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2000 DIGILAW 288 (BOM)

Mangatu J. Verghese v. Daulatram Dyeing and Bleaching Mills, Bombay and others

2000-04-25

R.J.KOCHAR

body2000
JUDGMENT- R.J. KOCHAR, J.:---The present petition has arisen from a judgement and order dated 1st October, 1993 dismissing the revision application filed by the employee under section 44 of the M.R.T.U. and PULP Act, 1971, challenging the judgement and order passed by 5th Labour Court, Bombay on 23rd August, 1989 dismissing the complaint of unfair labour practice filed by the employee to challenge the order of discharge dated 11th July, 1983 passed by the respondent No. 1 employer. Hereinafter the parties will be referred to as the employee and the employer. 2.If I may say both the learned Judges could have written better orders than what they have done, I would not be wrong. Indeed they are not happily written. At one point of time, I had thought of remanding the matter back for fresh trial. When, however, I noticed the date of termination as 11th July, 1983, on a second thought I have taken all the pains to hear the matter and on considering entire material on record before the Labour Court I have arrived at my one conclusions on the basis of the said material. I thought it unjust to remand the matter back to the trial Court for fresh trial after lapse of more than 17 years and again making both the parties to undergo second round of litigation. 3.The employee was employed by respondent No. 1 as a junior clerk from the year 1977. At the relevant time he was in the Accounts Department of the respondent No. 1. It is undisputed fact that in the year 1982, there was a dispute inter se, amongst the partners of the respondent No. 1 firm. One of the partners Shri V.D. Chabbria had filed a suit in the High Court for dissolution of the firm and for rendering accounts against the three other partners who are also the brothers. It further appears that the Court Receiver was appointed by this Court in the said suit and the defendant partners were appointed as his agents to conduct the business of the firm. It further appears that the Court Receiver was appointed by this Court in the said suit and the defendant partners were appointed as his agents to conduct the business of the firm. During the pendency of the said suit, it appears from the record and which is not disputed that by a notice dated 4th August, 1982, addressed by M/s. Kanga and Company, Advocates for the plaintiff in the said suit called on the employee i.e. the petitioner herein to give in writing whether some account books were maintained by him. Though it does not seem to understand why the notice was addressed to him, the same has proved to be fateful for him. It will be useful to reproduce the contents of the said notice as below :--- "In the above mattter we are instructed by our client Mr. Vasudeo D. Chabbria, the plaintiff herein to state that an account book showing the recoveries to be made by the firm of Messrs Daulatram Dyeing and Bleaching Mills, from its customers was maintained by you and still the same is maintained by you. The defendants have denied the aforesaid fact. In view of the aforesaid circumstances, under the instructions of our client, the plaintiff herein, we hereby call upon you to give us in writing, whether such book was and is maintained by you or not. If you do not write us about the fact within 48 hours from the receipt hereof by you, our client shall be constrained to take such steps against you, as he may be advised. We shall also thank you to let us know whether the aforesaid book viz., the Debtors Register has been handed over by the defendants to the Court Receiver or not." It is thus clear that the concerned employee was required to furnish certain information regarding the receipt etc. during the business. The notice also issued a threat to the employee that if he did not furnish the required information a suitable action would be taken against him. To say the least, it was not at all proper on the part of the said Advocates to have individually given such a notice to the employee. They could have adopted legal, proper and fair method of getting the required information. To say the least, it was not at all proper on the part of the said Advocates to have individually given such a notice to the employee. They could have adopted legal, proper and fair method of getting the required information. It further appears from the record that said notice was served on the employee by hand delivery at his residence and it is also significant to note that the said employee was available at his residence and had not reported for work on that day. It is also significant to note that soon after the receipt of the said notice, he rushed to the office of the said Advocates and sworn an affidavit giving the information required by them on the very same day i.e. 4th August 1982. From the face of the record it is crystal clear to me that the employee who was working in the accounts department leaked the necessary and required information to the opponents of his employer whose lis was pending in the High Court and that information was to be used by the plaintiff in the said suit. Faced with the affidavit filed by their own employee, the respondent employer when came to know that the concerned employee had leaked the necessary information, which was confidential and which pertained to the accounts maintained by it, issued a notice dated 11th July 1983 discharging the concerned employee from service with immediate effect. Since the said employee refused to accept the said letter and the amount of legal dues including retrenchment compensation etc., it was posted to him along with a covering letter dated 11th July 1983. It is a admitted fact that he received both these letters and also the legal dues including the amount of retrenchment compensation payable to him under section 25-F of the I.D. Act. The letter of termination gives reasons as loss of confidence for discharging from employment. The first para of the said letter is an under :--- "The Management regrets to inform you that since it has lost confidence in you on account of your certain activities which are inconsistent with the covenants of your contract of employment and which are detrimental to the interests of the Management, it has been decided to discharge you from service. You are therefore, hereby informed that you are discharged from service with effect from the close of working hours of today." It appears that in view of the affidavit given by the employee to the Advocates of the opponents of his employer in a High Court suit, the respondents employer considered that it was not safe to continue the concerned employee in employment as he was carrying on such activities which were inconsistent with the covenants of the contract of employment and were detrimental to the interest of the respondent management. In short he was found to be betraying the confidence of his employer and he was, therefore, considered not loyal and faithful to the employer. One additional fact which requires to be mentioned by me is that as soon as the respondent employer came to know about the affidavit having been filed by the employee, he was not immediately dismissed or discharged or removed from employment, though there was sufficient justification for doing so. It appears that a lenient view was taken and he was transferred from the accounts department to other department, but was continued in employment. This conduct on the part of the respondent employer reflects their bona fides. It further appears that he had not reported to the transferred department but instead filed a complaint of unfair labour practice before the Industrial Court challenging the order of transfer as mala fide and alleging unfair labour practice. Finally, the Industrial Court appears to have dismissed his complaint on the basis of evidence and material on record. 4.The concerned employee has challenged the impugned order dated 11th July 1983 discharging him from employment by filing a complaint of unfair labour practice under section 28 of the MRTU and PULP Act under Item 1 of Schedule IV of the Act. The employee had taken various grounds to challenge the said order of discharge such as unfair labour practice etc. The respondent, employer, contested the said complaint and denied the charge of unfair labour practice and tried to justify their action by adducing oral and documentary evidence before the Labour Court. It is an admitted position that before issuing the impugned discharge order no domestic enquiry was held against the employee. It was, therefore, necessary for the employer to have justified its action by adducing proper evidence before the trial Court. It is an admitted position that before issuing the impugned discharge order no domestic enquiry was held against the employee. It was, therefore, necessary for the employer to have justified its action by adducing proper evidence before the trial Court. Both the parties adduced their respective oral evidence by examining the employee himself and one of the partners on behalf of respondent No. 1 employer. On the basis of the entire material on record, the Labour Court was pleased to dismiss the complaint. The Labour Court has considered the question of loss of confidence in the context of the conduct of the employee who received a notice from M/s. Kanga and Company and who filed an affidavit in response to the said notice. The Labour Court has correctly appreciated this conduct of the employee who did not even wait for 48 hours as required in the said notice to furnish the information sought for by him and immediately rushed to the office of the said Advocates on the very same day and sworn an affidavit which was prepared by the said Advocates on the same day. It is also pertinent to note that at the time when the concerned employee went to the office of the said Advocates, the plaintiff, Vasudeo Chabbria was present and that he appears to have given instructions to prepare such an affidavit. According to the Labour Court and rightly so, the employee could have gone to the respondent employer and shown them the notice received by him and could have sought their opinion and permission to deal with the notice suitably. The information sought for by the opponents of the respondent employer pertained to the sensitive department of the firm i.e. the accounts department. Every piece of information within the accounts department is absolutely confidential in nature and nothing can be leaked out from the department and particularly to the opponents in the litigation. Here in an employee who acts in hand and glove with the opponents of his employer. According to me, he has betrayed the trust, faith and confidence of his employer. He was not at all obliged to furnish the information of the accounts department to the opponents in the litigation. By doing so, according to me, he has certainly acted against the interest of his employer. He has also behaved in a detrimental manner as an employee. He was not at all obliged to furnish the information of the accounts department to the opponents in the litigation. By doing so, according to me, he has certainly acted against the interest of his employer. He has also behaved in a detrimental manner as an employee. According to me, therefore, the respondent employer is fully justified in passing the order of discharge on the ground of loss of confidence. According to me, nothing more is required to lose confidence in such an employee. I, therefore, do not find any fault with the findings recorded by the Labour Court that the aforesaid facts were sufficient for the employer to conclude that the employee was not trustworthy, honest and faithful and therefore, he should be discontinued from accounts department and subsequently he was discharged from the service. The Labour Court has also recorded that its conclusion was further strengthened by some other documents produced on behalf of the respondent employer to show that the employee had finally landed in the employment of the said Vasudeo Chabbria, the plaintiff in the High Court suit, to whom he had obliged by betraying his own employer. According to me, therefore, the Labour Court is justified in coming to the conclusion that the order of discharge for loss of confidence was legal, proper and justified and that there was no infirmity or unfair legal practice engaged by the employer. 5.It is not that the employee has acted innocently or innocuously. He knew that dispute between brothers is pending in the High Court and that the plaintiff had filed the said suit against the employers who are plaintiffs' own brothers. I cannot blame the respondent employers if they have suspected his loyalty or faithfulness and their suspicion is based on tangible material i.e. the affidavit filed by the employee concerned in the suit leaking out the confidential information which is to be in exclusive possession of the accounts department only. The employee had absolutely no business to utter or leak out any confidential information which came in his possession as a part of duty in the accounts department. On his oral evidence in a complaint of unfair labour practice filed by him against the respondent employer challenging his transfer from the accounts department to other department, it is crystal clear and beyond any manner of doubt that he knew what he was doing. On his oral evidence in a complaint of unfair labour practice filed by him against the respondent employer challenging his transfer from the accounts department to other department, it is crystal clear and beyond any manner of doubt that he knew what he was doing. In his own admission in the said complaint before the Industrial Court, he had admitted a number of crucial facts. It would be relevant to reproduce the said admissions from the oral evidence recorded by the Industrial Court. "I have filed an affidavit in High Court that I was maintaining the accounts of 1981-82....... I have filed this affidavit as per directions of Kanga and Kanga Solicitors of V.D. Chabbria. .. R.D. Chabbria who was running the business on behalf of the custodian asked me whether I have filed affidavit in the High Court in January 1983. I told him that I have filed an affidavit in the High Court, .... I have not taken permission of the opponent to file affidavit nor informed the opponent that I have filed an affidavit. After reading the contents of the affidavit and found that the contents are true and correct I signed the affidavit. It is not true that I have no talk with Advocate Kothari who has prepared the affidavit. .... I have received Ex. U. 6 by hand delivery from the peon of Kanga. When I had been to the office of Kanga I was not on duty or in office hours. I had been to Kanga on 4th of August 1982." 6.Shri Dharap, the learned Advocate for the employee submitted that there is no ground for loss of confidence in the employee by the employer. I do not agree with the submission of the learned Advocate. There has been sufficient material on record for the respondent employer to have lost confidence. The employee from the accounts department having disclosed on affidavit the confidential details from the accounts books to the opponents of his employer, is more than enough for the employer to lose his confidence in him. It is not the question of information being truthful or otherwise, it is the conduct of the employee who goes out of his way to betray the confidence placed by his employer in him. It is not the question of information being truthful or otherwise, it is the conduct of the employee who goes out of his way to betray the confidence placed by his employer in him. It is obvious from the oral evidence before the Industrial Court that he knew what was the background in which that information was sought for. In the aforesaid circumstances, I am not able to agree with the submissions of Shri Dharap that there was no material or evidence on the basis of which there was loss of confidence in the employee. There was more than tangible evidence in the hands of the respondent employer in the form of affidavit filed by the employee in the pending litigation in favour of the opponents of his employer. This one affidavit is enough for any reasonable and prudent man to lose confidence in such an employee. According to me, nothing more is required or necessary. The respondent employer has lawfully, rightly and justifiably passed the order of discharge simpliciter on the basis of loss of confidence. Though there was no enquiry which preceded the discharge order the respondent employer has justified its action by adducing proper evidence before the Labour Court. Even assuming that the order of loss of confidence carries a stigma that it amounts to a misconduct for which a domestic enquiry was essential, the said deficiency of want of enquiry can be removed by adducing evidence before the Court to justify its action and such an order of the Labour Court passed on the evidence adduced before it would relate back to the order of discharge. In our case, the respondent employer has sufficiently proved the basis on which it has lost confidence in the employee. I am, therefore, not able to agree with the submissions of Shri Dharap that the findings recorded by the Labour Court are perverse and that ground of loss of confidence was not proved before the Labour Court. Once I hold that there was more than sufficient ground for the respondent employer to lose confidence in the employee, there is no question of victimisation or mala fide action on the part of the employer. The respondent employer has behaved exactly in the manner in which any reasonable and prudent employer would behave. No employee having dubious loyalty and character would ever be tolerated by any employer. The respondent employer has behaved exactly in the manner in which any reasonable and prudent employer would behave. No employee having dubious loyalty and character would ever be tolerated by any employer. In our case, the concerned employee was holding a post of clerk in the accounts department and according to me, his actions amount to loss of confidence. If such an employee leaks out any information about the accounts department, he can never be tolerated for continuation in service in such a department. I would be fortified by the following observations of the Supreme Court made in the decision given in the case of (Gujarat Steel Tubes Ltd. v. Gujarat Steel Tubes Mazdoor Sabha)1, reported in 1980(1) L.L.J. 137 . Para 55 of the said judgment is relevant and reads thus :--- "On the contrary, even if there is suspicion of misconduct the matter 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 simpliciter, 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. We need not chase other hypothetical situations here." 7.The aforesaid order of the Labour Court was carried by the employee before the Industrial Court under section 44 of the Act. The Industrial Court has dismissed the revision application by its order dated 1st October 1993 while agreeing with and confirming the order of the Labour Court. The Industrial Court while doing so has rightly observed in para 11(5) that :-- "The belief of suspicion of the employer should not be a mere whim or fancy. It should be bona fide and reasonable. It must rest on some tangible basis and the power has to be exercised by the employer objectively, in good faith which means honesty with due care and prudence." I do not find any infirmity in the conclusion of the Industrial Court. It should be bona fide and reasonable. It must rest on some tangible basis and the power has to be exercised by the employer objectively, in good faith which means honesty with due care and prudence." I do not find any infirmity in the conclusion of the Industrial Court. 8.Shri Dharap in support of his submissions cited the following judgments :-- i) 1986(2) L.L.J. 355 Delhi (Amarjeet Singh v. Punjab National Bank)2; ii) 1987(1) L.L.J. 107 (Kamalkishore Laxman v. Management of M/s. Pan American World Airways Inc.)3; iii) 1993(2) C.L.R. 116 S.C. (P.K. Yadav S. JMA Industries)4; iv) 1992(1) C.L.R. 332 Bom. (C.P. Singh v. Maharashtra State Co-operative Marketing Federation Ltd.)5. 9.Apart from the facts in each of the aforesaid cases on which the said decisions are based, there is no quarrel with the ratios laid down by the courts. On the facts before me, I have come to a definite conclusion that the employee had behaved in the manner which was definitely detrimental to the interest of the respondent employer to have invited loss of confidence in him. There has been a justified subjective satisfaction in the mind of the respondent employer and such subjective satisfaction was not imaginary but was based on tangible material in the form of the affidavit filed by the employee at the instance of the plaintiff in the suit against the respondent employer leaking out the confidential information of the accounts department. 10.In the result, there is no substance in the petition. The same deserves to be dismissed. The same is dismissed with no orders as to costs. Rule is discharged. Petition dismissed. -----