- 1 - IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE SIDE JURISDICTION WRIT PETITION NO.8068 OF 2006 Shri Shashikant Rameshpant Kavishwar,) Aged about 64 years, residing at ) Kaustubh, House 269, ) Near Dr.Spruha Kaple Hospital, ) Ruikar Path, Mahal, Nagpur 440 002.).. Petitioner Vs. 1. Managing Director, ) The Maharashtra State ) Co-operative AGriculture and ) Rural Development Bank Limited,) Bombay, Plot No.15-A, ) Morvi Lane, Chaupati, ) Bombay - 7. ) 2. The Divisional Officer, ) The Maharashtra State ) Co-operative AGriculture and ) Rural Development Bank Limited,) Bombay, Divisional Office, ) 204E/KH, Tarabai Park, ) Near Pearl Hotel, Kolhapur. ) 3. The Divisional Officer, The Maharashtra State ) Co-operative AGriculture and ) Rural Development Bank Limited,) Bombay, Divisional Office, ) Nagpur, Near Ganeshpeth Police) Station, Ganeshpeth, ) Nagpur 440 002. ).. Respondents -- Shri M.S.Topkar for the Petitioner. Shri V.P.Sawant for the Respondents. -- CORAM : R.M.S.KHANDEPARKAR, J DATED : 12TH DECEMBER, 2006 - 2 - ORAL JUDGMENT: ORAL JUDGMENT: ORAL JUDGMENT: 1. Heard. Rule. By consent, the rule is made returnable forthwith. 2. The petitioner challenges the judgment and order dated 13th October, 2006 passed by the Industrial Court at Kolhapur, in Revision Application (ULP) No.25 of 2004. The challenge to the impugned judgment and order is restricted to the permission granted to the respondent/employer to lead additional evidence consequent to the findings arrived at by the Labour Court about the inquiry being vitiated. 3. The learned advocate appearing for the petitioner, while drawing attention to the decisions of the Apex Court in Delhi Cloth and General Mills Co. Delhi Cloth and General Mills Co. Delhi Cloth and General Mills Co. v. Ludh Budh Singh, v. Ludh Budh Singh, v. Ludh Budh Singh, reported in AIR 1972 SC 1031, Shankar Chakravarti v. Britannia Biscuit Co. Ltd. & Shankar Chakravarti v. Britannia Biscuit Co. Ltd. & Shankar Chakravarti v. Britannia Biscuit Co. Ltd. & Anr., Anr., Anr., reported in AIR 1979 SC 1652, Shambhu Nath Goyal Shambhu Nath Goyal Shambhu Nath Goyal v. Bank of Baroda & Ors., v. Bank of Baroda & Ors., v. Bank of Baroda & Ors., reported in AIR 1984 SC 289, Karnataka State Road Transport Corporation v. Karnataka State Road Transport Corporation v. Karnataka State Road Transport Corporation v. Lakshmidevamma (Smt.) & Anr., Lakshmidevamma (Smt.) & Anr., Lakshmidevamma (Smt.) & Anr., reported in 2001 II CLR 640, submitted that the Industrial Court has failed to consider that the decision about the refusal of - 3 - permission to the employee to amend the written statement in relation to the right to lead additional evidence had attained finality consequent to the earlier order of the Industrial Court and thereby acted illegally in directing the Labour Court to grant permission to the respondent-employer to lead additional evidence by the impugned order. The Industrial Court, in effect, by the impugned order has set aside and reviewed its earlier order passed in another revision application between the same parties and arising out of same proceedings. In fact, the earlier order had attained finality, and therefore, it could not have been subjected to reconsideration in the present revision application, nor in the circumstances the decision of the Apex Court in Divyash Pandit v. Management, NCCBM, Divyash Pandit v. Management, NCCBM, Divyash Pandit v. Management, NCCBM, reported in (2005)2 SCC 684 was attracted. 4. The learned advocate appearing for the respondents, on the other hand, placing reliance in the decisions of the Apex Court in The Hindustan The Hindustan The Hindustan Construction Co. Ltd. v. Shri G.K.Patankar & Anr., Construction Co. Ltd. v. Shri G.K.Patankar & Anr., Construction Co. Ltd. v. Shri G.K.Patankar & Anr., reported in (1976)1 SCC 810 and Bharat Forge Co.Ltd. Bharat Forge Co.Ltd. Bharat Forge Co.Ltd. v. A.B.Zodge & Anr., v. A.B.Zodge & Anr., v. A.B.Zodge & Anr., reported in (1996)4 SCC 374, has submitted that the Industrial Court, having found that the Labour Court ought to have given an opportunity to - 4 - the respondent-bank to establish the charges which were levelled against the petitioner-complainant consequent to its finding about the inquiry being vitiated, has directed to exercise the power in terms of Section 11A of the Industrial Disputes Act, 1947 and in that context, it cannot be said to have reviewed its earlier order passed in another revision application. In fact, it has followed the decision of the Apex Court in Divyash Pandit’s case (supra), Divyash Pandit’s case (supra), Divyash Pandit’s case (supra), and to that extent, a substantial justice has been done which would not warrant interference in exercise of powers under Article 227 of the Constitution of India. 5. The Industrial Court, after taking into consideration the decisions of the Apex Court in Workmen of Motipur Sugar Factory (Pvt.) Ltd. v. Workmen of Motipur Sugar Factory (Pvt.) Ltd. v. Workmen of Motipur Sugar Factory (Pvt.) Ltd. v. Motipur Sugar Factory, Motipur Sugar Factory, Motipur Sugar Factory, reported in 27 FJR 376, Cooper Cooper Cooper Engineering Ltd. v. P.P.Munde, Engineering Ltd. v. P.P.Munde, Engineering Ltd. v. P.P.Munde, reported in (1975)48 FJR 152 and K.S.R.T.C.’s case (supra) K.S.R.T.C.’s case (supra) K.S.R.T.C.’s case (supra) as well as Divyash Pandit’s case (supra), Divyash Pandit’s case (supra), Divyash Pandit’s case (supra), has held thus:- "In the case in hand, the Bank had preferred an application at Exh.C-34 for making an amendment in the Written-statement but, the same was dis-allowed. The said order was confirmed by the Industrial Court. - 5 - Thereafter, the Labour Court after considering entire material on record, came to the findings that the enquiry was non-est. The facts of the case warranted that the Labour Court should have given one opportunity to the Petitioner Bank to establish the charges before delivery of the Judgment in favour of the Complainant. This aspect was never considered by the Labour Court when it concluded that the enquiry was non-est. Divyash Pandit’s case cited (supra) makes it amply clear that even if, the management had not made any prayer for submitting additional evidence in its written-statement the Labour Court under its powers could permit the Bank to adduce additional evidence to justify its action. This particular aspect has been totally ignored by the Labour Court." 6. The law on the point, as regards the right of the management to lead additional evidence in support of the charges levelled against the employee consequent to the finding by the Labour Court about the inquiry being vitiated is not in dispute. The points for consideration which arise in the matter relate to the prerequisites for exercise of the said - 6 - right, the stage at which it can be exercised, the procedure to be followed for exercise of such right and the powers of the Labour/Industrial Court in that regard. 7. In Delhi Cloth and General Mills Co.’s case Delhi Cloth and General Mills Co.’s case Delhi Cloth and General Mills Co.’s case (supra), (supra), (supra), the Apex Court has observed that the Delhi and Madhya Pradesh High Courts had held that it is the duty of the Tribunal to decide, in the first instance, the propriety of the domestic enquiry held by the management and if it records a finding against the management, it should suo motu provide an opportunity to the management to adduce additional evidence, even though the management had made no such request, and further that the said view was held to be erroneous by a decision of the Apex Court in The State Bank of The State Bank of The State Bank of India v. R.K.Jain & Ors., India v. R.K.Jain & Ors., India v. R.K.Jain & Ors., reported in AIR 1972 SC 136. Certain broad principles, which emerged on the basis of various decisions delivered by the Apex Court on the point in issue were paraphrased as under:- "(1) If no domestic enquiry had been held by the management, or if the management makes it clear that it does not rely upon any domestic enquiry that may have been held - 7 - by it, it is entitled to straightway adduce evidence before the Tribunal justifying its action. The Tribunal is bound to consider that evidence so adduced before it, on merits, and give a decision thereon. In such a case, it is not necessary for the Tribunal to consider the validity of the domestic enquiry as the employer himself does not rely on it. (2) If a domestic enquiry had been held, it is open to the management to rely upon the domestic enquiry held by it, in the first instance, and alternatively and without prejudice to its plea that the enquiry is proper and binding, simultaneously adduce additional evidence before the Tribunal justifying its action. In such a case no inference can be drawn, without anything more, that the - 8 - management has given up the enquiry conducted by it. (3) When the management relies on the enquiry conducted by it, and also simultaneously adduces evidence before the Tribunal, without prejudice to its plea that the enquiry proceedings are proper, it is the duty of the Tribunal, in the first instance, to consider whether the enquiry proceedings conducted by the management, are valid and proper. If the Tribunal is satisfied that the enquiry proceedings have been held properly and are valid, the question of considering the evidence adduced before it on merits, no longer survives. It is only when the Tribunal holds that the enquiry proceedings have not been properly held, that it derives jurisdiction to deal with the merits of the dispute and in such a case it has to consider - 9 - the evidence adduced before it by the management and decide the matter on the basis of such evidence. (4) When a domestic enquiry has been held by the management and the management relies on the same, it is open to the latter to request the Tribunal to try the validity of the domestic enquiry as a preliminary issue and also ask for an opportunity to adduce evidence before the Tribunal, if the finding on the preliminary issue is against the management. However elaborate and cumbersome the procedure may be, under such circumstances, it is open to the Tribunal to deal, in the first instance, as a preliminary issue the validity of the domestic enquiry. If its finding on the preliminary issue is in favour of the management, then no additional evidence need be cited - 10 - by the management. But, if the finding on the preliminary issue is against the management, the Tribunal will have to give the employer an opportunity to cite additional evidence and also give a similar opportunity to the employee to lead evidence contra, as the request to adduce evidence had been made by the management to the Tribunal during the course of the proceedings and before the trial has come to an end. When the preliminary issue is decided against the management and the latter leads evidence before the Tribunal, the position, under such circumstances, will be, that the management is deprived of the benefit of having the finding of the domestic Tribunal being accepted as prima facie proof of the alleged misconduct. On the other hand, the management will have to prove, by adducing proper evidence, that the workman is - 11 - guilty of misconduct and that the action taken by it is proper. It will not be just and fair either to the management or to the workman that the Tribunal should refuse to take evidence and thereby ask the management to make a further application, after holding a proper enquiry, and deprive the workman of the benefit of the Tribunal itself being satisfied, on evidence adduced before it, that he was or was not guilty of the alleged misconduct. (5) The management has got a right to attempt to sustain its order by adducing independent evidence before the Tribunal. But the management should avail itself of the said opportunity by making a suitable request to the Tribunal before the proceedings are closed. If no such opportunity has been availed of, or asked for - 12 - by the management, before the proceedings are closed, the employer can make no grievance that the Tribunal did not provide such an opportunity. The Tribunal will have before it only the enquiry proceedings and it has to decide whether the proceedings have been held properly and the findings recorded therein are also proper. (6) If the employer relies only on the domestic enquiry and does not simultaneously lead additional evidence or ask for an opportunity during the pendency of the proceedings to adduce such evidence, the duty of the Tribunal is only to consider the validity of the domestic enquiry as well as the finding recorded therein and decide the matter. If the Tribunal decides that the domestic enquiry has not been held properly it is not its - 13 - function to invite suo motu the employer to adduce evidence before it to justify the action taken by it. (7) The above principles apply to the proceedings before the Tribunal, which have come before it either on a reference under Section 10 or by way of an application under Section 33 of the Act." 8. In Shankar Chakravarti’s case (supra) Shankar Chakravarti’s case (supra) Shankar Chakravarti’s case (supra), the Apex Court held that the contention that there is something like "an obligatory duty" of the Labour or Industrial Court to call upon the employer to adduce additional evidence if it so chooses, after recording a specific finding on the preliminary issue as to whether there was no enquiry or the one held was defective, was negatived in Delhi Cloth and General Delhi Cloth and General Delhi Cloth and General Mills Co.’s case (supra) Mills Co.’s case (supra) Mills Co.’s case (supra). It was also observed that in Cooper Engineering Ltd.’s case (supra) Cooper Engineering Ltd.’s case (supra) Cooper Engineering Ltd.’s case (supra) (AIR 1975 SC 1900) the contention regarding the denial of opportunity to lead evidence on account of failure of the Tribunal to pass an order on the written request on behalf of the employer in that regard before - 14 - disposal of the matter was rejected. Referring to the decision in Workmen of Firestone Tyre & Rubber Co. of Workmen of Firestone Tyre & Rubber Co. of Workmen of Firestone Tyre & Rubber Co. of India (P.) Ltd v. The Management & Ors., India (P.) Ltd v. The Management & Ors., India (P.) Ltd v. The Management & Ors., 1973 Lab IC 851, it was observed that the Apex Court therein had held that the employer who wants to adduce evidence for the first time before the Tribunal to justify its action should ask for it at the appropriate stage and if such opportunity is availed by the employer, the Tribunal has no power to refuse, but it is not for a moment can be suggested that there is some duty or obligation as a matter of law cast upon the Tribunal to call upon the employer to adduce additional evidence even if no such opportunity is sought to be availed by the employer himself. Further, referring to the decision in Cooper Engineering Ltd.’s case Cooper Engineering Ltd.’s case Cooper Engineering Ltd.’s case (supra), (supra), (supra), it was observed that there is nothing in the decision to suggest that the Apex Court therein had specifically overruled the decision in State Bank of State Bank of State Bank of India v. R.K.Jain India v. R.K.Jain India v. R.K.Jain, ( 1972 Lab IC 13 ). It is clarified that the Apex Court had thereby negatived the contention of the employer that there is an obligatory duty in law on the Labour Court or the Industrial Tribunal to give an opportunity to the employer irrespective of the fact whether it is asked for or not to adduce additional evidence after recording a finding on the preliminary issue that - 15 - either no domestic enquiry was held or the one held was defective. It was also held that the Cooper Cooper Cooper Engineering Ltd. case (supra) Engineering Ltd. case (supra) Engineering Ltd. case (supra) is not an authority for the proposition in every case coming before the Labour Court or Industrial Tribunal under Section 10 or Section 33 of the Act complaining about the punitive termination of service following a domestic enquiry that the Court or Tribunal as a matter of law must first frame a preliminary issue and proceed to decide the validity or otherwise of the enquiry and then serve a fresh notice on the employer by calling upon the employer to adduce further evidence to sustain the charges if it so chooses to do. It was also ruled that the quasi-judicial tribunal is not required to advise the party either about its rights or what it should do or omit to do. Burden to prove by leading necessary evidence to establish an allegation made by a party is on the party making the allegation. The test would be who would fail if no evidence is led. It must seek an opportunity to lead evidence and lead evidence. It was also held that the pleadings before such bodies are not to be read strictly, but at the same time, the pleadings must be such that same should give sufficient notice to the other party of the case it is called upon to meet. Referring to the decision in Tin Printers (Pvt.) Ltd. v. Industrial Tribunal, Tin Printers (Pvt.) Ltd. v. Industrial Tribunal, Tin Printers (Pvt.) Ltd. v. Industrial Tribunal, - 16 - (1967)2 Lab LJ 677, it was held thus:- "The rules of fair play demand that where a party seeks to establish a contention which if proved would be sufficient to deny relief to the opposite side, such a contention has to be specifically pleaded and then proved. But if there is no pleading there is no question of proving something which is not pleaded. This is very elementary." It was also observed that if no such pleading is put forth either at the initial stage or during the pendency of the proceedings, there arises no question of a sort of advisory role of the Labour Court or the Industrial Tribunal, as it is unintended by the Act to advise the employer, a party much better off than the workman, to inform it about its rights, namely, the right to lead additional evidence and then give an opportunity which was never sought. 9. In the Workmen of M/s.Firestone Tyre & Rubber Workmen of M/s.Firestone Tyre & Rubber Workmen of M/s.Firestone Tyre & Rubber Co. of India P.Ltd. (supra), Co. of India P.Ltd. (supra), Co. of India P.Ltd. (supra), after taking into consideration all earlier decisions, it was ruled that the following principles broadly emerge therefrom:- "(1) The right to take disciplinary - 17 - action and to decide upon the quantum of punishment are mainly managerial functions, but if a dispute is referred to a Tribunal, the latter has power to see if action of the employer is justified. (2) Before imposing the punishment, an employer is expected to conduct a proper enquiry in accordance with the provisions of the Standing Orders, if applicable, and principles of natural justice. The enquiry should not be an empty formality. (3) When a proper enquiry has been held by an employer, and the finding of misconduct is plausible conclusion flowing from the evidence, adduced at the said enquiry, the Tribunal has no jurisdiction to sit in judgment over the decision of the employer as an appellate body. The - 18 - inference with the decision of the employer will be justified only when the findings arrived at in the enquiry are perverse or the management is guilty of victimisation, unfair labour practice or mala fide. (4) Even if no enquiry has been held by an employer or if the enquiry held by him is found to be defective, the Tribunal in order to satisfy itself about the legality and validity of the order, had to give an opportunity to the employer and employee to adduce evidence before it. It is open to the employer to adduce evidence for the first time justifying his action, and it is open to the employee to adduce evidence contra. (5) The effect of an employer not holding an enquiry is that the Tribunal would not have to - 19 - consider only whether there was a prima facie case. On the other hand, the issue about the merits of the impugned order of dismissal or discharge is at large before the Tribunal and the latter, on the evidence adduced before it, has to decide for itself whether the misconduct alleged is proved. In such cases, the point about the exercise of managerial functions does not arise at all. A case of defective enquiry stands on the same footing as no enquiry. (6) The Tribunal gets jurisdiction to consider the evidence placed before it for the first time in justification of the action taken only, if no enquiry has been held or after the enquiry conducted by an employer is found to be defective. (7) It has never been recognised that the Tribunal should straightway, - 20 - without anything more, direct reinstatement of a dismissed or discharged employee, once it is found that no domestic enquiry has been held or the said enquiry is found to be defective. (8) An employer, who wants to avail himself of the opportunity of adducing evidence for the first time before the Tribunal to justify his action, should ask for it at the appropriate stage. If such an opportunity is asked for, the Tribunal has no power to refuse. The giving of an opportunity to an employer to adduce evidence for the first time before the Tribunal is in the interest of both the management and the employee and to enable the Tribunal itself to be satisfied about the alleged misconduct. (9) Once the misconduct is proved either in the enquiry conducted by - 21 - an employer or by the evidence placed before a Tribunal for the first time, punishment imposed cannot be interfered with by the Tribunal except in cases where the punishment is so harsh as to suggest victimisation. (10) In a particular case, after setting aside the order of dismissal, whether a workman should be reinstated or paid compensation is, as held by this Court in The Management of Panitole Tea Estate v. The Workmen, 1971-1 SCC 742 = (AIR 1971 SC 2171) within the judicial decision of a Labour Court or Tribunal." It was further ruled that :- "If there has been no enquiry held by the employer or if the enquiry is held to be defective, it is open to the employer even now - 22 - to adduce evidence for the first time before the Tribunal justifying the order of discharge or dismissal. We are not inclined to accept the contention on behalf of the workmen that the right of the employer to adduce evidence before the Tribunal for the first time recognized by this Court in its various decision, has been taken away. There is no indication in the section that the said right has been abrogated. If the intention of the legislature was to do away with such a right, which has been recognised over a long period of years, as will be noticed by the decisions referred to earlier, the section would have been differently worded. Admittedly there are no express words to that effect, and there is no indication that the section has impliedly changed the law in that respect. Therefore, the position is that even now the employer is entitled to adduce evidence for the first time before the Tribunal even if he had held no enquiry or the enquiry held by him is found to be defective. Of course, an opportunity will have to be given to the workman to lead evidence contra. The stage at which