IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED:12.01.2011 CORAM: THE HONOURABLE MRS.JUSTICE CHITRA VENKATARAMAN W.P.Nos.23044 and 24473 of 2006 M.P.Nos.1 to 3 of 2006 in W.P.No.23044 of 2006 and M.P.No.1 of 2009 in W.P.No.24473 of 2006 W.P.No.23044 of 2006: The Divisional Railway Manager Southern Railway Chennai. .. Petitioner versus 1. Presiding Officer Central Government Industrial Tribunal-cum-Labour Court Chennai. 2. Rambabu Kamath .. Respondents W.P.No.24473 of 2006: D.Suresh .. Petitioner versus 1. The Deputy Chief Engineer Head Quarters Construction/Southern Railway Egmore Chennai-8. 2. The Presiding Officer Central Government Industrial Tribunal- cum-Labour Court Shastri Bhavan, Chennai-6. .. Respondents PRAYER: W.P.No.23044 of 2006 is filed under Article 226 of the Constitution of India for the issue of a Writ of Certiorari, calling for the records of the impugned order in I.D.No.374 of 2004 dated 15.12.2005 from the file of the Central Government Industrial Tribunal-cum-Labour Court, Chennai and to quash the same. https://hcservices.ecourts.gov.in/hcservices/ W.P.No.24473 of 2006 is filed under Article 226 of the Constitution of India for the issue of a Writ of Certiorarified Mandamus calling for the concerned records relating to the award dated 12.6.2001 in I.D.No.28 of 2001 passed by the second respondent, to quash the same and to consequently direct the first respondent Management to reinstate the petitioner in service with effect from 28.8.1992 with all consequential benefits including arrears and backwages for the period during which the petitioner had been kept out of employment illegally and give him all other monetary and other attendant service benefits to which the petitioner is entitled to in law. For petitioner in W.P.No.23044 of 2006/1st respondent in W.P.No.24473 of 2006 : Mr.P.H.Aravind Pandian For 2nd respondent in W.P.No. 23044 of 2006 : Ms.R.Vaigai For petitioner in W.P.No.24473 of 2006 : Mr.N.G.R.Prasad for M/s.Row & Reddy ORDER W.P.No.23044 of 2006 is filed by the Divisional Railway Manager, challenging the order of the Central Government Industrial Tribunal- cum-Labour Court in I.D.No.274 of 2004 dated 15th December 2005. W.P.No.24473 of 2006 is filed by a dismissed temporary employee against the order of the Central Government Industrial Tribunal-cum- Labour Court dated 12.06.2001 in I.D.NO.28 of 2001. The petitioner in W.P.No.24473 of 2006 seeks a direction to the respondent Management to reinstate the petitioner in service with effect from 28.08.1992 with all consequential benefits, including arrears and back-wages for the period during which the petitioner was kept out of employment and giving other attendant service benefits to which the petitioner would be entitled to in law. It may be noted that in both these writ petitions, the employee concerned was taken in service as Substitute Bungalow Lascar. 2. The issues raised in both these writ petitions are substantially same as to and when an order of termination could be called stigmatic that the employer has to comply with the requirement of Article 311(2) of the Constitution of India and follow the procedure of holding enquiry before visiting the employee with an order of dismissal by way of punishment and whether a contract employee, being a temporary employee, is entitled to the protection of Article 311 of the Constitution of India. https://hcservices.ecourts.gov.in/hcservices/ 3. The question as to the entitlement of a temporary employee to have the protection on a punishment meted out to a temporary employee came up for consideration in a series of decisions. In the decision reported in AIR 1964 SC 1854 (Champaklal Chimanlal Shah Vs. The Union of India), referring to the decision reported in AIR 1960 SC 689 (State of Bihar Vs. Gopi Kishore Prasad), the Apex Court pointed out that temporary servants are also entitled to the protection under Article 311(2) of the Constitution in the same manner as permanent Government servants when the Government takes action against the temporary employees by meeting out any one of the three punishments, namely dismissal, removal or reduction in rank. The Apex Court pointed out that this protection is available only when discharge, removal or reduction in rank is sought to be inflicted by way of punishment and not otherwise. The Apex Court pointed out that when a preliminary enquiry is first held, that enquiry is really for the satisfaction of the Government to decide whether punitive action should be taken or action should be taken under the contract or the Rules in the case of a temporary Government servant or a servant holding a higher rank temporarily, to which he has no right. In the preliminary enquiry, the explanation of the Government servant may be taken, document and even oral evidence may be considered. When such a preliminary enquiry makes out a prima facie case against the servant concerned, charges are then framed against him. The show cause notice is issued as to why disciplinary action should not be taken against him. 4. The enquiry officer appointed holds the enquiry in accordance with the principles of natural justice. In the formal departmental enquiry, the delinquent servant has an opportunity to cross-examine the witness tendered against him. He is also given the right to let in evidence. Thereafter, the enquiry officer makes a report for the authority concerned having power, to take action. 5. Where the competent authority accepts the report and determines tentatively that the punishment should be inflicted, then it communicates a copy of the report to the enquiry officer and its own conclusion and issues a show cause notice as to why the tentative punishment should not be inflicted upon him. The servant concerned has an opportunity of making his representation on the conclusions arrived at by the departmental authority as well as the punishment imposed. The Apex Court pointed out that when a preliminary enquiry is held, the same is not to be confused with a regular departmental enquiry. As far as preliminary enquiry is concerned, there is no question of being governed by Article 311(2) and the preliminary enquiry can be held ex parte, since it is merely for the satisfaction of the Government. However, when the Government decides to hold a regular enquiry for the purpose of inflicting one of the three major punishments, then the Government servant gets the protection of Article 311(2) of the Constitution of India. The Apex Court pointed out that the motive or the inducing factor which influences the https://hcservices.ecourts.gov.in/hcservices/ Government to take action under the terms of the contract of employment or the specific service Rule is irrelevant. Thus where a mere preliminary enquiry is held and following the enquiry, the services are dispensed with in accordance with the contract or specific Rule, the same would not mean termination of the service as amounting to a punishment within the meaning of Article 311(2) of the Constitution of India. Whether such termination would amount to dismissal or removal as a punishment, depended upon the facts of each case. The sum and substance is that where the termination, dismissal or removal from service is to act as a penalty or a punishment which stigmatizes the delinquent Government servant, necessarily the intended action has to conform to Article 311(2) of the Constitution of India. 6. Referring to the decision reported in AIR 1958 SC 36 (Parshotam Lal Dhingra Vs. Union of India (UOI), the Apex Court pointed out that the protection under Article 311(2) of the Constitution of India is available only when discharge, removal or reduction in rank is said to be inflicted by way of punishment and not otherwise. The Apex Court further pointed out to the two tests mentioned in the above-said decisions namely, "(i)whether the servant had a right to the post or (ii) whether he has been visited with evil consequences; and if either of the tests is satisfied, it must be held that the servant had been punished. " Where a complaint is the basis for the dissatisfaction with the work and/or conduct of a temporary servant, the Government or the appointing authority may decide to dispense with the service of the servant without any action taken to punish him for his conduct/bad work. However, where the Government decides to punish such a servant, necessarily, the protection under Article 311(2) comes to the aid of the Government servant, irrespective of his status as a temporary employee or as a permanent employee. 7. In the decision reported in (1974) 2 SCC 831 (Samsher Singh Vs. State of Punjab and Anr.) followed in 1984-I-LLJ 337 Anoop Jaiswal Vs. Government of India and Anr.), the Apex Court pointed out that no abstract proposition can be laid down that where the services of a probationer are terminated without saying anything more in the order of termination than that the services are terminated, it can never amount to a case of punishment in the facts and circumstances of the case. An authority may simply discharge a probationer on the ground of misconduct or inefficiency or for similar reasons without a proper enquiry and may simply discharge the probationer with a view to giving him a chance to make good in other walks of life without a stigma at the time of termination of probation. However, if the probationer is faced with an enquiry or charges of misconduct, https://hcservices.ecourts.gov.in/hcservices/ corruption, etc., and the services are terminated without following the provisions of Article 311(2) of the Constitution of India, he can claim protection. Thus the Apex Court pointed out that the form of the order is not decisive as to whether the order is by way of punishment. It pointed out "even an innocuously worded order terminating the services may, in the facts and circumstances of the case, establish that an enquiry into the allegations of serious and grave character of misconduct involving stigma has been made in infraction of the provisions of Article 311. In such a case, the simplicity of the form of the order will not give any sanctity." 8. Thus, in the decision reported in 1984-I-LLJ 337 (Anoop Jaiswal Vs. Government of India and Anr.), the Apex Court pointed out that it is always open to the Court to go behind the form and ascertain the true character of the order. Thus if the Court holds that the order, though in form is merely a determination of employment, is in reality a cloak for an order of punishment, the Court would not be debarred merely because of the form of the order, in giving effect to the rights conferred by law upon the employee. Thus if on reading the order, the Court reaches the conclusion that the alleged act of misconduct was a cause of the order and that but for that incident it would not have been passed, then it is inevitable that in the absence of an opportunity to defend himself, as provided under Article 311 (2) of the Constitution given, the order of discharge should fall to the ground. 9. Thus in (2008) 2 SCC 479 Nehru Yuva Kendra Sangathan Vs. Mehbub Alam Laskar), the Supreme Court pointed out that where the order of termination was based on the findings in an enquiry and that the enquiry had been taken into consideration only for the purpose of judging the suitability of an employee, the same could not be said to be a foundation for terminating the probation. Thus a distinction exists between motive and foundation. 10. In the above-said decision, the Supreme Court pointed out that an enquiry as regards the alleged withdrawal of some amount from the Government fund and deposited in the personal Bank Account of the delinquent employee was found out, leading to the termination of the services of the employee, who was a probationer. The employer passed an order of termination on the basis of certain allegations of financial irregularities. On a challenge by the dismissed employee, the High Court directed reinstatement of the employee. On further appeal to the Supreme Court, it was held that the delinquent employee was not aware that his service had been terminated on a finding of misconduct or the fact that an enquiry had been conducted behind his back. Thus, if the employee had come to know at a later stage the real object and purport for which the termination order was issued, he could challenge the same. Thus if an order terminating the probation is innocuous on its face, it stood vitiated, when in effect and substance it was found to be stigmatic, founded on a finding of https://hcservices.ecourts.gov.in/hcservices/ misconduct. A material which amounts to a stigma need not be contained only in the termination order, but may also be contained in an order or proceeding referred to in the order of termination or annexure thereto. 11. In contrast to this decision is the decision reported in (2010) 2 SCC 623 Chaitanya Prakash and Anr. Vs. H. Omkarappa) where the delinquent employee therein suffered an order of termination during the period of probation, on the ground of the performance not being satisfactory. It was pointed out therein that the employer advised the employee to improve his performance. However, the employer ultimately terminated his services without any reasons therein. The said order was challenged before the High Court. It is seen that the said employee applied for the post of Managing Director in a company. He was not called for interview in view of the letter sent by the previous employer bringing to their notice the misconduct of the employee. The High Court allowed the petition, holding that the order of termination was stigmatic. On further appeal, the Apex Court considered the decisions reported in (2006) 4 SCC 469 (Abhujit Gupta Vs. S.N.B. National center, Basic Sciences and Ors.), (2003) 3 SCC 263 Mathew P. Thomas Vs. Kerala State Civil Supply Corpn. Ltd. and Ors., (2002) 1 SCC 520 Pavanendra Narayan Verma Vs. Sanjay Gandhi P.G.I. of Medical Sciences and anr) and (1996) 4 SCC 504 (Allahabad Bank Officers Association and another Vs. Allahabad Bank and others), applied the ratio laid down therein and held that the reasons given for terminating the services of the employee could not be said to be stigmatic. The Apex Court further pointed out that where an order of termination referred to unsatisfactory service of the person concerned, the same cannot be said to be stigmatic. It pointed out to the decision reported in (2006) 4 SCC 469 (Abhujit Gupta Vs. S.N.B. National Centre, Basic Sciences and others) that expression like "want of application", "lack of potential" and "found not dependable" when made in relation to the work of the employee, would not be called stigmatic - Refer (1996) 4 SCC 504 (Allahabad Bank Officers Assn. Vs. Allahabad Bank). The decisions reported in (2005) 7 SCC 447 (Rajasthan State Road Transport Corporation and Ors. Vs. Zakir Hussain), (2002) 9 SCC 636 (State of Punjab and Ors. Vs.Bhagwan Singh) and (1997) 2 SCC 191 (Kunwar Arun Kumar Vs. U.P. Hill Electronics Corporation Ltd. and Ors.) are to the effect that where an order merely terminates the services of a candidate on the ground that the candidate was found not suitable, the service could be terminated without an enquiry during probation and that the same would not be styled as punitive or based on stigma. Hence, what amounts to stigma needs to be considered herein. 12. In the decision reported in (1999) 3 SCC 60 (Dipti Prakash Banerjee Vs. Satvendra Nath Bose National center for Basic Sciences, Calcutta and Others), the Supreme Court considered the criteria of differentiating between foundation and motive and what amounted to stigma. The Supreme Court referred to the decision reported in https://hcservices.ecourts.gov.in/hcservices/ (1974) 2 SCC 831 (Samsher Singh Vs. State of Punjab) as well as the decisions thereafter and pointed out in paragraph 21 as follows: "21. If findings were arrived at in an inquiry as to misconduct, behind the back of the officer or without a regular departmental enquiry, the simple order of termination is to be treated as 'founded' on the allegations and will be bad. But if the inquiry was not held, no findings were arrived at and the employer was not inclined to conduct an inquiry but, at the same time, he did not want to continue the employee against whom there were complaints, it would only be a case of motive and the order would not be bad. Similar is the position if the employer did not want to enquire into the truth of the allegations because of delay in regular departmental proceedings or he was doubtful about securing adequate evidence. In such a circumstance, the allegations would be a motive and not the foundation and the simple order of termination would be valid. " 13. Referring to the decision reported in (1987) 1 SCC 146, Kamal Kishore Lakshman Vs. Management of Pan American World Airways Inc. and Ors), the Supreme Court held, where the imputation or the charge is in relation to the work and not for any other purpose and any person reading a letter or an order of compulsory retirement/dismissal would not be led to believe that there is something wrong with the employee as regards his conduct or character, the same would not amount to a stigma. 14. As His Lordship Justice Krishna Iyer, in the decision reported in (1974) 2 SCC 831 (Samsher Singh Vs. State of Punjab) pointed out, when does motive trespass into foundation? When do we lift the veil of form to touch the substance? ... After all, between unsuitability and misconduct, the thin portions do their bounds divide. Referring to the dictionary meaning of the term "stigma", the Apex Court referred to the decision reported in (1987) 1 SCC 146 (Lakshman Vs. Pan American World Airways Inc.), which reads as follows: " 27. As to what amounts to stigma has been considered in Kamal Kishore Lakshman v. Pan American World Airways (1987) I SCC 146. This Court explained the meaning of 'stigma' as follows (SCC p. 150, para 8): https://hcservices.ecourts.gov.in/hcservices/ "8. According to Webster's New World Dictionary, it (stigma) is something that detracts from the character or reputation of a person, a mark, sign etc., indicating that something is not considered normal or standard. The Legal Thesuras by Burton gives the meaning of the word to be blemish, defect, disgrace, disrepute, imputation, mark of disgrace or shame. The Webster's Third New International Dictionary gives the meaning as a mark or label indicating a deviation from a norm. According to yet another dictionary 'stigma' is a matter for moral reproach. Similar observations were made in Allahabad Bank Officer's Assn. V. Allahabad Bank (1996) 4 SCC 504. " Thus where the words used do not cast an aspersion on the reputation or character, but only in relation to the work or the suitability to the work, the order of dismissal or retirement could not be called as a punishment with stigma as a foundation. Hence, whether the order of termination stigmatizes an employee or not has to be seen on the facts and circumstances of each case and the language employed in the order of termination. Use of offensive words, per se, however, does not lead one to view an order of termination as causing stigma. 15. Learned counsel appearing on either side referred to series of decisions of the Apex Court as to when an order of termination was only a motive and not the foundation. In all these cases, one may notice the declaration of law that even though an order of discharge or dismissal may look plain and simple containing no words of stigma, yet, the words used therein offer a clue as to whether the order was the foundation or a motive. Where the order of termination or dismissal contains references to proceedings or orders or instances and on lifting the veil, points out to definite conclusions of misconduct, thus ultimately leading to an order of termination, then the order of termination is stigmatic, thus entitling the delinquent employee to the protection of Article 311(2) of the Constitution of India. Thus, the decisions relied on by the learned counsel appearing for the second respondent reported in AIR 1968 SC 1089 (The State of Punjab and another Vs. Sukh Raj Bahadur), AIR 1964 SC 1854 (Champaklal Chimanlal Shah Vs. The Union of India), (1994) 2 SCC 323 (M.Venugopal Vs. Divisional Manager, Life Insurance Corporation of India), (2001) 3 SCC 117 (H.F.Sangati Vs. R.G. High Court of Karnataka), (2002) 9 SCC 636 (State of Punjab and others Vs. Bhagwan Singh) and AIR 2005 SC 4251 (State of Haryana Vs. Satyender Singh https://hcservices.ecourts.gov.in/hcservices/ Rathore) are all to be seen in the context of the facts therein. So too the decisions relied on by the learned counsel appearing for the petitioner in the respective writ petitions. 16. Nevertheless, it must be pointed out that all these decisions give us the legal background in considering the issue before this Court that irrespective of the status of an employee as a probationer or as a temporary service/contract service, in a case of an order of punishment which attaches a stigma, the compliance of the requirement under Article 311(2) is absolute. 17. In the background of the above-said decisions, the relevancy of Section 2(ii) of the Industrial Disputes Act and Section 25F need to be seen. Section 2(oo) of the Industrial Disputes Act defines retrenchment as follows: " [(oo) "retrenchment" means the termination by the employer of the service of a workman for any reason whatsoever, otherwise than as a punishment inflicted by way of disciplinary action but does not include- (a) voluntary retirement of the workman; or (b) retirement of the workman on reaching the age of superannuation if the contract of employment between the employer and the workman concerned contains a stipulation in that behalf; or [(bb) termination of the service of the workman as a result of the non-renewal of the contract of employment between the employer and the workman concerned on its expiry or of such contract being terminated under a stipulation on that behalf contained therein; or] (c) termination of the service of a workman on the ground of continued ill-health;] " 18. In the decision reported in (1984) 1 SCC 244 (Management of Karnataka State Road Transport Corporation, Bangalore Vs. M. Boraiah and Anr.), the Supreme Court pointed out to the Constitution Bench decision reported in 1957 (1) SCR 121 Hariprasad Shivshanker Shukla Vs. A.D.Divikar) as to the meaning of the word "retrenchment" and held that the word "retrenchment" means discharge of surplus labour or staff by the employer for any reason whatsoever otherwise than as a punishment inflicted by way of disciplinary action. https://hcservices.ecourts.gov.in/hcservices/ 19. Section 25F of the Industrial Disputes Act deals with conditions precedent to retrenchment of workmen. The said Section reads as follows: "25F. Conditions precedent to retrenchment of workmen No workman employed in any industry who has been in continuous service for not less than one year under an employer shall be retrenched by that employer until- (a) the workman has been given one month’s notice in writing indicating the reasons for retrenchment and the period of notice has expired, or the workman has been paid in lieu of such notice, wages for the period of the notice; [* * *] (b) the workman has been paid, at the time of retrenchment, compensation which shall be equivalent to fifteen days’ average pay [for every completed year of continuous service] or any part thereof in excess of six months; and (c) notice in the prescribed manner is served on the appropriate government [for such authority as may be specified by the appropriate government by notification in the Official Gazette]. 20. In the decision reported in (2005) 2 MLJ 697 (Manager (P and A), Oil and Natural Gas Corporation Ltd. Vs. G. Radhakrishnan), a Division Bench of this Court pointed out that where a case falls under Section 2(oo) of the Industrial Disputes Act, the requirement of compliance of Section 25F is absolute, unless the case is covered under any of those excepted clauses mentioned in the said Section. This relates to a case of a contract labour for a period of 11 years and thereafter employed by the employer as security supervisor, wherein the employee