Madras High Court
B. Bhaskaran vs The Presiding Officer, I Addl. Labour ... on 13 November, 2006
Author: P. Jyothimani
Bench: P. Jyothimani
ORDER P. Jyothimani, J.
1. This writ petition is directed against the award passed by the First Additional Labour Court, Madras dated 31.03.1997 passed in I.D. No. 841 of 1990, dismissing the petition filed by the workman holding that the removal of the petitioner from service by the Management is valid and proper and the petitioner is not entitled for reinstatement, however, awarding a compensation of Rs. 40,000/- to the petitioner from the Management for the reason that till the date of suspension, the petitioner has worked for five years under the Management. While the second respondent - Management has not challenged the award in respect of the grant of compensation to the petitioner, the petitioner-workman had challenged the award.
2. The case of the petitioner is that he has joined under the second respondent Management as a Casual Labourer on 14.11.1981 and his last drawn salary was Rs. 700/- per month. The petitioner was working as an Attender in the Stores Department. The second respondent instead of regularising the services of the petitioner has been keeping the petitioner as a casual employee. The second respondent has placed the petitioner under suspension on 17.02.1987 pending enquiry. Thereafter, a charge sheet dated 02.03.1987 was served on the petitioner alleging that there were shortages in the Stores and a suspicion has arisen of the petitioner aiding and abetting theft of materials in the Stores. The charge is said to have been framed based on the report given by the Manager (Spare Parts) one Mr. N. Sridhar. The said person is stated to have mentioned that on a reconciliation of the annual inventory and physical stock, shortage of materials was found. One Mr. N. Ramanathan, Law Officer was appointed as an Enquiry Officer. In respect of the theft, police complaint was given against four employees. However, there was no complaint against the petitioner and there was no interrogation by the police at any point of time. In the charge sheet laid before the Chief Metropolitan Magistrate, Egmore four persons were arrayed as accused, namely, I.N. Janakiraman, Mazdoor/Helper, 2. S.V. Ramasubramaniam, Assistant Store Keeper, 3. A. Janakiraman, Stores Supervisor and 4. L.L. Devotta Assistant Materials Receiving Section and the petitioner was not an accused in the criminal case. During the domestic enquiry, the petitioner has required production of copies of some of the documents like police complaint preferred by the Manager Sridhar, final report of police investigation etc., and the said documents were not furnished. According to the petitioner, the charge itself is vague and not specific in nature and given on the basis of suspicion.
3. In the domestic enquiry, on the Management side three witnesses were examined, out of whom M.W.1 the complainant N. Sridhar, who has stated that one Police Officer visited his office and he informed M.W.1 that N. Janakiraman, Mazdoor/Helper who was the first accused in the criminal case was interrogated and he has given a confession statement stating that he committed theft along with the assistance of others. The said M.W.1 has also stated that he understood from the said Officer that the petitioner B.Bhaskaran was one of the persons named by Janakiraman and therefore, a charge sheet is levelled against the petitioner as if he has abetted the offence. Neither the confession statement stated to have been given by the said Janakiraman was produced in the domestic enquiry nor the said Janakiraman was examined as a witness. According to the petitioner, in any event, any confession given before the police is not a valid document. Apart from the said M.W.1 there were two more witnesses examined namely Mr. J.P. Rossvan, Chief Security Officer as M.W.2 and Mr. S. Vinod Kumar, Parts Eecutive as M.W.3. According to the petitioner, the said M.Ws.2 and 3 have not made any allegation against the petitioner. In spite of all the discrepancies, the Enquiry Officer has concluded, as if the charge against the petitioner has been proved. It is also the case of the petitioner that the second respondent Management being a big concern which is connected with Simson Group of Companies and the Stores Department is manned by many security men round the clock with a strict watch and vigil, no one can very easily enter into the premises. In such circumstances, it is stated that about 8587 numbers of nozzles valued about Rs. 5,00,000/- were stolen from the Stores Department. There was no opportunity given to the petitioner to peruse the relevant registers and the ledgers to prove his innocence before the Labour Court. Even though the petitioner has attacked the very validity of the domestic enquiry, an endorsement has been made saying that he is not questioning the validity of the domestic enquiry on the ground that the petitioner has got a good case on merits. In those circumstances, the Labour Court has misconstrued the endorsement as if the petitioner has accepted the finding of the Enquiry Officer and proceeded as if what remained was only to decide about the quantum of punishment.
4. The award of the Labour Court is questioned on many legal grounds including that the Labour Court has abdicated its power and jurisdiction, that the Labour Court has merely repeated the arguments advanced before it and has not given cogent reasons for arriving at a conclusion, that the Labour Court has failed to appreciate that merely having a suspicion cannot be a ground for framing charge as it has been laid down in the hierarchy of judgments, that the Labour Court has failed to appreciate the purpose of endorsement which is not in effect accepting the guilt or charge and therefore, the conduct of the Labour Court in proceeding with the quantum of punishment is not valid in law, that the Labour Court has failed to give any reason for the purpose of arriving at a conclusion that the removal of the petitioner from service is valid, that the Labour Court has failed to appreciate that there was absolutely no evidence in the domestic enquiry to hold the petitioner guilty, that the Labour Court has failed to appreciate that none of the witnesses examined on the Management side during the domestic enquiry have stated that they have seen the petitioner involved in the committing of theft, that the Labour Court has not appreciated that even as per the complainant M.W.1, he only heard a Police Officer stating that Janakiraman has confessed that he and some other persons were involved in theft and that is presumed to be the petitioner and therefore, by no stretch of imagination the petitioner could be implicated in the incident, that the Labour Court has failed to appreciate that out of four persons who were implicated in the criminal case, the petitioner was never made either in the First Information Report or in the charge in the criminal case and even among the four persons in the criminal case, one S.V. Ramasubramaniam was neither suspended nor disciplinary action was taken against him and that the Labour Court has not passed orders by proper application of mind.
5. Mr. K.M. Ramesh, learned Counsel appearing for the petitioner would submit that the impugned award has been passed without appreciating the evidence properly. According to him, there is no legal evidence specifically implicating the petitioner in the misconduct. The learned Counsel would submit in this regard that the evidence of M.Ws. 1 and 2 are hearsay evidence. M.W.1 who is a complainant only says that one of the Police Officers have informed him that Janakiraman, Mazdoor/Helper who was the first accused in the criminal case has confessed before the Police Officers that along with him, some other persons were involved and it was suspected that the petitioner is one such person. Therefore, according to the learned Counsel for the petitioner, this is not the evidence at all against the petitioner and it is not even a hearsay evidence, especially in the circumstances that the said Janakiraman has never been examined and in fact the said Janakiraman himself was acquitted in the criminal case. That apart, according to the learned Counsel for the petitioner, the evidence of M.W.2 is also general in nature and that cannot be sufficient to conclude that the petitioner was involved in the offence. The learned Counsel would further contend that the charge framed against the petitioner is vague. A reading of the entire charge shows that it revolves round on the basis of suspicion. That apart, the copies of the police complaint were not produced even in the domestic enquiry or before the Labour Court. The learned Counsel would further submit that the copy of the final report of the Police has not been produced either in the domestic enquiry or before the Labour Court. The learned Counsel would also submit that even assuming that there is a loss of confidence of the employer towards the petitioner being the employee, the same is not pleaded and proved. Even a reference to the counter filed before the Labour Court shows that even though there is a reference about the loss of confidence, there is absolutely no evidence in that regard. The suspicion and probabilities alone cannot be the ground of loss of confidence. To support his contention in that regard, the learned Counsel has relied upon the judgment of the Supreme Court reported in 1978 II LLJ 84 apart from the Division Bench judgments of this Court reported in 1985 1 LLJ 46 and 1987 WLR 69, in support of his contention that hearsay evidence cannot be a ground and it cannot be treated as a material evidence. The learned Counsel also relied upon the judgments reported in 2002(2)LLN 709 [Management of Engine Valves, Ltd., Chennai v. Presiding Officer, First Additional Labour Court, Madras and Anr.] [Hardwari Lal v. State of U.P. and Ors.] apart from [Kuldeep Singh v. Commissioner of Police and Ors.].
6. On the other hand, Mr. Sanjay Mohan for M/s Ramasubramaniam Associates, learned Counsel on behalf of the second respondent Management would contend that the charge framed against the petitioner was not that he has committed the offence of theft. It was based on the strong suspicion that the petitioner has abetted and helped the employees who were involved in organised theft of property. According to him, by such a strong suspicion, especially the circumstance that in fact the theft has been committed in an organised manner by a group of employees, there is certainly a loss of confidence of the second respondent Management towards the petitioner. According to him, when once there is a loss of confidence on the part of the employer, the only duty that is imposed on the employer is to conduct a domestic enquiry in a fair manner, based on which any further order can be passed. He would further contend that when once the domestic enquiry is conducted in a proper manner and order of termination is passed, even if the order of termination is wrong, the workman cannot claim reinstatement. In that regard, the learned Counsel relied upon the judgment reported in 1985 II LLN 582 [Chandu Lal v. Pan American World Airways Inc.]. The learned Counsel would also specifically contend that M.W.1 has categorically stated in the cross examination that he has no enmity against the petitioner at all, which is not denied. He would further state that even the petitioner as W.W.1 has admitted that he was aware of shortages. Therefore, the decision taken against the petitioner is bona fide. In that regard, he would also submit that the petitioner has in fact waived his right of raising preliminary objection regarding the correctness of the domestic enquiry, by making a specific endorsement and in such circumstances, it should be presumed that the petitioner has no legal ground against the domestic enquiry and therefore, even assuming that based on the domestic enquiry report, the petitioner is terminated, it should be treated as bona fide and that cannot be a ground for reinstatement, since it is a case of loss of confidence. The learned Counsel in this regard has relied upon the judgment of this Court reported in 2003(2)LLN 796. It is also admitted that the other employees namely Janakiraman who was the first accused acquitted in the criminal case has resigned and it is stated that he was paid Rs. 8,00,000/- of compensation for the 22 years of service rendered by him. That apart, one other accused Sridhar was dismissed from service. The learned Counsel would submit that it is considering the 5-1/2 years of service by the petitioner, the amount of Rs. 40,000/- was correctly arrived at, which the learned Counsel of the second respondent is not opposing.
7. I have heard the learned Counsel for the petitioner as well as the learned Counsel for the second respondent and perused the entire records.
8. On the face of it, in this case, the conducting of domestic enquiry by the second respondent is admitted and it is also admitted that before the Enquiry Officer three witnesses were examined, apart from full participation by the petitioner. Even though in the claim statement filed by the petitioner in the Labour Court, the petitioner has raised objection about the legality of the enquiry proceedings conducted by the Enquiry Officer, as it is seen in the award passed by the Labour Court, the counsel for the petitioner has made the following endorsement before the Labour Court on 11.07.1996. The endorsement was as follows:
Petitioner prays that this Hon'ble Court may be pleased to hear the arguments in the I.D. Under Section 11-A, since petitioner is waiving the preliminary issue.
Therefore, it is clear that as far as the preliminary issue regarding the validity of domestic enquiry, the same was not pressed by the petitioner-workman. It is true that the same cannot be taken as if the petitioner has accepted the charge framed against him, nevertheless it remains the fact that it is not open to the petitioner to go back to question the validity procedure followed in the domestic enquiry. Therefore, the presumption is that the domestic enquiry was properly held by the Enquiry Officer. However, the contention of the learned Counsel for the petitioner is that the Enquiry Officer has not appreciated the evidence of witnesses properly, especially in the circumstances that there was absolutely no evidence against the petitioner by any one of the witnesses to show that the petitioner has abetted the commission of offence of theft by the other employees. He would emphatically argue that the evidence of M.W.1 who is the complainant, cannot be even taken as a hearsay evidence. On the other hand, it is a remotest of possibility by saying that one Police Officer has informed him that during the course of interrogation Janakiraman, the first accused has confessed that some other persons were involved in the offence and the petitioner is suspected to be one of the such other persons. It is true that it can be termed as a no evidence at all, but then the fact remains that even as per the evidence of the petitioner as W.W.1 it is specific that he has no enmity with any of his co-workers or higher ups in the Department and that was his specific admission in the cross examination. He would further state in the cross examination that even though he was not aware of the magnitude of the shortage but was aware that there was shortage noticed during the inventory. His evidence is in the following words:
As far as I am concerned, I was not aware about the magnitude of the shortage, but was aware that there was shortage noticed during the inventory.
That apart, the findings of the enquiry as well as the statement of examination of witnesses taken during the time of domestic enquiry and a perusal of the entire documents would show that the petitioner has been given full opportunity to cross examine the witnesses who have deposed against him.
9. Now, if we refer to the actual charge which has been levelled against the petitioner as it is seen in the order of the second respondent Management dated 02.03.1987, the crux of the charge appears to be as follows:
It is reported by the Manager-Spare Parts that you have been assisting the Storekeeper and you have access to the Stores and you have been handling materials in the Stores everyday. It is further reported and the Management is having strong suspicion that you are involved in the theft and that you have abetted and helped the employees who were involved in the organised theft of the Company's property.
10. Therefore, as rightly pointed out by the learned Counsel for the second respondent, the crux of the charge is not as if the petitioner has committed theft, but there is a strong suspicion that he has abetted commission of theft by some other employees. In this regard, it is relevant to point out, as I have stated earlier, that it is the admitted case of the petitioner during his cross examination that no one of his co-workers, including the witnesses examined on the Management side, were any inimically disposed towards him and that the reading of his evidence in the cross examination shows that in fact he has admitted that he was aware of the shortages in the store room, even though at one stage he has stated that his knowledge was only after the date of suspension. But in the other place he has admitted about the knowledge, but not aware of the actual magnitude of theft, however, he also said that both the statements are correct. It is also not in dispute that the petitioner was at relevant point of time working as a casual labourer/attender posted in the Stores Department. The second respondent Management by the earliest communication dated 17.02.1987 has informed the petitioner that there was a theft of stock to the extent of 4.30 lakhs and as an employee forming part of the said department, the Management has every reason to believe that the petitioner was also reasonable as it is seen in Ex.W.1. While that being so, that even though the petitioner cannot be stated to have been entrusted with the stock or materials so as to make him liable for the conduct of theft, it was nevertheless his duty to inform the Management about the shortage, when it is an admitted case that he was aware of the shortage, even though he would not tell the magnitude of shortage. By correlating this fact along with the nature of charge which is abetment, certainly, one can come to a reasonable conclusion that by the conduct of the petitioner not even informing the second respondent about the shortage at the relevant point of time, there is every reasonable possibility on the part of the second respondent to have suspicion about the petitioner. It is in those circumstances, the Labour Court in the award has correctly come to the conclusion that the order of the second respondent in discharging the petitioner from service is not invalid.
11. The submission made by the learned Counsel for the petitioner about the want of evidence or no evidence in respect of implication of the petitioner into the charge, in my considered view is not a relevant fact. Considering the above said circumstances, even assuming that the evidence of M.Ws.1 and 2 before the domestic enquiry has not directly attributed the petitioner and that no one of the witnesses on the Management side have ever seen the petitioner in abetting himself with the other employees for committing theft, in the teeth of the specific admission by the petitioner that he was aware of shortages, I am of the considered view that shortfall of evidence against the petitioner in the domestic enquiry through M.Ws.1, 2 and 3 does not matter much. The suspicion of the employer - the second respondent about the involvement of the petitioner in abetting the conduct of theft by other employees is fortified by the very admission of the petitioner during cross examination and especially in the circumstance the procedure followed by the Enquiry Officer during the domestic enquiry is not questioned and in fact an endorsement to the effect that preliminary objection is given up. This shows that the petitioner has lost the confidence of the employer. When once the honesty of the employee is suspected which has got some legal basis, and the same is bona fide, the petitioner being a person who was also working at Stores certainly loses the trust and confidence of the employer, when it is not at all in dispute that the theft has been committed from the Stores Department and in such circumstances, the suspicion of the employer in the integrity of the petitioner cannot be said to be whimsical. This view as correctly pointed out by the learned Counsel for the second respondent was the decision of this Court rendered by R. Jayasimha Babu, J. (as he then was) in Assistant General Manager, T.I. Cycles of India Ltd. v. Presiding Officer, Labour Court and Anr. reported in 2003(2) LLN 796. That was a case wherein the employer charge sheeted the workman who was a watchman, charging him with complicity in theft of the materials belonging to the employer. There also, after the domestic enquiry, the workman was terminated from service. The learned Judge while referring to the judgments of the Apex Court reported in:
(1)1975(2)LLN 426 [Chembur Co-operative Industrial Estate, Ltd. v. M.K. Chhatre] (2) [Francis Klein and Company (Private) Ltd. v. Their Workmen] (3) 1975 (1) LLN 261 [L. Michael v. Johnson Pumps India, Ltd.] (4) 1989 (2) LLN 325 [T.I. Miller v. Additional Labour Court] held that even though there was a finding that the charge against the employee had not been proved, nevertheless upheld the employer's plea that the employer had lost confidence in the employee and awarded compensation. The learned Judge ultimately set aside the award of the Labour Court directing reinstatement of the workman with back wages and has directed a compensation of Rs. 1,25,000/- to be paid.
12. On the facts of the said case which also resembles like the present case, the learned Judge has observed as follows in paragraph No. 9:
In this case what is material is the position held by the workman, whether it was a position of trust and confidence and whether the employer acted bona fide honestly and objectively and had some basis of doing so. The fact that the employee workman is a watchman by itself would show that he is occupying a position of trust and confidence. The suspicion regarding the employee's conduct and integrity cannot be said to be merely whimsical or fanciful as the employer had before it the report from a responsible police officer of the rank of Superintendent of Police wherein he had stated the result of the enquiry which showed the association of the workman with a receiver of stolen goods and his complicity in committing theft of the property from the factory of the employer.
and ultimately decided in paragraph No. 14 as follows:
14. Having regard to the amounts already drawn by the employee - workman and having regard to what had been paid over to the other employee, and taking note of the erosion in the value of the rupee in the recent past, the employer is directed to pay to the workman concerned a sum of Rs. 1,25,000/- (Rupees one lakh twenty-five thousand only). The sum of Rs. 1 lakh already deposited shall be allowed to be withdrawn by the workman. The employer shall in addition pay a sum of Rs. 25,000/-. Counsel for the employer says that the employer will hand over that amount directly to the workman with a week's time.
As laid down by the Apex Court in the judgment reported in 1985 II LLN 582, cited supra, it is necessary to have the disciplinary proceeding as a conditional precedent before terminating the petitioner on the ground of loss of confidence. The Apex Court has held as follows in paragraph No. 8:
It is difficult to agree with the finding of the Labour Court that when service is terminated on the basis of loss of confidence the order does not amount to one with stigma and does not warrant a proceeding contemplated by law preceding termination. Want of confidence in an employee does point out to an adverse facet in his character as the true meaning of the allegation is that the employee has failed to behave up to the expected standard of conduct which has given rise to a situation involving loss of confidence....
13. On the facts and circumstances of the case which I have narrated above, especially in the teeth of the admission of the petitioner about his knowledge about the shortage in the Stores in which he was also working, I do not think that the judgment of this Court relied upon by the learned Counsel for the petitioner rendered by the Division Bench reported in 1998(3)LLN 878 [India Pistons Ltd. v. C. Kumaraswamy and Anr.] has any application. That was the case wherein, the Division Bench has found that there was no material to suggest that the Management could say that they have lost confidence in the worker. But that is not the fact in the present case.
14. In these circumstances, I am of the considered view that the award of the Labour Court does not warrant any interference. However, in respect of payment of compensation, as I have stated earlier, it is not disputed by the second respondent that Janakiraman who was actually incharge of the Stores as a Mazdoor who was also the first accused in the criminal case was paid around Rs. 8,00,000/- as compensation for his 22 years of service. As far as the petitioner in the present case is concerned, he has been working admittedly for 5/1-2 years. By considering the above said fact and also taking into consideration the present cost of living, I am of the considered view that an amount of Rs. 40,000/- directed to be paid by the Labour Court as a compensation to the petitioner has to be increased. Accordingly, while upholding the validity of the award of the Labour Court passed in I.D. No. 841 of 1990 dated 31.03.1991, the amount of compensation directed by the Labour Court is modified to Rs. 1,00,000/- instead of Rs. 40,000/- with a direction to the second respondent to pay the said amount of Rs. 1,00,000/- as a compensation in lieu of the services rendered by the petitioner. This writ petition is ordered accordingly. No costs.