Madras High Court
The Deputy General Manager vs The Presiding Officer on 12 March, 2013
Author: N. Paul Vasanthakumar
Bench: R.K.Agrawal, N. Paul Vasanthakumar
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 12-3-2013 CORAM: The Honourable Mr.R.K.AGRAWAL, Acting Chief Justice and The Honourable Mr.Justice N. PAUL VASANTHAKUMAR Writ Appeal No.2096 of 2012 M.P.No.1 of 2012 The Deputy General Manager, Indian Bank, Head Office, 66, Rajaji Salai, Chennai- 600 001 now at Corporate Office/Head Office, HRM Department, I.R.C., II Floor, 254 to 260, Avvai Shanmugam Salai, Royapettah, Chennai 600 014. .. Appellant Vs. 1. The Presiding Officer, Central Government Industrial Tribunal- cum-Labour Court, Chennai 600 006. 2. G.R.Samy .. Respondents Writ Appeal filed under Clause 15 of Letters Patent against the order made in W.P.No.17902 of 200913.3.2012. For Appellant : Mr.Karthick for M/s.T.S.Gopalan & Company 1st Respondent : Labour Court For 2nd Respondent: Mr.K.M.Ramesh J U D G M E N T
N. Paul Vasanthakumar, J.
This writ appeal is directed against the order passed by the learned Single Judge of this Court in W.P.No.17902 of 2009 dated 13.3.2012, wherein the learned single Judge set aside the award of the Central Government Industrial Tribunal-cum-Labour Court, Chennai/first respondent herein, made in I.D.No.13 of 2007 dated 25.6.2009 and directed the appellant Indian Bank to reinstate the second respondent/writ petitioner herein in service with full backwages.
2. The case of the second respondent/writ petitioner before the learned single Judge was as follows:
(a) The second respondent/writ petitioner was appointed in the appellant Bank in the year 1978 as sub-staff and was promoted to clerical cadre in the year 1990 and posted to work at Chintadripet Branch, Chennai. While working in the said branch, he was allocated work in the section pertaining to issuance of BPOs, DDs.
(b) The second respondent/writ petitioner was placed under suspension pending enquiry, by order dated 10.4.2001 followed with issuance of a charge memo dated 24.10.2002 alleging that on 15.3.2001, while he was working in BPO, DD issuing section, he had removed BPO No.004639 from the BPO book kept in the Officer's table without his knowledge and had handed it over to one Ravindran, an ex-employee of the Bank, which was noticed by one Rajaram, Section Officer on 19.3.2001. When the second respondent/writ petitioner was enquired, he pleaded ignorance and told to check thoroughly. As the said BPO was missing, the same was marked as cancelled in the BPO register.
(c) On 2.4.2001 the said BPO was presented for clearing through service Branch of Canara Bank, Chennai, favouring New Sri Lakshmi Saw Mills, Bangalore-64 for an amount of Rs.3.50 lakhs with the endorsement in the reverse to the effect "Payee's A/c Credited" made by Canara Bank, Yelahanka Satallite Town Branch. It was found that the signature in the BPO was forged and the same was returned by Chintadripet Branch, marking "Fraudulent pay order".
(d) A criminal complaint was registered against the second respondent before the Central Crime Branch, Egmore, Chennai, for the same set of charges in Cr.No.232 of 2001 for offences under Section 379 and 420 IPC, which was tried as C.C.No.8960 of 2002 on the file of the Additional Chief Metropolitan Magistrate, Egmore, Chennai. After trial, the second respondent/writ petitioner was acquitted from the criminal case by judgment dated 9.2.2004.
(e) A domestic enquiry was conducted in respect of the charges before completion of criminal proceedings and the Enquiry Officer submitted his findings on 3.11.2003 and held that all the charges were proved. The second respondent/writ petitioner submitted written objections/comments regarding the enquiry findings on 26.12.2003. Thereafter he was served with second show cause notice dated 18.5.2004 proposing the punishment of compulsory retirement and subsequently final order was passed on 8.7.2004 imposing the punishment of compulsory retirement.
(f) The second respondent/writ petitioner preferred appeal before the General Manager, who is the appellate authority on 18.8.2004, which was also rejected on 15.2.2005.
(g) Thereafter the second respondent raised an industrial dispute under section 2A of the Industrial Disputes Act, 1947, before the Assistant Labour Commissioner (Central) Chennai, and a failure report as to the conciliation was issued and thereafter the Ministry of Labour, Government of India on 6.2.2007 referred the issue for adjudication, which was taken on file by the first respondent in I.D.No.13 of 2007.
(h) Before the Central Government Industrial Tribunal-cum-Labour Court, the criminal case judgment was marked as Ex.W-1 and on the side of the Bank, Exs.M-1 to M-28 were marked. Relying on Ex.M-8, M-10 & M-17, which are the statements of employees of the Bank made before the Police Authorities, the first respondent Central Industrial Tribunal-cum-Labour Court dismissed I.D No.13 of 2007 by an award dated 25.6.2008. The said award was challenged by the second respondent/writ petitioner by filing W.P.No.17902 of 2009 and the learned single Judge by order dated 13.3.2012 allowed the writ petition ordering reinstatement with full backwages.
(i) Aggrieved over the order of the learned single Judge, the Bank has preferred this writ appeal contending that the criminal court judgment was not placed before the Disciplinary Authority before imposing the punishment; that the Labour Court was called upon to decide only the punishment imposed based on the Enquiry Officer's report; that the second respondent/writ petitioner did not examine himself to controvert the fact of his receiving Rs.5,000/- from one Ravindran, to whom he passed on the missing BPO; that the criminal Court finding cannot be relied upon in departmental proceedings; that the Bank has lost its confidence on the second respondent/writ petitioner and imposed only a penalty of compulsory retirement with superannuation benefits; that the second respondent/writ petitioner received the gratuity and provident fund dues after the said order was passed; and that, the learned single Judge has not considered the fact that two witnesses examined in the enquiry MW-6 and 7 were actually present when confessional statement of the second respondent was recorded in the police station, which is admissible in domestic enquiry, even though the same may not be admissible in criminal court.
3. The learned counsel appearing for the appellant Bank relied on certain judgments in support of his contentions and prayed for setting aside the order of the learned single Judge dated 13.3.2012 and to restore the award passed by the Central Industrial Tribunal-cum-Labour Court dated 25.6.2008.
4. The learned counsel appearing for the second respondent/writ petitioner on the other hand justified the order of the learned single Judge dated 13.3.2012 and contended that the learned Judge has gone into the merits in detail and found that the award passed by the Central Industrial Tribunal-cum-Labour Court dated 25.6.2008 was based on no evidence and therefore no interference is called for in the order of the learned single Judge. The learned counsel also relied on the judgment of the Supreme Court reported in (2009) 2 SCC 570 (Roop Singh Negi v. Punjab National Bank) in support of his contentions.
5. We have perused the punishment order dated 8.7.2004 passed by the appellant Bank; award of the Central Industrial Tribunal-cum-Labour Court dated 25.6.2008; order of the learned single Judge dated 13.3.2012; decisions cited by both sides; and connected records.
6. The charges levelled against the second respondent/writ petitioner by the appellant Bank reads as follows:
"It has been alleged against you that:
On 15.03.2001 when you were working in the BPO, DD issue section of your branch you had removed BPO No.004639 from the BPO book kept in the officer's table without his knowledge and had handed it over to one Shri.Ravindran (an ex-exployee of our bank).
When the non-availability of the BPO was noticed by Shri.Rajaram, Section Officer on 19.03.2001 and when he inquired you about the same, you pleaded ignorance and told him to check thoroughly. As the BPO was not available the same was marked as 'cancelled' in the BPO register.
On 02.04.2001 the BPO No:004639 purported to be missing as above was presented through clearing by Service Branch, Canara Bank, Chennai favouring New Sri Lakshmi Saw Mills, Bangalore-64 for an amount of Rs.3,50,000 with the endorsement on the reverse to the effect "Payee A/c Credited" made by Canara Bank, Yelahanka Satallite Town Branch. It was found that the signatures in the BPO was forged and the same was returned by our Chintadripet Branch marked "Fraudulent Pay Order."
A police complaint was lodged vide letter dtd.02.04.2001 by our Chintadripet Branch with the Chintadripet Police Station about the missing/fraudulent pay order while also detailing the mode in which it was presented as above. The police authorities taking cognizance of the complaint filed an FIR 232/2001 u/s.379 and 420 of the IPC.
When the matter was taken up for investigation by the police authorities, the fact that you had removed the BPO as detailed above came to light. Thus, the BPO removed by you fraudulently was misused and presented through clearing though it was returned as a 'Fraudulent Payorder'.
Based on the detention made by the police authorities you were placed under suspension pending further action vide letter dated 10.04.2001.
Your act/s as above, if proved, is a Gross Misconduct under the following Clauses of the Biparties Settlement dated 10.4.2002 for which you are charged.
Clause 5(j): Doing any act prejudicial to the interest of the Bank involving or likely to involve the in serious loss; & Clause 5(l): Abetment or instigation of the act as stated in Clause 5(j)."
7. A criminal complaint was also lodged before the Central Crime Branch, Egmore, Chennai, which was registered as Cr.No.232 of 2011 under sections 379 and 420 IPC. Charge sheet was filed against the second respondent in C.C.No.8960 of 2002 before the Additional Chief Metropolitan Magistrate, Egmore, Chennai, and in the said criminal case, the second respondent was acquitted. In the departmental enquiry proceedings, the second respondent participated and the Enquiry Officer submitted his report before completion of the criminal trial, that was on 3.11.2003. During enquiry, the confessional statement made by the second respondent before the crime branch police was marked as Ex.M-12. The complaint was given by one Subramanian, the Branch Manager, who was examined as MW-7, in whose presence the Inspector of Police recorded the confessional statement of the second respondent. An ex-employee of the Bank viz., Ravindran, to whom the BPO was handed over, has confessed before the Police that he received the BPO from second respondent/writ petitioner, whose statement was also recorded in the presence of the complainant Subramanian, who was examined as MW-7 in the departmental proceedings.
8. The contention of the second respondent/writ petitioner before the management as well as the Central Government Industrial Tribunal-cum-Labour Court was that confessional statement given before the Police cannot be relied on to prove the charges in the departmental proceedings, particularly when one Ravindran, to whom the second respondent allegedly handed over the Bank BPO, was not examined.
9. The learned single Judge, while allowing the writ petition held that during trial in the criminal case, the criminal Court found no evidence to show that the second respondent had stolen the BPO and consequently he was acquitted in the criminal case. The said criminal case judgment was marked before the Central Industrial Tribunal-cum-Labour Court as Ex.W-1 and the Tribunal accepting the validity of the confessional statement of the second respondent, which was witnessed by the said Subramanian MW-7, upheld the order of compulsory retirement.
10. In the domestic enquiry the said Subramanian, Branch Manager, who witnessed the recording of confessional statement of the second respondent was examined. The confessional statement given before the Police, which was recorded under section 161 Cr.P.C. may not be relied on in the criminal proceedings as per Sections 25 and 26 of the Indian Evidence Act, 1872. However, the Central Government Industrial Tribunal held that the said rules of evidence do not apply to departmental enquiries. The said approach of the Central Government Industrial Tribunal-cum-Labour Court in our view is just and proper as the acquittal in criminal case has no relevance in the departmental proceedings, if separate enquiry was conducted and a finding was given to the effect that the charges are proved. It is well settled proposition of law that proof required in a criminal case is beyond all reasonable doubts and in the departmental proceedings preponderance of evidence is sufficient and strict rules of evidence are not applicable. The said issue is no longer res integra.
11. (a) The Hon'ble Supreme Court in the decision reported in (2013) 1 SCC 598 (Deputy Inspector General of Police v. S.Samuthiram) considered the very issue regarding the effect of acquittal in a criminal case with respect to the punishment imposed in the departmental proceedings. In the said decision it is held that even if the Delinquent Officer is acquitted honourably, he is not entitled to claim reinstatement, unless the service rules provides so. In paragraphs 23, 26 to 28 the Hon'ble Apex Court held thus, "23. We are of the view that the mere acquittal of an employee by a criminal court has no impact on the disciplinary proceedings initiated by the Department. ...............
26. ........... in the absence of any provision in the service rules for reinstatement, if an employee is honourably acquitted by a criminal court, no right is conferred on the employee to claim any benefit including reinstatement. Reason is that the standard of proof required for holding a person guilty by a criminal court and the enquiry conducted by way of disciplinary proceeding is entirely different. In a criminal case, the onus of establishing the guilt of the accused is on the prosecution and if it fails to establish the guilt beyond reasonable doubt, the accused is assumed to be innocent. It is settled law that the strict burden of proof required to establish guilt in a criminal court is not required in a disciplinary proceedings and preponderance of probabilities is sufficient. There may be cases where a person is acquitted for technical reasons or the prosecution giving up other witnesses since few of the other witnesses turned hostile, etc. In the case on hand the prosecution did not take steps to examine many of the crucial witnesses on the ground that the complainant and his wife turned hostile. The court, therefore, acquitted the accused giving the benefit of doubt. We are not prepared to say that in the instant case, the respondent was honourably acquitted by the criminal court and even if it is so, he is not entitled to claim reinstatement since the Tamil Nadu Service Rules do not provide so.
27. We have also come across cases where the service rules provide that on registration of a criminal case, an employee can be kept under suspension and on acquittal by the criminal court, he be reinstated. In such cases, the reinstatement is automatic. There may be cases where the service rules provide that in spite of domestic enquiry, if the criminal court acquits an employee honourably, he could be reinstated. In other words, the issue whether an employee has to be reinstated in service or not depends upon the question whether the service rules contain any such provision for reinstatement and not as a matter of right. Such provisions are absent in the Tamil Nadu Service Rules.
28. In view of the abovementioned circumstances, we are of the view that the High Court was not justified in setting aside the punishment imposed in the departmental proceedings as against the respondent, in its limited jurisdiction under Article 226 of the Constitution of India."
Thus, the second respondent/writ petitioner cannot rely upon the acquittal order passed in his favour by the Criminal Court and pray for setting aside the order of compulsory retirement passed against him.
(b) In the decision reported in (2008) 5 SCC 554 (Usha Breco Mazdoor Sangh v. Management of Usha Breco Limited) in paragraph 33 the Supreme Court held thus, "33. Before a departmental proceedings, the standard of proof is not that the misconduct must be proved beyond all reasonable doubt but the standard of proof is as to whether the test of preponderance of probability has been met. ............."
12. In the decision cited by the learned counsel appearing for the second respondent/writ petitioner, reported in (2009) 2 SCC 570 (Roop Singh Negi v. Punjab National Bank), the Supreme Court held that the provisions of the Evidence Act is not applicable and there must be some evidence to arrive at a decision. In the said case, the Supreme Court found that there was no evidence except the confession given by the delinquent before the police. No witness, who was present while recording the confessional statement, was examined. Hence the punishment order was set aside on the ground that suspicion alone will not substitute the legal proof.
13. The learned single Judge set aside the order of compulsory retirement, which was confirmed by the appellate authority as well as the Central Government Industrial Tribunal-cum-Labour Court. The scope of judicial review in disciplinary matters is very limited. If there is some evidence available and based on such evidence the disciplinary authority comes to a conclusion, the Courts are not expected to over turn the said decision on the ground of insufficiency of materials. The grounds on which the Disciplinary Authority's decision can be set aside are, on no evidence or for any violation of procedural safeguards to the Delinquent officer, including the principles of natural justice. The Supreme Court in the decision reported in (2006) 6 SCC 794 (Union of India v. K.G.Soni) in paragraphs 14 and 15 held thus, "14. .......... the court should not interfere with the administrators decision unless it was illogical or suffers from procedural impropriety or was shocking to the conscience of the court, in the sense that it was in defiance of logic or moral standards. In view of what has been stated in Wednesbury case the court would not go into the correctness of the choice made by the administrator open to him and the court should not substitute its decision to that of the administrator. The scope of judicial review is limited to the deficiency in the decision-making process and not the decision.
15. To put it differently, unless the punishment imposed by the disciplinary authority or the Appellate Authority shocks the conscience of the court/tribunal, there is no scope for interference. Further, to shorten litigations it may, in exceptional and rare cases, impose appropriate punishment by recording cogent reasons in support thereof. In the normal course if the punishment imposed is shockingly disproportionate, it would be appropriate to direct the disciplinary authority or the Appellate Authority to reconsider the penalty imposed." (Emphasis Supplied) Again in (2006) 1 SCC 63 (Karnataka Bank Ltd. v. A.L.Mohan Rao) and in several other decisions the Apex Court held that it is not for the courts to interfere in cases of gross misconduct if the Disciplinary Authority's decision is based on Enquiry Officer's report, which has been conducted in a fair and proper manner and a misconduct is proved.
14. In the grounds of appeal the appellant bank has stated that the second respondent has lost the confidence of the Bank and after compulsory retirement order, the second respondent received a sum of Rs.1,32,942/- towards gratuity and Rs.2,50,645/- as terminal benefits. Once the Banking establishment has lost confidence on its staff in the clerical cadre, whether reinstatement can be ordered to such staff, who is dealing with public money was considered by the Supreme Court in the decision reported in 2007 AIR SCW 4136 : JT 2007 (8) SC 588 (Ramesh Chandra Sharma v. Punjab National Bank & Another). In paragraph 20 it is held thus, "..............................
Once the employer has lost the confidence in the employee and the bona fide loss of confidence is affirmed, the order of punishment must be considered to be immune from challenge, for the reason that discharging the office of trust and confidence requires absolute integrity. A necessary implication which must be engrafted on the contract of service is that the servant must undertake to serve his master with good faith and fidelity. In a case of loss of confidence, reinstatement cannot be directed. Granting such an employee the relief of reinstatement would be "an act of misplaced sympathy which can find no foundation in law or in equity." (Vide Air India Corporation, Bombay vs. V.A.Ravellow, AIR 1972 SC 1343; The Binny Ltd. vs. Their Workmen, AIR 1973 SC 1403; Kamal Kishore Lakshman vs. Management of M/s.Pan American World Airways Inc & Ors., AIR 1987 SC 229; Francis Kalein & Co. Pvt. Ltd., vs. Their Workmen, AIR 1971 SC 2414; Regional Manager, Rajasthan SRTC Vs. Sohan Lal, (2004) 8 SCC 218; and Bharat Heavy Electricals Ltd. Vs. M.Chandrashekhar Reddy & Ors., 2005 AIR SCW 1232).
In Kanhaiyalal Agrawal & Ors. Vs. Factory Manager, Gwaliar Sugar Co. Ltd. (2001) 9 SCC 609, the Hon'ble Supreme Court laid down the test for loss of confidence to find out as to whether there was bona fide loss of confidence in the employee, observing that, (i) the workman is holding the position of trust and confidence; (ii) by abusing such position, he commits act which results in forfeiting the same; and (iii) to continue him in service/establishment would be embarrassing and inconvenient to the employer, or would be detrimental to the discipline or security of the establishment. Loss of confidence cannot be subjective, based upon the mind of the management. Objective facts which would lead to a definite inference of apprehension in the mind of the management, regarding trustworthiness or reliability of the employee, must be alleged and proved." "
The same is the view taken by the Division Bench of this Court in W.A.No.1861 of 2009, Judgment dated 21.6.2010. The said writ appeal was preferred against the order of one of us (N.Paul Vasanthakumar, J.) made in W.P.No.5387 of 2001 dated 27.8.2009.
15. The issue of exercise of discretion under Section 11A of the Industrial Disputes Act, 1947, by the Labour Court came up before the Hon'ble Supreme Court in the decision reported in AIR 2009 SC 2528 (Divisional Manager, Rajasthan S.R.T.C. v. Kamruddin) wherein it is held that though power is available to the Labour Court/Industrial Tribunal in terms of Section 11A of the Industrial Disputes Act, 1947, to interfere with the quantum of punishment, the said power should be exercised judiciously. The failure of the Conductor of the Transport Corporation Bus to collect the correct fair from the passengers, who was dismissed from service was set aside by the Labour Court, which order was confirmed by the High Court and the same was set aside by the Supreme Court on the ground that the Labour Court has not exercised its jurisdiction, conferred under Section 11A of the Act, judiciously.
16. In the case on hand, the Central Government Industrial Tribunal-cum-Labour Court refused to exercise its discretion conferred under Section 11A of the Industrial Disputes Act, 1947, and dismissed the dispute raised, which decision was set aside by the learned single Judge. As we find that there is evidence against the second respondent/writ petitioner to sustain the charges, the order passed by the learned single Judge in setting aside the order of compulsory retirement with direction to reinstate him with full backwages, cannot be sustained.
17. In the light of the above findings and decisions cited supra, we are not persuaded to subscribe the view expressed by the learned single Judge in allowing the writ petition filed by the second respondent/writ petitioner. Consequently, the writ appeal is allowed and the order of the learned single Judge in W.P.No.17902 of 2009 dated 13.3.2012 is set aside. No costs. M.P.No.1 of 2012 is closed.
vr To The Presiding Officer, Central Government Industrial Tribunal-cum-Labour Court, Chennai 600 006