IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No 6055 of 1999 with SPECIAL CIVIL APPLICATION No 6057 of 1999 with SPECIAL CIVIL APPLICATION No 6058 of 1999 with SPECIAL CIVIL APPLICATION No 6059 of 1999 with SPECIAL CIVIL APPLICATION No 6060 of 1999 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 concerned : NO Magistrate/Magistrates,Judge/Judges,Tribunal/Tribunals? -------------------------------------------------------------- GUJARAT AMBUJA CEMENT PVT LTD Versus N D RATHOD C/O NASANTBHAI PAMNANI -------------------------------------------------------------- Appearance: 1. In all matters : MR KS NANAVATI for NANAVATI ASSOCIATES for Petitioner MR PJ KANABAR for Respondents -------------------------------------------------------------- CORAM : HON'BLE MR.JUSTICE AKSHAY H.MEHTA Date of decision: 14/05/2004 CAV COMMON JUDGEMENT 1. All these petitions are directed against the common judgment and award rendered by the Judge, Labour Court at Amreli dated 23rd April, 1999 in Reference [L.C.A.] No. 139 of 1998 and its allied cases. By the said award the reference cases filed by the respondents have been allowed and the petitioner has been directed to reinstate them on their original post with continuity of service and full back wages from the date of dismissal from service till reinstatement and all other incidental benefits and also to pay a sum of Rs.500/= to each of the respondents by way of costs. 1.1. Since these petitions are directed against the aforesaid common award, they are heard together and now they are being disposed of by this common judgment. 2. In these petitions two major controversies are involved. First controversy has been the subject matter of number of decisions that have been rendered by the Apex Court in different cases uptill now and that is, at what stage the employer or management can seek permission of the Industrial Tribunal or the Labour Court to lead additional evidence in the trial proceedings to substantiate order of dismissal passed against the workman. The second controversy is if the permission is sought at the appropriate stage, is it incumbent upon the Industrial Tribunal or the Labour Court, if it came to the conclusion that the departmental inquiry held against the delinquent was defective or invalid and hence vitiated, to call upon the employer or the management to lead additional evidence to substantiate the order of dismissal passed against the delinquent. 3. To decide these issues it is necessary to narrate certain relevant facts. 3.1. The petitioner is a company incorporated and registered under the Companies Act, 1956 and it is engaged in the business of manufacturing various types of cements. According to the petitioner, it is situated at Ambujanagar, Taluka Kodinar. At the relevant time it had employed 247 employees in its factory. It is the say of the petitioner that the present respondents together with seven other employees working in the factory and the Mines Department of the petitioner, formed a workers' union known as 'Ambuja Cement Mazdoor Sangh' and posed themselves as leaders of the said union. Out of total 247 workmen, only few became the members of the said union. The rest of the workmen refrained themselves from the membership of the said union. According to the petitioner, the said union immediately upon formation, wrote a letter to the petitioner company dated 1st January, 1990 requesting it to recognize the union as well as the office bearers of the union. Together with the said letter, the union also submitted to the management a charter of demands requesting the petitioner to grant their demands. Since no positive reply was received from the company, the union again wrote a letter dated 18th January, 1990 inter-alia threatening the petitioner that if the demands of the union were not negotiated and settled, the workmen would start agitation/Dharna, etc. with effect from 29th January, 1990. 3.2. It is the say of the petitioner that pursuant to letter dated 18th January, 1990 declaring their intention, 78 out of 247 workmen started the agitation and went on strike, completely disrupting the work of the factory of the petitioner. These 78 workmen worked in different shifts and in general shift. Since the said workmen did not call off the strike despite initial request made by the management and thereafter by notice for calling off the strike and to commence the work of the factory; the petitioner was constrained to serve them with the notices to take disciplinary action against them and also made clear to them that the wages for the days on which the strike was observed would be deducted from their salary. It is the say of the petitioner that the workmen not only did not comply with the notice, but they continued the illegal strike and even misbehaved with the superior officers and instigated others to go on strike. Further they went to the extent of giving serious threats to other employees and tried to compel them to join the strike. The petitioner therefore had no alternative but to initiate departmental proceedings against them. It issued show cause notice cum charge-sheet against 8 employees including the present respondents on different dates, first being of 6th February, 1990. 3.3. It appears from the record of the petitions that three officers were appointed as the Inquiry Officers, namely S/s. D.V. Mankad, K. Gaurappan and A.C. Karnik. The charges levelled against the respondents were by and large identical with slight variance in one or two charges. They were as under :- "01. Use of impertinent language, to insult superiors, indecent behaviour, insubordination and committing act which is subversive of discipline; 02. Unlawful cessation of work or going on illegal strike in contravention of the provisions of law and the standing orders and participation in a sitdown strike; 03. Inciting and/or instigating other employees to take part in an illegal strike, sitdown strike and action in furtherance of such strike launched in contravention of the provisions of law; 04. Disorderly behaviour and conduct endangering the life or safety of any person within the factory premises; 05. Act of sabotage or causing damage to the work in progress or to any property of the management wilfully; 06. Wilfull interference with the work of another workman or of a person authorized by the management to work on its premises; 07. Holding or participating in the meetings, demonstrations and shouting slogans inside the factory premises or mines or residential colony; 08. Unauthorized absence from duty for more than eight consecutive days; 09. Committing a nuisance in the premises of the factory, breach of these Standing Orders; 10. Canvassing for Trade Union Membership and collection of Union funds within the premises except as permissible under law; 11. Making a false, vicious or malicious statement in public against management/factory of officer; 12. Instigation, incitement, abetment or furtherance of any of the above acts." According to the petitioner, though they were duly served with the notices and summons to remain present at the inquiry, the respondents had not accepted the summons and had refused to participate in the inquiry. The Inquiry Officers were, therefore, obliged to conduct the inquiry in their absence. Upon conclusion of the recording of the evidence of the petitioner's witnesses, the Inquiry Officers proceeded to prepare the reports since the respondents had not chosen to remain present and contest the charges. 3.4. It appears from the record that the Inquiry Officers found the respondents guilty of using impertinent language and insulting the superiors, indulging in unruly behaviour and having acted in a manner which was subversive of discipline. They also found that the respondents were guilty for participating in illegal strike. Further, they were also found unauthorisedly absent from service and guilty of committing nuisance in the premises of the company. However, they were not found guilty of incitement, abetment, instigation, etc. They were also not found guilty of canvassing for trade union membership and collection of union funds. 3.5. They were thereafter served with a notice to show cause against the imposition of proposed punishment. The same was not accepted by them. Hence, the disciplinary authority, which was equipped with the entire material including the report of the Inquiry Officer, proceeded to pass the orders of dismissal against the respondents. 3.6. The respondents gave notices to take back them in service, but their request was not granted by the petitioner and, therefore, they raised industrial dispute. It appears that attempts to conciliate the dispute initially had yielded some positive result, but ultimately negotiations broke down and failure report was submitted. The dispute ultimately was referred to Labour Court for adjudication by the Assistant Labour Commissioner, Amreli by order dated 11th March, 1991. It also appears from the record that initially the reference cases were filed before the Labour Court at Rajkot and thereafter they transferred to the Labour Court at Bhavnagar and lastly they were transferred to Labour Court, Amreli with present reference case numbers. 4. Say of the respondents can be gathered from the averments made by them in their respective statements of claim. Before the common contentions raised by the respondents in the reference cases are narrated, it would be necessary to set-out certain individual details of the respondents. 4.1. Reference (L.C.A.) No. 139 of 1998 was filed by Mr. N.D. Rathod, respondent of Special Civil Application No. 6055 of 1999. He was working as Heavy Equipment Operator at monthly salary of Rs.1950/=. He was dismissed from the service by order dated 24th March, 1990. He requested vide notice dated 24th January, 1991 to petitioner to take him back in the service, but the same was not acceded to. 4.2. Refrence (L.C.A.) No. 146 of 1998 was filed by Mr. D.D. Koradia, respondent of Special Civil Application No. 6057 of 1999 was working as Machinery Assistant at monthly salary of Rs.1,683=60. He was dismissed from service on 1st March, 1990. He demanded reinstatement by serving a notice dated 7th May, 1991, but the demand was not complied with by the petitioner. 4.3. Reference (L.C.A.) No. 162 of 1998 was filed by Mr. B.U. Parmar, respondent of Special Civil Application No. 6058 of 1999 was working as Plant Operator at monthly salary of Rs.1,700/=. He was dismissed from service on 1st March, 1990. He also made demand for reinstatement by serving a notice, date of which is not available on record, but the demand was not acceded to by the petitioner. 4.4. Reference (L.C.A.) No. 145 of 1998 was filed by Mr. U.B. Ghade, respondent of Special Civil Application No. 6059 of 1999 was working as Plant Operator at monthly salary of Rs.1,700/=. He was dismissed from service on 1st March, 1990. He demanded reinstatement by serving a notice dated 29th April, 1991, but the demand was not responded to. 4.5. Reference (L.C.A.) No. 150 of 1998 was filed by Mr. D.B. Upadhyay, respondent of Special Civil Application No. 6060 of 1999 was working as Senior Fitter at monthly salary of Rs.2,800/=. He was dismissed from service on 1st March, 1990. He demanded reinstatement by serving a notice dated 7th May, 1991. However, the demand was not complied with by the petitioner. Hence, industrial dispute. 4.6. All the respondents filed their statements of claim which were more or less based on the averments to the effect that demand was made for recognition of the union and to recognize the officer bearers and also to accede to their certain legitimate demands, but the petitioner did not agree. Hence, a programme of holding peaceful demonstration was organized on 31st January, 1990. In the meanwhile efforts to bring about amicable settlement were made with the help of Government Labour Officer, but the petitioner did not give any cooperation and ultimately all the members of the union were dismissed from service by the petitioner by taking ex-parte decision. According to them, they had not received any communication with regard to holding of the departmental inquiry against them and the inquiry that was conducted was against the principles of natural justice. Further that the allegations levelled against them were not established and the findings given by the Inquiry Officers were erroneous. They also challenged the proportionality of the orders of dismissal and demanded reinstatement with continuity of service together with back wages and other incidental benefits. but the demand was not responded to. 4.7. All these reference cases were contested by the petitioner by filing written statements wherein it was contended that on account of the serious misconduct of the respondents, they were served with show cause notices and charge-sheets and their explanation was called for. But the same were not accepted by the respondents and they were returned with an endorsement 'refused'. Further that respondents had not filed any written statement to the charge-sheet. They were also given notice with regard to date fixed for hearing, but neither they had accepted the notice nor they had remained present. Further that upon inquiry, the acts of misconduct were held to be proved by the Inquiry officers and on the basis of the same, they were dismissed from the service in accordance with the principles of natural justice. It was further averred that since the respondents had lost confidence of the petitioner, they were not entitled to be re-employed in service of the petitioner. 4.8. It may be noted here that in this very written statement the petitioner had also averred and sought permission of the Labour Court that in the event it came to the conclusion that the inquiry held against the respondents was vitiated on any of the grounds alleged against it, the petitioner be permitted to lead additional evidence to prove the misconduct and substantiate the orders of dismissal. 5. At the hearing of the reference cases, both the parties produced documentary evidence. So far the respondents are concerned, they have also examined themselves as witnesses. It appears from the record that before the oral evidence was recorded, the respondents submitted individual pursis stating that they admitted the inquiry proceedings and did not challenge legality and validity of the inquiry. It appears that in view of this pursis, the petitioner did not choose to lead any additional evidence, but placed complete reliance on the evidence of the witnesses examined by it before the Inquiry Officers, whose evidence had remained unchallenged because the respondents had not participated in the inquiry proceedings. 5.1. At the end of the recording of the evidence, the Labour Court on the strength of the material produced before it, passed its judgment and award. It is pertinent to note that in para. 19 of the judgment the Labour Court has referred to the respective pursis submitted by the respondents admitting the legality and validity of the inquiry proceedings and has recorded a conclusion that since the applicants of those reference cases (i.e. the present respondents) have not challenged the legality and validity of the inquiry and have admitted the same, there was no need to take any decision with regard to the said inquiry. Thus, in other words, though the respondents had initially challenged the validity in their statements of claim, the said challenge was given up by filing pursis and the Labour Court had decided to proceed with the judgment on the basis that there was no need to give any finding with regard to validity of the inquiry. It also appears that since the challenge was given up, the petitioner did not think it proper to lead additional evidence and chose to rely on the material of the inquiry. 6. The Labour Court, however, thereafter recorded the conclusion that considering the material on record, no opportunity was granted to the respondents to defend their interest at the inquiry. It further concluded that copy of the report was not furnished to the respondents to enable them to make representation against it, that the strike was not illegal. Further it came to the conclusion that there was undue haste shown by all concerned including the Inquiry Officers in concluding the inquiry proceedings. It also recorded a finding that undue haste was shown by the disciplinary authority in passing the order of dismissal. It further concluded that the findings given by the Inquiry Officers were with malafide intention and further that the findings were not legal and proper and were not based on legal procedure. Thus, the most of the findings given by the Labour Court are relating to the procedural aspect of the inquiry and the Labour Court has impliedly held that the inquiry was violative of principles of natural justice, defective and hence vitiated. In view of this finding, the Labour Court allowed all the reference cases and ultimately gave award in terms stated above. It is this award which is now being challenged before this Court. 7. Mr. K.S. Nanavai, Learned Senior Advocate for Nanavati Associates for the petitioner has submitted that the judgment and award of the Labour Court are perverse, erroneous and are against the settled principle of law. He has submitted that the inquiry was legal and valid and all the opportunities were extended to the respondents to defend their interest at the hearing, but they did not choose to avail the same. The petitioner, therefore, cannot be blamed and it cannot be said that the inquiry was ex-parte. It is his submission that when challenge to the inquiry was given up, it was not proper for the Labour Court to hold that it was defective. He has also submitted that the petitioner at the very first instance, namely at the stage of filing written statement, had requested for permission to lead further evidence in case the Labour Court came to the conclusion that the inquiry was not legal or it had got vitiated for any reason. In view of this request, the Labour Court ought to have granted permission to lead additional evidence but the same has not been done and that has caused serious prejudice to the petitioner. He has lastly submitted that the matters be remanded back to the Labour Court to give proper opportunity to the petitioner to lead additional evidence. 7.1. As against that, Mr. P.J. Kanabar, learned advocate appearing for the respondents in all petitions has fully supported the judgment and award passed by the Labour Court and has submitted that no illegality has been committed by the Labour Court and its award is just and proper. According to him, the judgment of the Labour Court is based on the material that was placed before it and it was well within its limits to consider the same and give appropriate findings with regard to the issues involved. He has also submitted that on the questions of fact the Labour Court has decided against the petitioner and this Court may not interfere with such findings under Article 227 of the Constitution of India. He has further submitted that the Labour Court has decided the matter mainly on the basis that the orders of dismissal passed against the respondents were not legal and not in accordance with the standing orders and, therefore, the judgment is not required to be disturbed. It is submitted that merely because there are some incidental findings with regard to the defective procedure adopted by the Inquiry Officers, it cannot be said that the judgment and award are solely based on such finding. He has further submitted that even if the permission is sought by the petitioner in the written statement, it was the petitioner's duty to lead additional evidence at the appropriate stage and it was not for the Labour Court to call upon it to lead evidence. In his submission, when the petitioner had passed pursis not to lead evidence, it had forfeited its right to lead additional evidence and now it cannot make any grievance regarding it. Lastly he has submitted that these petitions have no merit and they are required to be dismissed. 7.2. It may be noted here that in the course of the hearing both the learned counsels have made extensive submissions relating to the aforesaid controversies and have also placed reliance on various decisions of the Apex Court as well as of this Court and some other High Courts. I will refer to the same in the due course of this judgment. 7.3. Apart from the aforesaid submissions, both the learned counsels have also made certain submissions, which are purely based on the facts of the case and, therefore, I will express my opinion on the question whether they can be considered in a petition under Article 227 of the Constitution of India little later. 8.0 I may first deal with the aforesaid two controversies. 8.1. As stated above, so far the first one is concerned, it is by now a well defined proposition of law that the employer or the management has to seek permission for leading additional evidence to substantiate the orders of dismissal in the event the inquiry is held to be vitiated at the first available opportunity. It is pertinent to note that claiming the right of leading additional evidence by the management and grant of permission for the same by the Labour Court or the Tribunal are not by way of any statutory provision, but this procedure has been evolved and recognized by the Apex Court all over these years with a view to curtail the cumbersome proceedings of holding inquiry again. It has been found that instead of having the entire inquiry proceedings de-novo in the event of earlier inquiry being vitiated on account of any inherent infirmity, it was more convenient and desirable to permit the management to lead additional evidence to substantiate its action. Ofcourse the issue regarding stage to seek permission has constantly remained in debate and it has been recently considered by the five Judge Bench of the Apex Court in a decision rendered in the case of Karnataka State Road Transport Corporation v/s. Lakshmidevamma reported in (2001) 5 S.C.C. p.433 and controversy has been finally put at rest. However, since both the learned counsels have argued this issue extensively before me and it has also got some overlapping effect on the second controversy, I am inclined to discuss it in little detail. With this background in mind, I would like to refer to certain decisions which have been cited at the bar by both the sides. First I will refer to the decision rendered by the Apex Court in the case of Delhi Cloth & General Mills v/s. Ludh Budh Singh reported in (1972) 1 S.C.C. p. 595. In the said decision several principles of law have been laid down by the Apex Court in relation to the domestic inquiry held by the management; the jurisdiction of the Tribunal in the proceedings arising from the decision taken by the management as a result of the said inquiry and the right of the management in such proceedings with regard to leading the additional evidence. The Apex Court has said that at the trial proceedings before the Tribunal the management has two fold right, namely that it can rely upon the domestic inquiry held by it in the first instance and alternatively and without prejudice to its plea that the inquiry was proper and binding, lead simultaneously the additional evidence before the Tribunal. It is thereafter held that it was open for the management to request the Tribunal to try the validity of domestic inquiry as preliminary issue and also to ask for an opportunity to adduce evidence before the Tribunal if the finding on the preliminary issue was against the management. The Apex Court has further held, which is required to be reproduced verbatim, as under :- "(e) The management has got a right to attempt to