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Gujarat High Court · body

2018 DIGILAW 452 (GUJ)

DIVISIONAL CONTROLLER v. INDUSTRIAL TRIBUNAL

2018-02-08

K.M.THAKER

body2018
JUDGMENT : 1. Heard Mr. Joshi, learned advocate for the petitioner. The respondent No.2, though served, has not entered appearance. 2. In this petition, the petitioner has prayed, inter alia, that:- “7(A) This Hon'ble Court be pleased to issue a writ of certiorari or any other appropriate writ, order or direction in the form of certiorari or any other appropriate writ, order or direction calling for the records and proceedings of Reference (I.T.) No.60 of 2009 and after perusing the same be pleased to quash and set aside the award of the tribunal dated on 20/05/2013.” 2.1 The petitioner is aggrieved by award dated 20.5.2013 passed by learned Tribunal in Reference (IT) No.60 of 2009 whereby the learned Tribunal set aside the order of penalty passed by the appellate authority of the petitioner corporation against the concerned workman. 3. So far as order of penalty passed against the concerned workman is concerned, it is necessary and appropriate to note, at this stage, that upon conclusion of domestic inquiry and after considering all findings recorded by the Inquiry Officer in his final report, the disciplinary authority had imposed penalty by way of dismissal from service. 3.1 However, against the order of disciplinary authority, the concerned workman preferred departmental appeal. 3.2 The appellate authority considered the appeal and the order of disciplinary authority and in exercise of his appellate power, the appellate authority modified the order of penalty, inasmuch as the appellate authority set aside the order whereby the concerned workman was dismissed from service. Instead, the appellate authority directed reinstatement of the concerned workman and imposed modified penalty of reducing workman's salary in the pay scale by 5 stages. 3.3 Consequently, the penalty order terminating service of the petitioner did not survive when the appellate authority passed the order and modified the penalty. 4. The award passed by the learned Tribunal is required to be examined in light of above mentioned facts, more particularly the fact that the order under challenge imposed penalty of reducing salary in pay scale by 5 stages and the order terminating the service. 5. 4. The award passed by the learned Tribunal is required to be examined in light of above mentioned facts, more particularly the fact that the order under challenge imposed penalty of reducing salary in pay scale by 5 stages and the order terminating the service. 5. At this stage, it is also relevant to clarify that the concerned claimant has categorically accepted and admitted, in the statement of claim before trial Court that by virtue of order dated 22.8.2007 passed by the appellate authority, the disciplinary authority's order, whereby his service was terminated, was set aside and instead, modified penalty was imposed. In paragraph No.2 of claim statement, the petitioner has mentioned, inter alia, that:- “Subsequently by virtue of order dated 20.8.2007 in First Appeal, the Corporation directed reinstatement and imposed penalty of reduction of salary by 5 stages in the pay scale. The said order of penalty is illegal and unjustified.” (free translation) 6. According to the learned advocate for the petitioner, the learned Tribunal overlooked said fact and ignored that only order of penalty which was under challenge imposed penalty short of discharge or dismissal i.e. order imposing penalty of reducing concerned workman's pay scale by 5 stages. 7. So far as factual background is concerned, it has emerged from the record that the concerned workman (who raised industrial dispute) was working as Driver with the petitioner corporation. The corporation received report/complaint against the petitioner on 7.4.2005, the petitioner was assigned duty at 64- A, 65 Palasana, however, the petitioner unauthorizedly and without prior intimation did not remain present and did not attend his duty. According to the petitioner corporation, said unauthorized absence of the petitioner not only caused financial loss to the corporation but also caused difficulties and harassment to the passengers because the trip to the extent of 290 kms. had to be cancelled. 8. With the said allegation, the corporation served charge sheet and in pursuance of the charge sheet, domestic inquiry was conducted. The Inquiry Officer, in his report, held that the allegations and charge against the concerned workman are proved. 9. The disciplinary authority after considering the material available on record of the inquiry and the findings recorded by the Inquiry Officer, decided to terminate the concerned workman and accordingly, after following procedure prescribed by Rules, passed order dated 16.11.2005 whereby the concerned workman came to be dismissed from service with the corporation. 9. The disciplinary authority after considering the material available on record of the inquiry and the findings recorded by the Inquiry Officer, decided to terminate the concerned workman and accordingly, after following procedure prescribed by Rules, passed order dated 16.11.2005 whereby the concerned workman came to be dismissed from service with the corporation. 10. Aggrieved by the said order, the concerned workman filed appeal before the appellate authority. 11. The appellate authority partly allowed the appeal by partially reversing the order of the disciplinary authority. The appellate authority, vide his order dated 22.8.2007, set aside the order of dismissal and directed that the workman should be reinstated. The appellate authority, however, imposed penalty of reducing concerned workman's salary in the pay scale by 5 stages. 12. Against the said order by the appellate authority, the workman raised industrial dispute which was referred by the appropriate government vide order of reference dated 29.6.2009. The said order of reference was registered as Reference (IT) No.60 of 2009. 13. The concerned workman filed his statement of claim. As mentioned above, in paragraph No.2 of his statement of claim, the concerned workman has specifically mentioned and admitted that the order terminating his service by way of dismissal was set aside by the appellate authority and the penalty was modified. Thus, from the statement of claim filed by concerned workman, it becomes clear that the order of terminating service of the concerned workman by way of dismissal did not exist/survive when the dispute was raised, referred and placed before the tribunal. Therefore, the said order could not have been made subject matter of dispute or reference before learned Tribunal. The only order of penalty which survived before and was to be adjudicated by the learned Tribunal was reduction of concerned workman's salary in the pay scale by 5 stages. 14. The petitioner corporation opposed the reference. In its written statement, the corporation mentioned relevant details including the fact about the appellate authority's order. 15. Before the learned Tribunal, the concerned workman filed pursis (Exh.10) and admitted legality and propriety of the inquiry. Thus, the dispute with regard to legality of the inquiry did not arise. The concerned workman, however, reserved his challenge against the findings of the Inquiry Officer. 15. Before the learned Tribunal, the concerned workman filed pursis (Exh.10) and admitted legality and propriety of the inquiry. Thus, the dispute with regard to legality of the inquiry did not arise. The concerned workman, however, reserved his challenge against the findings of the Inquiry Officer. In paragraph Nos.10 and 11 of the award, the learned Tribunal has, after examining the evidence as well as material available on record, more particularly the findings recorded by the Inquiry Officer, reached to the conclusion that not only the inquiry is legal and proper but the findings recorded by the Inquiry Officer are correct and fair and the said findings cannot be considered perverse. 16. In the result, the legality of the inquiry as well as findings of the Inquiry Officer sustained and passed the scrutiny by learned Tribunal. 17. In this context, at this stage, it would be appropriate to take into account the observations by Hon'ble Apex Court in paragraph Nos.18 and 29 of the decision in case of Management of Bharat Heavy Electricals Ltd. v. M. Mani [ (2018) 1 SCC 285 ], which read thus:- “18. In our pinion, once the Labour Court upheld the departmental enquiry as being legal and proper then the only question that survived for consideration before the Labour Court was whether the punishment of “dismissal” imposed by the appellant to the respondents was legal and proper or it requires any interference in its quantum. 19. In other words, the Labour Court should have then confined its enquiry to examine only one limited question as to whether the punishment given to the respondents was, in any way, disproportionate to the gravity of the charge levelled against them and this, the Labour Court should have examined by taking recourse to the provisions of Section 11-A of the Industrial Disputes Act, 1947 (in short “the Act”) and the law laid down by this Court in Workmen v. Firestone Tyre & Rubber Co. of India (P) Ltd. It was, however, not done thereby rendering the order of the Labour Court legally unsustainable.” 17.1 In light of said observation by Apex Court it becomes clear that once inquiry is held legal and fair the only issue which survives before the tribunal is about quantum of penalty. of India (P) Ltd. It was, however, not done thereby rendering the order of the Labour Court legally unsustainable.” 17.1 In light of said observation by Apex Court it becomes clear that once inquiry is held legal and fair the only issue which survives before the tribunal is about quantum of penalty. Of course, within that limited purview of tribunal's authority, the tribunal's power under Section 11- A of the Act will co-exist when penalty in question is “discharge or dismissal”. 17.2 However, it is pertinent to note that, in the cases where the quantum of penalty is “short of discharge or dismissal” then the power under Section 11-A would not be available to the tribunal with full force and depth. The tribunal's power to examine propriety of and to disturb the quantum of penalty which is short of discharge or dismissal shrinks when the inquiry is found legal and fair and findings by inquiry officer do not fall in category of perverse findings or findings contrary to or without support of evidence. In such cases (of restricted penalty) the tribunal would not interfere. In this context, it is beneficial to read observation by this Court in case of Gujarat State Road Transport Corporation v. Prabhashanker K. Acharya [ 1992 (2) GLH 354 ]. In the said decision, the Court addressed below quoted issues:- “The moot questions for consideration are: (1) what is the extent and ambit of jurisdiction of labour court/ industrial tribunal to interfere in finding by the employer - management regarding misconduct of workman; (2) whether the jurisdiction and powers of the labour court/ industrial tribunal under section 11a of the industrial disputes act to interfere with the order imposing punishment is confirmed to only the punishment of discharge or dismissal or also extend to the punishments other than the said punishments; (3) if not, whether the labour court/ industrial tribunal can interfere with the punishment other than that of the discharge or dismissal passed by the management under the provisions of sections 7, 7a and 15 of the industrial dispute act. If yes. (4) what is the extent of the jurisdiction and power of labour court/ industrial tribunal and under what circumstances the order of such punishment can be interfered with?” The Court, then, observed and held, inter alia, that:- “18. If yes. (4) what is the extent of the jurisdiction and power of labour court/ industrial tribunal and under what circumstances the order of such punishment can be interfered with?” The Court, then, observed and held, inter alia, that:- “18. The powers and the jurisdiction of the labour court and the industrial tribunal to interfere with the finding of misconduct and order imposing the punishment other than the punishment of discharge or dismissal is restricted even though the labour court or tribunal had wider powers than revisionsl powers. It cannot exercise the powers of an appellate authority and reappraise the evidence and set aside the finding only because the other view is possible or even plausible. The labour court or the tribunal also cannot interfere with the nature or the quantum of the punishment casually because it considers to impose other kind of punishment or to impose lesser punishment than the one awarded by the management. The tribunal can interfere with the finding of misconduct or the nature and the quantum of the punishment only under the circumstances as set out above and specifically by various judicial pronouncements. The tribunal can interfere with the finding of the' management in the following circumstances : (1) want of good faith. (2) victimisation or unfair labour practice. (3) basic error or violation of principles of natural justice. (4) finding completely baseless or perverse. (5) colourable exercise of power or want of bona fide, and (6) punishment shockingly disproportionate regard being had to the particular conduct or the past record or is such that no reasonable employer would ever impose in like circumstances unless he is actuated by considerations of victimisation or natural labour practice. The above circumstances are illustrative and not exhaustive and the tribunal can interfere with the finding or the punishment in circumstances alike also, but the tribunal cannot interfere with the finding or nature and quantum of punishment casually or as if exercising appellate jurisdiction.” In the said decision, the Court, speaking through Hon'ble Mr. The above circumstances are illustrative and not exhaustive and the tribunal can interfere with the finding or the punishment in circumstances alike also, but the tribunal cannot interfere with the finding or nature and quantum of punishment casually or as if exercising appellate jurisdiction.” In the said decision, the Court, speaking through Hon'ble Mr. Justice A.M.Ahmadi (as His Lordship then was) observed, inter alia, that:- “...To put it differently, is it within the ambit of the labour court/industrial tribunal's jurisdiction to interfere with the employer's discretion in the field of disciplinary jurisdiction and reduce the penalty imposed by the employer after the charge of misconduct was proved at a properly held domestic enquiry even when the punishment imposed is short of dismissal or discharge and the labour court/industrial tribunal has come to the conclusion that the enquiry was in accordance with the principles of natural justice and finding of guilt was not perverse or mala fide? such a power is specifically conferred in cases of discharge or dismissal under the newly inserted section 11a by industrial disputes (amendment) act, 1971 (45 of 1971) with effect from December 15,1971.... ....But this power is specifically confined to cases of discharge or dismissal and not to other case where the punishment imposed is short of that. That would ordinarily mean that the legislature intended to permit interference in managerial discretion by the labour court/industrial tribunal in cases where the punishment results in termination of employment and not in all cases. In other words, cases of punishment other than discharge or dismissal would continue to be governed by the law laid down by judicial pronouncements prior to the insertion of section 11a in the act. It would, therefore, be advantageous to examine the case law in this behalf as obtaining section 11a was placed on the statute book. ...It is therefore, clear from this decision that while the supreme court recognised the power of adjudicatory forums to interfere in matters of discipline to the limited extent of the case falling within one of the four stipulations delineated above, it at the same time cautioned that the role of such forums was not of appellate nature, meaning thereby, that it cannot substitute its own judgment for that of the employer even if any one of the four conditions did not exist. In view of this decision and having regard to the recommendation no. In view of this decision and having regard to the recommendation no. 119 of the I. L. O. The legislature stopped in by introducing section 11a on the statute book. By this new provision the limitation placed by the supreme court was sought to be lifted by permitting the adjudicatory authorities to interfere in cases of discharge or dismissal if the concerned authority found that the order was not justified and has entitled the said authority to substitute the punishment. Since section 11a is limited in scope, in that, it governs cases of punishment of discharge or dismissal only, it follows by necessary implication that the legislature did not intend to clothe the adjudicatory authorities with similar power where the punishment is other than discharge or dismissal. The legislative intent is obvious, namely, it did not desire that the managerial prerogative of taking disciplinary action against the erring workmen should be absolute or unlimited even in cases of termination of service presumably because it was apprehended that such extreme, unchecked and unfettered power may not be conducive to maintenence of industrial peace. 7. It will be seen from the above discussion that the position in law before and after the insertion of section 11a has been consistent in so far as cases other than termination of service by an order of discharge or dismissal are concerned. It is only in cases of discharge or dismissal that the legislature enlarged the jurisdiction of the adjudicatory forums to interfere with the order of punishment by introducing section 11 - a in the act. The tendency of the labour court/industrial tribunal to lightly interfere with the order of punishment, in cases where punishment inflicted is short of dismissal or discharge, as if it were exercising appellate jurisdiction must be deprecated. It must be remembered that the quantum of punishment cannot be measured in golden scales and will offer from individual to individual depending on his notions of discipline but the labour court/industrial tribunal will not be justified in interfering with the employer's order of punishment merely because it would have visited the workmen with a lighter punishment if it were wearing the employer's shoes. It is only in cases where the labour court/industrial tribunal comes to the conclusion, for reas to be stated in writing, that the punishment imposed is grossly disproportionate to the proved misconduct, that it my interfere with the order of punishment. Such cases would be far and few. Unfortunately, we have noticed that labour court/industrial tribunal freely interferes with the quantum of punishment, some of the cases on hand are examples of unwarranted interference, which has been responsible for generating a lot of avoidable litigation. That is why it was thought that the time was ripe for clearly stating the jurisdictional parameters of the labour court/industrial tribunal in such cases. However, a word of caution for the managements seems necessary, namely, that it must act in a responsible manner in the choice of punishment from the wide range of censure to dismissal if it does not want the labour court/industrial tribunal to interfere on the ground that the severity of the punishment betrays victimisation.” (emphasis supplied) 18. In present case, after recording the conclusions with regard to legality of the inquiry and the findings of the Inquiry Officer, learned Tribunal proceeded to examine the legality and propriety of the order of penalty imposed against concerned workman. At this stage, it will not be out of place to recall that the only order of penalty which survived against the petitioner is the order reducing the concerned workman's salary in the pay scale by 5 stages. Differently put, the penalty imposed against concerned workman was short of discharge or dismissal from service. 19. In this view of the matter, the learned Tribunal's jurisdiction was circumscribed so far as the order of penalty is concerned. Having regard to the quantum of penalty which was under challenge before the learned Tribunal, the powers under Section 11-A of the ID Act were not available to the tribunal. With regard to the order of penalty which fall short of discharge or dismissal, the tribunal cannot exercise powers under Section 11-A of the Act. 19.1 In this context, profitable reference can be had to observations by Hon'ble Apex Court in paragraph No.16 of the South Indian Cashew Factories Workers' Union v. Kerala State Cashew Development Corpn. Ltd. & Ors. [ (2006) 5 SCC 201 ], which reads thus:- “16. 19.1 In this context, profitable reference can be had to observations by Hon'ble Apex Court in paragraph No.16 of the South Indian Cashew Factories Workers' Union v. Kerala State Cashew Development Corpn. Ltd. & Ors. [ (2006) 5 SCC 201 ], which reads thus:- “16. The Labour Court had earlier held that the enquiry was properly held and there was no violation of the principles of natural justice and that the findings were not perverse. The vitiating facts found by the Labour Court against the enquiry are erroneous and are liable to be set aside. If enquiry is fair and proper, in the absence of any allegations of victimization or unfair labour practice, the Labour Court has no power to interfere with the punishment imposed. Section 11A of the Act gives ample power to the Labour Court to re-appraise the evidence adduced in the enquiry and also sit in appeal over the decision of the employer in imposing punishment. Section 11A of the Industrial Disputes Act is only applicable in the case of dismissal or discharge of a workman as clearly mentioned in the Section itself. Before the introduction of Section 11A in Indian Iron and Steel Co. Ltd. v. Their Workmen [(1958) SCR 667] this Court held that the Tribunal does not act as a Court of appeal and substitute its own judgment for that of the Management and that the Tribunal will interfere only when there is want of good faith, victimisation, unfair labour practice, etc. on the part of the management. There is no allegation of unfair labour practice, victimisation etc. in this case. The powers of the Labour Court in the absence of Section 11A is illustrated by this Court in Workmen of Firestone Tyre and Rubber Co. of India (Pvt.) Ltd. v. The Management [ (1973) 1 SCC 813 ]. When enquiry was conducted fairly and properly, in the absence of any of the allegations of victimisation or malafides or unfair labour practice, Labour Court has no power to interfere with the punishment imposed by the management. Since Section 11A is not applicable, Labour Court has no power to re-appraise the evidence to find out whether the findings of the enquiry officer are correct or not or whether the punishment imposed is adequate or not. Of course, Labour Court can interfere with the findings if the findings are perverse. Since Section 11A is not applicable, Labour Court has no power to re-appraise the evidence to find out whether the findings of the enquiry officer are correct or not or whether the punishment imposed is adequate or not. Of course, Labour Court can interfere with the findings if the findings are perverse. But, here there is a clear finding that the findings are not perverse and principles of natural justice were complied with while conducting enquiry.” From above quoted observations by Hon'ble Apex Court and from the observation by Apex Court in case of BHEL (supra), it comes out that the scope of Labour Court's authority to disturb the order of penalty is held to be even more circumscribed or restricted than what Division Bench observed in case of Gujarat State Road Transport Corporation (supra). The legal position explained in case of BHEL (supra) and South Indian Cashew Factories Workers' Union (supra) will be applicable more intensely in case where penalty order is short of discharge or dismissal and scope of interference by labour Court in such case would be more narrow or circumscribed than in case of dismissal or discharge. 20. In present case, despite the fact that when the concerned workman raised industrial dispute, the order of dismissal did not survive, the learned Tribunal proceeded on the premise as if the order of dismissal survived. The learned Tribunal ignored or overlooked the fact or lost sight of the fact that the said order was setaside by appellate authority and it did not exist. With such misconception and by overlooking the facts and circumstances, the learned Tribunal decided the reference. 21. Not only this, learned Tribunal also ignored the fact that the workman had admitted legality and propriety of the inquiry. Besides this, learned Tribunal also overlooked its own conclusion that the inquiry was conducted in legal and fair manner and the findings recorded by the Inquiry Officer are correct, just and legal. 22. In this view of the matter, even if the award by the learned Tribunal is examined from either perspective i.e. from the perspective that the learned Tribunal exercised power under Section 11-A or from the perspective that the learned Tribunal exercised power of adjudication and not merely power under Section 11-A then also from both perspective, the order is not sustainable. If the final conclusion by learned Tribunal and direction by the learned Tribunal are considered as order in exercise of power under Section 11-A, then, the learned Tribunal's order is hit by decision by Hon'ble Apex Court in case of South Indian Cashew Factories Workers' Union (supra). 23. On the other hand, if the learned Tribunal's decision is considered on the premise that the learned Tribunal found that the order of penalty imposed by the appellate authority is legal and cannot be sustained, then, in that event, the award is contrary to the legal position declared by Hon'ble Apex Court in case of Management of Bharat Heavy Electricals Ltd (supra). 24. Besides above mentioned aspect, even if the decision by learned Tribunal is independently examined, i.e. not from the perspective of the decision in case of South Indian Cashew Factories Workers' Union (supra) or from the perspective of the observation in the case of BHEL (supra) or the decision in case of GIDC (supra), then also, on examination of the award and the observation/decision recorded by the learned Tribunal, this Court is satisfied that the learned Tribunal committed material error of law and irregularity in holding that the order of penalty is incorrect and unjustified and deserved interference. The quantum of penalty and the suggestion with regard to quantum of penalty is not within the realm of learned Tribunal's jurisdiction unless it is established by the workman and unless learned Tribunal records categorical finding that the quantum of penalty is so excessive that it smacks of victimization. Without specifically and expressly recording such findings, the learned Tribunal could not have lightly and casually interfered with the decision of appellate authority. 24.1 The decision with regard to quantum of penalty – in case of proved misconduct – is in exclusive realm of and with exclusive discretion of the employer. The Court cannot sit in Appeal over that decision. The Court can neither weigh the quantum of penalty in golden scales or by its own standard or yardstick and cannot substitute the penalty imposed by the employer merely because Court finds it improper, except in case the quantum is excessively disproportionate which no prudent employer would impose or which smacks of victimization. In such case, the Court must first record such conclusion (with reasons). 24.2 The impugned award does not pass this test. In such case, the Court must first record such conclusion (with reasons). 24.2 The impugned award does not pass this test. The tribunal has not recorded the conclusion that the penalty demonstrates victimization. Any ground to interfere with the penalty is not recorded by the tribunal. The learned Tribunal has interfered with the order of penalty very casually and without justification. 24.3 The learned Tribunal lost sight of the fact that proved misconduct is antithesis of victimisation. 24.4 For the said reason also, the impugned award is not sustainable. When the proved misconduct of the workman is taken into account, then, it comes out that the penalty imposed by the corporation cannot be said to be harsh or excessive, much less by way of victimization. For the aforesaid reasons, the petition succeeds. The award dated 20.5.2013 deserves to be set aside and is, accordingly, set aside. Rule is made absolute to aforesaid extent.