The
General Secretary, South Indian Cashew Factories Workers' Union Vs. The Managing
Director, Kerala State Cashew Development Cor [2006] Insc 304 (12 May 2006)
Arijit
Pasayat & Tarun Chatterjee 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
-
causing willful
loss to the Corporation:
-
habitual breach
of rules;
-
making false
allegations against superior officers;
-
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.
The
appellantUnion 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:
-
Whether the
order of reference is proper and valid.
-
Whether the
enquiry held is proper and valid.
-
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:
"The
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:
".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 :
".As
stated by me earlier the enquiry was conducted by the Assistant Personnel
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 :
"..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 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 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.
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