Full Judgment Text
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CASE NO.:
Appeal (civil) 2521 of 2000
PETITIONER:
The General Secretary, South Indian Cashew Factories Workers’ Union
RESPONDENT:
The Managing Director, Kerala State Cashew Development Corporation Ltd. & Ors.
DATE OF JUDGMENT: 12/05/2006
BENCH:
ARIJIT PASAYAT & TARUN CHATTERJEE
JUDGMENT:
J U D G M E N T
ARIJIT PASAYAT, J.
Challenge in this appeal is to the legality of judgment
rendered by a Division Bench of the Kerala High Court setting
aside the judgment of a learned Single Judge. By the
impugned judgment it was held that the punishment of
reversion passed by the disciplinary authority was proper.
The concerned workman was in the employment of Kerala
State Cashew Development Corporation Ltd. (hereinafter
referred to as the Corporation) the respondent No.1 in this
appeal.
Background facts in a nutshell are as follows :
The appellant-Union raised an industrial dispute on
behalf of one of its member questioning correctness of the
order passed by respondent No.1 reverting the concerned
workman Sh. S. Sivasankara Pillai, Manager, Grade II. He
was designated as Manager, Grade II in the respondent No.1’s
establishment. He was charge-sheeted for misconduct of (1)
causing willful loss to the Corporation: (2) habitual breach of
rules; (3) making false allegations against superior officers; (4)
gross negligence of duty. The essence of allegations raised
against him was that by order dated 1.2.1975 he was put in
charge of filling and packing section of that factory. On
8.9.1975 he did not arrange work in the filling section and
that occasioned considerable loss to the factory. On 11.9.1975
the filling work suffered for about 1= hours due to his
indifferent attitude. On 16.9.1975 no work was done in the
filling and packing sections, though the workmen were ready
to work. Because of this non-cooperation and indifference,
huge loss was caused to the Corporation. Dissatisfied with the
explanation submitted by the employee, a domestic enquiry
was conducted. The Assistant Personnel Manager of the
respondent establishment conducted the enquiry. The enquiry
officer submitted a report holding that the charges were
proved in the enquiry. After considering the findings of the
enquiry officer and seriousness of the charges leveled against
the employee, the Management imposed a punishment by
reverting the employee as factory clerk, but the salary he was
drawing was protected. According to the Respondent-
Management, he was not dismissed from service by taking a
lenient view, even though the misconducts proved in the
enquiry were serious.
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The appellant\026Union filed statement before the Labour
Court questioning the enquiry as well as the punishment
imposed. The respondent-management in its pleadings raised
three preliminary points:
(1) Whether the order of reference is proper and valid.
(2) Whether the enquiry held is proper and valid.
(3) Whether the findings of the enquiry officer are based
on legal evidence or whether the same are perverse?
The Labour Court at first held that the concerned
employee was not a workman as defined under the Industrial
Disputes Act, 1947 (in short the ’Act’) and hence there is no
valid industrial dispute. That order was set aside by the
Kerala High Court and remanded for reconsideration. After
remand the Labour Court in preliminary order found that the
employee is a workman as defined under the Act and
Industrial dispute is validly raised. With regard to the enquiry,
it was found that enquiry was fair and proper and findings are
not perverse. But the Labour Court set aside the enquiry
report on the ground that the enquiry officer was biased as
enquiry was conducted by an employee of the Corporation and
he also made certain observations against the workman,
which were not necessary for considering whether there was
misconduct or not. The relevant portion of the preliminary
order is as follows:
"\005The workman challenges the validity of
the enquiry. The findings of the enquiry
officers are also challenged by him. As such
first of all I shall see whether the enquiry held
is proper and valid. In the enquiry 4 witnesses
are examined on the side of the management
and 19 documents were marked. Three
documents were marked on the side of the
workman. A perusal of the enquiry report and
connected papers shows that the workman
fully participated in the enquiry. The
witnesses examined by the management were
cross examined in extensor by the workman.
The requests made by the workman were
allowed by the enquiry officer. It has therefore
to be said that principles of natural justice
have been complied with by the enquiry officer.
In that sense it has to be said that the enquiry
is proper and valid."
After holding that enquiry was proper and valid, with
regard to the findings, the Labour Court held as follows:
"\005.The enquiry officer relied on the
evidence of the 4 witnesses examined by the
management. He believed them and found the
workman guilty of the charges. I do not say
that the findings are perverse."
Therefore, after holding that natural justice was complied
with, enquiry held was proper and valid and that the findings
are not perverse, the Labour Court set aside the enquiry
because enquiry officer was an interested person and biased.
Reasoning of the Labour Court as far as relevant is as follows :
"\005.As stated by me earlier the enquiry
was conducted by the Assistant Personnel
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Manager of the Corporation. This I may state
was not proper. He is an employee of the
corporation. As such needless to say that he
is an interested person, interested in the
corporation. He can and he will record a
finding in favour of the corporation only. The
enquiry cannot therefore be said to be an
impartial one. It is true that there is not legal
bar in the management holding an enquiry by
any of its officers. But in fairness that task
could and should have been entrusted with
some external agency. This the management
had not done. The enquiry cannot therefore be
said to be a proper and valid one."
The Labour Court also held that the enquiry officer made
some observations which are unwarranted and that shows
that the enquiry officer was biased towards the workman.
Hence, he did not accept the report and posted the case for
fresh evidence.
The Management challenged the preliminary order before
the Kerala Court by filing O.P. No.5185 of 1987 and by
judgment that original petition was dismissed holding that
validity of the preliminary order can be canvassed by the
Management if the award goes against it. Thereafter, the
witnesses examined in the enquiry were again examined. No
additional evidence was let in by the worker. Labour Court re-
appraised the evidence and found that the charges were not
proved and hence the punishment imposed was set aside by
the award. Learned Single Judge found that the findings of
the Labour Court in the preliminary order to the effect that the
employee is a workman as defined under the Act is based on
evidence and there is valid industrial dispute. With regard to
the contention that enquiry was valid, no specific finding was
recorded. The contention of the Management that enquiry
cannot be said to be vitiated merely because the enquiry was
conducted by an officer of the Management was not considered
by the learned Judge. The learned Judge merely found that
the entire matter was considered by the Labour Court and
Labour Court had jurisdiction to go into all the aspects of the
dispute. Therefore, the original petition was dismissed. The
learned Single Judge, inter alia, held as follows :
"\005..It was submitted that the first
respondent was not justified to go into the
validity of the domestic enquiry of the findings
arrived at by the Enquiry Officer, which, it was
submitted, were matters outside the scope of
Exh. P.5 (Rejoinder dt. 29.8.1978). I do not
agree that this submission is justified. The
first respondent, in my view has jurisdiction to
go into all aspects of the dispute and to come
to conclusions based on the evidence and
other materials."
The respondent No.1 filed a writ appeal before the
Division Bench contending that the preliminary order of the
Labour Court in setting aside the enquiry report was illegal.
However, the said issue was not considered by the learned
Single Judge. Though it did not contest the finding that the
concerned employee is a workman as defined under the Act
and that there was valid preference for adjudication, it
questioned the conclusion. It was submitted that having
found that the enquiry conducted was fair and proper, there
was no scope for reappraising the evidence or to consider the
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adequacy of punishment. The Labour Court had erred in
holding that since enquiry was conducted by an officer of the
Management, the enquiry was vitiated and also because he
made some observations against the workman that did affect
the validity of the enquiry. The Division Bench accepted the
stand of the respondent No.1. Questioning correctness of the
conclusions of the Division Bench, the present Appeal has
been filed.
Learned counsel for the appellant submitted that the fact
that the enquiry officer was an officer of the management itself
affected the fairness of the enquiry. Further his biased
approach was evident from the unnecessary observations
made by him. He, therefore, contended that the view of the
learned Single Judge was the correct one and should be
restored. Learned counsel for the respondent No.1 on the
other hand supported the impugned order of the High Court.
In Delhi Cloth and General Mills Co. Ltd. v. Labour Court
[(1970) 1 LLJ 23] this Court has held that merely because the
Enquiry Officer is an employee of the Management it cannot
lead to the assumption that he is bound to decide the case in
favour of the Management.
In Saran Motors (P) Ltd. v. Vishwanath [(1964) II LLJ
139] this Court held as follows :
"It is well-known that enquiries of this
type are generally conducted by officers of the
employer companies and in the absence of any
special bias attributable of a particular officer,
it has never been held that the enquiry is bad
just because it is conducted by an officer of the
employer."
Therefore, finding of the Labour Court that enquiry was
vitiated because it was conducted by an officer of the
Management cannot be sustained.
The only other ground found by the Labour Court
against the enquiry officer is that he made some unnecessary
observations and, therefore, he was biased. The plea that
enquiry officer was biased was not raised during the enquiry
or pleadings before the Labour Court or in earlier proceedings
before the High Court. The bias of the enquiry officer has to
be specifically pleaded and proved before the adjudicator.
Such a plea was significantly absent before the Labour Court.
We also note that the Labour Court itself found that the
enquiry officer relied on the evidence adduced in the enquiry
and its findings were not perverse. After such a finding, even
if he has stated some unwarranted observations, it cannot be
stated that report is baised. In Tata Engineering and
Locomotive Co. Ltd. v. S.C. Prasad [(1969) 3 SCC 372] this
Court held that :
"Industrial Tribunals, while considering the
findings of domestic enquiries, must bear in
mind that persons appointed to hold such
enquiries are not lawyers and that such
enquiries are of a simple nature where
technical rules as to evidence and procedure
do not prevail. Such findings are not to be
lightly brushed aside merely because the
enquiry officers, while writing their reports,
have mentioned facts which are not strictly
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borne out by the evidence before them."
In this case for finding the employee guilty, the enquiry
officer relied on the evidence adduced in the enquiry and
Labour Court itself found that the findings were not perverse.
In such circumstances, the preliminary order of the Labour
Court setting aside the enquiry on the ground that enquiry
was conducted by an officer of the Management and he had
made some observations in the enquiry report which were not
warranted in the case is not a vitiating factor and these
reasons are not sufficient to set aside the enquiry.
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. But, here there is a
clear finding that the findings are not perverse and principles
of natural justice were complied with while conducting
enquiry.
Above being the position the impugned judgment of the
High Court does not suffer from any infirmity to warrant
interference.
The appeal is sans merit and is dismissed. No costs.