IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 22.07.2011 CORAM: THE HON’BLE MR. JUSTICE K.CHANDRU W.P.No.19888 of 2009 Managing Director New Man Press Private Limited No.68, Royapettah High Road Chennai 14. .. Petitioner Vs. 1. The Presiding Officer Second Additional Labour Court Chennai 104 2. A.Radhakrishnan .. Respondents Prayer : Petition under Article 226 of the Constitution of India praying for a Writ of Certiorari to call for the records from the file of the first respondent in I.D.No.438 of 2002 and to quash the award passed therein dated 4.6.2009. For Petitioner :: Mr.H.Balaji For Respondents :: Mr.S.Ravi for R2 R1 - court O R D E R The petitioner is the management of New Man Press Private Limited. They have come forward to challenge an award passed by the 1st respondent Labour Court made in I.D.No.438 of 2002 dated 4.6.2009. By the aforesaid award, the Labour Court set aside the order of termination passed against the 2nd respondent and directed his reinstatement with backwages at the rate of 50%. 2. The Writ Petition was admitted on 19.10.2009. Pending the Writ Petition, this Court granted an interim stay on condition that the petitioner deposits 50% of the amount to the credit of the Industrial Dispute. In the meanwhile, the 2nd respondent filed two applications in M.P.Nos.1 and 2 of 2010 seeking for vacating the interim order and also payment under Section 17-B of the Industrial Disputes Act. However, when both applications came up along with the stay application on 8.11.2010, on finding that the 2nd respondent had https://hcservices.ecourts.gov.in/hcservices/ already reached the age of superannuation, the application in M.P.No.2 of 2010 was not pressed and accordingly was dismissed. In the vacate stay application, which was heard along with the stay application, the interim stay granted was made absolute and this Court also recorded the fact that 50% of the backwages was deposited in the Fixed Deposit and the workman was directed to withdraw quarterly interest from such deposit. The matter was directed to be posted for final disposal. 3. When the matter came up on 20.7.2011, this Court directed both parties to explore the possibility of any settlement. However, the parties were at variance with reference to the quantum of compensation and the matter could not be settled. 4. The only point raised by the learned counsel for the petitioner was that when they filed counter statement in resisting the claim made by the 2nd respondent, in paragraph No.7, they have stated that in case the Labour Court arrived at the conclusion that the enquiry was not fair and proper, they may be permitted to prove the misconduct by letting in evidence before the Labour Court. It was stated before the Labour Court that for the purpose of determination of preliminary issue, evidence was let in on behalf of the 2nd respondent. He had examined himself as WW1 and on the side of the petitioner management one Tmt.Vasantha Seetharaman was examined as M.W.1. On the side of the workman, 17 documents were filed and marked as Ex.W.1 to Ex.W.17. On the side of the management, 17 documents were filed and marked as Ex.M.1 to Ex.M.17. 5. The Labour Court instead of determining the preliminary issue, framed the issue on the merits of the case by stating whether the 2nd respondent was entitled for any relief in the main Industrial Dispute. On the basis of such issue, the Labour Court relied upon the documents, which are filed for the purpose of determining the preliminary issue and deciding the merits of the case. Even in the Claim Statement filed by the 2nd respondent, he had attacked the Ground No.B that the enquiry was not conducted in accordance with the principles of natural justice, which was done ex parte contrary to law and justice. In the proof affidavit filed by the 2nd respondent, in paragraph Nos.4 and 5 the workman once again raised the issue relating to the validity of the enquiry. Likewise, in the proof affidavit filed by M.W.1, she had asserted that the enquiry was fair and proper. It was also claimed that written arguments were also filed by the management dated 21.4.2009 only with reference to the preliminary issue. 6. The Labour Court overlooking these facts went into the main case and passed final award and hence the impugned award must be set aside. In the affidavit filed in support of the Writ Petition, in paragraph NO.7, it was asserted by the petitioner that the Labour Court instead of framing the preliminary issue straight away passed https://hcservices.ecourts.gov.in/hcservices/ the final award and hence the Labour Court's award was illegal. In ground No.8.E, a similar ground was raised. 7. In opposition to these pleadings, in the affidavit filed in support of the vacate stay application, the workman did not deny these allegations specifically and merely stated that the Labour Court heard both sides and passed the final award. This evasive denial makes this Court to think that the allegations made by the petitioner with reference to the conduct of the workman was correct. Though the attendance register was produced by the petitioner including the proof affidavit and written argument, the Labour Court did not keep in mind the procedure to be adopted in terms of Section 11(a) of the Industrial Disputes Act. 8. Further, under the introduction of Section 11(a) of the Industrial Disputes Act, the Labour Court is bound to frame a preliminary issue. With reference to the validity of the domestic enquiry, if the authorities are variance on the said issue and only after passing such an award, the question of taking up the main case will arise. In case the Labour Court is of the opinion that the enquiry is unfair, then no part of the evidence recorded in the departmental enquiry can be relied upon by the Labour Court. On the other hand, if the enquiry is set aside and if the employer seeks for a further opportunity, that opportunity must be provided to the employer to satisfy the Labour Court with reference to the misconduct of the workman, who has raised the dispute. 9. The Supreme Court in Neeta Kaplish vs. Presiding Officer, Labour Court and another reported in 1991 (1) CLR 219 held that in case of an enquiry, no part of the earlier record can be relied upon and that will not constitute the merits on record in terms of the proviso to Section 11-A of the Industrial Disputes Act. 10. Further, the need to issue preliminary order before going into the merits of the case, has been emphasised by the Supreme Court in Cooper Engineering Ltd. v. P.P. Mundhe, (1975) 2 SCC 661. The Supreme Court held that there is an obligation on the part of the Labour Court to frame a preliminary issue. In this case, the Labour Court had not framed the issue, though the parties have pleaded for framing such an issue. Hence the impugned award has to be necessarily set aside due to non-application of mind and ignoring the pleadings on record before the Labour Court. 11. In this context, it is necessary to refer to paragraphs 21 and 21 of the judgment in Cooper Engineering case (cited supra), which reads as follows: 21. Propositions (4), (6) and (7) set out above are well- recognised. Is it, however, fair and in accordance with the principles of natural justice for the Labour Court to https://hcservices.ecourts.gov.in/hcservices/ withhold its decision on a jurisdictional point at the appropriate stage and visit a party with evil consequences of a default on its part in not asking the court to give an opportunity to adduce additional evidence at the commencement of the proceedings or, at any rate, in advance of the pronouncement of the order in that behalf? In our considered opinion it will be most unnatural and impractical to expect a party to take a definite stand when a decision of a jurisdictional fact has first to be reached by the Labour Court prior to embarking upon an enquiry to decide the dispute on its merits. The inference involves determination of the larger issue of discharge or dismissal and not merely whether a correct procedure had been followed by the management before passing the order of dismissal. Besides, even if the order of dismissal is set aside on the ground of defect of enquiry, a second enquiry after reinstatement is not ruled out nor in all probability a second reference. Where will this lead to? This is neither going to achieve the paramount object of the Act, namely, industrial peace, since award in that case will not lead to a settlement of the dispute. The dispute, being eclipsed, pro tempore, as a result of such an award, will be revived and industrial peace will again be ruptured. Again another object of expeditious disposal of an industrial dispute (see Section 15) will be clearly defeated resulting in duplication of proceedings. This position has to be avoided in the interest of labour as well as of the employer and in furtherance of the ultimate aim of the Act to foster industrial peace. 22. We are, therefore, clearly of opinion that when a case of dismissal or discharge of an employee is referred for industrial adjudication the Labour Court should first decide as a preliminary issue whether the domestic enquiry has violated the principles of natural justice. When there is no domestic enquiry or defective enquiry is admitted by the employer, there will be no difficulty. But when the matter is in controversy between the parties that question must be decided as a preliminary issue. On that decision being pronounced it will be for the management to decide whether it will adduce any evidence before the labour court. If it chooses not to adduce any evidence, it will not be thereafter permissible in any proceeding to raise the issue. We should also make it clear that there will be no justification for any party to stall the final adjudication of the dispute by the Labour Court by questioning its decision with regard to the preliminary issue when the matter, if worthy, can be agitated even after the final award. It will be also legitimate for the High Court to refuse to intervene at this stage. We are https://hcservices.ecourts.gov.in/hcservices/ making these observations in our anxiety that there is no undue delay in industrial adjudication." 12. Under the circumstances, the Writ Petition stands allowed and the impugned order stands set aside. The matter is remanded to the 1st respondent Labour Court to proceed in accordance with law after due notice to the parties. 13. It is made clear that until the final award is passed in I.D.No.438 of 2002, the amount lying in the Fixed Deposit shall not be withdrawn by both sides and the 2nd respondent can withdraw the quarterly interest as per the directions already issued by this Court. Since the dispute is of the year 2002 and more than 9 years have lapsed, the Labour Court shall give preference to the disposal of the industrial dispute and in any event dispose of the same, within a period of four months from the date of receipt of a copy of this order. No costs. Sd/ Asst. Registrar /true copy/ Sub Asst.Registrar ajr To 1. The Presiding Officer Second Additional Labour Court Chennai 104. 1 cc To Mr.H.Balaji, Advocate, SR.44705. W.P.No.19888 of 2009 PA(CO) RVL 02.08.2011 https://hcservices.ecourts.gov.in/hcservices/