C.W.P. No.5734 of 1997 -1- IN THE HIGH COURT FOR THE STATES OF PUNJAB AND HARYANA AT CHANDIGARH C.W.P. No.5734 of 1997 Date of Decision:06.11.2009 Lakhmir Singh .....Petitioner Versus The Presiding Officer, Labour Court, U.T., Chandigarh and others ....Respondents Present: Mr. K.L. Arora, Advocate with Ms. Deepa Jain, Advocate for the petitioner. Mr. R.S. Ahluwalia, Advocate for the respondents No.2 and 3. 2. C.W.P. No.1418 of 1997 Pepsu Road Transport Corporation, Patiala through its Managing Director .....Petitioner Versus The Presiding Officer, Labour Court, U.T., Chandigarh and another ....Respondents Present: Mr. R.S. Ahluwalia, Advocate for the petitioner. None for respondent No.2. 3. C.W.P. No.2336 of 1997 Pepsu Road Transport Corporation, Patiala through its Managing Director .....Petitioner Versus The Presiding Officer, Labour Court, U.T., Chandigarh and another ....Respondents Present: Mr. R.S. Ahluwalia, Advocate for the petitioner. None for respondent No.2. C.W.P. No.5734 of 1997 -2- 4. C.W.P. No.15541 of 1999 Gobinder Singh .....Petitioner Versus The Presiding Officer, Labour Court, U.T., Chandigarh and others ....Respondents Present: Mr. B.S. Walia, Advocate for the petitioner. Mr. R.S. Ahluwalia, Advocate for respondents No.2 and 3. CORAM:HON'BLE MR. JUSTICE K. KANNAN 1. Whether Reporters of local papers may be allowed to see the judgment ? Yes 2. To be referred to the Reporters or not ? Yes 3. Whether the judgment should be reported in the Digest? Yes -.- K. KANNAN J. 1. The above batch of writ petitions arise out of a batch of references, which had been disposed of by the Labour Court, Chandigarh directing reinstatement of two of the workmen namely Tarwinder Singh and Satinder Pal Singh and rejecting the references sought at the instance of three other workmen namely Lakhmir Singh, Kanwaljit Singh and Gobinder Singh. Against the order of references, Lakhmir Singh had preferred C.W.P. No.5734 of 1997 while Gobinder Singh has filed C.W.P. No.15541 of 1999. The Corporation-management has filed C.W.P. No.1418 of 1997 against the direction for reinstatement of Satinder Pal Singh and C.W.P. No.2336 of 1997 against the direction for reinstatement of Tarwinder Singh. All the four writ C.W.P. No.5734 of 1997 -3- petitions arise out of a single cause of action viz., of the allegation imputed against the workmen that they had been jointly responsible for the shortages in the stores of the Corporation during the time when all the five workmen referred to above had been working. Tarwinder Singh and Satinder Pal Singh were Assistant Store Keepers while the other three were the Store Keepers. An enquiry which was held subsequent to issuance of a chargesheet against the delinquent workmen yielded to a finding of guilt, which was accepted by the disciplinary authority and passed an order of removal from service. The enquiry found that the shortage of store articles amounting to Rs.1,19,294.59 had occurred due to the negligence of staff posted in the stores section as well as for other conjectured reasons, namely, theft of stores articles, issue of stores articles without demand slips etc. They were, therefore, found to be jointly responsible. The Labour Court found the enquiry to be fair and proper but still intervened with the punishment meted out to the Assistant Store Keepers that they could not have been directly responsible and directed reinstatement, while with regard to the remaining three, the Labour Court found that the punishment of removal of service meted out to them was justified. Of the three, only two persons have preferred the writ petitions and yet another workman Kanwaljit Singh, is not reported to have filed any writ petition. 2. Learned counsel Sh. K.L. Arora appearing for the C.W.P. No.5734 of 1997 -4- workman in C.W.P. No.5734 of 1997 as well as the workmen who were defending the action filed at the instance of the Corporation against Tarwinder Singh and Satinder Pal Singh submitted at the outset that the Corporation itself did not have any definite case against the workmen. The management witnesses, according to him, had given evidence only to the effect that there could be several reasons for shortage such as theft or negligence or issue of store articles without demand slips. According to him, the conduct leading to shortage is itself not defined as a misconduct in the relevant rules of PRTC. On an issue of fact, the learned counsel submitted that the physical verification and reconciliation had been done in the absence of the petitioner- Lakhmir Singh. The preparation of accounts themselves were found to be deficient as indeed even the Corporation had admitted that there was also an excess of the goods of the value of Rs.28,082/- at the time when the physical verification had been made. According to him, even the conclusion of shortage was wrong and it was only a case of misposting of items under the wrong heads. Illustrative of his arguments, he referred to the stock position of two of the items namely mobil oil and gear oil. He referred to the evidence of MW-3 management witness, Sh. Davinder Parshad, who admitted in his evidence that there was a double entry of a demand slip in 'stores stocks quantity maintenance register.' He also admitted that the entry of gear oil C.W.P. No.5734 of 1997 -5- in the register at No.311 had been recorded twice and he did not know who had made it. In such an event, the learned counsel's submission was that even a shortage of Rs.1,19,294.59 reported was wrong. If due credit was to be given for the excess, which was admitted by the management to the tune of Rs.28,082.62 and the double entries that had been made for the mobil oil and the gear oil, the net shortage would be only Rs.29,297/-. Even at the time when they had taken over the duty, it was reported that there was a shortage of Rs.61,414.61 in the ledger on which the signatures of handing over/taking over clearly existed and admitted by the witnesses. According to him, if only the accounts had been reconciled in their absence, they would have been in a position to point out even that there was no shortage at all. Even the goods which were reported to be missing and for which shortages had been attributed, they were all not mere small articles but they included two large drums which could have been stealthily removed. They had been found short before the workmen had taken charge only because that during the reconciliation in the year 1986-87, it was noticed that two demand slips had been issued during May, 1986 for two drums. 3. It was also argued that even the charges had been vague. Apart from the charge that the workmen had been responsible for causing shortage, charge No.2 was; “dishonest in connection with the business of Corporation” and charge No.3 was “habitual C.W.P. No.5734 of 1997 -6- negligence in the performance of official duties and acts subversive of office discipline.” No evidence had been placed with reference to above two charges but the Enquiry Officer and the Labour Court had merely stated that the charges had been established. 4. Learned counsel Sh. B.S. Walia appearing for the another workman, Gobinder Singh had, apart from reiterating the arguments made by the counsel Sh. Arora also contended that the workmen had not been duly apprised about the assistance of co- workers in the conduct of enquiry and their signatures had been taken in a cyclo-styled sheet with entries to suggest that they had forsaken the right to avail the services of co-workers for associating with them during the enquiry. It was his further contention that the ultimate order of removal from service had been passed by Managing Director when the rules provided that the punishment of removal was only required to be done by the Additional Managing Director with the right of an appeal to the Managing Director. By the assumption of jurisdiction by the Managing Director to visit the workman that punishment for removal from service, a right of appeal to the Managing Director had been lost. He brings in support of his arguments a decision in Surjit Ghosh Vs. Chairman & Managing Director, United Commercial Bank 1995(4) RSJ 104 where a Deputy General Manager had acted as disciplinary authority when under the C.W.P. No.5734 of 1997 -7- regulations he was cited as an Appellate Authority and the contention of the bank was that no prejudice had been caused because the Deputy General Manager was higher in rank than the disciplinary authority namely the Divisional Manager. The Hon'ble Supreme Court held that when there was a direction for an appeal against the order of disciplinary authority and when the appellate or the higher authority against whose order there was no appeal, exercises the powers of the disciplinary authority in a given case, it meant that it resulted in discrimination against the employee concerned. The Hon'ble Supreme Court, therefore, held that such a situation cannot savour of legality. Yet another decision, which the learned counsel relied on was judgment of the Calcutta High Court in Kalimur Rahaman Vs. The Calcutta Municipal Corporation and others 2000(3) RSJ 194 that dealt with the case of a Municipal Commissioner, who was the Appellate Authority under the Calcutta Municipal Act, had issued the charge-sheet and also the punishment order. The deprivation of a right of filing of appeal was found in the case as resulting in grave miscarriage of justice. 5. Learned counsel appearing for the Corporation addressed the Court generally on the limited jurisdiction available to a Court exercising jurisdiction under Article 226 of the Constitution to show that finding of guilt by an Enquiry Officer on appreciation of evidence of oral witnesses and documents C.W.P. No.5734 of 1997 -8- relating to accounting entries cannot be interfered even by the Labour Court and much less by the High Court. He referred to the decisions in B.C. Chaturvedi Vs. Union of India and others 96(1) RSJ 461 that held that judicial review was not an appeal from a decision but review of the matter in which the decision is taken. Power of judicial review is meant to ensure that the individual receives fair treatment and not to ensure that the conclusion which the authority reaches is necessarily correct in the eye of the Court. A.S. Wadhawan, Officer UCO Bank Vs. UCO Bank and others 96(1) RSJ 470 was cited for the position that a person, who misused his position for personal gain and betrayed the confidence of the employer was not fit to hold a position of responsibility in a Bank. Canara Bank Vs. V.K. Awasthy (2005) 6 SCC 321 was cited by the counsel appearing for the Corporation to state that the proportionality of punishment handed down by the management could not be interfered with in a routine manner and when the charges had been proved that an employee in a bank failed to discharge his duties with utmost integrity, honesty, devotion and diligence, the Court shall not interfere with the punishment. The other decision cited by the counsel was again on the issue of the imperatives of the need for reluctance to interfere in matter of punishment counselled by the Hon'ble Supreme Court in V. Ramana Vs. APSRTC and others (2005) 7 SCC 338. Syndicate Bank and others Vs. Venkatesh C.W.P. No.5734 of 1997 -9- Gururao Kurati (2006) 3 SCC 150 also adverted to the same principle of the limited scope available for a Court to interfere in the matters of punishment. To the same point were also the decisions in Amrit Vanaspati Co. Ltd. Vs. Khem Chand and another (2006)6 SCC 325, T.N.C.S. Corpn. Ltd. and others Vs. K. Meerabai (2006) 2 SCC 255 and U.P. State Road Transport Corporation, Dehradun Vs. Suresh Pal (2006) 8 SCC 108. 6. From this general rule, it can be very well seen that the Courts shall be reluctant to interfere with matters of punishment, especially when cases involved misappropriation of public funds of public bodies and corporations. The same could not be said to be instances when the charge is not one of misappropriation but of negligence. Even on the issue of negligence, it can be noticed in this case that the management witnesses were not prepared to place the entire blame on the workmen. They noticed that the articles which were found short were not any small items, which could be pilfered out of the factory gate but oil drums and certain articles of huge sizes which were more in the nature of the inferences possible from reconciliation of the entries found in the account books and the actual items found in the store. That the accounts of the Corporation were not foolproof were also noticed by the fact that even at the time when the handing over/taking over took place, there was a discrepancy in accounts to the tune of over Rs.60,000/-. The Corporation itself did not have any answer C.W.P. No.5734 of 1997 -10- for a situation that there was also a surplus shown which meant that goods which had been shown as having been issued out were still seen in the stores resulting in surplus. As regards one item of accounting entry, there was even an admission of a double entry relating to gear oil. The management witnesses themselves had stated that goods could have been issued out without proper demand slips and there could have been also some thefts in the stores. While I have no difficulty in accepting the contention of the management that a full-fledged enquiry that results in a finding of guilt shall not be interfered with lightly, it has to be still seen whether the nature of misconduct attributed to the workmen had been such that the removal from service was properly done on charges which were all not very precise. I have already reproduced the charges No.2 and 3, which made no reference to any particular events but made a bald statement that the workmen had been habitually negligent and further that the workmen were dishonest in connection with business. The Enquiry Officer could not have found the charges as having been established on such omnibus allegations. Finding of dishonesty or habitual negligence could be based on specific instances. It shall be the specific instances that could form the basis of charge- sheet and not an inference of a conduct as the basis in the charge- sheet itself. If one takes out of reckoning Charges No.2 and 3, the only charge that stands out is the alleged negligence relating to a C.W.P. No.5734 of 1997 -11- so-called shortage of Rs.1,19,294.59, which also have been shown that what were not real shortages but could even be seen as resulting from wrong entries in accounts. Even the amounts so specified in the charge-sheet were found to be not established and if due credit were to be given to the shortages that were already reported even before the workmen took over and also providing for some wrong double entries and alleged surpluses, it would remain to be seen that the charges had not been fully proved. The finding that the workmen had been negligent was definitely justified in one sense and the workmen themselves had reported to have signed in the reconciliation reports. An objection has been taken by the counsel, Sh. Arora that even the signatures in the reconciliation report had been taken, only when there was a threat by the management that even the subsistence allowance would be withdrawn. This was contemplated with the fundamental allegation that reconciliation sheets were prepared and the physical verifications were made in the absence of the workmen. I do not feel inclined to accept the contention that they were not present at the time of physical verification or that they signed in the reconciliation of the accounts under any form of pressure. There is a concurrent finding of negligence of the workmen but only the value of the goods that were reported as shortages have not been fully proved. The value was certainly less than what was attributed to the workmen. C.W.P. No.5734 of 1997 -12- 7. The contention of the learned counsel in relation to the prejudice alleged to have been caused by the punishment being handed down by the Managing Director, who was the Appellate Authority could be seen in the context of how even the workmen treated the situation. They had at no point of time complained of prejudice and in effect even an appeal had been filed to the Chairman. The workmen themselves did not wait to obtain a result of the decision but in the meanwhile sought for a reference to the Labour Court where the very same issue relating to the finding of guilt by the Enquiry Officer was canvassed. The workmen had not complained even then that there was any prejudice caused to them by the Appellate Authority in taking the decision. The decisions of the Hon'ble Supreme Court in Surjit Ghosh's case, in my view, shall not be taken to mean that at all times when an Appellate Authority decides to pass an order there is a prejudice. In this case, the workmen themselves were prepared to take an appeal as still available to the Chairman and they had adopted such a course. The workmen, however, did not wait till a decision was rendered but had resorted to the proceedings before the Labour Court. I, therefore, also reject the contention of the workmen that there had been any prejudice and the order of the punishing authority in directing the removal of the workmen from service was incompetent for want of jurisdiction. C.W.P. No.5734 of 1997 -13- 8. As regards the contention of the learned counsel appearing for the workmen that the punishing authority, while directing the recovery of amount from the workmen, had punished the workmen twice over by removal of service, the learned counsel appearing for the Corporation refers in answer to a decision of this Hon'ble Court under Pepsu Road Transport Corporation, Patiala and another Vs. Shri Gopal Krishan (1998-2) CXIX PLR 48 to the effect that withholding of increments with cumulative effect and denying the workman also the pay and salary for a period of suspension was not a case of double jeopardy. The penalties prescribed in Regulation 20 of the PEPSU Road Transport Corporation provides for recovery from pay or security during service or after termination of services whole or any part of any pecuniary loss caused to the Corporation by negligence or breach of the order and it also provides for in Clause (vii) removal from service which does not disqualify from future employment and in sub-clause (viii), the punishment of dismissal from service is provided. They are not seen to be mutually exclusive and hence the contention of the learned counsel for the workmen that recoveries could not have been made alongside with removal from service is not correct. 9. On consideration of all facts, I am of the view that there is no scope for interference with the finding in relation to the misconduct as regards negligence. Charge against the workmen C.W.P. No.5734 of 1997 -14- to the extent that as regards the misconduct the extent of loss to the tune of Rs.1,19,294.59 could not be said to be established and the amount shall be taken only as 29,297/-. Consequently, the recoveries proportioning the amount as to be distributed amongst the five workmen shall stand individually and the liability shall be distributed amongst the five workmen only to the extent of Rs.29,297/- namely Rs.5859/-. Even as regards the punishment by removal of service, in my view, would be disproportionate and in view of the finding that the loss was not due to any misappropriation and that it was only on account of negligence, the matter shall be considered by the Managing Director again to provide for such penalty as the rules admit of, which is less than punishment of removal from service. The punishment could be either of stoppage of increments for any specified period or for any other punishment enumerated in Clauses (i) to (vi) of Regulation 20. 10. Under the circumstances, the award of the Labour Court insofar as it approves of the punishment of removal from service for two of the workmen, who have challenged the finding before the Court namely Lakhmir Singh and Gobinder Singh would stand set aside. As regards the decision taken by the Labour Court already directing reinstatement of two other workmen, Tarwinder Singh and Satinder Pal Singh, which are the subject of challenge in C.W.P. Nos.1418 and 2336 of 1997 would require no C.W.P. No.5734 of 1997 -15- modification. 11. In sum, C.W.P. No.5734 of 1997 and C.W.P. No.15541 of 1999 are partly allowed setting aside the respective orders of removal from service passed by the Labour Court. They shall be modified relating to punishment and the competent authority under the relevant rules shall re-examine the quantum of punishment set out in Regulation 20 which is less than removal from service within six weeks from the date of receipt of the copy of this order. Consequently, the respective orders of removal from service are set aside. C.W.P. Nos.1418 and 2336 of 1997 are dismissed confirming the order passed already by the Labour Court. There shall be, however, no direction as to costs. (K. KANNAN) JUDGE November 06, 2009 Pankaj*