IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION APPEAL APPEAL APPEAL NO. 398 OF 2002 NO. 398 OF 2002 NO. 398 OF 2002 IN WRIT PETITION NO.1425 OF 1997 Madura Coats Limited ] (Known for some time as ] Coats Viyella India Limited], ] having its establishment ] Appellant at 15, Rajmahal, 84, Veer ] (Ori. Nariman Road, Mumbai - 400 020 ] Petitioner) Vs. 1. Shri P.C. Rathod ] Presiding Officer, ] 3rd Labour Court, ] having his Office at Arun ] Chambers, 6th Floor, Tardeo, ] Respondents Mumbai - 400 034. ] (Ori. ] Respodents) 2. Shri Rajan Karta ] C-2, 226, "Triveni", ] Ambadi Cross Road, Vasai (W), ] Thane Dist. - 401 202 (M.S.) ] Mr. S.M. Naik a/w S.K. More for Appellant. Mr. K.P. Anilkumar for respondent Nos. 1 & 2. CORAM CORAM CORAM : R.M.S. KHANEPARKAR, & : R.M.S. KHANEPARKAR, & : R.M.S. KHANEPARKAR, & P.B. P.B. P.B. MAJMUDAR, JJ. MAJMUDAR, JJ. MAJMUDAR, JJ. DATE DATE DATE : 28TH APRIL, 2008 : 28TH APRIL, 2008 : 28TH APRIL, 2008 JUDGMENT JUDGMENT JUDGMENT (PER R.M.S. KHANDEPARKAR, J.) :- (PER R.M.S. KHANDEPARKAR, J.) :- (PER R.M.S. KHANDEPARKAR, J.) :- 1. This appeal is directed against the judgment and order of the learned Single Judge dated 21/23rd January, 2002 by which the learned Single Judge has dismissed the petition filed by 2 the present appellant and confirmed the order passed by the Third Labour Court, Mumbai in Reference (IDA) No.712 of 1988. 2. The respondent No.1 - Workman was appointed as Accounts Assistant since 1980 on payment of Rs.1,700/- per month. He was subjected to charge-sheet dated 20/3/1987 for deliberately defrauding the appellant- Company to the tune of Rs.26,12,377.42 in collusion with M/s Indu Exports of India. The services of the said respondent were terminated on the ground of loss of confidence without holding domestic enquiry vide the order dated 15/5/1987. The aforesaid termination order was subject matter of the industrial dispute. The Respondent- workman raised the industrial dispute regarding the termination order. The dispute was referred to the Third Labour Court, Mumbai for adjudication which was numbered as Reference (IDA) No.712 of 1988. It is the case of the respondent No.1- Workman that he was subjected to charge-sheet on false and baseless allegations and he was made a scape-goat. It is the case of the respondent No.1 workman that M/s Indu Exports was involved in cheating with N.T.C.. The said party used to keep 3 blank cheques signed with Shri Dorai Subramaniam, Senior Sub-Manager. It is also his case that the practice of the Company was that no lorry receipt was issued to any customer unless a demand draft of a cheque, after confirmation of the clearance of the same or cash was received. The lorry receipt was kept in the safe custody of M/s S.E. Dorai Subramaniam. He used to issue lorry receipts to parties after endorsing it. It is also the case of the workman that it was the duty of the Sales Manager to issue lorry receipts only after ascertaining the clearance of cheques from the Banks. The Company used to accept blank or post-dated cheques and used to issue lorry receipts to M/s Indu Exports of India. It is also his case that the Regional Sales Manager or Senior Sub-Manager used to give him the instructions to fill-up the blank cheques and deposit the same on a particular date. It is also his case that he used to fill up blank cheques of M/s Indu Exports of India and arrange to deposit as per the instructions. It is his further case that the Company was not making debit notes regarding dishonoured cheques which was mandatory as per the Auditor’s instructions and it was the duty of the Senior Sub-Manager to see that the debit notes 4 were prepared in cases of dishonour of cheques and every dishonoured cheque was required to be entered in the cheques dishonoured register. It is also his case that the Company was not maintaining any such register, even though the Auditor’s had made a remark in that behalf. During October 1985 to June 1987, there was no internal auditing in the Office even though other offices were audited 2 or 3 times during the said period. It is also the case of the respondent that he was forced to write and sign the so-called confession letter under force and duress. The respondent pleaded that the action of the company terminating his services was malafide and bad in law and he prayed for reinstatement with full backwages and continuity of service. 3. The claim of the respondent was opposed by the appellant Company (1st party) by filing it’s written statement. On behalf of the appellant (1st party) it was contended that it was the duty of the respondent to receive cash, cheques, drafts, pay orders from the customers and arrange to deposit them in the Company’s account with the Bank. It is also contended that the respondent was required to prepare daily finance report of 5 deposits and send it to the Accounts Department at Ambasamudram Office. It is the case of the Company that he had adopted the modus operandi whereby the dishonour of the cheques of M/s Indu Exports of India was never informed to the Sales Manager/ Senior Sub-Manager, and instead he used to submit fresh cheque of matching amount every month to square up the debit balance accounts due to dishonouring of cheques. The respondent used to manage to credit the cheques of M/s Indu Exports at the end of month so as to match the debit balance. It is also the case of the Company that on 30/12/1996 when the respondent was on leave, he deposited 14 cheques of M/s Indu Exports to match the dishonoured cheques so that he could reconcile the deposit with the Bank’s financial statement. It is the case of the company that the respondent used to personally collect from the Bank the dishonoured cheques and he deliberately concealed this fact from the Sales Manager. The dishonoured cheques were not recorded by the respondent in daily finance statement. It is the case of the company that this act on the part of the respondent deliberately and knowingly done in collusion with M/s Indu Exports of India to defraud the Company to the tune of 6 Rs.26,12,377.42. It is the case of the Company that in view of the documents and written submissions of the respondent, his services were terminated for loss of confidence without holding domestic enquiry. 4. The Labour Court framed various issues at Exhibit C-2. On appreciation of evidence, the Labour Court found that the Company had miserably failed to prove the mis-conduct against the respondent as mentioned in the charge-sheet dated 20/3/1987. The Labour Court found that it is the normal rule that if the termination is held illegal, void, ab-initio and bad in law, the workman should be reinstated in service with the back wages with continuity of service. The Labour Court accordingly passed an order of reinstatement with 50% of back wages, last drawn by him for the period from 5/7/1987 till the date of the order. 5. The Company challenged the said order of Labour Court by filing Writ Petition No. 1425 of 1997 before the learned Single Judge. The learned Single Judge has held that the Award of the Labour Court does not warrant interference. The learned Single Judge on detail consideration of the 7 evidence adduced by the parties before the Labour Court and by detail analysis thereof has found that the Labour Court was justified in ordering reinstatement of the respondent. The learned Single Judge found that the order impugned by the petitioner Company terminating the services of the respondent was without holding any enquiry, even though the charge-sheet was issued to him on 20/3/1987. Even the question about the so-called admission of the workman has also been considered by the learned Single Judge in detail. The learned Single Judge has observed as under : "7. I have gone through the Award of the Labour Court as well as the evidence in great detail with the help of the learned counsel on both sides. The finding of the Labour Court cannot be faulted when he has held that the documents produced before him do not prove that misconduct against the Respondent No.2 Workman. The finding of the Labour Court is that the Workman was working on instructions from the superiors, the Sales Manager Chatterjee and Sub- Manager Doraiswamy. The evidence on record also supports the workman as he has been able to establish that it was under the directions of his superiors that he had filled in the cheques of Indu Exports. He has also established that although the accounts section was aware of the dishonoured cheques, a lorry receipt would be prepared and goods used to be delivered to Indu Exports against the cheque without verifying as to whether the cheque had been honoured or not. 8 8. In my view, it is not possible to assail the finding of the Labour Court that the petitioner has not established the guilt of the Respondent No.2 workman as only xerox copies, some of which were illegible, had been produced before him. The relevant statements of bank reconciliation have not been produced at all. In my view, the Labour Court has rightly come to the conclusion that the Petitioner has not been able to prove its case against the workman. There was no internal audit in the office during the period February 1986 to February 1987 nor has the Petitioner maintained a dishonoured cheque register. The allegation of the Petitioner that it was for the Respondent No.2 workman to maintain this register has been disbelieved by the Labour Court and I see no reason to differ from this finding of the Labour Court. Indeed, if the internal audit had been conducted, if at all the workman had committed any misconduct, it would have been noticed much earlier. It has come on record that the Sub-Manager Doraiswamy Subramaniam used to countersign the daily finance statement and it is surprising that he had not noticed that cheques issued by Indu Exports during the period February 1986 to February 1987 had been dishonoured. It is impossible to accept the version of the Petitioner that the Company was not aware of the fact that the workman was issuing fresh cheques in the name of Indu Exports against dishonoured cheques of Indu Exports for over a period of year." 7. It is required to be noted that though the High Court while dealing with a case under Article 226 and 227 of the Constitution of India, is not required re-appreciate the evidence on record, the learned Single Judge has taken pains to consider 9 the entire evidence on record and ultimately has agreed with the Award of the Labour Court. 8. In our view, the learned Single Judge was perfectly justified in upholding the Award of the Labour Court. The learned Single Judge has considered the evidence of Officers of the Company i.e. Sub-Manager Mr. Durai Subramanian. The learned Single Judge has also considered that the internal audit was not carried out by the Company during the relevant period. It has also found that the work of the respondent was supervised by the higher Officers. The learned Single Judge after appreciating the evidence which was adduced before the Labour Court has found that the Labour Court has rightly passed an order of reinstatement by setting aside the order of termination. 9. In our view, it can not be said that the learned Single Judge has committed any error in upholding the Award passed by the Labour Court as cogent reasons have been given by the learned Single Judge while upholding the order of Labour Court. In our view, there is no substance in this appeal. The same is therefore dismissed, however, there shall be no order as to costs. 10 ( R.M.S. KHANDEPARKAR, J.) R.M.S. KHANDEPARKAR, J.) R.M.S. KHANDEPARKAR, J.) ( P.B. MAJMUDAR, J.) P.B. MAJMUDAR, J.) P.B. MAJMUDAR, J.)