Kerala High Court
Kerala State Co-Operative Coir ... vs Sreekumar on 3 April, 2002
Equivalent citations: (2002)IIILLJ101KER
Author: J.B. Koshy
Bench: J.B. Koshy, K. Padmanabhan Nair
JUDGMENT J.B. Koshy, J.
1. Whether Employees' Insurance Court is competent under Section 75 of the Employees State Insurance Act, 1948 (hereinafter referred to as 'the Act') to consider the validity of an order of dismissal from service of an employee on the ground of violation of S.73 of the Act, is the important question of law that is being considered in this appeal. Scope and ambit of Sections 73 and 75 of the Act are also under consideration. Before going into the merits of the case, we may consider brief facts of the case.
2. First respondent in the appeal was employed in the appellant Kerala State Cooperative Coir Marketing Federation Ltd. as Depot Manager of Chungom Depot. While he was in service, he was charge-sheeted for theft and misappropriation of property worth Rs. 59,780-30 and for falsification of accounts and for misappropriation of property worth Rs. 58,850-07 during the period from 1.7.1987 to 31.3.1989. A domestic enquiry was conducted in respect of the above charges and enquiry officer found that he was guilty of the charges levelled against him. A copy of the enquiry report was forwarded to him and on the basis of the report of enquiry, the Board of Directors of the appellant Federation decided to dismiss him from service in its meeting held on 9.12.1993 and he was dismissed from service by order dated 25.1.1994 which was served on him on 2.2.1994. His dismissal from service was challenged under the Industrial Disputes Act and was the subject-matter of adjudication before the Industrial Tribunal, Alappuzha in I.D. No. 12/95. Apart from raising industrial dispute, first respondent filed an application before the Employees Insurance Court under Section 75 of the Act contending that he was dismissed from service while he was under medical treatment for sickness under the ESI Scheme and being an ESI covered employee, his dismissal is invalid in view of Section 73 of the Act.
3. The pleading of the first respondent in his application dated 22.2.1994 filed under Section 75 of the Act is as follows:
"......,...The domestic enquiry was concluded on 12.8.1993 and on 15th of August, 1993, while travelling to Pandalam, the applicant sustained a severe heart attack and was admitted in Pandalam NSS Medical Mission Hospital and underwent treatment till 24.8.1993 and was advised bed rest. The applicant approached the ESI Dispensary, Factory Ward on 2.10.1993 and was continuing on leave till 16.2.1994. His leave is now extended to four more weeks. However, the 1st opposite party in violation of the provisions of the standing orders applicable to this employee, dismissed him vide proceeding No. FC/D/010/90-913239 dated.25.1.1994 and the same was hand delivered on 2.2.1994 at the residence of the applicant as he was on ESI leave due to the above illness".
The Management raised various contentions. The Management admitted that he was under treatment at the NSS Medical Mission Hospital, Pandalam from 15.8.1993 to 24.8.1993; but, during that time, he did not avail any ESI leave and he was under half pay leave. They also contended that he was dismissed from service by order dated 25.1.1994 which was served on him on 2.2.1994. On that day, the Management was not informed that he was in receipt of sickness benefit or he was under, medical treatment for sickness during those days. It was also contended that till the date of dismissal, he had not furnished any certificate to show that during those days he was absent from work as a result of sickness. A petition was also filed stating that maintainability of the case should also be decided as a preliminary point as proceedings under Section 75 of the Act will not lie for setting aside the dismissal, even if there is violation of Section 73 of the Act. Various other contentions were also taken.
4. First, we may consider the scope of Section 73 of the Act. Section 73 of the Act is as follows:
"73. Employer not to dismiss or punish employee during period of sickness, elc.-
(1) No employer shall dismiss, discharge, or reduce or otherwise punish an employee during the period the employee is in receipt of sickness benefit or maternity benefit, nor shall be, except as provided under the regulations, dismiss, discharge or reduce or otherwise punish an employee during the period he is in receipt of disablement benefit for temporary disablement or is under medical treatment for sickness or is absent from work as a result of illness duly certified in accordance with the regulations to arise out of the pregnancy or confinement rendering the employee unfit for work.
(2) No notice of dismissal or discharge or reduction given to an employee during the period specified in Sub-section (2) shall be valid or operative."
5. There is a contention by the appellant that purposive interpretation should be taken despite the words used in the section as the purpose of the section was not to take disciplinary action on an insured employee merely because he was absent from work or he was getting benefits under the ESI Scheme. In other words, a person should not be punished merely because he got benefits from the ESI Scheme or he was granted leave though he was able to be absent without leave because of the provisions of the Act and ESI Scheme. It is true that purpose of the Act seems to be as suggested by the appellant. But, the Court cannot go beyond the clear wording of the Act as held by the Supreme Court in Buckingham and Carnatik Co. Ltd. v. Venkatayya& Anr. ((1963) II LLJ 638) that that clause is not happily worded. But, the section is to put a sort of moratorium against all acts against the insured during the contingencies mentioned in Section 73. The Supreme Court held as follows:
"Even so, what is the effect of Section 73(1)? In considering this question, it would be useful to take into account the provisions of Sub-section (2). This sub-section provides that no noiice given to an employee during the period specified in Sub-section (1) shall be valid or operative. Thus, it is clear that the giving of the notice during the specified period makes it invalid, and itisremarkable that the notice is not in regard to dismissal, discharge or reduction in respect of sickness alone, but it includes all such notices issued, whatever may be the misconduct justifying them. Thus, there can be no doubt that the punitive action which is prohibited by Section 73( 1) is not confined to punitive action proceeding on the basis of absence owing to sickness; it is punitive action proceeding on the basis of all kinds of misconduct which justifies the imposition of the penalty in question. What Section 73(1) prohibits is such punitive action and it limits the extent of the said prohibition to the period during which the employee is ill. We are free to confess that the clause is not very happily worded, but it seems to us that the plain object of the clause is to put a sort of a moratorium against all punitive actions during the pendency of the employee's illness. If the employee is ill and if it appears that he has received sickness benefit for such illness, during that period of illness no punitive action can be taken against him. That appears to us to be the effect of that part of Section 73(1) with which we are concerned in the present appeal. If that be so, it is difficult to invoke Section 73 against the appellant, because the termination of Venkatayya's services has not taken place during the period of his illness for which he received sickness benefit".
But, it was held that what is prohibited is a positive act on the part of the employer; but, automatic termination for absence without leave for a specified period will not come within the prohibition of Section 73(1) of the Act. Here, dismissal order was served even though issue of show cause notice, service of charge sheet, conducting of domestic enquiry etc. were over before he became sick. His heart disease itself was started after domestic enquiry was over. But, at that time also, admittedly, he did not take any ESI leave or benefits as he was on half pay leave and he was discharged from the hospital on 24.8.1993. But, the contention is that dismissal order was served on 2.2.1994 and during that time he was on medical treatment for sickness under the ESI Scheme. Hence Section 73 of the Act will apply. We are of the opinion that if he was under medical treatment on 25.1.1994 as well as on 2.2.1994 and that fact was known to the employer, technically, Section 73(1) and (2) of the Act may be applicable as Supreme Court in Municipal Corporation of Greater Bombay v. B.R.S.T. Workers' Union ((1973) 3 SCC 543) held that Section 73 places an embargo upon the powers of an employer to dismiss, discharge or otherwise punish an employee in the circumstances mentioned therein. But, it only postpones the event. If employer was not aware of the above, we may have to consider whether that embargo applies to the employer and what is the effect? Before considering the same, we may consider the main question raised in the appeal whether correctness of dismissal on the allegation of violation of Section 73 of the Act can be challenged in a proceeding under Section 75 of the Act.
6. Section 75 of the Act is as follows:
**75. Matters to be decided by Employees' Insurance Court:-
(1) If any question or dispute arises as to -
(a) whether any person is an employee within the meaning of this Act or whether he is liable to pay the employee's contribution, or
(b) the rate of wages or average daily wages of an employee for the purposes of this Act, or
(c) the rate of contribution payable by the principal employer in respect of any employee, or
(d) the person who is or as the principal employer in respect of any employee, or
(e) the right of any person to any benefit and as to the amount and duration thereof, or (ee) any direction issued by the Corporation under Section 55-A on a review of any payment of dependants' benefits, or.
(f) omitted, or
(g) any other matter which is in dispute between a principal employer and the Corporation, or between a principal employer and an immediate employer, or between a person and the Corporation or between an employee and a principal or immediate employer, in respect of any contribution or benefit or other dues payable or recoverable under this Act, or any other matter required to be or which may be decided by the Employees' Insurance Court under this Act, such question or dispute subject to the provisions of Sub-section (2-A) shall be decided by the Employees' Insurance Court in accordance with the provisions of this Act.
(2) Subject to the provisions of Sub-section (2-A), the following claims shall be decided by the Employees' Insurance Court, namely,-
(a) claim for the recovery of contributions from the principal employer;
(b) claim by a principal employer to recover contributions from any immediate employer;
(c) omitted;
(d) claim against a principal employer under Section 68;
(e) claim under Section 70 for the recovery of the value or amount of the benefits received by a person when he is not lawfully entitled thereto; and
(f) any of aim for the recovery of any benefit admissible under this Act.
(2-A). If in any proceedings before the Employees' Insurance Court a disablement question arises and the decision of a Medical Board or a Medical Appeal Tribunal has not been obtained on the same and the decision of such question is necessary for the determination of the claim or question before the Employees' Insurance Court, that Court shall direct the Corporation to have the question decided by this Act and shall thereafter proceed with the determination of the claim or question before it in accordance with the decision of the Medical Board or the Medical Appeal Tribunal, as the case may be except where an appeal has been filed before the Employees' Insurance Court under Sub-section (2) of Section 54-A in which case the Employees' Insurance Court may itself determine all the issues arising before it.
(2-B). No matter which is in dispute between a principal employer and the Corporation in respect of any contribution or any other dues shall be raised by the principal employer in the Employees' Insurance Court unless he has deposited with the Court fifty percent of the amount due from him as claimed by the Corporation;
Provided that the Court may, for reasons to be recorded in writing waive or reduce the amount to be deposited under this sub-section.
(3). No Civil Court shall have jurisdiction to decide or deal with any question or dispute as aforesaid or to adjudicate on any liability which by or under this Act is to be decided by a Medical Board, or by a Medical Appeal Tribunal or by the Employees' Insurance Court."
Admittedly; there is no dispute regarding the question whether first respondent was an employee or whether he is liable to pay employees' contribution. .There is no dispute regarding the rate of wages or rate of contribution or rate of benefit payable to him. There is no dispute between the principal employer and the Corporation or between the principal employer or the employee in respect of any contribution or benefits or other dues payable or recoverable under the Act. Therefore, on the plain meaning of Section 75 of the Act, this dispute will not come under Section 75 of the Act.
7. It is contended for the first respondent that if there is a dispute regarding a benefit under the Act, proceedings under Section 75 is maintainable. What is referred under Section 75(g) is benefit or other dues payable or recoverable under the Act and benefit is not used. In the ordinary sense, we have to read with the context. What are the benefits payable and available under the Act are defined under Section 46 of the act. S.46 of the Act is as follows:
"46. Benefits:-
(1) Subject to the provisions of the Act, the insured persons, their dependants or the persons hereinafter mentioned, as the case may be, shall be entitled to the following benefits, namely-
(a) periodical payment to any insured person in case of his sickness certified by a duly appointed medical practitioner or by any person possessing such qualifications and experience as the Corporation may, by regulations, specify in this behalf (hereinafter referred to as sickness benefit);
(b) periodical payments to an insured woman in case of confinement or miscarriage or sickness arising out of pregnancy, confinement, premature birth of child or miscarriage, such woman being certified to be eligible for such payments by an authority specified in this behalf by the regulations (hereinafter referred to as maternity benefits);
(c) periodical payments to an insured person suffering from disablement as a result of an employment injury sustained as an employee under this Act and certified to be eligible for such payments by an authority specified in this behalf by the regulations (hereinafter referred to as disablement benefit);
(d) periodical payments to such dependants of an insured persons who dies as a result of an employment injury sustained as an employee under this Act, as are entitled to compensation under this Act (hereinafter referred to as dependants' benefit);
(e) medical treatment for an attendance on insured persons (hereinafter referred to as medical benefit); and
(f) payment to the eldest surviving member of the family of an insured person who has died, towards the expenditure on the funeral of the deceased insured person, or, where the insured person did not have a family or was not living with his family at the time of his death, to the person who actually incurs the expenditure on the funeral of the deceased insured person (to be known as funeral expenses):
Provided that..........."
Various benefits like sickness benefit, medical benefit, maternity benefit, disablement benefit, dependants' benefit etc. are defined in Sections 49 to 56 of the Act and, in any event, this is not a benefit or dues payable or recoverable under the Act coming within Section 75(g)of the Act. Therefore, we are of the opinion that the proceedings under Section 75 of the ESI Act is not maintainable questioning the dismissal of an employee even if there is violation of Section 73.
8. Then, the question to be decided is what is the remedy available to the employee concerned. In this case, the matter is already referred for adjudication under the Industrial Disputes Act. Here, the first respondent was charge-sheeted for misappropriation of more than Rs. one lakh. The above illness came only after domestic enquiry was over. In the counter statement dated 13.11.1995 submitted by the first respondent employee regarding the preliminary petition filed by the appellant before the Employees' Insurance Court, it has been stated that he never availed any ESI benefit for more than two decades until October, 1993 and he has taken half pay leave from 1.9.1993 to 20.10.1993. Thereafter only he availed ESI leave. The enquiry was concluded on 12.8.1993. According to the definite case of the Management, on the date of dismissal or at the time of service of notice, Management was not informed that he was under medical leave. Ext. Rl(h) produced along with the counter affidavit shows that it is dated 28.6.1994 and after the date of dismissal. It is the case of the appellant that that information of sickness was on 28.6.1994 after four months of service of the order of dismissal. The first respondent who was the applicant before the El court did not go to the box and depose that he informed the appellant about his sickness during those days, that is, 25.1.1994 or 2.2.1994 before dismissal order was issued. If that be so, what is the effect of those orders are to be adjudicated by the Industrial Tribunal. The Industrial Tribunal has to find out first whether the enquiry conducted was fair and proper. If enquiry was not proper, management will get an opportunity to prove the misconduct before the Tribunal. If misconduct is not proved, employee will get reinstatement and other reliefs. If the enquiry was fair and proper and findings of the enquiry officer are correct, then it is for the Industrial Tribunal to consider any relief has to be given. The Industrial Tribunal can also consider the effect of S.73 of the Act. If misappropriation of more than Rs. One lakh is proved, then, it is for the Industrial Tribunal to consider how Section 73 will apply in this case and what are the reliefs to be granted on the facts of the case. If the Management was not aware at the time when order was issued that he was under treatment under ESI scheme, dismissal order will be effective after the period of sickness is over as Section 73 is only an embargo in taking disciplinary action or serving notice or orders during the period of sickness covered under the ESI Scheme. That embargo is lifted soon after the sickness is over. Even otherwise, relief has to be moulded by the Industrial Tribunal as Industrial Tribunal or Labour Court on the facts of the case are not bound to hypertechnicalities as it has to do justice considering the facts and overall circumstances.
Since it is for the parties to adduce evidence whether he was under actual sickness covered under the ESI scheme as on 25.1.1994 or 2.2.1994 and whether the management was aware at that time when order was issued and served while respondent was under treatment. It is for the Tribunal to decide the consequential effect taking out all the circumstances etc. when the matter is adjudicated, along with the other contentions raised in the Industrial Dispute. It is true that an employee should not be victimised on the ground that he was availing ESI benefits. But, at the same time, Section 73 should not be misused for protecting the erring employees. Even though it is a shield against victimisation, it cannot be used as a device for protecting the guilty. It is for the Industrial Tribunal to decide whether the employee is guilty of the misconduct alleged or not and the El Court has no jurisdiction to decide it.
We allow the appeal and set aside the order on the ground that correctness of the dismissal cannot be challenged under Section 75 of the Act on the allegation that dismissal order was served violating the provisions of Section 73 of the Act.