IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 4-7-2008 CORAM THE HONOURABLE MR.JUSTICE N.PAUL VASANTHAKUMAR W.P.NO.15457 OF 2008 Kandasamy ... Petitioner Vs. 1. The Management, TNSTC (Kovai Division) Ltd., Chennimala Road, Erode. 2. The Presiding Officer, Labour Court, Salem. ... Respondents Prayer: This writ petition is filed under Article 226 of Constitution of India, praying this Court to issue a writ of Certiorari calling for the records on the file of the second respondent in proceedings I.D.No.426 of 2000 and dated 3.1.2008 and further quash the same as illegal, incompetent and without jurisdiction. For Petitioner : Mr.V.Raghavachari O R D E R Prayer in the writ petition is to quash the the proceedings of the second respondent in I.D.No.426 of 2000 dated 3.1.2008 upholding the order of dismissal of the petitioner from service. 2. The petitioner has joined the service in the respondent Corporation as conductor on 3.2.1982 and he served at various branches. According to the petitioner, in his career spanning over 17 years, he had not suffered any major punishments. In the year 1999, petitioner was placed at Anthiyur branch and he was on duty in the bus bearing registration No.TN-33-N-0697, plying between Coimbatore- Erode route. https://hcservices.ecourts.gov.in/hcservices/ 3. On 28.6.1999 at about 10.20 a.m., when the petitioner was on duty in the bus plying from Coimbatore and while the bus was nearing Tindal, the Checking Inspectors got into the bus for checking. At that time, there were 30 passengers and according to the petitioner he issued tickets to all of them and corresponding entries were also made in the invoice and the fares collected were also recorded. The Checking Inspectors found that four passengers on board were travelling beyond the destination and they hold tickets for Rs.18/- but entry made in the collection book is for lesser amount. When the Checking Inspectors questioned, petitioner replied that the four passengers had to get down at Perundurai, but they had overstayed in the bus and the same was unnoticed by him as he was closing the invoice. According to the petitioner, he was continuously called upon to go for trip for two nights and three days and hence he could not rectify the mistakes. Not satisfied with the explanation, charges were framed against the petitioner alleging that he had misappropriated Rs.34.50. Subsequently petitioner was suspended with effect from 2.7.1999 based on the charge memo. The order of suspension was revoked and the petitioner rejoined duty on 17.7.1999 and he was transferred to Nambiyur branch as per the proceedings of the first respondent dated 20.7.1999. 4. An enquiry was conducted against the petitioner and the Enquiry Officer found the petitioner as guilty, as there was excess of Rs.34.50 in the collection bag on 28.6.1999. Based on the report of the Enquiry Officer, first respondent Corporation, by its order dated 15.11.1999 dismissed the petitioner from service, against which the petitioner filed I.D.No.426 of 2000 before the Labour Court, Salem. The Labour Court by award dated 3.1.2008, dismissed the dispute confirming the order of dismissal passed by the first respondent. The said award of the Labour Court is challenged in this writ petition on the ground that the first respondent Corporation has not considered the explanation offered by the petitioner; as the amount collected was available within the collection bag and therefore no question of misappropriation arises; and that only based on the statement obtained during spot inspection, the petitioner shall not be termed as offender. 5. Heard the learned counsel for the petitioner. 6. Petitioner having been dismissed from service by order dated 15.11.1999, challenged the order of dismissal by raising I.D.No.426 of 2000 before the second respondent Labour Court. The Labour Court, after considering the entire materials including exhibits, came to the factual conclusion and held as follows: "In point No.1 it is decided that the petitioner has misappropriated the fare collected from the passengers by preparing false carbon copy of the ticket by some adjustments and https://hcservices.ecourts.gov.in/hcservices/ misappropriated a portion of the amount collected from passengers and thereby caused loss of income and reputation to the Corporation. The delinquent who committed misappropriation deserve no sympathy and the punishment of dismissal is incommensurate with the misconduct committed by the petitioner. Therefore, the order passed against the petitioner dismissing him from service is not liable to be set aside and he is not entitled to any relief and the points are answered accordingly." 7. The Labour Court came to the above conclusion by stating that from the evidence of RW-1 it is clear that the petitioner has collected proper fare from the passengers and prepared carbon copy of the bill by some adjustment showing lesser amount, thereby he misappropriated Rs.3.50 per ticket, totalling Rs.14/-. Further, the excess amount was found in the cash bag. The disciplinary authority as well as the Labour Court found that the charge levelled against the petitioner is proved, particularly misappropriation. The said finding given by the Labour Court is just and proper and I am unable to see any perversity in the said finding, warranting interference. 8. The learned counsel for the petitioner argued that the alleged amount of misappropriation is Rs.14/-, for which the extreme penalty of dismissal is ordered by the respondent, which is not proportionate to the gravity of the offence. The said submission of the learned counsel for the petitioner is not sustainable as the amount misappropriated is of no consequence while awarding punishment. 9. (a) In J.T. (1996) 3 SC 96 (Municipal Committee, Bahadurgarh v. Krishnan Behari and Others), the Honourable Supreme Court held that in cases of misappropriation, there cannot be any other punishment other than dismissal. It is further held that any sympathy shown in such cases is totally uncalled for and opposed to public interest and that the amount misappropriated may be small or large, but it is the act of misappropriation that is relevant. (b) Imposing punishment is the discretion of the Disciplinary Authority and the High Court cannot interfere with the said discretion as held by the Supreme Court in AIR 1997 SC 3387 (Union of India v. G.Ganayutham). In paragraph 28 of the Judgment the Supreme Court held as under, "The current position of proportionality in administrative law in England and India can be summarised as follows:- (1) To judge the validity of any administrative order or statutory discretion, https://hcservices.ecourts.gov.in/hcservices/ normally the Wednesbury test is to be applied to find out if the decision was illegal or suffered from procedural improprieties or was one which no sensible decision-maker could, on the material before him and within the framework of the law, have arrived at. The Court would consider whether relevant matters had not been taken into account or whether irrelevant matters had been taken into account or whether the action was not bona fide. The Court would also consider whether the decision was absurd or perverse. The Court would not however go into the correctness of the choice made by the administrator amongst the various alternatives open to him. Nor could the Court substitute its decision to that of the administrator. This is the Wednesbury test. (2) The Court would not interfere with the administrator's decision unless it was illegal or suffered from procedural impropriety or was irrational in the sense that it was in outrageous defiance of logic or moral standards. The possibility of other tests, including proportionality being brought into English Administrative Law in future is not ruled out. These are the CCSU principles. (3)(a) As per Bugdaycay, Brind and Smith, as long as the Convention is not incorporated into English Law, the English Courts merely exercise a secondary judgment to find out if the decision maker could have, on the material before him, arrived at the primary judgment in the manner he has done. (3)(b) If the Convention is incorporated in England making available in principle of proportionality, then the English Courts will render primary judgment on the validity of the administrative action and find out if the restriction is disproportionate or excessive or is not based upon a fair balancing of the fundamental freedom and the need for the restriction thereupon. (4)(a) The position in our country, in administrative law, where no fundamental freedoms as aforesaid are involved, is that the Courts/Tribunals will only play a secondary role while the primary judgment as to reasonableness https://hcservices.ecourts.gov.in/hcservices/ will remain with the executive or administrative authority. The secondary judgment of the Court is to be based on Wednesbury and CCSU principles as stated by Lord Greene and Lord Diplock respectively to find if the executive or administrative authority has reasonably arrived at his decision as the primary authority. (4)(b) Whether in the case of administrative or executive action affecting fundamental freedoms, the Courts in our country will apply the principle of 'proportionality' and assume a primary role, if left open, to be decided in an appropriate case where such action is alleged to offend fundamental freedoms. It will be then necessary to decide whether the Courts will have a primary role only if the freedoms under Articles 19, 21 etc., are involved and not for Article 14." In the said Judgment, the Supreme Court referred its earlier decisions reported in (1997) 3 SCC 72 = JT 1997 (2) SC 367 (Indian Oil Corporation Ltd & Another v. Ashok Kumar Arora) and (1995) 6 SCC 749 = JT 1995 (8) SC 65 (B.C.Chaturvedi v. Union of India and Others). In the case of B.C.Chaturvedi, in paragraph 18, the Supreme Court held as under, "A review of the above legal position would establish that the disciplinary authority, and on appeal the appellate authority, being fact-finding authorities have exclusive power to consider the evidence with a view to maintain discipline. They are invested with the discretion to impose appropriate punishment keeping in view the magnitude or gravity of the misconduct. The High Court/Tribunal, while exercising the power of judicial review, cannot normally substitute its own conclusion on penalty and impose some other penalty. If the punishment imposed by the disciplinary authority or the appellate authority shocks the conscience of the High Court/Tribunal, it would appropriately mould the relief, either directing the disciplinary/ appellate authority to reconsider the penalty imposed, or to shorten the litigation, it may itself, in exceptional and rare cases, impose appropriate punishment with cogent reasons in support thereof." (c) In AIR 2000 SC 3129 (Janatha Bazar v. Secretary, Sahakari Noukarara Singh), it is held that once the act of misappropriation is proved, may be for a small or large amount, there is no question of https://hcservices.ecourts.gov.in/hcservices/ showing uncalled for sympathy and reinstalling the employee in service. (d) In (2003) 3 SCC 605 (Regional Manager, U.P.SRTC v. Hoti Lal), in paragraph 10 the Supreme Court held thus, "It needs to be emphasized that the court or tribunal while dealing with the quantum of punishment has to record reasons as to why it is felt that the punishment was not commensurate with the proved charges. As has been highlighted in several cases to which reference has been made above, the scope for interference is very limited and restricted to exceptional cases in the indicated circumstances. Unfortunately, in the present case as the quoted extracts of the High Court's order would go to show, no reasons whatsoever have been indicated as to why the punishment was considered disproportionate. Reasons are live links between the mind of the decision taken to the controversy in question and the decision or conclusion arrived at. Failure to give reasons amounts to denial of justice (See Alexander Machinery (Dudley) Ltd. v. Crabtree (1974 LCR 120 (NIRC)). A mere statement that it is disproportionate would not suffice. A party appearing before a court, as to what it is that the court is addressing its mind. It is not only the amount involved but the mental set-up, the type of duty performed and similar relevant circumstances which go into the decision-making process while considering whether the punishment is proportionate or disproportionate. If the charged employee holds a position of trust where honesty and integrity are inbuilt requirements of functioning, it would not be proper to deal with the matter leniently. Misconduct in such cases has to be dealt with iron hands. Where the person deals with public money or is engaged in financial transactions or acts in a fiduciary capacity, the highest degree of integrity and trustworthiness is a must and unexceptionable. Judged in that background, conclusions of the Division Bench of the High Court do not appear to be proper. We set aside the same and restore order of the learned Singe Judge upholding the order of dismissal." (e) In the decision reported in (2005) 7 SCC 338 (V.Ramana v. A.P.SRTC), the Supreme Court in paragraph 11 held as under, https://hcservices.ecourts.gov.in/hcservices/ "The common thread running through in all these decisions is that the court should not interfere with the administrator's decision unless it was illogical or suffers from procedural impropriety or was shocking to the conscience of the court, in the sense that it was in defiance of logic or moral standards. In view of what has been stated in Wednesbury case ((1948) 1 KB 223) the court would not go into the correctness of the choice made by the administrator open to him and the court should not substitute its decision for that of the administrator. The scope of judicial review is limited to the deficiency in decision- making process and not the decision." (f) The Honourable Supreme Court, in the decision reported in (2006) 3 SCC 143 (Bharat Petroleum Corporation Ltd. v. T.K.Raju) in paragraph 16 held that the power of judicial review in the matter of quantum of punishment awarded by the Labour Court is very limited and the same shall not be done in a routine manner. The relevant portion reads thus, "The power of judicial review in such matters is limited. This Court times without number had laid down that interference with the quantum of punishment should not be done in a routine manner." (g) The Supreme Court in the decision reported in (2006) 1 SCC 63 (Karnataka Bank Ltd. v. A.L.Mohan Rao) in paragraph 6 held as follows: "..... It is not for the courts to interfere in cases of gross misconduct of this nature with the decision of the disciplinary authority so long as the inquiry has been fair and proper and misconduct proved. In such matters, it is for the disciplinary authority to decide what is the fit punishment. In any case on such a misconduct, it could never have been said that termination of service is not the appropriate punishment." The above decision of the Supreme Court was followed by us in W.A.No.1062 of 2007 dated 6.9.2007 (M.Gunaseelan v. The Presiding Officer, Principal Labour Court, Chennai & Another), wherein this Court confirmed the decision of the Labour Court refusing reinstatement. (h) In the recent decision reported in 2007 AIR SCW 4136 = JT 2007 (8) SC 588 (Ramesh Chandra Sharma v. Punjab National Bank & Another), in paragraph 20, the Supreme Court held thus, https://hcservices.ecourts.gov.in/hcservices/ "The High Court itself has noticed a large number of decisions and formed the opinion that the charges levelled against the delinquent officer were of grave nature. A major punishment may be inflicted even where no pecuniary loss was caused to the Bank by reason of the act of the delinquent officer. In support of the aforementioned proposition of law, the High Court opined: "The charges levelled against the petitioner, which were found proved upon enquiry, are quite serious in nature. The petitioner had engaged himself in reckless lending causing huge financial loss to the Bank to the extent of Rs.1,14,87,164.76. It also shows that the petitioner had disbursed loan through middlemen and demanded and received illegal gratification from a borrower. We are of the considered opinion that in such cases, the officers of the Bank should not be permitted to continue in service at all. Once the employer has lost the confidence in the employee and the bona fide loss of confidence is affirmed, the order of punishment must be considered to be immune from challenge, for the reason that discharging the office of trust and confidence requires absolute integrity. A necessary implication which must be engrafted on the contract of service is that the servant must undertake to serve his master with good faith and fidelity. In a case of loss of confidence, reinstatement cannot be directed. Granting such an employee the relief of reinstatement would be "an act of misplaced sympathy which can find no foundation in law or in equity." (Vide Air India Corporation, Bombay vs. V.A.Ravellow, AIR 1972 SC 1343; The Binny Ltd. vs. Their Workmen, AIR 1973 SC 1403; Kamal Kishore Lakshman vs. Management of M/s.Pan American World Airways Inc & Ors., AIR 1987 SC 229; Francis Kalein & Co. Pvt. Ltd., vs. Their Workmen, AIR 1971 SC 2414; Regional Manager, Rajasthan SRTC Vs. Sohan Lal, (2004) 8 SCC 218; and Bharat Heavy Electricals Ltd. Vs. M.Chandrashekhar Reddy & Ors., 2005 AIR SCW 1232). In Kanhaiyalal Agrawal & Ors. Vs. Factory Manager, Gwaliar Sugar Co. Ltd. (2001) 9 SCC 609, the Hon'ble Supreme Court laid down the test for loss of confidence to find out as to whether there was bona fide loss of confidence in the employee, observing that, (i) the workman is holding the https://hcservices.ecourts.gov.in/hcservices/ position of trust and confidence; (ii) by abusing such position, he commits act which results in forfeiting the same; and (iii) to continue him in service/establishment would be embarrassing and inconvenient to the employer, or would be detrimental to the discipline or security of the establishment. Loss of confidence cannot be subjective, based upon the mind of the management. Objective facts which would lead to a definite inference of apprehension in the mind of the management, regarding trustworthiness or reliability of the employee, must be alleged and proved." " (i) A Division Bench of this Court in the decision reported in (2005) 3 M.L.J. 375 (The Management of Hindustan Teleprinters Employees Co-operative Thrift and Credit Society Limited v. The Presiding Officer, Principal Labour Court) in paragraph 14 held that in case of misappropriation, whether, of small amount or large amount, the only punishment which can be given is dismissal. 10. The management also considered the petitioner's past conduct in not issuing tickets by receiving ticket amount for nine times, for which he was earlier suspended ten days, and for remitting lesser amount 25 times for which 23 times he was imposed penalty and two times awarded censure. The management taking all these aspects, lost total confidence on the petitioner and dismissed the petitioner. Hence, I am of the view that the punishment imposed against the petitioner by the respondent management is just and proper and the same is rightly confirmed by the Labour Court, which requires no interference. The writ petition is dismissed in limine. Sd/- Assistant Registrar /true copy/ Sub Assistant Registrar vr To 1. The Management, TNSTC (Kovai Division) Ltd., Chennimala Road, Erode. 2. The Presiding Officer, Labour Court, Salem. TM(CO) JJM 17.07.08 Order in W.P.No.15457 of 2008 https://hcservices.ecourts.gov.in/hcservices/