bank of India has not been made party as such, and it would not suffice only to have made the Regional Manager of the said Bank a party to it. Following points arise for determination in this case: 1. Whether the enquiry was vitiated for not giving opportunity of hearing to the petitioner before discharging him ? 2. Whether the order of discharge amounts to retrenchment and, if so, whether the order is valid and legal ? 3. Whether the writ petition is barred because no appeal was filed and no industrial dispute was raised ? 4. Whether the Bank was properly sued or not ? 5.
2. Whether the order of discharge amounts to retrenchment and, if so, whether the order is valid and legal ? 3. Whether the writ petition is barred because no appeal was filed and no industrial dispute was raised ? 4. Whether the Bank was properly sued or not ? 5. Point No. 1 : There is no dispute on the point that the petitioner was given a charge-sheet and was informed of the decision of the Bank to institute enquiry against him. Which papers the petitioner wanted and which were not given to him; whether actually the petitioner required them or not these matters were not pressed in this Court. There is, however, no dispute on the point that the petitioner was not given a hearing as regards the punishment that was going to be inflicted on him. It is this opportunity of hearing of which the petitioner has made a grievance. On behalf of the respondent it has been contended that it was not a punishment by way of disciplinary action and, so the Bank was not required to hear him regarding the order going to be passed. So far the order of discharge is concerned there is some unusual provision in the Sastry Award. The case is covered by Section III paragraph 521 (10) (c) which reads as follows : "In awarding punishment by way of disciplinary action the authority concerned shall take into account the gravity of the misconduct, the previous record, if any, of the employee and any other aggravating or extenuating circumstances exist the misconduct may be condoned and in case such misconduct is of the "gross" type he may be merely discharged, with or without notice or on payment of a months pay and allowances, in lieu of notice. Such discharge may also be given where the evidence is found to be in sufficient to sustain the charge and where the bank does not, for some reason or other, think it expedient to retain the employee in question any longer in service. Discharge in such cases shall not be deemed to amount to disciplinary action." It would appear from it that when the person proceeded against is held guilty of mis-conduct and if it is of "gross" type but there are some extenuating circumstances he may be merely discharged with or without notice or on payment of certain allowances.
Discharge in such cases shall not be deemed to amount to disciplinary action." It would appear from it that when the person proceeded against is held guilty of mis-conduct and if it is of "gross" type but there are some extenuating circumstances he may be merely discharged with or without notice or on payment of certain allowances. Paragraph 521 (10) (e), however, eomtemplates a discharge even when the charge of misconduct has not been proved, but the Bank for some reason or other, does not think it expedient to retain the employee in service. This is rather an unusual provision, but all the same when the provision is there the parties are bound by it. The Sastry Award in the last sentence of paragraph 521 (10) (c), quoted above has said that the discharge in such cases shall not be deemed to amount to disciplinary action. Now a question arises, if the employee would be entitled to a hearing so far the order of discharge is concerned, if it will not amount to disciplinary action, or in other words, punishment. The answer to this is found in paragraph 521 (10) (a) of the Sastry Award itself, the relevant portion of which is quoted below : "An employee against whom disciplinary action is proposed or likely to be taken shall be given a charge-sheet to enable him to prepare and give his explanation as also to produce any evidence that he may wish to tender in his defence....... He shall be permitted to appear......to cross-examine any witness .... to examine witnesses and produce other evidence in his defence. He shall also be given a hearing as regards the nature of the proposed punishment in case any charge is established against him." From the last sentence of this clause it is, clear that the employee has to be given an opportunity of being heard regarding the "proposed punishment", only if the charge is established against him. Where, of course, the charge is not established against him, but he is being discharged in accordance with the special provision contained in paragraph 521 (10) (c) of the Award, the employee has no right to be heard regarding the proposed punishment because it is not a punishment at all under sub-clause (c) of Clause (10) of paragraph 521 of the Sastry Award. 6.
6. This question also arose in the case of Baleshwar Prasad v. Agent, State Bank of India, reported in AIR 1958 Pat 418 . Justice R. K. Choudhary speaking for the Court after discussing the relevant provisions of the Sastry Award observed in paragraph 5 as follows: "It has, therefore, been contended on behalf of the opposite party that the order of discharge does not in view of Paragraph 521 (10) (c) of Sastry Award amount to a punishment under a disciplinary action, and, therefore, the question of giving the petitioner a hearing as regards the nature of the proposed punishment does not arise. In my opinion, the argument put forward is well founded and must prevail." 7. It is, thus, clear that it was not necessary to give a hearing to the petitioner on the point of the order of discharge and, as such there is nothing to vitiate the enquiry. S. Point No. 2: Whether the order of discharge in the instant case amounts to retrenchment of the employee or not, is a relevant point for consideration, because in case of discharge the employee would be entitled to certain compensation to which he would not be entitled otherwise. The order of discharge as found in Annexure 4 to the writ petition does not give the reasons for discharging the petitioner and they were not necessary also. It is pure and simple order of discharge running as follows: "It has been decided to discharge you from the Banks service with one months pay and allowances in lieu of notice with immediate effect." 8. The order is dated 25th May, 1976 and has been signed by Sri D. P. Sinha, Regional Manager, Region I. Paragraph 521 (10) (c) has already been quoted at page 4. Cases of retrenchment have been dealt with in Section IV Paragraph 522 (6) of the Sastry Award. It deals with the cases of retrenchment of more than five employees at a time. That is however, not the case here. The petitioner, however, relies on the provisions of the Industrial Disputes Act, 1947 (hereinafter called "the Act") for a finding that his also is a case of "retrenchment".
It deals with the cases of retrenchment of more than five employees at a time. That is however, not the case here. The petitioner, however, relies on the provisions of the Industrial Disputes Act, 1947 (hereinafter called "the Act") for a finding that his also is a case of "retrenchment". The word "retrenchment" has been defined in Sec. 2 (oo) of the Act to run as follows: " "retrenchment" means the termination by the employer of the service of workman for my reason whatsoever, otherwise than as a punishment inflicted by way of disciplinary action, but does not include (a) voluntary retirement of the workman,or (b) retirement of the workman on reaching the age of superannuation if the contract of employment between the employer and the workman concerned contains a stipulation in that behalf or (c) termination of the service of a workman on the ground of continued ill-health," This definition has been inserted by Act 43 of 1953. It would, therefore, be available to the petitioner who had entered in service in 1970 and whose case was decided in 1976. By the order of discharge his service has no doubt been terminated. As already held above it was not a punishment inflicted by way of disciplinary action. The case also does not come within the three types of cases enumerated in sub-clauses (a), (b) and (c) of Section 2 (oo) of the Act. His case, therefore, will come in the category of termination of service "for any reason whatsoever" and in that view of the matter it would be clearly a case of "retrenchment" within the meaning of the Industrial Disputes Act, 1947 . Regarding the application of Section 2 (oo) of the Act, I may with advantage refer to the observations of his Lordship Justice Krishna Iyer speaking for the Supreme Court in the case of the State Bank of India v. N. Sundara Money reported in AIR 1976 SC 1111 : (1976 Lab IC 769) in paragraph 9 running as follows: "A break-down of Section 2 (oo) unmistakably expands the semantics of retrenchment. Termination......for any reason whatsoever are the key words. Whatsoever the reason, every termination spells retrenchment. So the sole question is has the employees service been terminated?
Termination......for any reason whatsoever are the key words. Whatsoever the reason, every termination spells retrenchment. So the sole question is has the employees service been terminated? Verbal apparel apart, the substance is decisive, A termination take place where a term expires either by the active step of the master or the running out of the stipulated term. To protect the weak against the strong this policy of comprehensive definition has been effectuated. Termination embraces not merely the act of terminntion by the employer, but the fact of termination howsoever produced." 9. The above authority was also approved in the case of Hindustan Steel Ltd. v. Presiding Officer, Labour Court, Orissa reported in AIR 1977 SC 31 : (1976 Lab IC 1766). In the case of Delhi Cloth and General Mills Co. Ltd. v. Shambhu Nath Mukherji reported in AIR 1978 SC 8 : (1977 Lab IC 1695) also, it has been held that striking of the name of the workman from the rolls by the management is termination of service and, it would amount to retrenchment within the meaning of Section 2 (oo) of the Industrial Disputes Act. It has been contended on behalf of the respondent Bank that the provisions of the Act would not apply, because the question of disciplinary action is a subject matter of the Sastry Award. In my opinion, for matters which are not covered by the Sastry Award or for a particular case which does not come within the ambit of the Sastry Award, the provisions contained in the Industrial Disputes Act will fully and validly operate. The Sastry Award has not dealt wtih a case like this and, as such the provisions of the Act must be held to be applicable. There is, thus, no doubt that the discharge of the petitioner amounts to his retrenchment. 10. Once it is held to be a case of retrenchment the benefits of Section 25-F of the Act will be available to the workman i. e. the petitioner. I may mention that the fact that the petitioner is a workman and, the Bank is an industry, has not been disputed here in the case.
10. Once it is held to be a case of retrenchment the benefits of Section 25-F of the Act will be available to the workman i. e. the petitioner. I may mention that the fact that the petitioner is a workman and, the Bank is an industry, has not been disputed here in the case. Section 25-F of the Act reads as follows: "No workman employed in any industry who has been in continuous service for not less than one year under an employer shall be retrenched by that employer until (a) the workman has been given one months notice in writing indicating the reasons for retrenchment and the period of notice has expired, or the workman has been paid in lieu of such notice, wages for the period of the notice; Provided that no such notice shall be necessary if the retrenchment is under an agreement which specifies a date for the termination of service, (b) the workman has been paid, at the time of retrenchment, compensation, which shall be equivalent to fifteen days" average pay (for every completed year of continuous service) or any part thereof in excess of six months; and (c) notice in the prescribed manner is served on the appropriate Government (or such authority as may be specified by the appropriate Government by notification in the Official Gazette)." According to Clause (b) of Section 25-F it was incumbent for the Bank to pay compensation at the time of retrenchment itself. 11 In AIR 1976 SC 1111 : (1976 Lab IC 769) (supra) while discussing the provisions of Sections 2 (oo) and 25-F of the Act his Lordship Justice Krishna Iyer observed as follows in paragraph 8 of the Judgment. "Without further ado, we reach the conclusion that if the workman swims into the harbour of Section 25F, he cannot be retrenched without payment, at the time of retrenchment, compensation computed as prescribed therein read with Section 25B (2). Though this type of retrenchment has not been particularly considered in the Sastry Award the principle that all persons retrenched should be given compensation has been accepted in Section V of paragraph 523 of the Sastry Award. In paragraph 524 of the award a general scale of compensation to cover all cases of retrenchment has also been given which is more or less on the same line as in Section 25F of the Act.
In paragraph 524 of the award a general scale of compensation to cover all cases of retrenchment has also been given which is more or less on the same line as in Section 25F of the Act. What exactly would be the amount of compensation is not necessary to be assessed here but the fact that he was entitled to compensation at the time of his discharge (amounting to retrenchment) cannot be lost sight of and, further the order of discharge cannot be said to be valid in absence thereof. 12. Point No. 3: Admittedly, in this case the petitioner did not prefer any appeal. According to him he has not been given a right of appeal under the Sastry Award. The respondent Bank, however, relies upon paragraph 521 (12) of the Sastry Award to say that the appeal lies in such a case. According to that paragraph "the Bank should also make provision for appeals against orders passed in disciplinary matters." It has already been held that according to last sentence of paragraph 521 (10) (c) the order impugned does not amount to disciplinary action. So when it is not a disciplinary action, the question of any appeal does not arise. This question had also cropped up in the authority reported in AIR 1958 Pat 418 mentioned above. Reference may be made to a portion of paragraph 7 of that authority running as follows: "It has next been contended that the right of appeal has been denied to the petitioner inasmuch as he preferred an appeal against the order of discharge but nothing appears to have been done in regard to it. Paragraph 521 (12) of the Sastri Award makes it perfectly clear that an employee is entitled to prefer an appeal against an order passed in disciplinary matters. But it has been rightly contended on behalf of the opposite party, that in view of the fact that the order of discharge did not amount to disciplinary action, there could be no question of going up in appeal against that order......." It is thus clear that no appeal lies against the impugned order.
But it has been rightly contended on behalf of the opposite party, that in view of the fact that the order of discharge did not amount to disciplinary action, there could be no question of going up in appeal against that order......." It is thus clear that no appeal lies against the impugned order. 13 True that no industrial dispute was raised in this case, but that also would not stand in the way of the petitioner, for the simple reason that under Section 10 of the Act it is the option of the appropriate Government to make a reference or not. The petitioner has no vested right to get the same, referred for an award. I am supported in this view by a Bench decision of this Court reported in 1978 BBCJ (HC) 350 through which four writ petitions were disposed of. It was held that the remedy which could bar the writ jurisdiction under Article 226 of the Constitution as amended by 42nd Amendment must be adequate and efficacious and not merely illusory. 14. Thus, there does not appear to be any thing against the maintainability of this writ petition. 15. Point No. 4: The petitioner has impleaded only the Regional Manager of the State Bank of India as party to his writ petition. He has not impleaded the State Bank of India as party, but the vakalatnama filed shows that the Regional Manager had given the vakalatnama for the Bank. It is also not disputed that it is the Bank which has contested the petition and not the Manager in his personal capacity. The affidavit has also been sworn by Sri Kameshwar Prasad who says in paragraph 1 of the counter affidavit itself that I am the officer of Bank and as such am well acquainted with the facts and circumstances of the case. Obviously, therefore, it is the Bank which has fought the case and, the irregularity, if any, stands cured. 16. In view of the discussions aforesaid it is clear that the order contained in Annexure 4 to the writ petition discharging the petitioner was not a valid order inasmuch as it was not accompanied with the amount of compensation in accordance with the provisions of the Industrial Disputes Act, 1947 . A question arises as to what will be his position after 25th May, 1976. In all fairness he has to be reinstated.
A question arises as to what will be his position after 25th May, 1976. In all fairness he has to be reinstated. But he will be treated as a purely temporary hand junior to all others of that grade. So far his salary is concerned he may get the lowest pay of the grade. Such a course has also the sanction of the Supreme Court in AIR 1976 SC 1111 : (1978 Lab IC 769) (para 10). 17. With the above direction the writ petition is allowed and the order contained in Annexure 4 is quashed. In the circumstances of the case there will be no order as to costs. 18. I agree.