IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH C.W.P. No. 1978 of 2009. Date of Decision : May 18, 2009. M/s Management, Indian Sugar and General Engineering Corporation (ISGEC), Saharanpur Road, Yamuna Nagar (Hr.) through its Personnel Officer Shri Dharmveer. ....... Petitioner. Versus. State of Haryana through Commissioner and Special Secretary to Government of Haryana, Labour Department, 30 Bays Building, Sector-17, Chandigarh, and others. ....... Respondents. CORAM:HON'BLE MR. JUSTICE AUGUSTINE GEORGE MASIH. Present:- Mr. P.K. Mutneja, Advocate, for the petitioner. Mr. D.S. Nalwa, Additional Advocate General, Haryana, for the respondent No. 1. Mr. Vineet Chaudhary, Advocate, for the respondent No. 3. AUGUSTINE GEORGE MASIH, J. In the present writ petition, the challenge is to the order dated 07.07.2008 (Annexure-P-5), passed by the Government of Haryana, vide which on a demand notice submitted by respondent No. 3-workman, reference under Section 10(1) of the Industrial Disputes Act, 1947, (herein referred to as “the Act”) has been made to the Labour Court, Ambala. The facts of the case in brief leading to filing of the present writ petition by the petitioner-company is that the Company is engaged in manufacture of Capital Goods/equipments, Machine Tools and Machinery for Petrochemical Industries, Boiler Parts etc. in its unit situated at Saharanpur Road, Yamuna Nagar, Haryana. Respondent No. 3-workman C.W.P. No. 1978 of 2009. was working as a Cashier and dealing with cash of the company. On 31.10.1992, cash in the custody of respondent No.3-workman was ordered to be checked/verified by the Internal Audit Department of the petitioner- Company. A team visited the cash office for the said purpose but respondent No. 3-workman by making an excuse that by mistake he has left the keys of the safe at his residence slipped off and never came back to report on duty thereafter. The petitioner-Company waited for some days for respondent No. 3-workman but he did not report back on duty, finally on 03.11.1992 the Company reported the matter to the insurance company. The keys were retrieved from house of respondent No. 3-workman and the safe was checked. Against an amount of Rs. 6,58,604.65, which was required to be there, only an amount of Rs. 21,295.65 was found in the safe, leading to the prima facie conclusion that respondent No. 3-workman had embezzled an amount of Rs. 6,37,308. Accordingly, an F.I.R. No. 421, dated 05.11.1992, under Section 406/408 I.P.C. was got lodged against respondent No. 3- workman at P.S. City Yamuna Nagar. After waiting for a long time, a charge-sheet dated 29.09.1993 (Annexure-P-1) was issued to respondent No. 3-workman wherein the charges of embezzlement of the amount abovementioned and absence from duty w.e.f. 31.10.1992 onwards were levelled against respondent No. 3- workman. The said charge-sheet was sent to respondent No. 3-workman by registered post as well as under postal certificate. No reply was submitted by respondent No. 3-workman to the said charge-sheet and accordingly vide order dated 29.10.1993, an Enquiry Officer was appointed to conduct a regular departmental inquiry against the respondent No. 3-workman. Despite several opportunities have been granted to respondent No. 3- -2- C.W.P. No. 1978 of 2009. workman to join inquiry proceedings which included publication in the newspaper, respondent No. 3-workman did not participate in the inquiry proceedings and accordingly he was proceeded against ex-parte. On conclusion of the inquiry, the Enquiry Officer submitted his findings holding respondent No. 3-workman guilty of the charges levelled against him. In pursuance to and on consideration of the inquiry report, a show cause notice was sent to respondent No. 3-workman which was not received by him. Show cause notice alongwith inquiry report was published in the newspaper 'Indian Express', on 27.04.1994, but no response to the said publication was received from respondent No. 3-workman. Consequently, the competent authority passed an order dismissing respondent No. 3-workman from service vide order dated 07.06.1994 (Annexure-P-2) under clauses 17.1 (C) and 17.1(E) of the certified standing orders of the Company applicable and in force to the respondent No. 3-workman. Respondent No. 3-workman did not take any action against the order of dismissal dated 07.06.1994. The criminal proceedings, which was put into motion by registration of an F.I.R. No. 421, dated 05.11.1992 against respondent No. 3- workman continued against him. The trial concluded in conviction of respondent No. 3-workman vide order dated 15.12.2003 and he was sentenced to rigorous imprisonment for two years and to pay a fine of Rs. 1,000/- The respondent No. 3-workman preferred an appeal against order of conviction and sentence. In the said appeal, the appellate court vide order dated 05.10.2007 (Annexure-R-1) acquitted respondent No. 3-workman. It is thereafter that respondent No. 3-workman submitted a demand notice dated 19.01.2008 (Annexure-P-3) claiming therein reinstatement with continuity of service and full back wages from the date of his termination. -3- C.W.P. No. 1978 of 2009. The petitioner-Company submitted its comments to the said demand notice on 18.03.2008 (Annexure-P-4), wherein a stand was taken that the services of the respondent No. 3-workman were terminated in accordance with standing orders applicable to the respondent No. 3-workman after holding a regular departmental inquiry against him. An objection was also raised on behalf of petitioner-Company that the demand notice was inordinately delayed by a period of 14 years from the date of dismissal of the respondent No. 3-workman as the workman was dismissed from service on 07.06.1994 whereas the demand notice was preferred on 19.01.2008. A stand was also taken that no industrial dispute exists or remains after such a long delay. On the failure of conciliation proceedings, respondent No. 1-Government of Haryana referred the matter for adjudication vide order dated 07.07.2008 (Annexure-P-5) which is under challenge in the present writ petition by the petitioner-Company. The basic challenge to the order of reference dated 07.07.2008 is that the reference has been made after a delay of 14 years from the date of termination of service of the respondent No. 3-workman and no industrial dispute exists after such a long delay. It has been submitted that respondent No. 3-workman absented from duty w.e.f. 31.10.1992 and did not turn up again. The petitioner-Company waited for him for a long time and thereafter issued charge-sheet on 29.09.1993 to which no response was received, a regular department inquiry followed in which he was held guilty, leading to dismissal of respondent No. 3-workman from service on 07.06.1994. No explanation whatsoever has come, what to say of cogent, explaining the inordinate long delay of 14 years in preferring a demand notice by respondent No. 3-workman on 19.01.2008, leading to the reference under -4- C.W.P. No. 1978 of 2009. challenge dated 07.07.2008. It has been submitted that the criminal proceedings have no bearing on the claim of the respondent No. 3-workman which he has submitted through his demand notice dated 19.01.2008, wherein he is claiming reinstatement in service with continuity thereof on the ground that the order of dismissal passed by the petitioner-Company was not in compliance with the statutory Rules. It has further been contended that exoneration in the criminal case, will not give any fresh cause of action to the respondent No. 3-workman nor would it give any fresh extension of limitation to the respondent No. 3-workman for preferring an industrial dispute which with the lapse of time seized to exist. It has also been contended that with the passage of such a long period of time even the records of the petitioner-Company are not traceable, which would hamper and put the Management in an advantageous position to defend itself before the Court in case the reference is allowed to continue. It is, therefore, contended that the order dated 07.07.2008 (Annexure-P-5) suffers from errors apparent on the face of the records and, therefore, cannot be sustained. Further assertion has been made that no explanation whatsoever has come forth from the respondent No. 3-workman for preferring the demand notice after an inordinate delay of 14 years after his termination except for the reason that the criminal proceedings were pending against him and he has been acquitted by the appellate court vide order dated 05.10.2007. This cannot be taken as an explanation as the claim which has now been made by way of demand notice under the Act or the standing orders covering the conditions of service of the respondent No. 3-workman were not dependent upon the criminal proceedings and there was no bar in putting forth his claim -5- C.W.P. No. 1978 of 2009. under the Industrial Dispute Act which he has now preferred after a long period of 14 years from the date of his termination. Counsel for the petitioner-Company has put forth his submissions as has been referred to above and in support of these contentions has relied upon the judgment of Hon'ble the Supreme Court on the question of delayed claim in the case of Nedungadi Bank Limited Versus K.P. Madhavankutty and other, 2000 (2) S.C.C. 455, to submit that the reference which has been made in the present case is that of a stale claim and at the time of reference, no industrial disputed existed or could be even said to have been apprehended. He submits that in Nedungadi Bank's case, the delay was seven years where Hon'ble the Supreme Court held the claim to be stale, whereas in the present case, the delay is of 14 years and that too without any explanation for not submitting his claim earlier. He on this basis submits that the demand raised by the respondent No. 3-workman for raising an industrial dispute was ex facie bad and incompetent. He relies upon the judgment of Hon'ble the Supreme Court in the case of Sukhmander Singh Versus State of Punjab and another, 1999 (9) S.C.C. 55, to contend that the date on which the cause of action accrued to respondent No. 3-workman to challenge the order arose on the date of termination of service and not on the date of acquittal by the criminal court several years later. He on this basis submits that the explanation of the respondent No. 3-workman that he was waiting for the outcome of criminal proceeding and on he being acquittal, he had submitted his demand notice, cannot be accepted as a reasonable explanation nor would the mere acquittal by criminal court give new cause of action to make good the delay in approaching the appropriate authority for making claim under the Act. He further relies upon the -6- C.W.P. No. 1978 of 2009. judgment of Hon'ble the Supreme Court in the case of Manager, Reserve Bank of India, Bangalore Versus S. Mani and others, 2005 (5) S.C.C. 100, to contend that merely because a judgment of acquittal has been passed in favour of employee would not be binding on the Management. He further contended that the respondent No. 3-workman has been given benefit of defective investigation, discrepancies in the statements of the witnesses while acquitting him of the criminal charges levelled against him. He on this basis submits that although the workman has been acquitted of the criminal charges but the departmental proceedings which were initiated against him and had culminated in the order of dismissal dated 07.06.1994 after holding a departmental inquiry against him, stood as it is stares on the face of workman who preferred not to challenge the order of termination or the proceedings unless he submitted his demand notice dated 19.01.2008 and on this basis he submits that the order of reference dated 07.07.2008 (Annexure-P-5), cannot be sustained and deserves to be quashed. On the other hand, counsel for the respondent No. 3-workman submits that no time limit has been prescribed under the Act for the appropriate Government to exercise its powers under Section 10 of the Act. Section 10 of the Act itself envisages reference of the Act at any time by the appropriate Government by order in writing. He submits that the allegations against the respondent No. 3-workman were levelled by the petitioner- Company and criminal proceedings were also initiated by the petitioner- Company itself, leading to the registration of an F.I.R. No. 42, dated 05.11.1992, P.S. City Yamuna Nagar. Even if the respondent No. 3- workman had preferred a demand notice before he was acquitted by the criminal court in the criminal proceedings initiated against him, the -7- C.W.P. No. 1978 of 2009. proceedings under the Act would not have ended in his favour because of the pendency of the criminal proceedings against him. He submits that this is a quite natural and justifiable reason for the respondent No. 3-workman for not approaching the appropriate Government before culmination of criminal proceedings in his favour. He submits that in any case, the exercise of powers under Section 10 of the Act by the appropriate Government is primarily administrative in nature and while exercising the same, the appropriate Government having come to a conclusion that indeed there existed an industrial dispute and has accordingly made a reference, which does not call for any interference by this Court. He relies upon the judgment of Hon'ble the Supreme Court in the case of Jai Bhagwan Versus Management of the Ambala Central Cooperative Bank Limited and another, A.I.R. 1984 S.C. 286, Sapan Kumar Pandit Versus U.P. State Electricity Board and others, 2001 (6) S.C.C. 222, and Haryana Land Reclamation and Development Corporation Limited Versus Nirmal Kumar, 2008 (1) Apex Court Judgments 613, to contend that no time limit has been prescribed under the statute, therefore, delay alone cannot be made the basis for challenging the order of reference made by the appropriate Government in exercise of its statutory powers. I have heard counsel for the parties and have gone through the records of the case. There can be no dispute with regard to submission of counsel for the respondent No. 3-workman that the law does not prescribe any time limit for the appropriate Government to exercise its powers under Section 10 of the Act, meaning thereby that the appropriate Government has the powers to make a reference in an appropriate case where it is of the opinion that any -8- C.W.P. No. 1978 of 2009. industrial dispute exists or is apprehended, the rider, therefore, is the existence of industrial dispute or an apprehension thereof. This would lead to a conclusion that for making a reference, no straight jacket formula can be prescribed which would guide the Government while coming to a conclusion with regard to the matter to be referred to and, therefore, merely because of lapse of time or there is a delay in putting forth a demand by the respondent No. 3-workman would itself ipso facto not be a ground for not making a reference. This would mean that reference under Section 10 of the Act is dependent on the facts of each individual case. If there is delay on the part of the respondent No. 3-workman in putting forth his demand but if he has reasonable and cogent explanation for not approaching the appropriate forum or not putting forth his claim, the delay itself would not be fatal for making a reference of the dispute, if it exists at that stage. The real test, therefore, for making a reference is with regard to existence of an industrial dispute on the date of reference for adjudication or an apprehension thereof. The judgments relied upon by counsel for the respondent No. 3- workman i.e. Jai Bhagwan Versus Management of the Ambala Central Cooperative Bank Limited and another (supra), Sapan Kumar Pandit Versus U.P. State Electricity Board and others (supra), and Haryana Land Reclamation and Development Corporation Limited Versus Nirmal Kumar (supra), lay down these principles. Even Nedungadi Bank Limited's case (supra) relied upon by counsel for the petitioner-Company also holds the same as the correct position in law. A perusal of the judgments relied upon by counsel for the respondent No. 3- workman, which have been referred to above would show that in all those cases, Hon'ble the Supreme Court while going into the factual aspect of that particular case -9- C.W.P. No. 1978 of 2009. came to a conclusion that the dispute as has been raised by the workman was alive all through. In Jai Bhagwan's case (supra), the question of delay was only limited to the grant of relief of back wages to the workman and was not pressed into service as a ground for claiming that the dispute has been rendered stale. The real issue before the Court which was adjudicated upon was as to whether the resort to reference under the Industrial Disputes Act was barred when a departmental remedy of appeal was available to the workman, which he had not availed, but this assertion of the Company was rejected and it was held that the alternative remedy of appeal did not bar the remedy available to the workman under the Act. In Sapan Kumar Pandit's case (supra), it was observed by the Court that it was an admitted fact that on the date of reference in that case, conciliation proceedings were not concluded and on that basis Hon'ble the Supreme Court came to the conclusion that it could not be said that the dispute did not exist on the date when the reference was made. Similarly, in the case of Haryana Land Reclamation and Development Corporation Limited (supra), Hon'ble the Supreme Court while going into the facts of the case came to the conclusion that there did exist a dispute on the date when the reference was made. That leads us to the case of Nedungadi Bank Limited (supra), wherein Hon'ble the Supreme Court in para-6 thereof observes as follows :- “6. Law does not prescribe any time-limit for the appropriate Government to exercise its powers under Section 10 of the Act. It is not that this power can be exercised at any point of time and to revive matters which had since been settled. Power is to be exercised reasonably and in a rational manner. There appears to us to be no rational basis on which the Central Government has exercised powers in this case after a lapse of about seven years of the order dismissing the -10- C.W.P. No. 1978 of 2009. respondent from service. At the time reference was made no industrial dispute existed or could be even said to have been apprehended. A dispute which is stale could not be the subject- matter of reference under Section 10 of the Act. As to when a dispute can be said to be stale would depend on the facts and circumstances of each case. When the matter has become final, it appears to us to be rather incongruous that the reference be made under Section 10 of the Act in the circumstances like the present one. In fact it could be said that there was no dispute pending at the time when the reference in question was made. The only ground advanced by the respondent was that two other employees who were dismissed from service were reinstated. Under what circumstances they were dismissed and subsequently reinstated is nowhere mentioned. Demand raised by the respondent for raising an industrial dispute was ex facie bad and incompetent.” In Shalimar Works Limited Versus Workmen, A.I.R. 1959 S.C. 1217, Hon'ble the Supreme Court has held that merely because the Act does not provide for limitation for raising an industrial dispute, it does not mean that the dispute can be raised at any time and without regard to the delay and reasons, therefor. There is no limit prescribed for reference of dispute to an Industrial Tribunal, even so it is only reasonable that the dispute should be referred as soon as possible after it has arisen and after conciliation proceedings have failed. Delay of four years in raising the dispute was held to be fatal in the said case, leading to dis-entitlement of the workman to any relief. In the case of Western India Match Co. Limited Versus Workers Union, 1970 (1) S.C.C. 225, Hon'ble the Supreme Court in para-8 has observed as follows :- -11- C.W.P. No. 1978 of 2009. “Therefore, the expression 'at any time', though seemingly without any limits, is governed by the context in which it appears. Ordinarily, the question of making a reference would arise after conciliation proceedings have been gone through and the Conciliation Officer has made a failure report. But the Government need not wait until such a procedure has been completed. In an urgent case, it can 'at any time', i.e., even when such proceedings have not begun or are still pending, decide to refer the dispute for adjudication. The expression 'at any time' thus takes in such cases as where the Government decides to make a reference without waiting for conciliation proceedings to begin or to be completed. As already stated, the expression 'at any time' in the context in which it is used postulates that a reference can only be made if an industrial dispute exists or is apprehended. No reference is contemplated by the section when the dispute is not an industrial dispute, or even if it is so, it no longer exists or is not apprehended, for instance, where it is already adjudicated or in respect of which there is an agreement or a settlement between the parties or where the industry in question is no longer in existence.” In the present case, charge-sheet was issued to the workman on 29.09.2003, inquiry was held against him where he was given ample opportunities to participate. Despite publication in the newspaper for joining the inquiry proceedings, the workman failed to do the same and ex-parte proceeding was, thus, held against him. After receipt of inquiry report, where he was found guilty of charges levelled against him, a show cause notice alongwith the inquiry report was sent to him through registered post which he refused to accept. Show cause notice alongwith the inquiry report was published in the newspaper 'Indian Express', dated 27.04.1994, which -12- C.W.P. No. 1978 of 2009. again the workman failed to respond to. The petitioner-Company left with no option passed the order of dismissal under the Standing Orders of the Company on 07.06.1994. The workman had the option to resort to legal remedies available to him against the order of dismissal from the date the order of termination was passed against him. He preferred to remain silent. The only explanation which has been put forth by the workman for preferring the demand notice on 19.01.2008 after a delay of 14 years, is that the criminal proceedings which were initiated against him vide F.I.R. No. 421 dated 05.11.1992, registered at P.S. City Yamuna Nagar, led to a trial, the trial court held him guilty of charges and convicted him on 15.12.2003 and sentenced him to rigorous imprisonment for two years and to pay fine of Rs. 1,000/-, an appeal preferred against the said order of the trial court resulted in acquittal of the workman on 05.10.2007 and it is only thereafter the workman could submit his demand noticed on 19.01.2008. It has been asserted on behalf of counsel for the workman that he was waiting for the outcome of the criminal proceedings before putting forth his claim. The benefits and the rights which a Workman acquires / attains while in employment with the Management and the benefits accruing there- from are not related to or dependent on the criminal proceedings unless the order passed against the workman is directly related to or are as a consequence of criminal proceedings initiated against him. In the present case, the services of the workman were terminated after holding a departmental inquiry against him. Apart from the charge of embezzlement, charge of absence from duty w.e.f. 31.10.1992 was also levelled. The criminal proceedings only related to the charge of embezzlement and it has nothing to do with the absence from duty of the -13- C.W.P. No. 1978 of 2009. workman. This factual aspect counsel for the workman has not been able to dispute that apart from the charge of embezzlement, the charge of absence from duty was proved against him during the departmental proceedings. The same is writ large, when despite