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2008 DIGILAW 511 (KAR)

Bharath Electronics Ltd v. Paul Durai

2008-09-17

MOHAN M.SHANTANAGOUDAR, P.D.DINAKARAN

body2008
JUDGMENT P. D. Dinakamn, CJ. The writ appeal is directed against the order dated 17th March, 2008 made in Writ Petition No.46828/2002 laid by the respondent-workman where the learned single Judge set aside the award dated 8.5.2002 in A.I.D NoA06/2001 on the file of the Additional Industrial Tribunal at Bangalore, wherein the order dated 28.1992 passed by the appellant-Management, dismissing the respondent workman from service, was confirmed. The learned Single Judge further directed the Management to reinstate the workman with continuity of service and 40% backwages from 28.1992. 2.1) The facts of the case, in brief are: The Managing Director of the appellant-company, invoking Standing Order 15A of the Certified Standing Orders of the company, by order dated 28.1992, dismissed the respondent workman from service with effect from 28.1992 for the following reasons: (i) As evidenced from the xerox copy of the agreement of sale-Ex.M4 entered between the respondent-workman and one Sri Erama Tamil Maran with regard to sale of site owned by the respondent, the respondent has described himself as Managing Director of the appellant Company - BEL; (ii) The respondent-workman was misrepresenting himself as Managing Director of the company and collecting money for making personal gain. 2.2) The Managing Director, in the interest of the organisation, was of the opinion that if no action was taken against the workman it would result in indiscipline and insubordination in the organisation and therefore, exercising his power under clause 15A of the Standing Orders of the Organisation, passed an order of dismissal dated 28.1992, which was challeng8d by the respondent-workman before the Additional Industrial Tribunal, Bangalore, in A.I.D No.406/2001, by raising an industrial dispute under Section 10(4-A) of the Industrial Disputes Act, 1947. 2.3) On the other hand, the workman seriously contended that EX.M4- xerox copy of the alleged agreement of sale, could not be the basis to hold that he misrepresented himself as the Managing Director of the Company; and that the order of dismissal is violative of principles of natural justice. 2.4) The Tribunal, by award dated 8.5.2002 held that the first charge against the workman describing himself as Managing Director of the company entered into an agreement of sale, stood proved as per the xerox copy of the sale agreement-Ex.M.4. 2.4) The Tribunal, by award dated 8.5.2002 held that the first charge against the workman describing himself as Managing Director of the company entered into an agreement of sale, stood proved as per the xerox copy of the sale agreement-Ex.M.4. However, the Tribunal bas not rendered any finding on the allegation that the workman was misrepresenting himself as the Managing Director and collecting money for his personal gain and held that the impugned order of dismissal could not be interfered with for want of a domestic enquiry in view of Clause 15-A of the Standing Orders. 3.1) Against the said award dated 8.5.2002 of the Tribunal, the workman approached this Court in Writ Petition No.46828/2002 reiterating the contentions that were made before the Tribunal. 3.2) The learned single Judge, by his detailed order dated 17th March 2008, set aside the award and directed the appellant-Management to reinstate the workman with 40% backwages with continuity of service. Hence the present appeal. 4) Both the learned Counsel appearing for the appellant-Management and respondent-workman the reiterated the submissions made before the learned single Judge. 5) The issue that arises for consideration is Whether a domestic enquiry can be dispensed with while passing an order under Clause -15A of the Standing Orders? 6.1) In this regard, it is apt to refer to clause 15A of the Certified Standing Orders of the company relied upon by the appellant-Management, which reads as hereunder: "15A. Special procedure in certain cases: Notwithstanding anything contained in standing order 15 or any other standing order, where a workman has been convicted by a Court of law for a criminal offence involving moral turpitude or where the Managing Director is satisfied in extra-ordinary circumstances for reasons to be recorded by him in writing that it is inexpedient or against the interest of the security to continue to employ the workman, the workman may be removed or dismissed from Service without following the procedure laid. down in Standing Order 15." 6.2) Our attention was drawn to clause 15 of the Standing Orders. Clause 15 of the Standing Orders provides for a detailed procedure to be followed in the matter of disciplinary action supposed to be initiated by the Management against an employee for the misconduct of the employee. Clause 15 (1) defines the constituent elements of the misconduct. Clause 15 of the Standing Orders provides for a detailed procedure to be followed in the matter of disciplinary action supposed to be initiated by the Management against an employee for the misconduct of the employee. Clause 15 (1) defines the constituent elements of the misconduct. Clause 15(2) prescribes the punishment that could be imposed on the workman in the proved misconduct and the guilty employee may be: i) Warned or censured; ii) Increments withheld; iii) Demoted to junior post or lower grade; iv) Suspended without pay for a period not exceeding four days at a time; v) Dismissed without notice or any compensation in lieu of notice. Clause 15(3)(a) provides for suspension of an employee pending disciplinary proceeding or where a proceeding is contemplated. Clause 15(3)(b) deals with the subsistence allowance during the period of suspension pending enquiry. Clause 15 (3) (c) provides that the enquiry shall be conducted either in English or Kannada. Clause 15(3)(d) prescribes the period within which the enquiry should be completed. Clause 15 (4) deals with other residuary procedure to be followed in the enquiry. Clause 15(5) makes it clear that no order of dismissal shall be valid- (i) Unless the worker concerned- (a) is informed in writing of the alleged misconduct and (b) is given an opportunity to explain in writing the circumstances alleged against him; and (ii) Unless an enquiry is held in conformity with the principle of natural justice. In awarding punishment under this Standing Order, account should be taken of the gravity of the misconduct, the previous record of the workman and any other extenuating or aggravating circumstances that may exist. (emphasis supplied) Clause 15(6) enables the worker to have the assistance of a co-worker in the enquiry. Clause 15(7) requires the management to provide copies of the statements that are recorded in his presence in the enquiry. Clauses 15(8) and 15 (10) contemplate that the order should be sent to the worker by Registered Post Acknowledgement Due. Clause 15(9) enables the management to institute independent enquiries before dealing with the charges against the workman. Clause 15A thereafter provides special procedure in certain cases. 7) A close analysis of Clause 15, Clause 15-A and the non-obstane clause employed in Clause 15A makes it clear that Clause 15A cannot be resorted by the Management in general and ordinary circumstances. Clause 15(9) enables the management to institute independent enquiries before dealing with the charges against the workman. Clause 15A thereafter provides special procedure in certain cases. 7) A close analysis of Clause 15, Clause 15-A and the non-obstane clause employed in Clause 15A makes it clear that Clause 15A cannot be resorted by the Management in general and ordinary circumstances. On the other hand, Clause 15A is attracted only under special circumstances where a workman could be removed or dismissed from service without following the procedure laid down in Standing order 15, and the extraordinary circumstances are- (i) where a workman is convicted by the Court of law in criminal offences involving moral turpitude, & (ii) where the Managing Director is satisfied that- in extraordinary circumstances, for reasons to be recorded in writing, that it is inexpedient, or against the interest of security to continue to employ the workman. 8) Of course, the power of the Management to dismiss an employee without enquiry when the Standing Orders provide for such dismissal is held to be legal and valid by the Apex Court in the case of AJIT KUMAR NAG Vs. GENERAL MANAGER (PJ)., INDIAN OIL CORPORATION LTD. Reported in (2005) 7 SCC 764 , wherein the Apex Court, considering the effect of Standing Orders therein held: "The principles of natural justice have no application when the authority is of the opinion that it would be inexpedient to hold an enquiry and it would be against the interest of security of the Corporation to continue in employment the offender workman when serious acts were likely to affect the foundation of the Institution: (Emphasis supplied) 9) But, in the instant case, there is no whisper in the order dated 28.1992 that there existed an extraordinary circumstance for consideration of the Managing Director to arrive at a conclusion that it is inexpedient or against the interest of security to continue the workman in the company. There is also no finding that the respondent-workman was convicted by any Court of law for any offence involving moral turpitude so as to attract the extraordinary powers provided in clause 15-A of the Standing Order. 10) The learned single Judge in paragraph 16 of the order rightly interpreted Clause 15-A of the Standing Order and held as follows: "16. There is also no finding that the respondent-workman was convicted by any Court of law for any offence involving moral turpitude so as to attract the extraordinary powers provided in clause 15-A of the Standing Order. 10) The learned single Judge in paragraph 16 of the order rightly interpreted Clause 15-A of the Standing Order and held as follows: "16. Insofar as back wages is concerned, the Management invoked provisions of Clause-15A of the Certified Standing Orders as there were several unanimous complaints received against the petitioner and the Chief Security Officer also submitted a report as per EX.M.19. In normal circumstances, the Management apprehending the involvement of the petitioner in a fraud and apprehending that he has used the name of the Managing Director to induce the innocent persons in the matter of getting appointment can invoke the provisions of Clause-15A of the Standing Orders. No doubt, invoking of Clause 15A in this case is not warranted. In normal circumstances, Management could have held an enquiry to find out whether there is any truth in the allegation. I have found that, invoking of clause 15A of the Standing Orders is not warranted. At the same time, initiation of an enquiry by the Management cannot be found fault with. In such circumstances, awarding of back wages is not justified." 11) In spite of our thorough scrutiny of the order dated 28.1992, we are unable to find out the existence of any extraordinary circumstance attracting Clause 15A of the Standing Order or any reason recorded by the Managing Director to the effect that it is inexpedient-to continue the employee-workman or that it is against the interest of the security of the company to continue the workman. In the absence of the above extraordinary circumstances which mandatorily constitute special circumstances in our considered opinion, Clause 15A is not attracted. When Clause 15-A is not attracted, the only ordinary course of action which ought to have been adopted by the appellant-management is to follow the procedure strictly as provided under Clause 15. 12) Our view in this regard is fortified by the decision of the Apex Court in the case of INDIAN RAILWAY CONSTRUCTION CO.LTD. Vs. When Clause 15-A is not attracted, the only ordinary course of action which ought to have been adopted by the appellant-management is to follow the procedure strictly as provided under Clause 15. 12) Our view in this regard is fortified by the decision of the Apex Court in the case of INDIAN RAILWAY CONSTRUCTION CO.LTD. Vs. AJAY KUMAR -reported in ( 2004 SCC 579 wherein it is held; "The power to dismiss an employee by dispensing with an enquiry is not to be so exercised as to circumvent the prescribed rules the satisfaction as to whether the facts exist to justify dispensing with enquiry has to be of the disciplinary authority... ... .. The contemporaneous circumstances can be duly taken note of in arriving at a decision whether to dispense with an enquiry or not." 13) It is apparent on the face of the record that the management has not followed the procedure contemplated in Clause 15. But, as rightly held by the learned Single Judge, the Tribunal erred that failure to conduct enquiry into the allegation, would not amount to violation of principles of natural justice, in view of Clause 15A of the Standing Orders. 14) Hence, finding no reason to interfere with the order of the learned single Judge, we pass the following order: (i) Writ Appeal is dismissed and the order of the learned single Judge dated 17.3.2008 in Writ Petition No.46828/ 2002 is confirmed; (ii) Award dated 8-5-2002, in A.LD. No. 406/2001 passed by the Additional Industrial Tribunal, Bangalore, is set aside; (iii) Consequently, the order of dismissal dated 25-8-1992 of the Appellant Management is set aside; (iv) Appellant is directed to reinstate the respondent-workman forthwith, if not yet reinstated, with continuity of service and the Appellant shall pay, 40% backwages to the respondent workman from the date of dismissal viz., from 25-8-1992 till 17th March, 2008 and thereafter to pay full wages till he is reinstated into service, within 30 days from the date of receipt of this order. 15) In the facts and circumstances of the case, we award costs of Rs.5000/-.