ORISSA HIGH COURT: CUTTACK. W.P.(C). No. 13530 OF 2009 In the matter of an application under Articles 226 and 227 of the Constitution of India ----------- M/s. IPISTEEL Ltd. …… Petitioner -Versus- Hemanta Kumar Rath …… Opp. party For Petitioner : M/s. Somanath Mishra and G. Tripathy For opp. party: M/s. S. Mohanty, S.K. Das and S.S. Mohapatra. ------------------------------------ Date of Judgment: 15.11.2011 ------------------------------------ PRESENT : THE HONOURABLE SHRI JUSTICE M.M. DAS M. M. Das, J. Non-supply of the inquiry report in a disciplinary proceeding basing on which an order of dismissal was passed by the Disciplinary Authority, whether can be held to be a ground for setting aside the order of dismissal and directing reinstatement of a workman in the facts and circumstances of the case, is the question involved in the present writ application. 2. Relevant facts for appreciating the contentions raised by the learned counsel for the respective parties are as follows:- The opposite party-workman while working as a cashier under the petitioner-management was dismissed from service with effect from 10.02.1994 pursuant to a disciplinary proceeding initiated by the petitioner-management for the charges of misappropriation/defalcation of money. After completion of the inquiry, the Inquiry Officer submitted his report holding that the opposite party-workman is guilty of the charges and basing on the said report, the petitioner-management dismissed the opposite party- workman from service. At the instance of the workman, an industrial dispute was raised, upon which the following reference was made to the Presiding Officer, Industrial Tribunal, and Bhubaneswar:- “Whether suspension of Sri Hemant Kumar Rath, Cashier by the management of M/s. IPISTEEL Ltd., Gundichapada, Dhenkanal with effect from 03.10.92 and his subsequent dismissal from services with effect from 10.2.94 by the management were legal and/or justified? If not, what relief he is entitled to ?” On such reference being made, the workman filed his statement of claim (Anneuxre-1) and petitioner-management filed its written statement (Anneuxre-2). The learned Presiding Officer, Industrial Tribunal, Bhubaneswar upon considering the pleadings of the parties and the evidence adduced by them before the said Tribunal, passed the award on 16th April, 2009 in I.D. Case No.119 of 2010. The Tribunal found that the inquiry conducted is fair and proper. But the report of the Inquiry Officer was not supplied to the workman before the Disciplinary Authority took the decision to impose major penalty of dismissal on him. Finding thus, it came to the conclusion that there was denial of reasonable opportunity to the workman by not supplying the report of the Inquiry Officer to him and consequentially 2 there was breach of the principles of natural justice. For the aforesaid reasons, the learned Presiding Officer held that the action of the management is not sustainable and accordingly the same cannot be held to be legal and justified. 3. In view of the above findings, the learned Tribunal observing that the workman is held entitled to be reinstated in service but without any back wages, directed reinstatement of the workman. Being aggrieved, the management-petitioner has preferred the present writ application challenging the said award. 4. On perusal of the impugned award, it appears that the Tribunal on the pleadings of the respective parties framed the following issues: (1) Whether the suspension of Sri Hemant Kumar Rath, Cashier by the management of M/s. IPISTEEL Ltd., Gundichapada, Dhenkanal with effect from 3.10.1992 and his subsequent dismissal from service with effect from 10.2.94 by the management were legal and/or justified ? (2) If not, what relief he is entitled to ? While answering the above issues, the Tribunal has come to the finding that “there having been no infirmity in the conduct of the enquiry, the same in no way can be termed to be either unfair or improper. Hence, the plea of the workman that he was not afforded with reasonable opportunity in the domestic enquiry besides being frivolous has no leg to stand. Accordingly, the enquiry conducted in the case is held to be fair and proper”. However, it appears that with regard to the question raised by the workman that he was not 3 supplied with a copy of the enquiry report before infliction of the major penalty of dismissal on him, the Tribunal, finding that in this connection the management has neither produced any oral or documentary evidence, which could show that opportunity to represent against the report of the enquiry officer was afforded to the workman, which is integral part of the inquiry, concluded that non- supply of a copy of the inquiry report to the delinquent can be said to be a denial of reasonable opportunity to the employee to prove his innocence and, thus, the same is a breach of principles of natural justice. For the aforesaid finding, the Tribunal relied upon the decision in the case of State of Uttaranchal & Others V. Kharak Singh, 2008 (118) FLR 1112. Thus holding, the Tribunal passed the impugned award on the basis that the action of the management is not sustainable and held to be neither legal nor justified and issued directions for reinstatement of the workman, in service, but without any back wages. 5. Mr. Somanath Mishra, learned counsel for the petitioner- management contended that in the facts of the case, the aforesaid finding of the Tribunal is contrary to the settled position of law and the consistent judicial pronouncement of the Hon’ble Apex Court. With regard to the decision in the case of State of Uttaranchal and others (supra), he submitted that the ratio of the said decision relied upon by the Tribunal ex facie shows non-application of judicial mind, as the facts in the said case are distinguishable from the facts of the 4 present case to the effect that in the said case the Hon’ble Supreme Court categorically held that the inquiry was not conducted in the prescribed manner. In the said decision, the Supreme Court after taking note of the charges framed held as follows: “12. xxx xxx xxx Though a detailed explanation has been submitted controverting the above charges, no enquiry in terms of the above-mentioned principles was ever conducted. On the other hand, one Mr. P.C. Lohani, Dy. Divisional Forest Officer, Nadhor acting as an enquiry officer after putting certain questions and securing answers submitted a report on 16.11.1985. No witnesses were examined. Apparently there was not even a presenting officer. A perusal of the report shows that the enquiry officer himself inspected the areas in the forest and after taking note of certain alleged deficiencies secured some answers from the delinquent by putting some questions. It is clear that the Enquiry Officer himself has acted on the Investigator, Prosecutor and Judge. Such a procedure is opposed to principles of natural justice and has been frowned upon this Court. 13. Another infirmity in the report of the enquiry officer is that he concluded the enquiry holding that all the charges have been proved and he recommended for dismissal of the delinquent from service. The last paragraph of his report dated 16.11.1985 reads as under:- “During the course of above inquiry, such facts have come into light from which it is proved that the employee who has doubtful character and does not obey the order, does not have the right to continue in the Government service and it is recommended to dismiss him from the service with immediate effect.” Though there is no specific bar in offering views by the enquiry officer, in the case on hand, the enquiry officer exceeded his limit by saying that the officer has no right to continue in the Government service and he has to be dismissed from service with immediate effect. As pointed out above, awarding appropriate punishment is the exclusive jurisdiction of the punishing/disciplinary authority and it depends upon the nature and gravity of the proved charge/charges and for attended circumstances. It is clear from the materials, the officer, who suspected and noted the shortfall of tress, himself conducted the enquiry, arrived at a conclusion holding the charges proved and also strongly recommended severe punishment of dismissal from service. The entire action and the course adopted by the enquiry officer cannot be 5 accepted and is contrary to the well known principles enunciated by this Court.” On such facts, the Hon’ble Supreme Court finding that the inquiry report was not supplied to the respondent therein confirmed the finding of the High Court setting aside the punishment on taking note of the infirmity in the inquiry. Mr. Mishra, submitted that in the present case, once the Tribunal has come to the finding that the inquiry conducted by the petitioner-management is fair and proper, it could not have relied upon the aforesaid decision, where the inquiry was held to have not been conducted in the prescribed manner. 6. Learned counsel for the workman, on the contrary, submitted that there is absolutely no infirmity in the impugned award, which has been passed in accordance with law. He vehemently urged that non-supply of the inquiry report to the workman would mean nothing but violation of principles of natural justice as the workman has been deprived of a further explanation with regard to the infliction of punishment. 7. Mr. Mishra learned counsel appearing on behalf of the petitioner relied upon various case laws out of which this Court finds that the decisions in the cases of Divisional Manager, Plantation Division, Andaman & Nicobar Islands V. Munnu Barrick and Others, 2005 Supreme Court Cases (L&S) 200 and Oriental Insurance Company Ltd. V. S. Balakrishnan, 2004 Supreme Court Cases (L&S) 521 are relevant to the question raised before this Court. 6 In the case of Divisional Manager, Plantation Division (supra), the Supreme Court in paragraphs – 17, 19 and 21 held as follows:- “17. The principles of natural justice cannot be put in a straitjacket formula. It must be viewed with flexibility. In a given case, where a deviation takes place as regards compliance with the principles of natural justice, the court may insist upon proof of prejudice before setting aside the order impugned before it. (See Bar Council of India v. High Court of Kerala). 19. In Karunakar this Court has clearly held that the employee must show sufferance of prejudice by non-obtaining a copy of the enquiry report. 21. Referring to a large number of decisions, it was observed that a court will refrain from interfering with an order, having regard to “useless formality theory”, in a given case. It was opined : (SCC p. 578, para 27) “27. it is to be noted that at no stage the employee pleaded prejudice. Both learned Single Judge and the Division Bench proceeded on the basis that there was no compliance with the requirement of Regulation 6(18) and, therefore, prejudice was caused. In view of the finding recorded supra that Regulation 6(18) has not been correctly interpreted, the conclusions regarding prejudice are indefensible”.” 8. In the case of Oriental Insurance Company Ltd. (supra), it was held as follows:- “The question, however, which still remains to be considered, is whether the High Court was justified in interfering with an order of punishment passed by the disciplinary authority merely on the ground that non-supply of enquiry report has vitiated the entire proceedings. It had not been brought to the notice of the learned Judges of the Court that the judgment of this Court in Ramzan Khan has already been considered by this Court in the case of Managing Director, ECIL v. B. Karunakar which is a Constitution Bench decision of the Court, and which clarifies the entire position. Without being aware of the correctness of law, the High Court appears to have interfered with an order of dismissal passed in 7 disciplinary proceedings in grave charges like the one with which we are concerned in the present case. Applying the principles indicated by this Court in ECIL case to the facts of the present case, we cannot conceive any prejudice which is said to have been caused to the delinquent, and therefore, non-supply of the enquiry report could not have been held to have vitiated the entire proceedings. In the aforesaid premises, we set aside the impugned order passed by the learned Single Judge of the High Court as well as the judgment of the Division Bench of the High Court, and hold that the writ petition filed by the respondent stands dismissed. In view of the nature of charges against the delinquent, we were considering of directing to lodge a first information report for criminal investigation, but we are told that the University has already taken those steps, and, therefore, we refrain from issuing any further direction in the matter.” 9. The Hon’ble Supreme Court in the case of Union of India and others v. Mohd. Ramzan Khan, AIR 1991 SC 471 laid down the law expressing that the inquiry report is bound to be supplied to the delinquent before taking a decision with regard to the infliction of punishment and also made the said decision prospective in operation from 20th November, 1990. The said judgment was reconsidered in the Constitution Bench decision in a batch of Civil Appeals in the case of Managing Director, ECIL, Hyderabad etc. etc. v. B. Karunakar, etc. etc., AIR 1994 Supreme Court 1074. The Constitution Bench per majority declared the judgment in the case of Ramzan Khan (supra) to be per incuriam. In the said case, the Hon’ble Supreme Court has held as follows: “7.(i) to (iv) xxx xxx (v) The next question to be answered is what is the effect on the order of punishment when the report of the Inquiry Officer is not furnished to the employee and what relief should be granted to him in such cases. The answer to this question has to be relative to the punishment awarded. When the employee is dismissed or removed from service and the inquiry is set aside because the 8 report is not furnished to him, in some cases, the non- furnishing of the report may have prejudiced him gravely while in other cases it may have made no difference to the ultimate punishment awarded to him. Hence to direct reinstatement of the employee with back-wages in all cases is to reduce the rules of justice to a mechanical ritual. The theory of reasonable opportunity and the principles of natural justice have been evolved to uphold the rue of law and to assist the individual to vindicate his just rights. They are not incantations to be involved nor rites to be performed on all and sundry occasions. Whether, in fact, prejudice has been caused to the employee or not on account of the denial to him of the report, has to be considered on the facts and circumstances of each case. Where, therefore, even after the furnishing of the report, no different consequence would have followed, it would be a perversion of justice to permit the employee to resume duty and to get all the consequential benefits. It amounts to rewarding the dishonest and the guilty and thus to stretching the concept of justice to illogical and exasperating limits. It amounts to an “unnatural expansion of natural justice” which in itself is antithetical to justice. Hence, in all cases where the Inquiry Officer’s report is not furnished to the delinquent employee in the disciplinary proceedings, the courts and Tribunals should cause the copy of the report to be furnished to the aggrieved employee if he has not already secured it before coming to the Court/Tribunal, and give the employee an opportunity to show how his or her case was prejudiced because of the non-supply of the report. If after hearing the parties, the Court/Tribunal comes to the conclusion that the non-supply of the report would have made no difference to the ultimate findings and the punishment given, the Court/Tribunal should not interfere with the order of punishment. The Court/ Tribunal should not mechanically set aside the order of punishment on the ground that the report was not furnished as is regrettably being done at present. The Courts should avoid resorting to short-cuts. Since it is the Courts/Tribunals which will apply their judicial mind to the question and give their reasons for setting aside or not setting aside the order of punishment, (and not any internal appellate or revisional authority), there would be neither a breach of the principles of natural justice nor a denial of the reasonable opportunity. It is only if the Courts/Tribunals find that the furnishing of the report would have made a difference to the result in the case that it should set aside the order of punishment. Where after following the above procedure, the Courts/Tribunals sets aside the order of punishment, the proper relief that should be granted is to direct reinstatement of the employee with liberty to the 9 authority/management to proceed with the inquiry, by placing the employee under suspension and continuing the inquiry from the stage of furnishing him with the report. The question whether the employee would be entitled to the back-wages and other benefits from the date of his dismissal to the date of his reinstatement if ultimately ordered should invariably be left to be decided by the authority concerned according to law, after the culmination of the proceedings and depending on the final outcome. If the employee succeeds in the fresh inquiry and is directed to be reinstated, the authority should be at liberty to decide according to law how it will treat the period from the date of dismissal till the reinstatement and to what benefits, if any and the extent of the benefits, he will be entitled. The reinstatement made as a result of the setting aside of the inquiry for failure to furnish the report should be treated as a reinstatement for the purpose of holding the fresh inquiry from the stage of furnishing the report and no more, where such fresh inquiry is held. That will also be the correct position in law.” 10. This Court, therefore, in view of the ratio laid down by the Hon’ble Supreme Court in the aforesaid Constitution Bench Decision, is of the view that the award directing reinstatement of the workman should be set aside and the matter should be remitted back to the learned Tribunal to be decided in accordance with the aforesaid directions/observations of the Hon’ble Supreme Court. Accordingly, the impugned award passed in I.D. Case No.119 of 2008 is set aside and the matter is remitted back to the learned Presiding Officer, Industrial Tribunal, Orissa, Bhubaneswar, who shall direct the Management (petitioner herein) to provide the workman with a copy of the inquiry report. On providing a copy of the same to the workman, he shall be given an opportunity to file his show case showing as to in which manner he has been prejudiced for non-supply of the said inquiry report to him earlier. Such show cause shall be filed within the time to be stipulated by the Tribunal and, in the event, such a show cause is 10 filed, the learned Presiding Officer, Industrial Tribunal shall hear the parties thereon. If after hearing the parties, he comes to the conclusion that non- supply of the report would have made no difference to the ultimate findings and the punishment imposed, the Presiding Officer shall not interfere with the order of punishment. The order to be passed by the Presiding Officer should be supported by reasons. 11. It is made clear that the findings of the Presiding Officer, Industrial Tribunal in the impugned award that no infirmity in the conduct of the inquiry has been found and the inquiry cannot be termed to be either unfair or improper and is held as fair and proper, are confirmed by this order. The Presiding Officer is not required to traverse to a point before the report of the Inquiry Officer was submitted to the disciplinary authority and should proceed to examine the case, as directed above, from the point/stage, where the inquiry report was required to be supplied to the workman. 12. With the aforesaid directions, the writ application is disposed of. …………………… M.M. DAS, J. Orissa High Court, Cuttack. November 15th ,2011/Himansu 11 12