IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED:18.02.2010 CORAM: THE HON'BLE MR.JUSTICE K.CHANDRU W.P.NOS.27086 and 27194 of 2007 and 5501 and 5502 of 2008 M.P.Nos.1 & 1 of 2007,1 ,1,2 and 2 of 2008 W.P.NOS.27086 and 27194 of 2007 : The Secretary, Chennai Corporation Societies Employees Cooperative Thrift and Credit Society (X-158) No.7 & 8 , Davidson Street, II Floor, Chennai 600 001. ...Petitioner in both W.Ps. R.Panneerselvam ...1st respondent in W.P.27086/2007 T.Jayakumar ...1st respondent in W.P.27194/2007 2.Presiding Officer, First Additional Labour Court, Chennai. ...2nd respdt in both W.Ps. Petitions filed under Article 226 of the Constitution of India praying to issue a writ of Certiorari calling for the records of the second respondent/First Additional Labour Court,Chennai relating to its award I.D.Nos.363 and 362 of 2000 dated 21.5.2007 and to quash the same. W.P.NOS.5501 and 5502 of 2008: T.Jayakumar ....Petitioner in W.P.No.5501/08 R.Pannerselvam ....Petitioner in W.P.No.5502/08 Vs. 1. The Secretary, Chennai Corporation Societies Employees Cooperative Thrift and Credit Society (X-158) No.7 & 8 , Davidson Street, IId Flloor, Chennai 600 001. 2.Presiding Officer, First Additional Labour Court, Chennai. ...Respondents in both W.PS. Petitions filed under Article 226 of the Constitution of India praying to issue a writ of Certiorari calling for the records in I.D.Nos.362 and 363 of 2000 on the file of the First https://hcservices.ecourts.gov.in/hcservices/ Additional Labour Court, Chennai, the second respondent herein and to quash that portion of the award dated 21.5.2007 passed therein by which 50% backwages has been denied to the petitioners herein. For Petitioner in W.P.Nos. 27086 and 27194 of 2007 & First respondent in W.P.Nos.5501 and 5502 of 2008 : Mr.Mr.P.Anbarasan For 1st respondent in both W.P.27086/2007 & W.P.2719/2007 & Petitioners in W.P.NO.5501 and 5502 of 2008 : Mr.Vasu Venkat R2 : Labour Court O R D E R The first two writ petitions are filed by the management of the Cooperative Society and the subsequent two writ petitions are filed by the contesting first respondent in those writ petitions. 2. The contesting respondents, Mr.Jayakumar and Panneerselvam were employed as Junior Assistants in the cooperative society. While Pannerselvam was employed from 9.1.1990, Jayakumar was employed with effect from 27.2.1992. Both the petitioners were dismissed by the Society which gave rise to an Industrial Dispute being raised by both the workmen. In the case of Pannerselvam, the dispute was taken on file by the second respondent Labour Court as I.D.No.363 of 2000. In the case of Jayaraman, the dispute was taken as I.D.No.362 of 2000. The petitioner society resisted the claim for their reinstatement and backwages. 3. The petitioner society filed a counter statement before the Labour Court justifying the dismissal against the two workmen. Unfortunately, the petitioner society did not take up an alternative plea that in the event of the Labour Court deciding the preliminary issue regarding the validity of the enquiry held against the management, they should be given opportunities to let in fresh evidence before the Labour Court. 4. In both the cases, the Labour Court, marked documents by consent of parties and heard the matter. The petitioner society also filed written brief before the Labour Court. The Labour Court, before answering the main issue relating to the relief claimed by the two workmen, went into the question of validity of the enquiries conducted by the petitioner society.Though the petitioner society contended that the enquiry was fair and proper and done in accordance with the special bye- laws of the society, the Labour Court, on the materials placed before the Court, came to conclusion that two Directors of the https://hcservices.ecourts.gov.in/hcservices/ society who were examined in the domestic enquiry were part of the sub-committee which was authorised to impose penalty on the workmen. After the evidence was over, they sat in the sub- committee and ultimately passed the orders of dismissal. Their action was also approved by the Board, in which process also, they have participated. 5.In that view of the matter, the Labour Court came to the conclusion that the enquiry suffered from personal bias and was liable to be set aside. But, the other contentions viz., that the workmen were not given assistance of lawyer and also they were discriminated in the matter of issuing charge memos, was rejected by the Labour Court. The Labour Court, having held that the enquiry suffered from personal bias on account of the two Directors who were instrumental in charge sheeting the workmen had deposed in the enquiry and later on approved their own action. 6.In this context, the Labour Court placed reliance upon the Judgment of the Supreme Court in R.L.Sharma Vs. Managing Committee, Dr.Hari Ram (Co-edn) H.School reported in 1993 LAB.I.C.Page 1808. In that case, the Supreme Court after finding that one of the members of the enquiry committee who appeared as a witness, subsequently sat in the enquiry committee, met for taking action against the teacher would vitiate the enquiry process itself . It is in that view of the matter, the Labour Court, set aside the enquiry conducted by the petitioner society. In the counter statement filed by the petitioner society, since there was no plea for letting in fresh evidence, the Labour Court concluded the proceedings and held that the charges framed against the two contesting respondents were not proved and therefore they are eligible to get the relief of reinstatement. 7. On the question of grant of backwages, the Labour Court came to the conclusion that since there was no material placed before it, it will not deny them backwages. But, at the same time, the Labour Court held that two contesting workmen were not eligible for full backwages. It held that they are entitled to get 50% of the backwages. This was on the ground of the fact situation of the case and in the interest of justice. It is the said Award, the petitioner-society has come forward to challenge before this Court. 8. The writ petitions were admitted on 14.8.2007 and 16.8.2007 . Pending the writ petition, this Court granted interim stay of operation of the award. Subsequently, on the application filed by the workmen, this Court granted the payment of last drawn wages under Section 17-B of the Industrial Disputes Act. The said payments are continuing till date. 9. After the said order was passed by this Court, the contesting respondents themselves have come forward to file the other two writ petitions viz., W.P.Nos.5501 and 5502 of 2008 challenging that portion of the award denying backwages. Those https://hcservices.ecourts.gov.in/hcservices/ writ petitions were admitted by this Court on 3.3.2008 and the petitioner society has filed counter affidavits in those two cases. 10. Heard the argument of P.Anbarasan, learned counsel for the petitioner society and Mr.Vasu Venkat, learned counsel appearing for the workmen. 11. The first question was whether the Labour Court's finding that the enquiry was vitiated on account of personal bias is justified or not. The fact situation viz, the two Directors were instrumental in charge sheeting the workmen, but subsequently they have participated in the sub committee proceedings as well as in the Board meeting, will certainly vitiate the enquiry and the Labour Cout was right in holding that such an enquiry cannot be upheld. The Labour Court placed reliance upon R.L.Sharma's case (cited supra) whichis on the point. Therefore, that finding do not call for any interference. Since the employer did not seek permission for conducting fresh evidence before the Labour Court, the Lower Court is not obliged to give permission. This position of law has been clarified by the Supreme Court in Shambu Nath Goyal Vs. Bank of Baroda reported in AIR 1978 S.C.1088. In paragraph 8, it was observed as follows: "In this case, the Tribunal completely misdirected itself when it observed that no demand was made by the workman claiming reinstatement after dismissal. When the inquiry was held, it is an admitted position, that the workman appeared and claimed reinstatement. After his dismissal he preferred an appeal to the Appelalte forum and contended that the order of dismissal was wrong, unsupported by evidence and in any event, he should be reinstated in service. If that was not a demand for reinstatement addressed to employer what else would it convey. That appeal itself is a representation questioning the decision of the Management dismissing the workman from service and praying for reinstatement. There is further a fact that when the Union approached the Conciliation Officer the Management appeared and contested the claim for reinstatement. There is, thus unimpeachable evidence that the concerned workman persistently demanded reinstatement. If in this background the Government came to this conclusion that there exists a dispute concering workman S.N.Goyal and it was an industrial dispute because there was demand for reinstatement and a reference was made, such reference could hardly be rejected on the ground that there was no demand and the industrial dispute did not come into existence. Therefore, https://hcservices.ecourts.gov.in/hcservices/ the Tribunal was in error in rejecting the reference on the ground that the reference was incompetent. Accordingly, this appeal is allowed and the Award of the Tribunal is set aside and the matter is remitted to tribunal for disposal according to law. The respondent shall pay costs of the appellant in this Court. As the reference is very old the Tribunal should dispose it of as expeditiously as possible." 12. This view was subsequently clarified by a decision of the Constitution Bench of the Supreme Court in Karnataka State Road Transport Corporation Vs.Smt.Lakshmi Devamma reported in 2001(5) SCC 433 = 2001(3) MLJ 76(SC). 13. In the light of the same, no exception can be taken by the Labour Court for ordering backwages. Though the contesting workmen have come forward by filing cross writ petitions seeking for the payment of full wages, it must be noted that in the present cases they succeeded solely on the ground of a technical mistake made by the petitioner society by not raising an alternative plea, in their counter statement filed before the Labour Court, in the respective I.Ds., and the defects could not be cured. At the same time, the workmen cannot take advantage of such a situation. 14. Further, P.Anbarasan, learned counsel for the petitioner Cooperative Society pleads that the Society is a small society and it cannot bear burden of such payments if ordered by this Court. Countering this argument, Mr.Vasu Venkat, learned counsel appearing for the workmen stated that this is not a case where under Section 11A of the Act, the Labour Court got jurisdiction to deny the backwages either wholly or partly, but this is a case where the workmen have come out clean in the absence of any legal evidence and therefore, the normal relief of backwages should be granted. However, this Court is unable to accept the said submission. 15. The Supreme Court in LAXMI RATTAN COTTON MILLS LIMITED Vs. STATE OF UTTAR PRADESH AND OTHERS reported in (2009) 1 SCC 695 had laid down that in the matter of backwages, the Court must exercise its discretion judiciously and all attempts must be made to strike a balance. Therefore, it is not a matter of right in every case the backwages should be 100%. In view of the fact that the petitioners workmen are drawing the monthly wages under 17-B of the ID Act all these years, this Court is not inclined to interefere with that portion of the award granting 50% of the backwages. https://hcservices.ecourts.gov.in/hcservices/ 16. In the result, in view of the above, the writ petitions are liable to be dismissed and accordingly dismissed. No costs. Consequently, connected M.Ps. are also dimissed. VJY Sd/- Asst. Registrar //True Copy// Sub Asst. Registrar To 1. The Secretary, Chennai Corporation Societies Employees Cooperative Thrift and Credit Society (X-158) No.7 & 8 , Davidson Street, IId Flloor, Chennai 600 001. 2.The Presiding Officer, First Additional Labour Court, Chennai. + 1 cc to Mr. P. Anbarasan, Advocate SR No.10765 + 1 cc to Mr. K. Vasuvenkat, Advocate SR No.10928 SP(CO) SR/1.3.2010 W.P.NOS.27086 and 27194 of 2007 and 5501 and 5502 of 2008 https://hcservices.ecourts.gov.in/hcservices/