IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No 8053 of 1998 For Approval and Signature: Hon'ble MR.JUSTICE AKSHAY H.MEHTA ============================================================ 1. Whether Reporters of Local Papers may be allowed : YES to see the judgements? 2. To be referred to the Reporter or not? : YES 3. Whether Their Lordships wish to see the fair copy : NO of the judgement? 4. Whether this case involves a substantial question : NO of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder? 5. Whether it is to be circulated to the Civil Judge? : -------------------------------------------------------- CENTRAL BANK OF INDIA Versus MAVJI C LAKUM -------------------------------------------------------------- Appearance: 1. Special Civil Application No. 8053 of 1998 MR ARUN H MEHTA for Petitioner No. 1 MR NALIN K THAKKER for Respondent No. 1 -------------------------------------------------------------- CORAM : MR.JUSTICE AKSHAY H.MEHTA Date of decision: 25/07/2002 CAV JUDGEMENT 1. In this petition the main question that is involved is what is the scope of the Labour Court or the Tribunal or National Tribunal while exercising power under Section 11-A of the Industrial Disputes Act, 1947 (for short "the Act") ? Though this question has time and again come for consideration before the Apex Court as well as this Court and other High Courts, in this petition the same has been extensively argued by both the sides and I am, therefore, required to deal with that issue and determine the same on the basis of submissions made by the learned counsels and the decisions and provisions of law cited by them in support of their respective submissions. 2. The facts that have given rise to the present controversy can be stated as under :- 2.1. The petitioner is Central Bank of India having its Head Office at Bombay and a Branch Office at Jamnagar. The respondent joined the service of petitioner at Jamnagar on 1/9/1951 as a Peon and subsequently he was promoted to the post of Head Peon. In the year 1981 he was working as Head Peon and at that time the petitioner received repeated complaints regarding the misbehaviour of the respondent with the clients of the bank, its officers and the other members of the office staff. In view thereof, the petitioner served the respondent with a charge-sheet and after detailed inquiry into the acts of misconduct of the respondent, he was discharged from service with effect from 22nd May, 1984. 2.2. The action of the petitioner discharging the respondent from service was challenged by him in the Court of the learned Civil Judge [J.D.] at Anjar by instituting Civil Suit being Civil suit No. 89 of 1984. The said suit came to be dismissed, against which the respondent preferred Civil Appeal No. 11 of 1987 before the District Court, Kutch at Bhuj. The said appeal was partly allowed. Though the District Court directed reinstatement of the respondent, it denied the backwages. It also directed the petitioner bank to hold inquiry afresh. Hence, Second Appeal No. 139 of 1989 was preferred by respondent before this Court wherein this Court [Coram : S.K. Keshote, J.] awarded 75% back wages from the date of filing of the suit and not from the date of discharge. 2.3. After the aforesaid proceedings, the departmental inquiry was started once again on the same charges referred to hereinabove. The Inquiry officer recorded his findings on 2nd June, 1990 and found the respondent guilty of charges nos. 1 and 2. The said officer, however, did not find that the respondent's behaviour was riotous. The Inquiry Officer also found the respondent guilty of other charges, namely charge nos. 3, 5 and 7, but he did not find the respondent guilty of charge nos. 4 and 6. Acting on the basis of the said findings of the Inquiry officer, the Disciplinary Authority again issued show cause notice dated 7th February, 1991 calling upon the respondent to show cause why the punishment of dismissal should not be imposed upon him. The petitioner submitted his reply to the said show cause notice on 18th March, 1991 wherein he gave detailed explanation to the charges held to be proved against him. He also requested the Disciplinary Authority that even if the charges are held proved, considering the nature of the said charges, punishment of dismissal contemplated by Disciplinary Authority was very harsh and the Authority should take lenient view in the matter. On the basis of the submissions made in the said explanation, the respondent requested the Authority to quash the notice issued against him. 2.4. The Disciplinary Authority by taking into consideration the entire record placed before it with regard to the inquiry held against the respondent including his explanation submitted in response to the show cause notice dated 7th February, 1991 issued by the Authority and after detailed consideration of all the relevant facts, the provisions of the bank rules and regulations and all other aspects concerning the issues, came to the conclusion that the respondent was guilty of committing acts of misconduct as per charge nos. 1, 2, 3, 5, 6 and 7 and the Disciplinary Authority proposed various punishment on each count but ultimately a composite punishment of discharge from bank's service was ordered by him. 2.5. Having been aggrieved by the order of discharge from the service issued by the Disciplinary Authority, the respondent approached the Appellate Authority i.e. the Assistant General Manager on 4th May, 1991. The Appellate Authority disposed of the appeal confirming the punishment of discharge from service awarded by the Disciplinary Authority vide its order dated 26th March, 1991. 2.6. Being dissatisfied with the order of Appellate Authority, the respondent raised dispute with regard to his discharge from service under the provisions of the Act, which ultimately came to be referred to the Industrial Tribunal (Central) at Rajkot for adjudication vide Government of India, Labour Department order No. 12012-264 dated 27th January, 1993. The said proceedings came to be numbered as Reference [ITC] No. 1 of 1993. The Tribunal came to the conclusion that the departmental inquiry held against the respondent was just and proper. This issue came to be decided by the Tribunal in light of application at Exh. 27 submitted by the respondent challenging the validity of the inquiry. So far the merits of the allegations made against the respondent were concerned, the Tribunal came to the conclusion that there was no evidence to impose penalty of discharge, but it held that there was some misconduct committed by the respondent. However, it also held that the acts of misconduct could not be termed as 'so serious' that the respondent for committing them, was required to be removed from service. The Tribunal, therefore, partially allowed the reference and the order of discharging the respondent from service was set aside and instead thereof, it imposed punishment of withholding his one increment with future effect. The award of the Tribunal is dated 2nd April, 1998. 2.7. In the meanwhile the respondent, upon reaching the age of superannuation of 60 years, retired from service with effect from 3rd September, 1994. 2.8. In view of the Tribunal's decision, the petitioner has approached this Court by filing the present petition. 3. Mr. Arun H. Mehta, the learned counsel for the petitioner has mainly challenged the decision of the Tribunal on the ground that the Tribunal has exceeded its power vested in it by the provisions of Section 11-A of the Act. Mr. Mehta has submitted that perusal of the judgment of the Tribunal clearly shows that it has nowhere discussed in detail why it is interfering with the decision of the Disciplinary Authority of the decision of the Appellate Authority on the question of the quantum of punishment even when very little scope is given to the Tribunal by the provisions of Section 11-A of the Act. He has further submitted that the Tribunal has not reached to the conclusion that the penalty of discharge imposed upon the respondent was disproportionately heavy or excessive and without giving such finding, it has substantially interfered with the punishment imposed on the respondent. Mr. Mehta has submitted that the complexion of acts of misconduct alleged against the delinquent would vary from institution to institution. In other words, considering the business dealt with or the service rendered by a particular institution the alleged act of misconduct may not entail serious consequence so far the said institution is concerned. However, the same act of misconduct may cause serious harm to the reputation, business, etc. of different institution. He, therefore, submitted that some wild language used by the respondent during the working hours for the valued customers of the bank may not only tarnish the reputation of the bank, but it may also result into loss of business to the bank since the aggrieved client may well choose to close his account in such bank and avail the service of some other bank. In support of its contentions Mr. Mehta has placed reliance on several decisions of the Apex Court and has drawn my attention to the scope of the Tribunal or the Labour Court under Section 11-A of the Act and the limits carved out by these decisions within which the Court and the Tribunal are required to exercise this power. 3.1. As against that, Mr. N.K. Thakker, the learned counsel for the respondent has vehemently urged before me that sitting under Article 227 of the Constitution of India my jurisdiction is very limited and I cannot reappreciate the evidence on record and disturb the conclusions and the ultimate decision reached by the Tribunal. He further submitted that prior to introduction of section 11-A of the Act, the Labour Court and the Tribunal hardly had any scope to interfere with the findings of the Inquiry officer and the penalty imposed upon the delinquent on the strength of such findings unless the inquiry itself was found to be against the provisions of law or violative of principles of natural justice. However, with the introduction of section 11-A powers have been conferred upon the Labour Court as well as the Tribunal to reappreciate the entire evidence adduced before the Inquiry officer and to examine each and every aspect thereof and to come to its own decision whether the punishment imposed on the delinquent was justified. Mr. Thakker therefore, submitted that when the Tribunal has exercised this power u/S. 11-A of the Act, this Court has very limited jurisdiction to interfere with the same. He also contended that looking to the acts of misconduct alleged against the respondent, it can well be said that none of the allegations is serious one and each allegation pertains to a solitary incident. The Tribunal therefore was completely justified in altering the punishment and reducing it from the discharge to stoppage of one increment with future effect. Mr. Thakker lastly submitted that this petition does not have any merit and deserves to be dismissed. In support of his contentions Mr. Thakker has also relied on certain decision, which will be discussed in the course of this judgment. 4. Considering the nature of submissions advanced before me by the parties, it is desirable to first refer to the provision of section 11-A of the Act. Section 11-A reads as follows :- "11-A. Powers of Labour Courts, Tribunals and National Tribunals to give appropriate relief in case of discharge or dismissal of workmen.- Where an industrial dispute relating to the discharge or dismissal of a workman has been referred to a Labour Court, Tribunal or National Tribunal for adjudication and, in the course of the adjudication proceedings, the Labour Court, Tribunal or National Tribunal, as the case may be, is satisfied that the order of discharge or dismissal was not justified it may, by its award, set aside the order of discharge or dismissal and direct reinstatement of the workmen on such terms and conditions, if any, as it thinks fit, or give such other relief to the workmen including the award of any lesser punishment in lieu of discharge or dismissal as the circumstances of the case may require; Provided that in any proceeding under this section the Labour Court, Tribunal or National Tribunal, as the case may be, shall rely only on the materials on record and shall not take any fresh evidence in relation to the matter." This section was brought into force by virtue of Act No. 45 of 1971 with effect from 16th December, 1971. With the introduction of this section, power has been conferred upon the Labour Court, Tribunal or National Tribunal, while dealing with the industrial dispute relating to discharge or dismissal of a workman to set aside the order of discharge or dismissal and direct reinstatement of the workman in case it is found that such discharge or dismissal was not justified. Power is also conferred upon them to reduce the quantum of punishment and award any lesser punishment in lieu of discharge or dismissal. Thus, it is very clear that after the introduction of section 11-A the Labour Court, Tribunal and the National Tribunal have been equipped with the power to come to its own conclusion whether in a given case the imposition of punishment of discharge or dismissal from the service is justified. It is for that purpose they are authorized to go into the evidence that has been adduced before the Inquiry Officer in detail and find out whether the punishment of discharge or dismissal is commensurate with the nature of charges proved against the delinquent. 4.1. However, the question that remains to be considered is whether the forums described above have unfettered power while exercising its discretion like the one conferred upon the appellate forum or it is required to be exercised only in certain exceptional circumstances. Obviously this question arises only when the Tribunal or the Labour Court finds the inquiry to be in order. If the inquiry is found to be illegal or violative of principles of natural justice, certainly the Tribunal can hold the same to be illegal and on that sole ground the punishment of discharge or dismissal can be set aside. In that case substitution of the same with lesser penalty will not arise. As against that, when the inquiry is found to be absolutely legal and in consonance with the principles of natural justice, the Tribunal or the Labour Court will be required to go into the evidence to find out whether the Disciplinary Authority is justified in imposing the penalty of dismissal or discharge. 4.2. Mr. Mehta did not dispute the power of the Labour Court and/or the Tribunal to go into the evidence to find out whether discharge or dismissal is justified. However, his emphasis was on the issue whether the Labour Court or the Tribunal can exercise this power lightly and/or easily or that it has to be exercised only in exceptional circumstances and in a very restricted manner. According to him, unless and until the decision of the Disciplinary Authority is so perverse or unreasonable so as to shock the judicial conscience of the Court or it has been based on extraneous considerations or without taking into account the relevant considerations or it is so disproportionate to the nature of the charges proved that no reasonable person would have taken such decision and further that these aspects are discussed in detail, appropriate reasons are given why it is inclined to hold so and definite findings are given to that effect, then only such power can be exercised. If all or any of this is missing, then the Labour Court or the Tribunal even if it comes to the conclusion that the punishment of discharge or dismissal could have been avoided and lesser punishment could have been awarded cannot substitute its own decision in that behalf. 4.3. The scope of Section 11-A as already stated above has been the subject matter of several decisions of the Apex Court and this Court. I will, therefore first refer to the decisions rendered by this Court. The learned single Judge of this Court in the case of Chanduji Senthaji Khant v. GSRTC reported in 1995 (2) GLH 232 elaborately considered the scope of Section 11A and the jurisdiction of the Tribunal or the Labour Court while exercising its discretion in the matter of penalty and made pertinent following observations: "Since qua non for exercising discretionary powers under Section 11A of the Act, is satisfaction of the tribunal that punishment imposed by the disciplinary authority is disproportionate to the misconduct proved. Unless that conclusion is reached the question of exercise of discretion for the purpose of substituting lesser penalty does not arise and if without recording any such conclusion, the Tribunal or Labour Court, as the case may be, embarks upon the question of penalty by assuming certain propositions not connected with workman, it can well be said that exercise of discretion in such cases cannot be sustained and award can be interfered with." 5. In the case of D.C.G.R.T.C. v/s. Ratansing K. Thakor reported in 1997 (2) G.L.H. at page 230 this Court while dealing with provisions of section 11-A has laid down as under:- "4. I have given my thoughtful consideration to the submissions made by the learned Counsel for the petitioner. The decision of the Division Bench of this Court has not been correctly read by the Labour Court. It is nowhere laid down that in no case penalty of dismissal could be given to the delinquent workman. Apart from this, the Labour Court have not (sic) interfered with the punishment of dismissal given to the workman only on the ground that there is wholesome unemployment in the country and there is no unemployment insurance scheme. If that position is allowed, then in no case penalty of dismissal, removal or termination can be given. The Apex Court in the aforesaid two cases held that in the matter of punishment to be given to a delinquent on proved misconduct the Court and Tribunal has very limited jurisdiction. But interference could be made in the matter of penalty to be given where the penalty is considered to be shocking the judicial conscience of the Court and not otherwise. In the present case, in the facts of the case which have come on record, coupled with the fact that the inquiry was not found defective and the charges framed against the workman was found proved, can the interference made by the Labour Court with the punishment which has been given to the workman be said to be justified? The reply to this question is obviously in negative. The Labour Court has failed to take into consideration the important fact that the Corporation provided public utility service and it cannot be compelled to continue an employee who deliberately caused damage to the bus and deliberately made the bus to break down, which has resulted in causing inconvenience to the passengers travelling in the said bus. Because of the aforesaid deliberate act of the workman, the passengers travelling in the said bus were compelled to go to their destination on foot. This conduct of an employee of the Corporation has resulted in damaging the reputation of the Corporation. Deliberate causing of damage to the bus as well as allowing three unauthorized persons to travel in the driver's cabin of the bus are serious misconducts. Above all, the respondent workman had not allowed the conductor to issue tickets to those three persons. The respondent-workman interfered with the discharge of duties by the conductor and he forced him to put the Corporation to loss of money which could have been collected from those three persons. Such interference of the driver in the discharge of duties by the conductor is a very serious misconduct and the minimum punishment for such persons should have been dismissal from service. The Labour Court has interfered with the punishment of dismissal without giving any cogent and justifiable reasons. It is not a case where the matter should have been taken lightly. The considerations weighed with the Labour Court are not germane to the facts of the case. The punishment which has been given to the delinquent in a given case has to be considered with reference to the gravity of the misconduct alleged and proved and not with reference to the employment of that person. If the Corporation is compelled to continue such a driver in its service it will not only encourage indiscipline among other persons, to the extent of putting the passengers travelling in the Corporation's bus to inconvenience, but also tarnish the reputation of the corporation. Taking into consideration the totality of the facts of the case and the law laid down by the Apex Court, it is a case where interference with the award made by the Labour Court is called for." 5.1. Again this Court in the case of Rajkot Municipal Corporation v/s. Navinchandra I. Vyas reported in 1997 (2) G.L.H. at page 331 dealt with provisions of section 11-A of the Act, wherein this Court categorically said that power of the Labour Court to interfere with the penalty is not unguided and the same has to be exercised judiciously and not on the basis of theory of socialism or social justice. In the said judgment this Court has taken into consideration various decisions of this Court and the Apex Court. It has been held as under :- "11. Mr. Clerk, in this connection rightly invited the attention of this Court to the subsequent decision of the Apex Court in the case of Christian Medical College Hospital Employees' Union v. Christian Medical College, Vellore reported in AIR 1988 SC 37. While negating the argument that application of provisions of Industrial Disputes Act to the minority institution would abridge the fundamental right of the minority educational institution the Court held that the Industrial Tribunal or the Labour Court has under Section 11A of the Act powers to substitute a lesser punishment in lieu of the order of discharge/dismissal passed by the management. However, confirmation of such power is not conferring an arbitrary or absolute power in the Industrial Tribunal or Labour Court. The power under Section 11A of the Act has to be exercised judiciously and the Industrial Tribunal or the Labour Court is expected to interfere with the decision of the Management under Section 11A of the Industrial Disputes Act only when it is satisfied that the punishment imposed by the management is highly disproportionate to the degree of guilt of the workman concerned. The Industrial Tribunal or the Labour Court has to give reasons for the satisfaction. Such reasons may not be fanciful or whimsical and they are once again subjected to judicial review by the High Court or the Supreme Court. Substitution of a punishment therefore solely on the ground that the theory of socialism or social justice requires that lenient view should be taken is untenable in law and tantamount to permitting the Labour Court or the Industrial Tribunal to act beyond the scope of Section 11A of the said Act. This Court also has considered the question of substitution or modification of penalty imposed by the disciplinary authority, and based on recent decision of the Supreme Court, this Court in the case of Vadodara Municipal Corporation Kamdar Karmachari Union v. Municipal Corporation of Vadodara and another reported in 1993 (9) GLH 640 made following observations which are in tune with and consistent with the binding precedents of the Apex Court and the objective sought to be achieved by the legislature by introduction of Section 11A of the I.D. Act, 1947 : "This case reminds this Court of the following observations of Chandrachud C. J. in the case of Shankardas v. Union of India reported in AIR 1985 SC 772 : "Cases which evoke sympathy come frequently before the court. But pity not often." In para. 13 of this udgment the learned Single Judge of this Court has further observed as under :- "13. In my opinion, applying the principle