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2003 DIGILAW 315 (KER)

Kuruvilla John v. Plant Manager M R F Ltd

2003-04-11

KURIAN JOSEPH

body2003
JUDGMENT Kurian Joseph, 1. Justice should not only be done, but should also appear to have been done. Essentially, the petitioners in this case attempt to build up a case on the ground of violation of this principle. The allegation is of bias. Ext. P-3 order of dismissal is passed by the first respondent Plant Manager. The order is passed based on the findings in a domestic enquiry in respect of Ext. P-2 charge sheet. The first respondent himself is a witness for the management in the domestic enquiry. Short facts: Petitioners were employees of the M.R.F. Limited, Kottayam. On 16th April 1985, 400 bags of H.A.F. Carbon Black were found recorded as having been received in the K-2 godown of the management company, as per the delivery chalan and Material Gate Pass. The first petitioner was the person responsible so far as the godown, was concerned. The Goods Received Note was prepared by the second petitioner. In fact, no such goods were actually received in the godown. However, on the basis of the alleged fraudulent entries, a payment of Rs. 1.93 lakhs was made in favour of M/s CACIL, the supplier. On coming to know of the issue, the petitioners were issued show cause notices on 25th May 198 They submitted their explanations on 6th June 198 Nothing took place for quite some time. They were charge sheeted only on 7th January 198 The first petitioner was placed under suspension thereafter. The enquiry was conducted originally by one Sri P. T. Mathew and thereafter by one Sri Zachariah Koshi. Though initially the petitioners cooperated with the enquiry, after the appointment of Sri Zachatiah Koshi as the Enquiry Officer, the petitioners did not cooperate. 2. The enquiry report was submitted on 11th August 198 On completion of the formalities, the petitioners were dismissed from service by order dated 16th September 198 Thereafter, dispute was raised and by order dated 9th March 1987, the Government referred the issue of dismissal of the petitioners for adjudication by the Labour Court. The Labour Court after extensively considering the various contentions taken by the parties found that there was proper and valid domestic enquiry and that the findings of the Enquiry Officer are correct. After upholding the enquiry, the justifiability of the punishment was also considered. The Labour Court after extensively considering the various contentions taken by the parties found that there was proper and valid domestic enquiry and that the findings of the Enquiry Officer are correct. After upholding the enquiry, the justifiability of the punishment was also considered. It was found that "the punishment imposed on the workmen is proper and justified and no interference is called for by invoking S.11A of the I. D. Act". Thus, award was passed against the petitioners. Hence, this Original Petition. Ext. M-1 is the file relating to the enquiry conducted by Sri Zachariah Koshy. It is seen that Sri George Mathew, the Plant Manager was examined as management witness on 12th July 1986 and thereafter, examining seven other witnesses, the enquiry was closed on 24th July 198 The Enquiry Officer has relied on the evidence of Sri George Mathew (M W. 1), the Plant Manager. Reliance is placed on the evidence of the said witness for arriving at a finding regarding fraud and dishonesty committed by the petitioners. 3. Ext. P-2 is the charge sheet issued by the very same George Mathew, the Plant Manager. Ext. P-3 dismissal order dated 16th September 1986 is also issued by the same person. It is stated at Para.6 of Ext. P-3 dismissal order as follows: "The Report along with the records of the enquiry has been carefully considered, and. the report has been accepted subject to the following, viz., The charge of collusion with others in defrauding the company levelled against Sri. Kuruvilla John does not appear to have been conclusively established in the enquiry, though various circumstances adverted to by the Enquiry Officer may lead to the inference that such a charge has been proved. In any view, the benefit of the views of the punishing authority in this regard, is given to Sri Kuruvilla John." However, at Para.7, the disciplinary authority with regard to his satisfaction found as follows: "In view of the gravity of the charges against the two employees which stand proved as stated above, and as there are no extenuating circumstances, the punishing authority (Plant Manager) is of the opinion that the proper punishment shall be dismissal from service." On the basis of such satisfaction, the first respondent dismissed the petitioners from service. 5. There were three charges in Ext. 5. There were three charges in Ext. P-2; (1) Fraud or dishonesty in connection with the company's business or property within the scope of Clause.12(d) of the Standing Orders of the Company and (2) wilful damage to the assets of the company [Clause 12 (o)]. (3) Making false or vicious statements in the records of the company and committing an act prejudicial to the management [Clause 12(x)]. It is stated in Ext. P-3 dismissal order that "they committed fraud or dishonesty in connection with the company's business or property and caused damage and loss to the company. They have lost the confidence reposed on them". It was on that basis, the dismissal order was passed. It is in this back ground, the contention of the petitioners regarding the bias has to be appreciated. 6. Though both sides heavily relied on the Standing Orders, the same is not seen produced before the Labour Court. However, learned Counsel for the petitioners has made available a copy of the Standing Orders. Both sides agree that the same can be taken on record and marked as Annexure X. 7. Clause.11 of the Standing Orders provides for termination of employment. To the extent relevant it reads as follows: "(j) Subject to the provisions of law for the time being in force the employment of any workman may be terminated for a reasonable cause. The reasons for the termination of service shall be recorded in writing and shall be communicated to the workman at the time of discharge." Clause 13 provides for punishment for misconduct. To the extent relevant it reads as follows: "13 Punishment for misconduct. - (i) Any employee may, if there are extenuating circumstances, be suspended from work or if, for reasons to be recorded by the Manager, he is of the opinion that dismissal is the appropriate punishment, dismissed without notice or compensation in the lieu of notice, if he is found guilty of misconduct. (ii) The order of suspension pending enquiry shall be in writing and shall take effect immediately on communication thereof to the employee either orally or in writing. Such order shall set out in detail the alleged misconduct and the employee shall be given an opportunity of explaining the circumstances alleged against him. (ii) The order of suspension pending enquiry shall be in writing and shall take effect immediately on communication thereof to the employee either orally or in writing. Such order shall set out in detail the alleged misconduct and the employee shall be given an opportunity of explaining the circumstances alleged against him. If on enquiry the order is confirmed or modified, the employee shall be deemed to be absent from duty for the period of suspension and shall not be entitled to any wages or dearness allowance for such period. If however, the order is rescinded, the employee shall be entitled to the same wages and dearness allowance as he would have received if he had not been suspended. No order of dismissal or suspension as substantive punishment shall be valid; Unless the employee concerned. (a) is informed in writing of the alleged misconduct; (b) is given a reasonable opportunity and time of at least 48 hours' duration to explain the circumstances alleged against him, and (c) is, if the employee so desired in writing, allowed the help, in the conduct of the enquiry regarding dismissal or suspension, of any coworker of the same department as the worker, whether a member or an officer of a labour union or not, and II. Unless an enquiry is held the Manager or such other officers as may be appointed by the Manager, in conformity with the principles of natural justice, and the order of suspension or dismissal states in a clear, brief and concise manner the reasons for the order of suspension or dismissal. In awarding punishment under this Standing Order, Manager shall take into account the gravity of the misconduct, the previous record, if any, of the employee and any other extenuating or aggravating circumstances that may exist. III. A copy of the order made by the Manager shall be delivered to the employee concerned or despatched to his last known place of residence. On the application of the concerned workman, a copy of the proceedings before the Manager will also bo given." 8. It may be seen from Clause.11 that a workman is liable to be terminated from service for reasonable cause. Clause.13 provides for the procedure. It is for the Manager to pass the order. On the application of the concerned workman, a copy of the proceedings before the Manager will also bo given." 8. It may be seen from Clause.11 that a workman is liable to be terminated from service for reasonable cause. Clause.13 provides for the procedure. It is for the Manager to pass the order. It is specifically provided under Clause.13 (ii) that an order of dismissal shall not be valid unless an enquiry is held by the Manager or such other officer appointed by the Manager in conformity with the principles of natural justice. True, it is regarding the conduct of enquiry. But, on a perusal of Clause.13 providing for the procedure for imposing the punishment of dismissal, it can be seen that special emphasis is given to adherence to the principles of natural justice. Even otherwise on general principles also, violation of the principles of natural justice would vitiate the whole disciplinary proceedings. 9. Sri. Jagadeeshchandran Nair submits that the first respondent is a Plant Manager. Clause.13 only provides that the order of punishment shall be issued by the Manager. Apparently there are other Managers. That there are other superior officers in the company is also otherwise admitted by the first respondent himself. It is seen from the records and the deposition of the first respondent that the headquarters of the company is in Madras and he had acted only under instruction from the headquarters. Admittedly, he was the witness for the management as M.W.1 in the domestic enquiry. In such circumstances, it cannot be said that there was no bias. As held by the apex court in Nageswara Rao v. State of Andhra Pradesh ( AIR 1959 SC 1376 ) justice should not only be done, but manifestly and undoubtedly seem to be done. This principle is applicable not only to Courts of justice or Judicial Tribunals but also to those who have to act judicially in deciding the rights of others. 10. In State of U.P. v. Mohammed Nooh ( AIR 1958 SC 86 ) the Supreme Court considered a situation where a person who was witness in the case presided over the trial. True, the Presiding Officer Sri B. N. Bhalla did not rely on his evidence. 10. In State of U.P. v. Mohammed Nooh ( AIR 1958 SC 86 ) the Supreme Court considered a situation where a person who was witness in the case presided over the trial. True, the Presiding Officer Sri B. N. Bhalla did not rely on his evidence. However, strongly disproving the conduct, the Constitution Bench observed as follows: "But assuming that Shri B. N. Bhalla did not rely on his own evidence in preference to that of Mohammad Khalil-a fact which is hard to believe, especially in the face of his own affidavit quoted above - the act of Shri B. N. Bhalla in having his own testimony recorded in the case indubitably evidences a state of mind which clearly discloses considerable bias against the respondent. If it shocks our notions of judicial propriety and fair play, as indeed it does, it was bound to make a deeper impression on the mind of the respondent as to the unreality and futility of the proceedings conducted in this fashion. We find ourselves in agreement with the High Court that the rules of natural justice were completely discarded and all canons of fair play were grievously violated by Shri N. N. Bhalla continuing to preside over the trial. Decision arrived at by such process and order founded on such decision cannot possibly be regarded as valid or binding." 11. It is the contention of Sri Pathrose Mathai, learned Counsel appearing for the first respondent that since the Standing Orders confer authority on the Manager, there was nothing wrong in the Manager imposing the order of punishment. Reference is invited to two decisions. 12. In Anglo American Direct Tea Trading Co. Ltd. v. Labour Court, Coimbatore and another ( 1971 (1) LLJ 147), the Madras High Court considered a position where Manager who was a witness in the enquiry passing the final order in the disciplinary proceedings. It was a case where the allegation itself was that the workman disobeyed the directions issued to him by the Manager, It is stated as follows: "Therefore, inevitably the Manager had to be a witness to substantiate the charge, and the fact that he happened to be a witness, while himself being the person competent to pass the order, cannot be said to have vitiated the enquiry to any extent." That decision cannot help the first respondent for many reasons. For one thing it has to be seen that this is not a case where the allegation is of the violation of any of the directions issued by the authority. Still further, it is not a case where the first respondent alone is the competent person to pass orders in disciplinary proceedings. As already noted, the disciplinary authority is the Manager as per the Standing Orders. The first respondent is only the Plant Manager and apparently there are several Managers in the company. All that apart, it is seen that the decision of the Constitution Bench in Mohammed Nooh's case (supra) is not referred. 13. Learned Counsel for the management further contends that the instant is a case of statutory bias and comes under the well accepted exception to the doctrine of bias. Reliance is placed on a Bench decision of the Bombay High Court in Bhansidhar Ganesh Ram Bhaiyyalal v. Municipal Council Deoli and others (1986 (2) LLJ 107). That is a case where a charge sheet was issued by the Standing Committee of the Municipal Council and enquiry committee was constituted to enquire into the charge. The Chief Officer of the Municipal Council was examined as a witness in the enquiry. The enquiry committee submitted its report and the same was accepted by a Special General Meeting of the Municipal Council. A show-cause notice proposing punishment of removal from service was issued by the Chief Officer. The reply submitted by the delinquent employee to the show-cause notice was placed before the general body meeting of the Municipal Council for taking final decision and the meeting was adjourned without taking any decision. Thereafter the Municipal Council was superceded. Chief Officer of the Municipal Council who gave evidence in the enquiry was appointed as a administrator of the Municipal Council who exercises powers of the Municipal Council on the standing committee. Thereafter the Administrator gave fresh opportunity of hearing to the delinquent employee who appeared before him and stated that he did not want to say any thing orally before him. Afterwards the Administrator accepted the report of the enquiry committee and removed the employee from service. In as much as the prior approval of Collector is required before dismissing the employee, the Administrator forwarded the papers including enquiry report to the Collector. After obtaining approval of the Collector the employee was removed from service. Afterwards the Administrator accepted the report of the enquiry committee and removed the employee from service. In as much as the prior approval of Collector is required before dismissing the employee, the Administrator forwarded the papers including enquiry report to the Collector. After obtaining approval of the Collector the employee was removed from service. The order of dismissal was challenged on the ground that the Administrator of the Municipality who was the Chief Officer had given evidence against the petitioner in the departmental enquiry and therefore, the order suffers from bias. Repelling the challenge, the Bench held that "The matters relating to disciplinary action against the employees, including the question of the power to appoint and the power to dismiss or to remove are governed by the provisions of the Act and in particular the provisions of S.79 of the Act, which does not permit any discretion in the competent authority to delegate its power to any other authority, which, if done, would amount to abdication of its powers rendering the orders passed by any other authority in its place as illegal and void. In other words, the bias, if any, is a statutory bias because no other authority can exercise the power of the Administrator under S.79 of the Act. The statutory bias is a well recognised exception to the doctrine of bias upon which the actions are struck down as illegal and void. It is, therefore, clear that there is no other alternative in the instant case to the Administrator except to consider himself the question of imposing punishment upon the petitioner because no other authority can consider it under the Act". Still further, it was held at Para.15 that "Further in our view the challenge on the ground of bias also loses its significance in the instant case because there are adequate safeguards provided against the action of dismissal or removal taken by the Administrator. The first safeguard is that it requires the prior approval of the Collector under S.79(4) of the Act, who is required to apply his mind to the record of the enquiry, to see whether the findings are perverse and further to see whether the punishment proposed is too severe. The first safeguard is that it requires the prior approval of the Collector under S.79(4) of the Act, who is required to apply his mind to the record of the enquiry, to see whether the findings are perverse and further to see whether the punishment proposed is too severe. The second safeguard which is provided is the provision of an appeal under S.79(6) of the Act under which the whole question about dismissal or removal effected by the Administrator is open in appeal before the higher authority, viz., the Regional Director of Municipal Administration. In view of these safeguards and in view of the circumstances already adverted to viz. that none else except the Administrator can take action of dismissal or removal, as well as the circumstances that the only question to be dealt with was of determining the punishment are of the view that the impugned order of removal cannot be struck down on the ground of the alleged bias of the Administrator". That decision also cannot help the first respondent to sustain the action. It is not a case where there is no alternative and therefore, it cannot be held that it is a case of statutory bias. Apparently the first respondent is not the only person competent to take disciplinary proceedings against the petitioners. That apart, there is no occasion for any other authority like the Collector in that case to consider the legality or propriety of the action. Still further, there is no provision in the standing orders for any appeal. 14. The first respondent is not the ultimate authority in the company where the petitioners worked. He is only a Plant Manager. Admittedly, he was the management witness in the enquiry conducted against the petitioners. It is on the basis of the findings in that enquiry, punishment is imposed on the petitioners. It is seen from Ext. P-3 order, imposing-punishment that it was on the satisfaction of the first respondent that the punishment of dismissal is imposed. It cannot also be said that there were no other Manager in the company other than the first respondent to issue orders. In such circumstances, it cannot be said that there was no bias on the part of the first respondent. Bias basically is a state of mind. State of mind of 1st respondent at the time of passing Ext. It cannot also be said that there were no other Manager in the company other than the first respondent to issue orders. In such circumstances, it cannot be said that there was no bias on the part of the first respondent. Bias basically is a state of mind. State of mind of 1st respondent at the time of passing Ext. P-3 cannot be said to be free from bias, in the facts and circumstances of the case. 15. Sri Pathrose Mathai further contends that the contention on bias was not raised before the Labour Court. Having not taken up such a contention before the Labour Court, the petitioners cannot be permitted to raise the issue before this Court. I am afraid, that argument also cannot be accepted. The issue might arise even while perusing the records in certiorari proceedings. The issue having thus arisen during the proceedings before this Court, there is no justice or justification in not considering the issue on the sole ground of the issue having not been raised before the Labour Court. There is no prejudice either to the first respondent. 16. Sri Jagadeesh Chandran Nair though addressed extensive arguments and made a vehement plea for setting aside the finding of the Labour Court regarding the domestic enquiry, I am not inclined to do so. Apparently petitioners had not made any attempt to verify the proceedings before the Domestic Enquiry Officer Sri Zacharia Koshy. Having thus opted not to cooperate with the Enquiry Officer for no justifiable reason, I do not find it necessary to consider the contentions. The files also disclose that the enquiry has been conducted properly and in compliance with the principles of natural justice. 17. The Labour Court having not considered the impact of the proceedings being vitiated on account of bias, I feel it is only just and proper that the matter is reconsidered by the Labour Court itself. There is no material before this Court to decide the issues. This is particularly so, in view of the long lapse of time and also the age of the petitioners. In the above circumstances, I set aside the award notified as per Ext. P-1 and remit the matter to the Labour Court, Ernakulam. The Labour Court shall pass an award in accordance with law within a period of three months from the date of receipt of a copy of the Judgment. In the above circumstances, I set aside the award notified as per Ext. P-1 and remit the matter to the Labour Court, Ernakulam. The Labour Court shall pass an award in accordance with law within a period of three months from the date of receipt of a copy of the Judgment. Original Petition is allowed as above.