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1987 DIGILAW 611 (RAJ)

Indian Tourism Development Corporation Ltd. v. The Authority Appointed under the Raj. Shops & Commercial Establishments, Act, 1958

1987-08-21

P.C.JAIN, S.C.AGRAWAL

body1987
JUDGMENT 1. - This writ petition under Article 226 of the Constitution of India has been filed by the petitioner, Indian Tourism Development Corporation Ltd., Jaipur against the order dated 30th September, 1986, passed by the Authority appointed under the Rajasthan Shops & Commercial Establishments Act, 1958, directing the petitioner to reinstate iv employee N. D. Gupta, who had been dismissed vide its order dated 19th June, 1985. 2. Though the point raised in this case lies in a narrow compass, but it will be relevant to mention some of the facts leading to the present writ petition: The petitioner Corporation is engaged in tourism development in the country. The petitioner Corporation runs various hotels in the country and one Hotel Jaipur Ashok, Jaipur is managed by it. Respondent No.. was an employee of the petitioner and was working in Hotel Jaipur Ashok, where he was posted as Junior Accountant. It is alleged that while discharging his duties he had committed a misconduct pertaining to the embezzlement of Rs. 2,000/- in nine spells by making interpolation in the record by way of alterations and cuttings in foreign exchange encashment certificates and receipts and in the related account books. Respondent No.2 was served with a charge-sheet. After the receipt of the charge-sheet respondent No. 2 filed a reply, which was not found satisfactory by the disciplinary authority and, therefore he ordered a domestic inquiry into the charges levelled against him. The Enquiry Officer conducted the enquiry and submitted his report to the disciplinary authority, finding respondent No. 2 guilty of the charges levelled against him. The Disciplinary Authority after going through the report of the Enquiry Officer issued a show cause notice to respondent No. 2 proposing a penalty of dismissal from service. Respondent No. 2 submitted a reply to the Disciplinary Authority who found the reply unsatisfactory. The Disciplinary Authority passed an order of dismissal against respondent No. 2 vide his order dated 19th June, 1985. Aggrieved by the order of termination, respondent No. 2 filed an application under Sec 28A of the Rajasthan Shops & Commercial Establishments Act, 1958 (in short, the Act) challenging his termination. The Authority under the Act after hearing the parties set aside the order of termination passed against respondent No. 2 and directed the petitioner to reinstate respondent No. 2 with all back wages. The Authority under the Act after hearing the parties set aside the order of termination passed against respondent No. 2 and directed the petitioner to reinstate respondent No. 2 with all back wages. It may be stated here that the Authority under the Act held that the inquiry conducted by the Enquiry Officer was not fair as respondent No, 2 was not given a fair opportunity to defend his case. On critical analysis, the Authority under the Act observed that the domestic enquiry was conducted in breach of the principles of natural justice. It is to assail the order of the Authority under the Act, (respondent No. I) dated 30th September, 1986, that this writ petition has been filed by the petitioner. 3. Mr. M.K Shah, learned counsel for the petitioner, has submitted that. the order dated 30th September. 1986 passed by respondent No. 1 is illegal and cannot be sustained on the following grounds: (a) That the finding of the learned Authority that respondent No. 2 had been denied the right of defence and, therefore, the inquiry was unfair and in breach of the principles of natural justice, is not based on any evidence on record and is a perverse finding. (b) That the learned Authority, respondent No. 1, has failed to exercise its jurisdiction vested in it under Section 28A of the Act, which permits the Authority to allow the employee (sic employer) to adduce additional evidence to prove the charge of misconduct levelled against the employee. Since respondent No. I did not allow the petitioner to adduce additional evidence to prove the charge of misconduct against respondent No. 2, respondent No. I has acted without jurisdiction and the order dated 30th September, 1986, liable to b;, set aside. 4. Shri P.K. Sharma, learned counsel for respondent No. 2, has submitted that the contentions raised by Shri Shah, learned counsel for the petitioner, are without any merit as the finding of respondent No. I with regard to defective inquiry in violation of principles of natural justice is based on proper appreciation of facts on record, and further there is no power vested in the Authority appointed under the Act to permit the employee (sic employer) to adduce additional evidence in support of the allegations of misconduct. The submission of Shri Sharma is that there is no power to direct the employer to conduct a de novo inquiry. 5. The submission of Shri Sharma is that there is no power to direct the employer to conduct a de novo inquiry. 5. We have given our anxious consideration to the submissions made by the learned counsel for the parties and have also perused the record of the case. 6. The grievance of respondent No. 2 that he was not given a reasonable opportunity to defend himself appears to be well-founded. On 19th September, 1984, the enquiry was fixed for evidence of the management. Shri N.D. Gupta, respondent No. 2, was present, but this representative I. R. Hemilton was not present. Shri N.D. Gupta. the employee, informed the Enquiry Officer that ITDC had banned the appearance of Shri Hemilton in all units of the Corporation including the Hotel Ashok, Jaipur and, as such, he is unable to represent him in the inquiry Shri Gupta, respondent No. 2 prayed for adjourning the hearing. but the hearing was not adjourned and the Enquiry Officer directed Shri Gupta to participate in the enquire and to defend himself. From the record, it is also evident that the Enquiry Officer proceeded with the enquiry in the absence of the employee, respondent No. 2. Thereafter. respondent No. 2 through letters dated I0th October. 1984, 6th November, 1984 and 12th January, 1985 had asked the Enquiry Officer to allow respondent No. 2 to participate in the enquiry but no action was taken by him. In the circumstances, the finding of respondent No. I that the enquiry was not held properly and the employee was not given ample opportunity to defend himself and that there was breach of principles of natural justice cannot be said to be wrong. It is well settled that by reason of breach or violation of principles of natural justice, a grave prejudice is caused to the delinquent employee and, as such, he is entitled to have the order of dismissal declared null and void and to have it set aside and quashed. We, therefore, agree with the finding of the prescribed Authority. respondent No. 1 and hold that there is no merit in the first contention raised by Shri Shah, learned counsel for the petitioner. 7. Now, we shall deal with the other submissions made by Shri Shah, learned counsel for the petitioner. We, therefore, agree with the finding of the prescribed Authority. respondent No. 1 and hold that there is no merit in the first contention raised by Shri Shah, learned counsel for the petitioner. 7. Now, we shall deal with the other submissions made by Shri Shah, learned counsel for the petitioner. In order to appreciate the submissions made by Shri Shah it would be better if we reproduce Section 28A of the Act with relevant Rule. It is reproduced as under : "28-A. Notice of dismissal or discharge by employer:-(1) No employer shall dismiss or discharge from his employment any employee who has been in such employment continuously for a period of not less than 6 months except for a reasonable cause and after giving such employee at least one month's prior notice or on paying him one month's wages in lieu of such notice; Provided that such notice shall not be necessary where the services of such employee are dispensed with for such misconduct, as may be defined in the rules made by the State Government in this behalf. and supported by satisfactory evidence recorded at an enquiry held for the purpose in the prescribed manner. (2) Every employee so dismissed or discharged may make a complaint in writing in the prescribed manner to a prescribed authority within 30 days of the receipt of the order of dismissal or discharge on one or more of the following grounds, namely : (a) that there was no reasonable cause for dispensing with his services; or (b) that no notice was served upon him as required by sub-section (I) or (c) that he had not been guilty of any misconduct : Provided that the prescribed authority may condone delay in filing such a complaint if it is satisfied that there was sufficient cause for not making the complaint within the prescribed time. (3) The prescribed authority shall cause a notice to be served on the employer relating to the said complaint, record briefly the evidence produced by the parties, hear them and make such enquiry as it nay consider necessary and thereafter pass orders in writing. giving reasons therefor. (4) While passing an order under sub-section (3), the prescribed authority shall have power to give relief to the employee by way of re-instatement or by awarding money compensation or by both. giving reasons therefor. (4) While passing an order under sub-section (3), the prescribed authority shall have power to give relief to the employee by way of re-instatement or by awarding money compensation or by both. (5) The decision of the prescribed authority under this section shall be final and binding both on the employer and the employee." Rule 24-A lists all the acts, which may be termed as misconduct. Under Rule-24-B (8) procedure is prescribed as follows : "24-B(8) The prescribed authority shall record briefly the evidence adduced before him, hear the parties summarily and after making such further enquiry as he may consider necessary. pass orders giving reasons therefor. T he orders shall be communicated to the parties forthwith." 8. Rule 24A prescribes list of acts which may be treated as misconducts as follows : (1) The following Acts shall each be treated as misconduct for the purpose of the proviso to sub-section (1) of Section 28A of the Act. (a) Wilful insubordination or disobedience, whether alone o. in combination with others, of any lawful and reasonable order of a superior. (b) Wilful damage or loss of employers' property. (c) Taking or giving bribe or any illegal gratification; (d) Theft, fraud or dishonesty in connection with the employers business or property; (e) Habitual absence without leave or absence without leave for more than ten days: (f) Habitual breach of any law applicable to the establishment; (g) Habitual late attendance; (h) Riotous or disorderly behaviour during working hours at the establishment or any act sub-sersive of discipline: (i) Habitual or gross negligence of neglect or work; (j) Stiking work or inciting others to strike work in contravention of the provisions of any law or rule.-...force of law; (k) Breach of the provisions of the standing orders applicable to the establishment and certified under the Industrial Employment (Standing orders) Act, 1945. (2) No order of dismissal or discharge on ground of misconduct shall be made except after an enquiry in which the employee concerned has been informed in writing of the misconduct alleged against him and is given a reasonable opportunity of being heard in respect of that misconduct, Sub-section (1) of Section 28.1 provides that no employer shall dismiss or discharge from his employment any employee who has been in such employment continuously for a period of not less than six months except for a reasonable cause and after giving such employee at least one month's prior notice or on paying him one month's wages in lieu of such notice. Thus, sub-section (() applies in cases of dismissal and discharge and in both the cases. requires (1) a reasonable cause without which an employer cannot dismiss or discharge his employee; (2) a month's notice or one month's pay in lieu thereof. In sub-section (1) there is a proviso which lays down that such a notice shall not be necessary where the services of such employee are dispensed with for such misconduct, as may be defined in the rules made by the State Government in this behalf', and supported by statisfactory evidence recorded at an enquiry held for the purpose in the prescribed manner. Sub-section (2) then provides that every employee so dismissed or discharged may make a complaint to the prescribed authority on any of the following three grounds : (a) That there was no reasonable cause dispensing with his services; or (b) that no notice was served upon him as required by sub-section (1); or (c) that he had not been guilty of any misconduct. It may also be noted here that proviso to sub-section (I) of Section 28A refers to such misconduct only as may be defined in the Rules made by the State Government in this behalf. The misconduct defined by the State Government have been enumerated in Rule 24-A. It is also evident from the Rules that no order of dismissal or discharge on the ground of such misconduct shall be made except after an inquiry in which the employee concerned has been involved in any of the misconduct alleged against him and is given a reasonable opportunity of being heard in respect of that misconduct. We also point out that under sub-rule (8) of Rule 24-B it is provided that the prescribed authority shall record briefly-the evidence adduced before him, hear the party summarily and after making such further inquiry as he may consider necessary, pass orders giving reasons therefor. A brief survey of the above referred provisions would indicate that misconducts for which an inquiry could be made in terms of proviso to sub section (1) of Sec 28A have been properly defined in the rules. There is a procedure for conducting an inquiry and the powers of the prescribed authority are also prescribed in the Rules In the back-ground of the aforesaid provisions of the Act and the rules made thereunder, we are to discover as to whether on failure to conduct an inquiry in terms of the proviso to sub-rule (1) and Section 28A, or in case the inquiry, though, conducted, is held to be defective, empowers the prescribed authority to order for de novo inquiry in the matter of charges of misconduct levelled against him. Shri Shah, learned counsel for the petitioner, submits that sub-rule (8) of Rule 24-B, read with section 28A gives jurisdiction to the prescribed authority to order de novo inquiry if the employer desires to do so In order to substantiate his case, Shri Shah has placed reliance on the following cases (1) Brooke Bond India v. Chandranath (SC) (1969 (19) FLR 180) (2) Kavitha Movie House v. M. A. Abdulkhader (1980-II LLJ 24) (3) M/s Raptakos, Brett & Co. Ltd. v. B. D. Harsha (1917 RLW 259) (4) Chelur Agencies, Calicut v. Appellate Authority, Calicut (1976 (1) Kerala 590) 9. On the other hand, Shri P. K Sharma, learned counsel for respondent No. 2 has placed reliance on Brooke Bond India v. Chandranath (supra), Kotal and Co v. Addl. Commissioner for Workmen's Compensation and Anr, (1970 (2) LLJ 364 and S. Rengarajan v. Srirangam Janopakara Bank Ltd. (23 FJR 193) . From the authorities cited above at the Bar by the learned counsel for the parties it appears that both Shri Shah, learned counsel for the petitioner and Shri P. K Sharma, learned counsel for respondent No. 2 placed reliance on Brooke Bond India v. Chandranath (supra). From the authorities cited above at the Bar by the learned counsel for the parties it appears that both Shri Shah, learned counsel for the petitioner and Shri P. K Sharma, learned counsel for respondent No. 2 placed reliance on Brooke Bond India v. Chandranath (supra). Amongst the authorities cited, there is one authority of the Supreme Court on which both the learned counsel for the parties placed reliance, there is one authority of this Court and there are authorities of Madras and Kerala High Courts. The authorities of the Kerala High Courts are unanimous in laying down that the authorities under the Kerala Shops and Establishments Act can conduct de novo inquiry; but the views expressed by the Madras High Court are not unanimous. 10. As learned counsel for the petitioner and learned counsel for respondent No. 2 place reliance on Brooke Bond India v. Chandranath (Supra), we would like to discuss the same, first. Though, Section 26 of the Bihar Shops & Commercial Establishments Act, 1953 has not been quoted in the judgment but it appears from the judgment of the Supreme Court as well as from the judgment of this Courts in M/s Raptakos, Brett & Co. Ltd. v. B. D. Harsha (supra) that proceedings under Section 26 of that Act are analogous to those under Section 28A of the Rajasthan Act. Ltd. v. B. D. Harsha (supra) that proceedings under Section 26 of that Act are analogous to those under Section 28A of the Rajasthan Act. The Supreme Court in Brooke Bond India v. Chandranath Choudhary (Supra) after analysing Section 26 of the Bihar Shops and Establishment Act, 1933 pointed out that Sub-section (2) confers a right on an employee to file a complaint before the Labour Court on the grounds i, e. (I) that there was no reasonable cause for dispensing with his services, or (2) that no notice was served on him as required by sub-section (I) or (3) that he was not guilty of any misconduct as held by the employer The words occurring in sub-section (2) f Section 26 of the Bihar Act were interpreted by the Supreme Court to mean dismissed or discharged as stated in sub-section (1), It was observed by the Supreme Court that sub section (I) applies to all cases where an employer either dismisses or discharges his employees and requires that there should be a reasonable cause for such an order and a notice or one month's wages in lieu thereof It means that an employer cannot dismiss or even discharge his employee without a reasonable cause therefor, and without giving one month's notice or payment of a month's wages in lieu thereof. It was further observed that even when a employer alleges that he had a reasonable cause for discharging or dismissing his employee the matter does not end as an employee so dismissed or discharged has the right under subsection (2) to file a complaint on any one of the three grounds referred to above. Further when a complaint is filed the procedure laid down in sub-section (5) would apply and the competent authority is entitled to record evidence and come to its own findings on such evidence. In that case, it was contended that Section 26 of the Act cannot apply, as it gives jurisdiction to the Labour Court to enters; in a complaint only in cases of misconduct as defined in the rules made under the Act, and if the misconduct alleged against the employee in the charge-sheet does not fall within the various acts set out in the rules, the authority will have no jurisdiction to entertain the complaint. Repelling this argument, the Supreme Court stated that the words 'any misconduct' show that sub-section (2) is not confined only to misconduct set out in Rule 20. It was clearly observed that sub-section (2) makes it abundantly clear that sub-sec. (2) applies to all cases of dismissal or discharge and not merely to the cases falling under the proviso. Sub-section (5) of Section 26 is also analogous to sub-rule 8 of Rule 24B of the Rules made under the Rajasthan Act of 1958. Rules 24A and 2-1B were introduced by Rajasthan Shops & Commercial (Amendment) Rules, 19"72. The said provisions provide that the prescribed authority shall cause a notice to be served on the employer relating to the said complaint, record briefly the evidence adduced by the parties, hear them and after making such inquiry as it may consider necessary, pass orders, giving reasons therefor. In the case before the Supreme Court the employee was served with a charge-sheet and an inquiry into the said charges was held The Enquiry Officer concluded his report by holding that the charges were satisfactorily proved and by an order dated 20th September, 1961, the company discharged the respondent employee from the company's services. Aggrieved by the order of discharge, the respondent filed a complaint, in the Labour Court under Section 26 of the Bihar Shops and Establishments Act 1953 on the ground that there was no reasonable cause for dispensing with the services and that he was not guilty of any misconduct. The Labour Court, with the consent of the parties, admitted the evidence recorded in the domestic inquiry as substantive evidence and also recorded certain other evidence led by the parties and ultimately found that the domestic inquiry was properly held and that it had jurisdiction to record evidence and come to its own findings of the domestic inquiry. The question arose before the Supreme Court was whether the Labour Court was right in entertaining additional evidence and in this regard the Supreme Court observed as follows : "The language of Section 26 clearly shows that when a complaint is filed on any one of the grounds set out in sub-section 2 the procedure laid down in sub-section 5 would apply and the competent authority is entitled to record evidence and come to its own findings on such evidence. The authority thus is required to come to its own findings on the evidence adduced by the parties and recorded by it independently of the findings given in the domestic enquiry. This is also clear from sub-section 2 where under an employee has a right to show that there was no reasonable cause for dispensing with his services or that he was not guilty of the misconduct for which he was charged and held guilty in a domestic enquiry. The fact that he is entitled to file a complaint and show that there was no reasonable cause or that he was not guilty of misconduct shows that the competent authority under Section 6 has to come to its own findings on the evidence led before it irrespective of the findings in the domestic enquiry." 11. It may be observed that the misconduct alleged *against the petitioner was one of the prescribed misconducts. The case of the employer was that they had reasonable cause to dispense with the service of the employee. The case of Brooke Bond India v. Chandranath (Supra) was not a case of defective domestic inquiry In Raptakos, Brett & Co. Ltd v. B. D. Harsha (Supra), a learned Single Judge of this Court (Hon'ble Sen J, as he then was) also considered the scope of Section 28A of the Act. In that case, there was no domestic inquiry held against the employee as he was never charge-sheeted; no olficer was appointed for inquiry and no evidence was led at any stage of the inquiry. The only controversy before the Tribunal was whether or not there was any reasonable cause for the discharge of respondent No. 2 from service within the meaning of Section 28A of the Act. The learned Judge observed that the Tribunal exceeded its jurisdiction on embarking on an inquiry which did not arise from the pleadings of the parties. The Authority by its order dated 31st Dec., 1987 (?) set aside the termination order on the ground that the allegations contained in the charge-sheet dated 17th March, 1976 were not established and, therefore, the order of dismissal as bad and it was directed that the petitioner be reinstated in service with full back wages. The learned Judge held that the Authority completely misdirected itself that respondent No. 2 had been dismissed from service for misconduct while this was a case of discharge simplicitor. The learned Judge held that the Authority completely misdirected itself that respondent No. 2 had been dismissed from service for misconduct while this was a case of discharge simplicitor. In the circumstances, the learned Judge allowed the petition and set aside the award of the Authority and dismissed the complaint. It w.i , thus. not a case where a domestic inquiry was held and the same was found to be defective Thus, the Rajasthan case and the Supreme Court case in no way render much assistance to resolve the issue which has been raised by the learned counsel for the petitioner. 12. However, there seems to be no dispute about the proposition of law laid down in the aforesaid two judgments of the Supreme Court and this Court which may be stated. thus, (I) There is no comparison between Section 28A of the Rajasthan Act and the provisions of the Industrial Disputes Act and the provisions of the two Acts are quite different, and further the purposes of Section 28A of the Rajasthan Act or Section 26 of the Bihar Act and Section 33A of the Industrial Disputes Act are distinct. (2) In case, the employer terminates the services of his employee on a reasonable cause after giving a notice as required under sub-section (I) of Section 26 of the Bihar Act or sub-section (I) of Section 28A of the Rajasthan Act, the Authority is required to come to its own finding on the evidence adduced by the parties and recorded by it independently of the findings given in the domestic inquiry. It is, thus, clear that even if a domestic inquiry was conducted by the employer the Authority shall have to decide the case after recording evidence as may be required and come to its own finding, as the employee has a right to show that his services were not dispensed with on reasonable cause or that he was not guilty of misconduct for which he was charged or held guilty in a domestic inquiry (3) The proviso applies only to those types of misconduct prescribed by the State Government and not to the rest of the misconducts not so prescribed, and provides that where services of an employee are dispensed with for a misconduct set out in the Rules it should be supported by satisfactory evidence recorded in a domestic inquiry held in this regard. As discussed above, in Brooke Bond India's case (Supra) the services of the employee were terminated on the ground of misconduct after a domestic inquiry. The domestic inquiry was held to be fair but the misconduct was not held to be proved In the Rajasthan case, the case of the employer was that the services of the employee were not terminated on the ground of misconduct, but there was a reasonable cause for terminating the services and, on fact the reasonable cause was found to be proved. It was not a case where the services were terminated on the ground of misconduct after a domestic inquiry. Thus, these two cases have a different background. But in the instant case, the services were terminated on the ground of misconduct which falls under Rule 24A. The services were terminated after a domestic inquiry which was not found to be valid as reasonable opportunity was not given to the employee to defend himself. 13. Now, we shall discuss the various judgments of the Kerala High Court. The relevant provision of the Kerala Shops and Commercial Establishment Act reads as follows: "18 Notice of dismissal-(I) no employer shall dispense with the services of an employee employed continuously for a period of not less than six months, except for a reasonable cause and without giving such employee at least one month's notice or wages in lieu of such notice, provided however that such notice has I not be necessary where the services of such employee are dispensed with on a charge of misconduct supported by satisfactory evidence recorded at an inquiry held for the purpose. (2) Any employee whose services are dispensed with may appeal to such authority and within such time as may be prescribed either on the ground that there was no reasonable cause for dispensing with his services or on the ground that he had not been guilty of misconduct as held by the employer. (3) The appellate authority may, after giving notice in the prescribed manner to the employer and the employee, dismiss the appeal or direct the reinstatement of the employee with or without wages for the period he was kept out of employment or direct payment of compensation without reinstatement or grant such other relief as it deems fit in the circumstances of the case." 14. In Chelur Agencies, Calicut v. Appellate Authority, Calicut (Supra), the question arose regarding the powers of the appellate authority as to whether the appellate authority has power to fill the lacuna by holding a de novo inquiry and sustain the punishment meted out as a result of such inquiry i.e in case it is found that the inquiry held by the employer was defective or unfair or not proper, or had been an act of victimisation, or was contrary to the principles of natural justice, then the appellate authority was within its bounds in holding the inquiry and the Kerala High Court held that it was open to the Appellate Authority to go into the matter afresh by taking additional evidence itself and by assessing the question of guilt or innocence of the employee in the light of the de novo enquiry held before it. In that judgment of the Kerala High Court various judgments of the Kerala High Court and the Madras High Court were considered laying, to some extent, divergent views. The case of Brooke Bond India was also mentioned for placing reliance, but there was no discussion on the basis of Brooke Bond India's case in the entire judgment. In fact, a cat scan of the judgments would reveal that there was discussion on the powers of the Authority but, in fact, what were the correct powers of the appellate authority were not spelt out as would be evident from the observations made by the Court in the following passage: "From the unsatisfactory nature of the discussion of the Appellate Authority and the inconclusive nature of its findings. I think it unnecessary and inappropriate to define categorically-if it were possible to do so the powers of the Appellate Authority, and the circumstances, if any, under which it may conduct a de novo enquiry and proceed to reassess the correctness of an action taken against an employee in the light of such de novo evidence. The difficulty that confronts me here is this. The Appellate Authority did not record any clear finding after a proper application of the mind and a satisfactory discussion of the salient aspects as to whether the domestic enquiry in this case was vitiated by non conformity with the principles of natural justice, and if so for what reasons." 15. The difficulty that confronts me here is this. The Appellate Authority did not record any clear finding after a proper application of the mind and a satisfactory discussion of the salient aspects as to whether the domestic enquiry in this case was vitiated by non conformity with the principles of natural justice, and if so for what reasons." 15. In Kavitha Movie House v. M.A. Abdulkhader (Supra), a Division Bench of the Kerala High Court again examined the aforesaid issue and held that in case the Appellate Authority found that the domestic inquiry was invalid or defective, the Authority can conduct de novo inquiry. The provisions of the Madras Shops & Commercial Establishment Act, are analogous to the provisions of the Kerala Shops and Establishments Act. In S. Rengarajan v. Srirangam Janopakara Bank Ltd. (Supra) a learned Single Judge of the Madras High Court held that the competent authority (there the Appellate Authority) was not competent to take additional evidence as if it were original authority and disposing of tho appeal on the basis of such evidence. In other worus, it was the opinion of the learned Single Judge that the Appellate Authority was not competent to take additional evidence. It may be observed that it was a case in which an inquiry was held into the matter of charges against the employee and the inquiry was found to be defective. In Srirangam Janopakara Bank v. Rangarajan ( 1964 (1) LLJ 221 ) , a Division Bench of the Madras High Court held that the Appellate Authority could take additional evidence in appeal whenever he finds it necessary to do so in the interest of justice. This was a case which over ruled the judgment of Veeraswami J. reported in S. Rengarajan v. Srirangam Janopakara Bank Ltd. & Anr. (Supra) This judgment of the Division Bench of the Madras High Court has taken into consideration Rule 9 sub-clause (2), which runs as under: "9 (2). The procedure to be followed by the Commissioner for Workmen's compensation when hearing appeals preferred to him under S. 41 (:') shall he summary. He shall record briefly the evidence adduced before him and then pass orders giving his reasons therefor". 16. The learned Division Bench of the Madras High Court in the above referred case took the view that the power of the Appellate Authority under Section 41. He shall record briefly the evidence adduced before him and then pass orders giving his reasons therefor". 16. The learned Division Bench of the Madras High Court in the above referred case took the view that the power of the Appellate Authority under Section 41. (2) of the Act should be coup trued in the widest manner possible so as to take in also the power to take additional evidence where the needs of the case called for it. In Kotak and Co. v. Addl. Commissioner for Workmen's Compention and Anr. (supra) Justice M. M. Ismail of the Madras High Court held the appellate authority has no jurisdiction to go into the merits of the case on the basis of the evidence led before him He further held that the authority will have jurisdiction to go into the merits of the case on the basis of the additional evidence led before him and decide one way or the other only in cases when employer bona fide holds enquiry and dispenses with the services of the employee and finds the enquiry to be not defective, as in such cases employer complies with statutory requirements of the Act. With regard to the powers given under Rule 9, the learned Judge observed that rule itself does not impose any obligation on the appellate authority to record any evidence before it and it only enables the appellate authority to briefly record the evidence that may be adduced before it. In that judgment it was made clear that where the employee does not hold any inquiry or make a farce of conducting an inquiry without bona fide intention to conduct any such inquiry as contemplated by the statute, and passes an order dispensing with the services of the employee on the ground of misconduct, in that eventuality, the appellate authority will have jurisdiction to take additional evidence In Zenith Lamps and Electricals v. Addl. Commissioner for Workmen's Compensation (1973 (11) LI.J 445) , a Division Bench of the Madras High court held that the appellate authority has no power to take additional evidence where the services of an employee who had put in more than six month's service have been terminated without any inquiry. The case of Sri Rangam Janopakara Bank Ltd. v. Rangarajan (Supra) was considered and distinguished by the Court. The case of Sri Rangam Janopakara Bank Ltd. v. Rangarajan (Supra) was considered and distinguished by the Court. It was a case where additional evidence was taken as inquiry was held in that case. From this judgment of the Division Bench of the Madras High Court it is clear that in case no inquiry is held, the appellate authority shall have no jurisdiction to take additional evidence. 17. Now, we would like to analyse the provisions of Section 28A of the Rajasthan Act. Section 28A if correctly interpreted it would mean that no employer has the right to dismiss or discharge an employee who has been in such employment continuously for a period not less than six months except for a reasonable cause after giving such employee at least one month's prior notice or on, paying him one month's wages in lieu of such notice. The proviso to Section adds a fetter to employer's power to dismiss or discharge an employee for misconduct. It is in the nature of exception and provides that no such notice shall be necessary where the services of such employee are dispensed with for misconduct as may be defined in the rules made by the State Government. It also carves out an exception to the main provision, which adds a rider by laying down that services of an employee could be terminated on the ground of such misconduct by serving the charges of misconduct on the employee and the charges should be supported by satisfactory evidence recorded at an inquiry held for the purpose in the manner prescribed. As already stated above, sub-clause (2) of Rule 24k prescribes a procedure for conducting an inquiry which lays down that where misconduct is alleged against an employee he should be given a reasonable opportunity of hearing in respect of the misconduct. We may observe that the common law gives eniplcler right to terminate the services of an employee in accordance with the terms of the contract between them. But section 28A of the Act has provided a restriction on this right by making it obligatory on the employer to hold an inquiry and make a record of the evidence before terminating the services of the employee. It is with respect to the misconducts which have been defined in the rules that an inquiry in terms of Sub-rule (2) of Rule.. 24A is required to be done. It is with respect to the misconducts which have been defined in the rules that an inquiry in terms of Sub-rule (2) of Rule.. 24A is required to be done. Thus, in case, the employer does not want to proceed in accordance with the main provision of Sec 28A and wants to terminate the services of the employee on the ground, of defined misconduct, it is obligatory upon him to make an inquiry in accordance with the rules, and if an inquiry is made, but the same is not conducted in accordance with the rules in our opinion it would not be an inquiry at all. We may further observe. as held by the Supreme Court in a number of cases, that a defective inquiry stands t n the same footing as no inquiry. Reference may be made to (9) Delhi Cloth and General Mills Co. v. Luch Budh Singh (1 )72 (25) FLR and Workmen of Motipur Sugar Factory (Private) Ltd. v. Motipur Sugar Factory (1965 (3) SCR 55 . The scherne of Sec 28A thus, suggests that in case an employer wants to terminate the services of his employee by way of dismissal or discharge, he is required to assign reasonable cause for dispensing with the services of the employee and he is further required to give one month's notice or one month's wages in lieu thereof. This procedure would be applicable for all types of misconducts on which services could be terminated and the prescribed authority may allow additional evidence to be produced even if a domestic inquiry was held or no inquiry at all was held by the employer. In case of the defined misconduct the procedure as laid down in sub-rule (2) of Rule 24A will have to be followed. In case, the prescribed authority holds that the inquiry is defective in as much as it has failed to provide reasonable opportu.,ity to defend to the employee it will be no inquiry in the eye of law. Thus, in case, where no inquiry is held in the matter of defined misconduct, the proviso will not be attracted and same result will follow in case inquiry is in violation of the prccedure prescribed under sub-rule (2) of Rule 24A. Thus, in case, where no inquiry is held in the matter of defined misconduct, the proviso will not be attracted and same result will follow in case inquiry is in violation of the prccedure prescribed under sub-rule (2) of Rule 24A. In case, the inquiry is invalid a it has violated the principles of natural justice, the same result would follow because it would again be no inquiry in the eye of law and, in such circumstances no power is vested in the prescribed authority to allow additional evidence for filling up the lacuna. In view of the discussions made above, on on the basis of the various authorities and on the plain reading of Section 28A of of the Act and the Rules made thereunder, the following principles may be culled out : "1. Where the services of an employee who has been in the employment continuously for the period of not less than six months are dispensed with either by way of dismissal or discharge. The employer may do so, by assigning reasonable cause and giving such employee at least one month's prior notice or paying him one month's wages in lieu of such notice. "2. If the reasonable cause is substantiated in a domestic inquiry conducted in the matter of misconduct of any nature alleged against the employee and, if one month's notice or one month's wages are paid in lieu of notice, the employer can justify his action either on the basis of evidence adduced in the domestic inquiry or he may substantiate the charges by producing additional evidence before the prescribed authority. In case, the services are dispensed with not on the ground of misconduct, but by way of discharge simplicitor, the same procedure is to be followed viz, that the employee is required to be given one month's wages or notice of one month and the employer may prove the grounds of dispensing with the services by producing additional evidence before the prescribed authority. "3. "3. In cases where the employer dispenses with the services of an employee on the ground of defined misconduct, as provided under Rule 24A, he is not required to give any notice, but he is required to conduct an inquiry in accordance with Sub-Rule (2) Rule 24A i. e. he is required to conduct an inquiry into the charges by giving a reasonable opportunity to the employee i e. by following the principles of natural justice and, in case, there is no such inquiry, it would mean no inquiry at all, as no inquiry or defective inquiry stands on the same footing. I he consequence of defective inquiry or no inquiry would be that proviso to Section 78A would not be attaracted and the action of the management in dispensing with the services will be null and void, 18. In the instant case, we have held that the inquiry was defective inasmuch as in the inquiry no proper opportunity was given to the employee to defend himself and, such an inquiry, is violative of the mandatory provisions of the Rules and makes the inquiry invalid and no inquiry in the eve of law at all. Thus. in our opinion the prescribed authority has committed no error of law in not allowing the petitioner to lead evidence before it for proving misconduct, alleged against the employee. We, thus, do not find any error in the order of the prescribed authority, 19. In the premises aforesaid, there is no force in the writ petition and the same is dismissed. In the facts and circumstances of the case the parties are left to bear their own costs.Petition dismissed. *******