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2007 DIGILAW 1954 (MAD)

State Bank of India rep. by Chief General Manager Local Head Office v. The Presiding Officer, Industrial Tribunal Madras & Another

2007-06-28

K.MOHAN RAM, R.BALASUBRAMANIAN

body2007
Judgment : R. Balasubramanian, J. The second respondent was an employee of the appellant. In a domestic enquiry held by the Bank on a misconduct, namely, dishonesty in dealing with two sums of money namely, Rs.600/- and Rs.1000/-belonging to a customer, she was dismissed from service. Complaining that the order of dismissal is passed solely on the ground of the confession letter (admission letter) stated to have been given by the second respondent/employee, the entire proceeding stands invalidated, the second respondent went before the Labour Court in I.D.No.22 of 1989. The Bank contested the proceedings before the Labour Court that the admission statement was voluntary. Yet, by way of abundant caution the Bank let in oral evidence before the Labour Court to prove the alleged misconduct. On evidence so let in, the Labour Court found that the charge with reference to the dishonest conduct on the part of the employee so far as it relates to the amount of Rs.600/-is proved and in the same breadth the Labour Court found that the other misconduct with reference to the other sum of Rs.1,000/-was not proved. It may not be out of place in this context to note that the order of dismissal passed originally by the disciplinary authority was converted into one of discharge by the appellate authority and only at that stage the second respondent went before the Labour Court. On such finding rendered by the Labour Court, it, exercising its power under Section 11-A of the Industrial Disputes Act, modified the punishment of discharge into one of reinstatement with a modified punishment of cut of two increments with cumulative effect accruing in the year 1985-86. The second respondent was directed to be paid the entire back wages except for a period of twelve months commencing from 12. 1985. The resultant position was that the second respondent was entitled to reinstatement and she accordingly stood re-instated. But however the Bank did not agree with the award passed by the Labour Court and therefore they came before this court in W.P.No.16033 of 1993. A learned Single Judge of this court passed the order impugned in this writ appeal on 19. 2000 confirming the award of the Labour Court. Heard Mr.J.Ravindran, learned counsel for the appellant and Mr.S.Vaidyanathan, learned counsel for the second respondent. 2. A learned Single Judge of this court passed the order impugned in this writ appeal on 19. 2000 confirming the award of the Labour Court. Heard Mr.J.Ravindran, learned counsel for the appellant and Mr.S.Vaidyanathan, learned counsel for the second respondent. 2. We state here that the finding of the Labour Court that the employer had established one part of the employees misconduct with reference to the sum of Rs.600/-had reached its finality as against the employee/second respondent is concerned (it is on record that the employee/second respondent accepted the award and did not challenge it in a manner known to law). Therefore we are confining ourselves only to the legal issue raised on the established facts by the learned counsel on either side, the legal issue being, when an employee is found guilty of misconduct of dishonesty, can a Court, in exercise of its power under Section 11-A of the Industrial Disputes Act, modify the punishment imposed by the employer? 3. Learned counsel for the appellant in support of his argument that when such misconduct namely, misconduct of dishonesty is proved, the Court shall not modify the punishment in exercise of the power under Section 11-A of the Industrial Disputes Act, brought to our notice the following judgments. 1999 -II- LLJ 194 (MANAGEMENT OF CATHOLIC SYRIAN Bank v. INDUSTRIAL TRIBUNAL, MADRAS & ANOTHER) 2004 -II- LLJ 423 (FRANCIS VINCENT NEELANKOVIL v. INDUSTRIAL TRIBUNAL) 2000 -II- LLJ 1395 (JANATHA BAZAAR S.K.C.C.W.S LTD. v. SECY., S.N. SANGHA) 2003 (3) SCC 605 (REGIONAL MANAGER, U.P. SRTC v. HOTILAL) 2005(3) SCC 254 (DIVISIONAL CONTROLLER, KSRTC v. A.T. MANE) 2006(1) SCC 63 (KARNATAKA Bank LTD. v. A.L.MOHAN RAO) 2006 - III - LLJ (S.C.) 232 (DIVISIONAL CONTROLLER, N.E.R.T.C. v. AMARESH) Learned counsel appearing for the second respondent, though not in a position to dispute the Law laid down by this court and by the Supreme Court in the above referred to judgments would, by bringing to our notice the judgment of the Supreme court reported in 2001(10) S.C.C. 548 (KRISHNA COCONUT CO. v. COMMERCIAL TAX OFFICER), contend that since on facts, it is not disputed that the second respondent was in service for a period of seven years prior to her discharge and on re-instatement she continues to be in service for seventeen long years even as on date, this court need not upset the judgment of the learned Single Judge impugned in this writ appeal. Learned counsel by taking us through page 55 of the records received from the Labour Court would submit that atleast in five other instances where employees of the Bank were similarly placed, the order of dismissal was modified into one of lesser punishment and therefore relying upon the judgment of the Supreme court reported in 2006(6) S.C.C. 548 (ANAND REGIONAL COOP. OIL SEEDS GROWERS UNION LTD. v. SHAILESHKUMAR HARSHADBHAI SHAH) would contend that there must be parity in punishment and if that is so, the second respondent must also be given the same treatment as had been given in the past to five of the employees mentioned in the tabular statement found at page 55 of the records received from the Labour Court and since that is what that has been done in this case, this court may like to refrain from interfering. 4. We carefully applied our mind to the rival submissions made with reference to the interference permissible under Section 11-A of the Industrial Disputes Act. Though learned counsel for the appellant had cited a long line of decisions, yet, we feel that it would be enough if we refer to the two judgments touching upon the issue namely, 2006 (1) S.C.C. 63 (three Judges Bench coram) and 2006 -III -LLJ (Supreme Court) 232. In the first judgment, the Honourable Supreme Court of India was considering the question of proportionality of the punishment to be imposed. In that case the workman was charged with gross misconduct of colluding with a Branch Manager and played a role in the grant of a fictitious loan in the name of one another person, the real beneficiary being some one else. On the charge found to be proved, his services were terminated. The dispute raised by the workman before the Labour Court was dismissed. Then the workman went before the High Court in a writ petition. The High Court found that the charge was found correctly established. On the charge found to be proved, his services were terminated. The dispute raised by the workman before the Labour Court was dismissed. Then the workman went before the High Court in a writ petition. The High Court found that the charge was found correctly established. But however it interfered with the punishment of termination and instead ordered reinstatement without back wages and continuity of service. The employer went up in appeal before a Division Bench and the Division Bench dismissed that appeal. Therefore the employer namely, Karnataka Bank Ltd. went before the Supreme Court of India. In deciding that case the Bench of the Supreme Court reflected their mind as hereunder:- "In our view, a gross misconduct of this nature does merit termination. We fail to see what other type of misconduct would merit termination. It is not for the courts to interfere in cases of gross misconduct of this nature with the decision of the disciplinary authority so long as the inquiry has been fair and proper and misconduct proved. In such matters, it is for the disciplinary authority to decide what is the fit punishment. In any case of such a misconduct, it could never have been said that termination of service is not the appropriate punishment." We now refer to the other judgment of the Supreme Court referred to earlier by the learned counsel for the Bank. The workman in that case was a conductor in the Transport Corporation. The disciplinary authority agreed with the report of the enquiry officer that the charge of misconduct alleged against the workman was proved. The charge against him in sum and substance is misappropriation of the Corporations funds. There the disciplinary authority dismissed the workman from service. The workman went before the Labour Court by raising a dispute. The Labour Court by its ultimate award dated 112. 1996 found that charge No.4 regarding pilferage against the workman was proved. As far as the punishment is concerned, the punishment of dismissal was substituted with reinstatement with 75% back-wages. The Transport Corporation challenged that award in the writ jurisdiction of the Karnataka High Court. The modified punishment was upheld by a learned Single Judge of the Karnataka High Court but the payment of back wages was reduced to 25%. The writ appeal filed by the Transport Corporation was also dismissed. The Transport Corporation challenged that award in the writ jurisdiction of the Karnataka High Court. The modified punishment was upheld by a learned Single Judge of the Karnataka High Court but the payment of back wages was reduced to 25%. The writ appeal filed by the Transport Corporation was also dismissed. Therefore the Transport Corporation went before the Honourable Supreme Court of India. The Supreme Court in that judgment, referred to the earlier judgments of that court, in particular reference to its judgment reported in 2001(1) LLJ 725 (Karnataka State Road Transport Corporation v. B.S. Hullikattl) and extracted para 6 of that reported judgment in its judgment. We extract para 6 as found extracted in the judgment of the Supreme Court reported in 2006(3) LLJ 232 . "6. It is misplaced sympathy by the Labour Courts in such cases when on checking it is found that the Bus Conductors have either not issued tickets to a large number of passengers, though they should have, or have issued tickets of a lower denomination knowing fully well the correct fare to be charged. It is the responsibility of the Bus Conductors to collect the correct fare from the passengers and deposit the same with the company. They act in a fiduciary capacity and it would be a case of gross misconduct if knowingly they do not collect any fare or the correct amount of fare." Then the Honourable Judges proceeded to state in the judgment reported in 2006 - III LLJ (SC) 232 that the reinstatement ordered by the Labour Court and its affirmation by the High Court is contrary to the Law laid down by the Supreme Court in Karnataka State Road Transport Corporation case. On facts in that case it was found that the misappropriation by the delinquent employee was only Rs.360.95. Even in para 21 of that judgment, the Supreme Court again referred to its judgment reported in 2005(3) S.C.C. 254 (Divisional Controller, KSRTC (NWKRTC) v. A.T. Mane) and extracted para 13 of the above referred to judgment. We extract para 13 as found extracted in the judgment of the Supreme Court. "13. Even in para 21 of that judgment, the Supreme Court again referred to its judgment reported in 2005(3) S.C.C. 254 (Divisional Controller, KSRTC (NWKRTC) v. A.T. Mane) and extracted para 13 of the above referred to judgment. We extract para 13 as found extracted in the judgment of the Supreme Court. "13. Coming to the question of quantum of punishment, one should bear in mind the fact that it is not the amount of money misappropriated that becomes a primary factor for awarding punishment; on the contrary, it is the loss of confidence which is the primary factor to be taken into consideration. In our opinion, when a person is found guilty of misappropriating the Corporations funds, there is nothing wrong in the Corporation losing confidence or faith in such a person and awarding a punishment of dismissal." After referring to the case laws referred to above and on the established facts in that case, the Supreme Court in that judgment (i.e.) 2006 -III-LLJ (SC) 232 reversed the award of the Labour Court as well as the judgment of the High Court and it restored the punishment of dismissal imposed by the disciplinary authority. In para 25 of that judgment, we find that the Supreme Court had found that in view of the charge having been proved on the Law laid down by it, the employee, in their opinion had no legal right to continue in service any further and thus directed the Transport Corporation to immediately discharge the employee from service. In this context, we will also usefully refer to the judgment of the learned Single Judge of this court reported in 1999(2) L.L.J 194 (MANAGEMENT OF CATHOLIC SYRIAN Bank LTD. v. INDUSTRIAL TRIBUNAL, MADRAS & ANOTHER). That was a case where a Bank employee was found to have misappropriated money. The learned Judge, in that case, going by the nature of duties which a Bank employee has to perform, had elaborately stated as to what is expected from such Bank employee. We extract here under para 17A of that judgment: "The workman was employed in a Bank where the confidence of the customers is paramount for the success of the business cannot be disputed. The effect of the continuation of the employment of such person who had failed to rejoin and inspire the confidence of the employer was also evident. We extract here under para 17A of that judgment: "The workman was employed in a Bank where the confidence of the customers is paramount for the success of the business cannot be disputed. The effect of the continuation of the employment of such person who had failed to rejoin and inspire the confidence of the employer was also evident. The risk to the Bank in employing a person like the second respondent -workman, who had patently duped its customer, and harmed the Banks reputation was also evident." This judgment was affirmed by a Division Bench of this court reported in 2004 (II) LLJ 423 (FRANCIS VINCENT NEELANKOVIL v. INDUSTRIAL TRIBUNAL). In 2006(10) S.C.C. 572 (SURESH PATHRELLA v. ORIENTAL BANK OF COMMERCE), the Honourable Supreme Court of India was dealing with a case of a Bank employee, who was dismissed from service for misappropriation of customers money. While dealing with the correctness or otherwise of the punishment imposed on the employee, the Supreme Court held as hereunder:- "It is a case of loss of confidence in the officer by the Bank. In such a situation, it would be a futile exercise of judicial review to embark upon the decision of the disciplinary authority removing the officer from service, preceded by an enquiry, and to direct the Bank to take back the officer in whom the Bank had lost confidence, unless the decision to remove the officer was tainted with mala fides, or in violation of principles of natural justice and prejudicial to the officer." In the judgment reported in 2003(4) S.C.C. 364 (CHAIRMAN & MANAGING DIRECTOR, UNITED COMMERCIAL BANK v. P.C. KAKKAR), the Supreme Court in dealing with the punishment inflicted on an employee of the Bank, had stated as hereunder:- "A bank officer is required to exercise higher standards of honesty and integrity. Every officer/employee of the bank is required to take all possible steps to project the interests of the bank and to discharge his duties with utmost integrity, honesty, devotion and diligence and to do nothing which is unbecoming of a bank officer. Every officer/employee of the bank is required to take all possible steps to project the interests of the bank and to discharge his duties with utmost integrity, honesty, devotion and diligence and to do nothing which is unbecoming of a bank officer. Good conduct and discipline are inseparable from the functioning of every officer/employee of the bank." Recently in the judgment reported in AIR 2007 Supreme Court Weekly 3656 (UCO BANK v. RAJINDER LAL CAPOOR) in dealing with the punishment imposed on a Bank employee, the Supreme Court observed that "the officers of the bank enjoys a part of confidence in them and when an employee of the bank is found to have embezzled or misappropriated any amount etc., the Court takes a strict view of the matter." 5. In the context of the Law laid down by the Supreme Court and on the established facts, we went through the judgment of the learned Single Judge challenged in this writ appeal. A careful perusal of the same do show that the learned Single Judge had not addressed himself - with respect we say - to the power of interference under Section 11A of the Industrial Disputes Act. Our reading of the learned Single Judges judgment shows that the learned Judge appears to have proceeded on the basis that the court exercising jurisdiction under Article 226 of the Constitution of India cannot act as an appellate authority and therefore once the Labour Court passed an award ( in this case the award is one of re-instatement), the writ court should not interfere. We respectfully state that the above referred to approach by the learned Single Judge to our mind, only shows that by exercising writ jurisdiction this court cannot interfere with the finding of fact rendered by any Tribunal including Labour Court. There cannot be any dispute over such preposition. The learned Judge finding that the Labour Court had not improperly exercised its discretion under Section 11-A of the Industrial Disputes Act, had upheld the award. One other fact which weighed with the learned Judge is that the second respondent had been reinstated long back. It must be noticed in this case that before the Labour Court , the Bank let in oral evidence to prove their case and on that evidence, the Labour Court found a part of the charge as proved. One other fact which weighed with the learned Judge is that the second respondent had been reinstated long back. It must be noticed in this case that before the Labour Court , the Bank let in oral evidence to prove their case and on that evidence, the Labour Court found a part of the charge as proved. Learned counsel for the second respondent is not in a position to bring to our notice any infirmity in the context of such proceeding before the Labour Court. In view of the Law laid down by this court and the Honourable Supreme Court in the various judgments brought to our notice by the learned counsel for the appellant, three of which we have already referred to earlier, there cannot be any doubt at all that the Labour Court had improperly exercised its power available under Section 11-A of the Industrial Disputes Act. Therefore we have no hesitation at all to conclude that the judgment of the learned Single Judge affirming the award of the Labour Court modifying the punishment of discharge into one of reinstatement and without back wages for a limited period, has to be interfered with. 6. Before disposing of this contentious issue between the parties, we also applied our mind to the point raised by the learned counsel for the second respondent that in view of the fact that the second respondent had been re-instated long before and that she has been working for the last seventeen years, this court would not upset the judgment in challenge, which fact also weighed with the learned Single Judge while passing the impugned judgment, we do find that in the judgment brought to our notice by the learned counsel for the second respondent namely, 2001 (10) S.C.C. 548 (KRISHNA COCONUT CO. v. COMMERCIAL TAX OFFICER), the Supreme Court had stated as hereunder:- "It is now brought to our notice that the respondent has been in service in the establishment of the appellant from the year 1982 onwards pursuant to the award of the Labour Court. In the circumstances, we do not think it would be appropriate to upset the present state of affairs when the respondent has been in employment for such a long period. In the circumstances, we do not think it would be appropriate to upset the present state of affairs when the respondent has been in employment for such a long period. Appeal is, therefore, dismissed." That was an appeal before the Supreme Court by Gujarat State Road Transport Corporation challenging the order of reinstatement passed by the Labour Court in substitution of the order of dismissal, which was affirmed by the High Court. In that case also the charge was for misappropriation of money. But in the judgment brought to our notice by the learned counsel for the appellant reported in 2006 - III - LLJ 232 -which judgment is definitely later in point of time to the above referred to one, the Honourable Judges of the Supreme Court had categorically held that a person found guilty of misappropriation had no legal right to continue in the employment any more and therefore directed the employer to discharge the employee, found to be at fault, from service forthwith. This only shows that the workman concerned in the judgment of the Supreme Court referred to above namely, 2006 -III -LLJ 232 was working on the day when the Supreme Court decided against him. The judgment of the Supreme Court reported in 2006 -III-LLJ 232 being later pronouncement of the Supreme Court on the issue, we are inclined to follow that and consequently reject the argument of the learned counsel for the second respondent that since the second respondent had been reinstated pursuant to the award of the Labour court and as such she continues to be in service for seventeen long years, this court should not interfere, would not hold any water for her. 7. Yet another point argued by the learned counsel for the second respondent is that atleast five persons similarly placed, who were originally visited with the order of dismissal, were later on treated leniently by the employer himself and therefore there must be parity in punishment. To sustain this point, learned counsel for the second respondent relied upon a judgment of the Supreme Court reported in 2006 (6) S.C.C. 548 . As rightly contended by the learned counsel for the appellant, parity in punishment between persons similarly placed was not in issue at all either before the Labour Court while it passed the award or before the learned Single Judge. As rightly contended by the learned counsel for the appellant, parity in punishment between persons similarly placed was not in issue at all either before the Labour Court while it passed the award or before the learned Single Judge. We find that the learned counsel for the Bank is right. In fact we do not find any reflection of mind on the above issue either in the award or in the judgment impugned in this appeal. But as rightly contended by the learned counsel for the second respondent/workman there is a tabular statement found at page 55 of the records received from the Labour Court. It does contain names of five persons; the branches of the Bank in which they were working; the nature of misconduct which is invariably shown to be malpractice; the nature of punishment first given namely, dismissal and the modified punishment. Except this, we do not find any other details as to when exactly such misconduct was committed; when the punishment of dismissal was given and when it was modified. There is nothing on record to show that whether all these five persons approached the court of Law and only due to the intervention of the court of law that punishment of dismissal was modified into lesser punishment or was it done unilaterally by the Management. Therefore we have real difficulty in appreciating this point. To say that, due to the intervention of the court such modification in punishment was given is totally different from such modification in punishment was by the employer himself. If such modification was done by the employer himself at any stage of the proceedings, then it is needless to state that this court cannot compel the employer to extend the same benefit to the second respondent as well. What would be the appropriate punishment in a given case to an employee, is only at the discretion of the employer and such discretion must be exercised on sound principles. The Honourable Supreme Court in the judgment reported in 2006(1) S.C.C. 63 Karnataka Bank Limited Case - we have already extracted the relevant paragraphs -had categorically held that it is for the disciplinary authority to decide what is the fit punishment to be imposed. The Honourable Supreme Court in the judgment reported in 2006(1) S.C.C. 63 Karnataka Bank Limited Case - we have already extracted the relevant paragraphs -had categorically held that it is for the disciplinary authority to decide what is the fit punishment to be imposed. The Supreme Court in the judgment reported in 2003(4) S.C.C. 364 (CHAIRMAN & MANAGING DIRECTOR, UNITED COMMERCIAL BANK v. P.C.KAKKAR) following its earlier judgment reported in 1997(3) S.C.C. 371 (BALBIR CHAND v. FOOD CORPORATION OF INDIA LIMITED) held that even if the co-delinquent is given lesser punishment, it cannot be a ground for interference. In Balabirs case, the Supreme Court held as hereunder:- "Merely because one of the officers was wrongly given the lesser punishment compared to others against whom there is a proved misconduct, it cannot be held that they too should also be given the lesser punishment lest the same mistaken view would be repeated. Omission to repeat same mistake would not be violative of Article 14 and cannot be held as arbitrary or discriminatory leading to miscarriage of justice. It may be open to the appropriate higher authority to look into the matter and take appropriate decision according to law." Under these circumstances, we have only to state that this court is legally helpless, in considering the plea raised by the learned counsel for the second respondent on parity in punishment, for want of relevant details and materials of the proceedings. 8. One other aspect of the case requires our attention and it is whether the employer is entitled to recover the emoluments paid to the second respondent from the date of reinstatement till date or till she is actually discharged. For the work done, the second respondent had earned money. It is not as though the Bank had paid money without extracting any work from her. The Supreme Court in the judgment reported in 2006 - III LLJ 232 at para 25 had also given a direction that the salary paid to the worker, who was directed to be discharged from service forthwith and other emoluments shall not be recovered from the employee. We will follow the same principle. Accordingly there shall be a direction to the Bank/appellant not to recover the salary and other emoluments paid to the second respondent from the date of her re-instatement till her date of discharge. 9. We will follow the same principle. Accordingly there shall be a direction to the Bank/appellant not to recover the salary and other emoluments paid to the second respondent from the date of her re-instatement till her date of discharge. 9. The resultant position is, the award of the Labour Court dated 22. 1993 in I.D.No.22 of 1989 and the order dated 19. 2000 in W.P.No.16033 of 1993 passed by the learned Single Judge of this court are set aside and the order of punishment namely, order of discharge discharging the second respondent from the services of the employer as imposed by the appellate authority is restored. The writ appeal stands disposed of accordingly. No costs.