State Bank Of India v. Union Of India — 1988 DIGILAW 206 (PAT)

Judgment Nagendra Prasad Singh, J. 1. This application has been filed for quashing an Award of the Central Government Industrial Tribunal (hereinafter referred to as the Tribunal) holding that the action of the petitioner while terminating the services of the workman respondent 3 (hereinafter referred to as the respondent) was not justified and as such the respondent was entitled to be reinstated in the service of the bank with full back wages. 2. The case of the respondent is that he was appointed as Guard-cum-Messenger against permanent vacancy on temporary basis by the competent authority of the State Bank of India, He joined the said post on 2nd February 1972 at Kadamkuan Branch of the State Bank. He continuously worked at Kodamkuan Branch till 21st January 1975 and thereafter he was transferred to Bihar School Examination Board Branch of the Bank where he joined on 21st January 1975. Again he was transferred to Fraser Road Branch of Bank where he joined on 1st July1975. Since 26th November 1975 he has been stopped from performing his duty by the Manager of the said Fraser Road Branch of the Bank. This led to an industrial dispute, which was ultimately referred by the appropriate Government to the Tribunal in the following words:- Whether the action of the management of State Bank of India in relation to their Patna Branch in terminating the services of Shri Rambinay Syharma, Ex-Guard-cum-Messenger with effect from 26th November 1975 is justified? If not, to what relief is the workman concerned entitled? 3. While the reference was being heard by the Tribunal, the petitioner filed a writ application (C.W.J.C. No. 1195 of 1981 (R) before this Court for quashing an order dated 16th July 1981, passed by the Tribunal, rejecting the prayer of the petitioner for adjournment and calling upon the parties to adduce evidence. A bench of this Court disposed of the said application at the admission stage itself on 30th July 1981 without hearing the respondent. A direction was given to the Tribunal to give reasonable time to the petitioner to produce its witnesses and then to dispose of the proceeding in accordance with law. 4. Before the aforesaid order of the High Court could be communicated to the Tribunal, an Award was given on 4th August 1981. A direction was given to the Tribunal to give reasonable time to the petitioner to produce its witnesses and then to dispose of the proceeding in accordance with law. 4. Before the aforesaid order of the High Court could be communicated to the Tribunal, an Award was given on 4th August 1981. That Award was challenged by the petitioner-Bank before this Court by filing another writ application (C.W.J.C. No. 1598 of 1981 (R). A learned Judge of this Court disposed of that writ application on 1st August 1985 saying that as the Award had been given after the aforesaid order dated 30th July 1981 had been passed by this Court in the earlier writ application, it was being quashed. A further direction was given to the Tribunal to decide the reference after giving reasonable opportunity to the petitioner and the concerned workman for adducing evidence. Thereafter, five witnesses were examined on behalf of the petitioner-Bank and the respondent examined himself in support of his case. 5. It is an admitted position that no order had been issued by the petitioner Bank terminating the services of the respondent. The service of the respondent according to the respondent stands terminated on the oral order of the Branch Manager since 26th November 1975. The respondent challenged the said oral order of removal from the Bank, saying that even if the said oral order be deemed to be retrenchment within the meaning of Sec.2(oo) of the Industrial Disputes Act (hereinafter referred to as the Act), as there has been non-compliance of the requirements of S .25F of the Act, the order of termination shall be invalid. 6. The case of the petitioner before the Tribunal was that the respondent while being posted at the Fraser Road Branch of the Bank, committed forgery in his Savings Bank Account by altering the balance noted therein with a view to withdraw an excess amount on 21st October 1975. It is said that although the balance to the credit of the respondent was Rs. 7.01, by interpolation in the bank ledger, he enhanced the same to Rs. 47.01 by adding 4 before 7 and withdrew a sum of Rs. 45 on 24th October 1975. According to the petitioner, thereafter, the Branch Manager did not allow the respondent to continue his duty. 7. 7.01, by interpolation in the bank ledger, he enhanced the same to Rs. 47.01 by adding 4 before 7 and withdrew a sum of Rs. 45 on 24th October 1975. According to the petitioner, thereafter, the Branch Manager did not allow the respondent to continue his duty. 7. The Tribunal came to the conclusion that as the respondent had worked continuously for 710 days between 2nd February 1972 and 25th November 1975 where after his service is said to have been terminated orally, he was entitled to the protection of Sec.25-F of the Act. It was also held that as the requirements of Sec.25-F of the Act had not been complied with there was no termination in eye of law. On that finding he directed reinstatement with back wages as already mentioned above. It may be pointed out that in respect of the evidence adduced on behalf of the Bank regarding misconduct of the respondent before the termination of his service it was held that in the facts and circumstances of the case as the action of the Bank only amounted to retrenchment of the respondent as defined under Sec.2(oo) of the Act, it was not proper to use the 5 evidence adduced on behalf of the Bank to establish the charge of misconduct against the respondent. 8. On the pleading of the parties before the Tribunal as well as before this Court it is an admired position that the respondent had been appointed on temporary basis as Guard-cum-Messenger and in that capacity the respondent continued in the service of the Bank for more than 240 days. The other fact which is not in dispute is that at no stage any charge was framed or any domestic enquiry was held in respect of the allegations regarding withdrawal of Rs.45/-by the respondent. It is also an admitted position that no order of termination, dismissal or discharge was passed against the respondent. The assertion of the respondent that he had not been allowed to perform his duties with effect from 26th November 1975 on the basis of verbal order of the Branch Manager was neither challenged before the Tribunal nor before this Court. 9. The assertion of the respondent that he had not been allowed to perform his duties with effect from 26th November 1975 on the basis of verbal order of the Branch Manager was neither challenged before the Tribunal nor before this Court. 9. The validity of the Award was questioned primarily on the ground that Tribunal, having allowed the petitioner-Bank to lead evidence in respect of the misconduct of the respondent, which led to the termination of his service, should have recorded a finding on the basis of evidence adduced that the Bank was justified in dismissing the respondent for misconduct with which he had been charged. According to the petitioner in view of Sec.11-A of the Act it was open to the petitioner to justify its action taken against the respondent for the alleged misconduct before the Tribunal, although no formal domestic enquiry had been held by the Bank before the service of the respondent was terminated. 10. Sec.11-A of the Act as follows:- 11-A. Powers of Labour Courts, Tribunals and National Tribunals to give appropriate relief in case of discharge or dismissal of workman:- Where an industrial dispute relating to the discharge or dismissal of a workman has been referred to a Labour Court, Tribunal or National Tribunal for adjudication and, in the course of the adjudication proceedings, the Labour Court, Tribunal or National Tribunal, as the case may be, is satisfied that the order of discharge or dismissal was not justified it may by its award, set aside the order of discharge or dismissal and direct reinstatement of the workman on such terms and conditions, if any, as it thinks fit, or give such other relief to the workman including the award of any lesser punishment in lieu of discharge or dismissal as the circumstance of the case may require: Provided that in any proceeding under this Section the Labour Court. Tribunal or National Tribunal, as the case may be, shall rely only on the materials on record and shall not take any fresh evidence in relation to the matter. Tribunal or National Tribunal, as the case may be, shall rely only on the materials on record and shall not take any fresh evidence in relation to the matter. The Supreme Court on several occasions has examined the scope of this Section specially in the context as to whether in cases where a domestic enquiry is held to be invalid or where no domestic enquiry has been held prior to the dismissal or discharge of the workman concerned, it is open to the management to examine witnesses before the Tribunal to satisfy that the order of dismissal or discharge was valid. Even before coming into force of Sec.11-A on the basis of earlier decisions it was pointed out by the Supreme Court in the case of Delhi Cloth and General Mills Co. V/s. Ludh Budh Singh 1972-1-LLJ-180 at 198 that "if no domestic enquiry had been held by the management, or if the management makes it clear that it does not rely upon any domestic enquiry that may have been held by it, it is entitled to straightway adduce evidence before the Tribunal justifying its action." It was held that the Tribunal is bound to consider the evidence adduced before it on merits. While construing the scope of Sec.11-A of the Act itself the Supreme Court in the case of the workmen of Firestone Tyre and fiubber Co. of India P. Ltd. V/s. The Management 1973-1-LLJ-278 pointed out that even in cases where after a proper and valid domestic enquiry a workman has been dismissed be the employer, Sec.11-A of the Act empowers the Labour Court or the Tribunal to reappraise the evidence and examine the correctness of the findings thereat. About cases where either no enquiry or defective enquiry had been held by the employer, it was observed as follows (p.296) Therefore, the position is that even now the employer is entitled to adduce evidence, for the first time before the Tribunal even if he had held no enquiry or the enquiry held by him is found to be defective. About cases where either no enquiry or defective enquiry had been held by the employer, it was observed as follows (p.296) Therefore, the position is that even now the employer is entitled to adduce evidence, for the first time before the Tribunal even if he had held no enquiry or the enquiry held by him is found to be defective. It was also pointed out that with introduction of Sec.11-A now full power has been given to the Tribunal to go into evidence and to satisfy it-self about the guilt or otherwise of the concerned workman on the basis of the evidence adduced before it for the first time and as to whether the order of dismissal or discharge was valid on the materials produced before it. The same view has been reiterated thereafter in the case of Gujarat Steel Tubes Ltd. V/s. Gujarat Steel Tubes Mazdoor Sabha 1980-I-LLJ-137 at 156: If misconduct was basic to the discharge and no enquiry precedent to the dismissal was made the story did not end there in favour of the workmen. The law is well settled that the Management may still satisfy the Tribunal about the misconduct. 11. In view of aforesaid pronouncement there should not be any difficulty in accepting the contention raised on behalf of the petitioner that the Tribunal should have considered and appraised the evidence adduced on behalf of the petitioner regarding the misconduct of the respondent, and should have recorded a finding whether the alleged misconduct had been-proved or not, instead of saying that as there had been non-compliance of Sec.25-F of the Act the termination was invalid in eye of law. But the difficulty in present case is that the Bank at no stage claimed to have dismissed or discharged the respondent. I have already pointed out that there is no written order either of dismissal, discharge or termination in respect of the respondent. As such, the question, which has to be answered is as to whether the right of management to lead evidence before the Tribunal justifying an order of dismissal or discharge in connection with any misconduct of a workman, can be exercised even in a case where there is no order of dismissal, discharge or termination. As such, the question, which has to be answered is as to whether the right of management to lead evidence before the Tribunal justifying an order of dismissal or discharge in connection with any misconduct of a workman, can be exercised even in a case where there is no order of dismissal, discharge or termination. No case was brought to our notice in support of the stand of the petitioner that the power under Sec.11-A can be exercised even in cases where the management never claimed to have dismissed or discharged the workman in question. If the bank had issued even an order of termination simplicities, it could have justified its action before the Tribunal by adducing evidence that in fact it was an order of dismissal on the ground of misconduct committed by the respondent. The principle of tearing the veil in such cases has been accepted by courts. In the aforesaid Gujarat Steel Tubes case (supra) it was pointed out (150-151): Masters and servants cannot be permitted to play hide and seek with the law of dismissals and plain and proper criteria are not to be misdirected by terminological cover-ups or by appeal to psychic processes but must be grounded on the substantive reason for the order, whether disclosed or undisclosed. The Court will find out from other proceedings or documents connected with the formal order of termination what the true ground for the termination is. If. thus scrutinized, the order has a punitive flavour in cause or consequence, it is dismissal. If it falls short of this test, it cannot be called a punishment. To put it slightly differently, a termination effected because the master is satisfied of the misconduct and of the consequent desirability of terminating the service of the delinquent servant it is a dismissal, even if he had the right in law to terminate with an innocent order under the standing order or otherwise. Whether in such a case the grounds are recorded in a different proceeding from the formal order does not detract from its nature. Nor the fact that after being satisfied of the guilt, the master abandons the enquiry and proceeds to terminate. Given an alleged misconduct and a live nexus between it and the termination of service the conclusion is dismissal, even if full benefits as on simple termination are given and non-injurious terminology is used. Nor the fact that after being satisfied of the guilt, the master abandons the enquiry and proceeds to terminate. Given an alleged misconduct and a live nexus between it and the termination of service the conclusion is dismissal, even if full benefits as on simple termination are given and non-injurious terminology is used. But it was further pointed out:- On the contrary, even if there is suspicion of misconduct the master may say that he does not wish to bother about it and may not go into his guilt but may feel like not keeping a man he is not happy with. He may not like to investigate nor take the risk of continuing a dubious servant. Then it is not dismissal but termination simplicities, if no injurious record of reasons or punitive pecuniary cut-back on his full terminal benefits is found. For, in fact, misconduct is not then the moving factor in the discharge. 12. All this can be said only when there is an order of termination or dismissal. But for the expression used Sec.2(00)of the Act while defining "retrenchment", in the present case it could not have been held that the service of the respondent has been terminated with effect from 26th November 1975. Sec.2(00) while defining retrenchment says that it means "termination by the employer of the service of a workman for any reason whatsoever", which has been given an expansive meaning by courts to cover even cases where there is no written order of termination. Reference in this connection may be made to the case of The State Bank of India. V/s. N. Sundara Money, in which it was pointed out: 1976-I-LLJ-478 at 482 A break-down of Sec.2(oo) unmistakably expands the semantics of retrenchment. Termination...for any reason whatsoever are the key words. Whatever 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 takes 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 termination by the employer, but the fact of termination howsoever produced. A termination takes 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 termination by the employer, but the fact of termination howsoever produced. May be, the present may be a hard case, but we can visualize abuses by employers, by suitable verbal devices, circumventing the amour of Sec.25F and Sec.2(oo). Without speculating on possibilities, we may agree that retrenchment is no longer terra incognita but area covered by an expansive definition. It means to end, conclude, cease. In the case of Delhi Cloth and General Mills Co. Ltd. V/s. Shambhu Nath Mukherji 1978-I-LLJ-1 striking off the name of the workman from the rolls by the management, was held to be termination of his service so as to be included within the meaning of retrenchment as defined by Sec.2(oo) of the Act for the purpose of protection under Sec.25-F of the Act. Again in the case of Mohan Lai V/s. The Management of M/s Bharat Electronics Ltd. 1981-II-LLJ-70 it was pointed out (P.73): Niceties and semantics apart, termination by the employer of the service of a workman for any reason whatsoever would constitute retrenchment except in cases excepted in the section itself 13. Because of the language of Sec.2(oo) of the Act and the expansive meaning given to that Section by courts there may be termination even in cases where no written order of termination has been issued. but in my view, the requirements or conditions are not identical for an order of dismissal or discharge. Merely because management has refused to take work from a workman, it will not amount to the dismissal or discharge of such workman, although it may amount to his retrenchment within the meaning of Sec.2(oo) of the Act. It is not possible to give an expansive meaning in context with Sec.11-A of the Act because that Section itself speaks:- ...if in the course of the adjudication proceedings, the Labour Court, Tribunal or National Tribunal, as the case maybe, is satisfied that the order of discharge or dismissal was not justified.... (Emphasis added) 14 The petitioner-Bank shall be deemed to be a State within the meaning of Article 12 of the Constitution. (Emphasis added) 14 The petitioner-Bank shall be deemed to be a State within the meaning of Article 12 of the Constitution. As such it cannot orally terminate the service much less dismiss an employee. But as petitioner-Bank will be deemed to be an industry" for the purpose of the Act in view S.2(00)it can terminate the service of a workman orally. The question is as to whether that power can be extended even to cases of dismissal or discharge on the ground of misconduct. In my view there must be an order of termination, dismissal or discharge in existence before the management can exercise its power to adduce evidence before the Tribunal under Sec.11-A of the Act. justifying its action. Perhaps, because of that the appropriate Government while referring the dispute to the Tribunal has used the expressions. Whether the action of the management of State Bank of India in relation to Patna Branch in terminating the service of Shri Rambinay Sharma is justified. (Emphasis added) 15. The learned Counsel for the petitioner then submitted that whatever may be the legal position regarding applicability of Sec.11-A of the Act so far as the present case is concerned, in view of the direction given by this Court in the earlier writ application, the Tribunal was bound to consider the evidence adduced on behalf of the petitioner-Bank regarding the misconduct of the respondent. The learned Judge while quashing the earlier Award dated 4th August 1981 had directed as follows:- In the result, this application is allowed and the award contained in Annexure 7 is quashed and the matter is sent back to respondent No. 1 to decide the reference after giving reasonable opportunity to the petitioner for adducing evidence. Respondent 1 will also give reasonable opportunity to respondent 2 for adducing evidence in the case if he chooses to do so It may be pointed out that in the whole judgment there is no direction by this Court to apply the provisions of Sec.11-A in the present case and to determine on the basis of the materials adduced by the petitioner whether the misconduct alleged had been established against the respondent. Merely because this court directed the Tribunal to offer reasonable opportunity to the parties to adduce evidence it does not mean that this court had directed to adopt the procedure of Sec.11-A of the Act. Merely because this court directed the Tribunal to offer reasonable opportunity to the parties to adduce evidence it does not mean that this court had directed to adopt the procedure of Sec.11-A of the Act. If this Court had given any such direction in the earlier writ application, although in the facts and circumstances of the case there was no scope for giving such direction, that direction having not been challenged in appeal, perhaps, would have become final, operative and binding, and there was no scope for Tribunal to ignore the evidence adduced on behalf of the petitioner in respect of the misconduct of the respondent. But in absence of any such specific direction, in my view, the Tribunal was perfectly justified in ignoring that evidence in absence of any order of dismissal or discharge. As even in absence of a written order of termination in the facts and circumstances of the present case, it can be held that there has been a termination within the meaning of Sec.2(oo) of the Act, and there being no dispute that the requirements of Sec.25-F of the At had not been complied with by the petitioner-Bank, irresistible conclusion will be that the service of the respondent has been terminated in contravention of the mandatory requirements of Sec.25-F of the Act which shall render the termination of the respondent illegal and invalid. The Tribunal was; right in coming to the aforesaid conclusion and directing the petitioner-Bank to reinstate the respondent in the service of the bank with full back wages. 16. In the result, this application fails, and is dismissed. As the petitioner-Bank has invoked the writ jurisdiction of this Court thrice and the respondents service stands terminated since 26th November 1975 the bank is directed to pay Rs.500.00 as costs to the respondents.