Case: Management Of Tournamulla Estate Vs. Workmen

2. The point before us is simple. The workman concerned was charge-sheeted in respect of riotous and disorderly behaviour for having assaulted a tea maker Shri U. M. Abdul Kader on May 29, 1965, inside the factory. A departmental enquiry was held wherein, it is said, he was given every opportunity to fully participate. He was found guilty of misconduct by the domestic tribunal and was accordingly dismissed. There was a scheme of gratuity in force, which was and is not challenged by the respondent. Clause 4 of that scheme, which is called "Terms of Agreement", provides that if a dispute arises regarding a claim for payment of gratuity of a workman who has been dismissed for misconduct, such a dispute shall be referred to the labour court having jurisdiction, for decision. As a dispute arose with regard to the payment of gratuity, the matter was referred to the Labour Court. Before that court, in the statement of case submitted by the Secretary of the Malabar Estate Workers Union, it was stated in cl. (c) asworker was not paid gratuity on dismissal, in spite of making a request for the same. There is a gratuity scheme applicable to this estate and as per the terms of the scheme if a dispute arises regarding the payment of gratuity to a dismissed workman, the same is left open to be decided by this Court. The allegations of misconduct levelled against the worker in this case cannot be considered to be one which by its nature disentitles the worker to claim gratuity. Even if the allegation is true the same does not involve any question of moral turpitude or cause any financial loss to the company. Any allegations of misconduct do not impose (sic) disentitle the workmen for gratuity. Hence in this particular case it is submitted that the worker is entitled for gratuity as claimed. The worker has put in 18 years of service and as such he is entitled to get at the rate of 15 days wages based on last drawn wage rate for every completed years of service." In reply, which was filed by the management, the facts which have been set out above and the circumstances in which the dismissal was directed, were fully given. Before the Labour Court, there seems to have been no dispute whatsoever that the dismissal of the respondent workman was on account of misconduct consisting of behaving in a riotous and disorderly manner and having assaulted a tea maker (supervisor). The Labour court, however, referred to the judgment of this Court in State of Punjab v. Suraj Parkash Kapur, (1962) 2 SCR 711  = (AIR 1963 SC 507 ) in which the general argument was not accepted that in all cases where services of an employee are terminated for misconduct, gratuity should not be paid to him.

Reasoning:
Misconduct could be of three kinds, (1) technical misconduct which leaves no trail of indiscipline, (2) misconduct resulting in damage to the employers property which might be compensated by forfeiture of gratuity or part thereof, and (3) serious misconduct such as acts of violence against the management or other employees or riotous or disorderly behaviour in or near the place of employment, which, though not directly causing damage, is conducive to grave indiscipline. The first should involve no forfeiture, the second may involve forfeiture of the amount equal to the loss directly suffered by the employer in consequence of the misconduct and the third will entail forfeiture of gratuity due to thethe provisions of this statute would not govern the decision of the present case, the importance of the enactment lies in the fact that the principle which was laid down in the Delhi Cloth Mills case with regard to forfeiture of gratuity in the event of commission of gross misconduct of the nature mentioned above, has been incorporated in the statute itself. Even otherwise, such a rule is conducive to industrial harmony and is in consonance with public policy.4. Learned counsel for the respondents has not been able to show how the rule laid down in the Delhi Cloth Mills case would not be applicable if the concerned workman was guilty of the kind of misconduct mentionedour opinion, it is not necessary to send the matter to the labour court, because the facts were not in dispute before it.