Nagar Palika Parishad Shamsabad ... vs Labour Court Up Agra & Others
2017 Latest Caselaw 20 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

                                                             (AFR)
 
RESERVED ON   30.03.2017
 
DELIVERED ON 04.05.2017 
 

 
Case :- WRIT - C No. - 7928 of 2001
 

 
Petitioner :- Nagar Palika Parishad Shamsabad Agra
 
Respondent :- Labour Court Up Agra & Others
 
Counsel for Petitioner :- Anil Bhushan,J.S. Pandey,Umesh Chandra Mishra
 
Counsel for Respondent :- C.S.C,Rajesh Tewari
 

 
Hon'ble Mrs. Sangeeta Chandra,J.

This writ petition has been filed challenging the order passed by the Labour Court, Agra dated 15.02.2000 published on 06.12.2000 in Adjudication Case Nos. 154 of 1984, 155 of 1984 and 279 of 1989. All the aforesaid adjudication cases have been decided by a consolidated award.

2. Brief facts as mentioned in the writ petition and all the materials placed on record for deciding the controversy are as follows :-

3. The respondent No. 2, Satya Prakash Gupta, was engaged as a Muharrir (Class-IV employee) in Nagar Palika Parishad, Shamsabad on 01.11.1968, respondent No. 3, Narbar Singh, was engaged as Muharrir (Class-IV employee) in Nagar Palika Parishad on 15.06.1966 and respondent No. 4, Narendra Kumar Jain, was engaged as Chowkidar again on a Class-IV post in Nagar Palika Parishad, Shamsabad on 08.12.1971. On a complaint being made regarding embezzlement by the three employees during their posting at octroi Check-post , they were suspended in 1974. This complaint related to the respondents not showing correct receipts of octroi at the barrier by fabricating counter-foils. After inquiry was conducted, they were dismissed in November, 1974 and all the three employees filed statutory appeals under the U.P. Municipal Servants Appeal Rules, 1967 before Commissioner, Agra Region, Agra challenging their respective dismissal orders. The statutory appeals were dismissed on 27.07.1977 by the Commissioner, Agra Region, Agra by a common order. The respondent Nos. 2, 3 and 4 thereafter filed separate claim petitions before the U.P. Public Service Tribunal. These claim petitions were heard together and decided on 26.08.1980 by the Tribunal. The dismissal orders were set aside on grounds of not following the Principles of Natural Justice; but liberty was given to Nagar Palika Parishad to start fresh proceedings from the stage they stood vitiated.

4. After the judgment of the Tribunal fresh inquiry was conducted against each of the respondents and inquiry reports were separately submitted by the Sub Divisional Magistrate, Fatehabad, Agra. On the basis of inquiry reports, all charges having been found proved, dismissal orders were passed against each of respondents separately on 17.07.1981.

5. Each of the respondents thereafter filed statutory appeals before the Commissioner, Agra Region, Agra which were dismissed on 22.02.1983. Respondent Nos. 2, 3 and 4 did not challenge the appellate order any further before the State Government or before the Public Service Tribunal, but this time raised an industrial dispute which was referred by the State Government to the Labour Court by reference order under Section 4-K on 26.07.1984. Adjudication Cases No. 154 of 1984, 155 of 1984 and 279 of 1989 were registered in Labour Court, Agra. All these cases were consolidated and heard together by the Labour Court. Nagar Palika Parishad filed its written statement before the Labour Court.

6. The petitioners herein filed written statement taking the following main grounds:-

a) That the reference under Section 4-K was not maintainable in the first place as dismissal orders have merged in the appellate order passed under the U.P. Municipal Servant Appeal Rules, 1967 by the Commissioner, Agra Mandal, Agra and this order had not been referred to for adjudication by the government to the Labour Court.

b) That the adjudication cases were barred by delay as original dismissal orders were passed in 1981 and from the date of original dismissal orders almost 25 years had lapsed and from the date of dismissal of the appeal 19 years had lapsed.

c) That due to charge of embezzlement being levelled against the respondents which was found to be prima facie proved, there was a loss of faith and it would not be appropriate to order their reinstatement.

d) That also w.e.f. 01.08.1990 the government abolished the Octroi altogether and therefore, there was no post available for the respondents to be reinstated in.

7. The issue raised with regard to the maintainability of the reference were rejected by the Labour Court by observing that against the dismissal order, Ram Bhajan Singh, Chowkidar had approached the Industrial Tribunal - IV, Agra and Adjudication Case No. 228 of 1985 was decided in his favour by the Presiding Officer by which the employee concerned had been reinstated in service with back wages. It is only thereafter the adjudication cases referred to herein above have been filed by the respondent nos. 2, 3 and 4.

8. The Labour Court by an order dated 31.01.1998 decided the preliminary issue with regard to the conduct of domestic inquiry and held the same to be fair and regular and also held that ample opportunity was given to the respondents therein. This order dated 31.01.1998 shows that the Labour Court came to the conclusion that the Principles of Natural Justice were followed to the letter in conduct of the inquiry against the respondents.

9. However, in its award dated 15.02.2000 the Labour Court examined the evidence considered by the Inquiry Officer and the statements of Prabhari Adhikari - RS Saxena as well as the Truck owner and one Laxmi Narayan, oil dealer where the truck concerned had delivered ten thousand litres of oil. The Labour Court discarded the evidence of witnesses produced by the employer saying that they were interested witnesses and the relevant documentary evidence like receipt relating to octroi was not produced before it. The other witness produced before the Labour Court was Octroi Inspector whose statement was also discarded on the ground that against the Octroi Inspector these three respondents had earlier made a complaint regarding securing employment on forged documents and therefore, he harbored a grudge against the employees. The dismissal orders were set aside holding that the charges had not been proved beyond reasonable doubt.

10. The Labour Court, however, came to the conclusion that after such a long gap from the date of dismissal, it would not be appropriate to order reinstatement, but instead awarded compensation of Rs.80,000/- each to the respondents and directed that on the same being paid, the respondents' claim to reinstatement on their dismissal orders being set aside, would be considered to be settled. At the same time, the Labour Court directed that the respondents be treated to be in continuous service and given retiral benefits like pension and gratuity also.

11. This writ petition has been filed by Nagar Palika Parishad on the ground that when the employees who were regular employees of the Nagar Palika Parishad, elected to file Statutory Appeals under the U.P. Municipal Servant Appeal Rules, 1967 before the Commissioner, Agra, which appeals were dismissed in 1983, they could not have raised an industrial dispute before the Labour Court.

12. Also, a further ground has been taken that when on perusal of the inquiry report a preliminary finding had been recorded on 13.01.1998 by the Labour Court itself that the inquiry was conducted in a fair and proper manner, the Labour Court could not have while considering the statements of the respondents and the employer's witnesses, re-assessed the evidence with regard to the proof of the charges nor could have discarded the oral statements of the employer's witnesses namely Laxmi Narayan - Oil Dealer and Shiv Prasad Sharma - Octroi Inspector on flimsy grounds. The inquiry report was not perused at all nor considered by the Labour Court, instead the Labour Court set out to take evidence on its own and came to the conclusion after a more than two decades of the incident that the evidence was insufficient to prove the charges.

13. At the time of hearing, Shri G.S. Pandey, Advocate, appearing for Nagar Palika Parishad mainly confined his arguments to two grounds of challenge. Firstly, when the respondents had filed statutory appeal under the U.P. Municipal Servant Appeal Rules, 1967 against their orders of dismissal and their appointments and conditions of service were governed by the Municipalities Act and Rules framed there-under, they could be said to be public servants under the definition of a Public Servant given in the U.P. Public Services (Tribunal) Act, 1976. In fact, the respondents had approached the learned Tribunal initially and the Tribunal had also given a declaration in their favour and had set aside their termination orders on the ground of non compliance with the Principles of Natural Justice with liberty to the Nagar Palika Parishad to conduct a fresh inquiry from the stage it stood vitiated.

14. Secondly, it has been argued that the Nagar Palika Parishad being a statutory authority/local authority under the Constitution it could not be treated as an "industry" and therefore, the industrial dispute raised by the respondent Nos. 2, 3 and 4 before the Labour Court could not at all have been entertained and was not maintainable.

15. The learned counsel for the petitioner has relied upon the following judgments of the Supreme Court and of this Court :-

i). R.C. Tiwari Vs. M.P. State Co-operative Marketing Federation and others reported in 90 FJR 468 (SC) wherein the Supreme Court held that dismissal order of an employee of Co-operative Society being confirmed by Registrar could not further be challenged by making a reference to the Labour Court. The Labour Court had no jurisdiction to decide the dispute with respect to the employees of Co-operative Societies, who were governed by the M.P. Co-operative Societies Act, 1960 and Statutory Rules framed thereunder.

ii). District Administrative Committee, U.P. Primary Agricultural Co-operative Credit Centralized Services Board Vs. Secretary-cum-General Manager, District Co-operative Bank Limited: (2010) 126 FLR 519 wherein this Court held that the Labour Court had no jurisdiction as U.P. Primary Agricultural Co-operative Credit Societies Centralized Service Regulations, 1978 provides for statutory remedy as held by the Hon'ble Supreme Court in the case of Ghaziabad Zila Sahkari Bank Ltd. Vs. Additional Labour Commissioner: 2007 (113) FLR 50 (SC) and an employees of Co-operative Society could not be treated as a 'workman' as statutorily defined under Section 2(z) of the U.P. Industrial Disputes Act.

iii). Ali Ganj Kshetriya Sahkari Samiti Limited, Bareilly Vs. Murari Lal Sharma and another: (2013) 4 UPLBEC 3448 wherein this Court again relying upon a judgment rendered in the case of Ghaziabad Zila Sahkari Bank Ltd. (supra) had held that the service conditions of employees of Co-operative Societies were governed by their own rules and regulations and labour laws were not applicable to them under Section 135 of the Co-operative Societies Act and therefore, the U.P. Industrial Disputes Act was not applicable to such employees.

16. Learned counsel for the petitioner also relied upon the judgment rendered in the case of M/s. Sahkari Ganna Vikas Samiti Limited Vs. The Presiding Officer, Labour Court and another, reported in (1993) 66 FLR 744 to argue that the termination order had merged in the order of the appellate authority, therefore, reference under Section 4-K of the U.P. Industrial Disputes Act by the government only referring to the termination order without any reference to the appellate order was not maintainable.

17. Shri Rajesh Tiwari, Advocate, appearing for the respondents, on the other hand, has argued that the judgments relied upon by the learned counsel for the petitioner are distinguishable on facts as they relate to the Co-operative Societies and their employees. Nagar Palika Parishad or Municipal Corporations have been held to be an "industry" amenable to the Industrial Disputes Act by the Hon'ble Supreme Court in several cases. The learned counsel for the respondents has cited the following cases to buttress his argument:-

i). Samishta Dube Vs. City Board Etawah and another reported in 1999 (81) FLR 746 wherein a lady clerk/typist working in the City Board, Etawah was treated as a workman falling within the definition of 'workman' in Section 2(z) of the U.P. Industrial Disputes Act and therefore, the provisions of Section 6-P and 6-N of the said Act were held to be applicable and the discharge of service of typist/clerk was held to be vitiated.

ii). The Municipal Corporation of Delhi Vs. Female Workers (Muster Roll) and another: 2000 SCC (L & S) 331 wherein the Hon'ble Supreme Court had held female muster roll employees to be entitled to maternity leave under the Maternity Benefit Act, 1961. The Municipal Corporation of Delhi was treated to be an industry for the purpose of reference to be made to the Industrial Tribunal.

iii). Jaipur Development Authority Vs. Ram Sahai reported in (2006) 11 SCC 684 wherein the Hon'ble Supreme Court upheld the judgment of the High Court confirming the award of Rajasthan Industrial Tribunal and only modified the relief to the extent that instead of reinstatement with back wages, a sum of Rs.75,000/- was awarded to the respondents therein by way of compensation.

iv). The U.P. Public Service Commission Vs. Dr. Jamuna Kurup and others, (2008) 2 SCC (L & S) 1115 wherein it was held that the employees of Municipal Corporation are not government servants even though they may enjoy the status of public servants governed by statutory rules and they cannot be said to be covered by the protection granted under Articles 309 to 311 of the Constitution.

18. On a specific query being made by the Court as to why the respondent Nos. 2, 3 and 4 had approached the U.P. Public Services Tribunal against their order of dismissal and the appellate order of the Commissioner in the earlier round of the litigation, Shri Rajesh Tiwari stated that the respondents had been ill-advised as Section - 1(4) (e) of the U.P. Public Services (Tribunal) Act clearly states that it shall not apply to 'workman' and merely approaching the Public Services Tribunal would not act as an estopple against the statute. The respondents were workman and Nagar Palika Parishad was an industry.

19. The learned counsel for the respondents has also relied upon a judgment rendered in the case of Parmanand Vs. Nagar Palika Parishad, Dehradun and others reported in 2003 (9) SCC 290 wherein Nagar Palika Parishad Deharadun was held to be an industry and the services of employees which were terminated after holding domestic inquiry were held to be vitiated by the Labour Court. The High Court had taken the view that the concept of 'industry' should be excluded to the extent the appointments are regulated by statutory rules in a government department and had relied upon the decision of the Supreme Court in the case of Himanshu Kumar Vidyarthi Vs. State of Bihar: 1997 (4) SCC 391 and had further held that as work of appellants therein had not been found satisfactory and as such their services were terminated before expiry of the period of probation, which was in accordance with service rules, and this termination could not be upset by the Labour Court and had allowed the writ petition and quashed the award. The appellants had contended before the Supreme Court that a Municipality/Local Authority has been held to be an industry for the purpose of Industrial Disputes Act by the Supreme Court in several decisions and the purpose for which Municipality or its activities were brought within the purview of the Constitution was entirely different and such inclusion did not take them out of the definition of industry for the activities carried on by the institution as an industry. The decision of Supreme Court in the case of Corporation of City of Nagpur Vs. Its Employees: AIR 1960 SC 675 and Bangalore Water Supply and Sewerage Board Vs. A. Rajappa and others: AIR 1978 SC 548 and Samishta Dube Vs. City Board Etawah and another : AIR 1999 SC 1056 were relied upon by the counsel for the appellant. The Supreme Court set aside the decision of the High Court holding that Nagar Palika is an industry for the purpose of Industrial Dispute Act.

20. On a perusal of this judgement in the case of Parmanand (supra) I find that in the very same judgment which has been relied upon by Shri Rajesh Tiwari to buttress his argument that Nagar Palika Parishad, Shamsabad was an industry, one of the judgments cited is by a Constitution Bench in the case of Corporation of City of Nagpur Vs. Its Employees: AIR 1960: SC 675. In this case, the Hon'ble Supreme Court has held that the activity of Municipal Corporation carried on in any of the departments except of those dealing with (i) assessment and levy of house-tax, (ii) assessment and levy of octroi, (iii) pulling down of dilapidated houses, (iv) prevention and control of food adulteration, and (v) maintenance of cattle pounds, will fall within the term definition of industry and any dispute in that regard will be covered under the Industrial Dispute Act.

21. The dispute in this writ petition relates to the respondent-employees working in the Nagar Palika Parishad, who were working in Octroi Department and this department indisputably cannot be said to be an industry as per law settled by the Hon'ble Supreme Court in its Constitution Bench decision in the case of Corporation of City of Nagpur (supra).

22. Moreover, the respondents had earlier approached the U.P. Public Services Tribunal against their initial order of termination and rejection of appeal and their Claim Petition was allowed. Their services being governed by the Municipalities Act, they had invoked the power of appellate authority as given under Section 77-A of the Municipalities Act and U.P. Municipal Servants Appeal Rule, 1967. If the Act and Rules framed thereunder governed their services as regular employees in the Octroi Department of Nagar Palika Parishad, Shamsabad, they clearly fell within the definition of a "public servant" given under the U.P. Public Services (Tribunal) Act, 1976. They had rightly considered themselves to be public servants and not workman barred by Section 1(4) (e) of the U.P. Public Services (Tribunal) Act from approaching the Tribunal, by filing the Claim Petition. Section 1 including provision (4) (e) of the U.P. Public Services (Tribunal) Act, 1976 is being quoted herein below :-

1. Short title, extent, commencement and application.―(1) This Act may be called the Uttar Pradesh Public Services (Tribunal)1 Act, 1976.

(2) It extends to the whole of Uttar Pradesh.

(3) It shall be deemed to have come into force on November 24, 1975.

(4) This section and Sections 2 and 6 shall apply in relation to all public servants while the remaining provisions shall not apply to the following classes of public servants, namely ―

(a) a member of a judicial service;

(b) 2[an officer or servant of the High Court or of a court subordinate to the High Court.]

(c) a member of the secretariat staff of any House of the State Legislature;

(d) a member of the Staff of the State Public Service Commission;

(e). "a workman as defined in the Industrial Disputes Act, 1947 (Act XIV of 1947), or the United Provinces Industrial Disputes Act, 1947 (U.P. Act No. XXVIII of 1947)."

(f) 3[a member of the staff of the Lok Ayukta]

(g) 4[the Chairman, Vice-Chairman, Members, Officers or other employees of the Tribunal]

23. Not being workmen they could not have approached the Industrial Tribunal and the Adjudication Cases No. 154 of 1984, 155 of 1984 and 279 of 1989 could not have been entertained at all by the Labour Court. The award impugned in this writ petition is liable to be set aside on this ground alone.

24. As regards the argument of Shri Rajesh Tiwari, the learned counsel for the respondents, that the respondents had approached the U.P. Public Services Tribunal against the order of dismissal earlier on wrong legal advice and they were actually workmen and not public servants and should not have approached the learned Tribunal at all but should have approached the Labour Court in the first instance. This argument is only stated to be rejected.

25. It is undisputed that the respondents had initially been dismissed in November, 1974 and against the dismissal orders they had filed Statutory Appeals before the Commissioner, Agra Region, Agra. Their appeals were rejected. After rejection of appeals, the respondent Nos. 2, 3 and 4 filed Claim Petitions before the U.P. Public Services Tribunal, which were decided on 26.08.1980 by the Tribunal and the dismissal orders were set aside on the ground of not following the Principles of Natural Justice. Liberty was given by the Tribunal to the petitioner to start fresh proceedings from the stage they stood vitiated. On the basis of judgment of the Tribunal, the respondents were reinstated and fresh inquiry was conducted thereafter.

26. The fact that the respondents were reinstated on the orders of Tribunal and fresh inquiry was conducted in the matter goes to show that they had taken the benefit of orders passed by the Tribunal. They cannot now be allowed to turn around and argue that their case was not maintainable before the Tribunal. In the judgment rendered in Shah Mukhun Lall Vs. Baboo Sree Kishen Singh (1867-69) 12 Moo Ind App 157, Lord Chemlsford observed thus :-

"A man cannot both affirm and disaffirm the same transaction, show its true nature for his own relief, and insist on its apparent character to prejudice his adversary. This principle, so just and reasonable in itself, and often expressed in the terms, that you cannot both approbate and reprobate the same transaction, has been applied by their Lord-ships in the Committee to the consideration of Indian Appeals, as one applicable also in the Courts of that country, which are to administer justice according to equity and good conscience. The maxim is founded, not so much on any positive law, as on the broad and universally applicable principles of justice."

27. The award of the Labour Court is also liable to be set aside on the ground that after going through the inquiry report which had been submitted by the Inquiry Officer on the basis of which the learned Tribunal in its order dated 31.01.1998 held that domestic inquiry against the respondents had been fairly conducted, the Labour Court could not have taken 'U' turn and examined all the evidence afresh particularly when the incident was of 1974 and it was examining the evidence in 1998-99. A list of sixty two documents were submitted on behalf of Nagar Palika Parishad before the Labour Court. The documentary evidence available on record was ignored, the oral statements of the oil dealer and the Octroi Inspector were discarded by the Labour Court as statements of interested witnesses. The Labour Court had no jurisdiction at all to conduct the domestic inquiry on its own after more than 24 years of the incident and come to a contrary finding. At best it could have examined the inquiry report and the documentary evidence submitted by both the parties and found fault, if any, with the conduct of inquiry, but ignoring the inquiry report and conducting the trial afresh after more than two and half decades, the Labour Court came to a conclusion that the charge of defalcation of public money (octroi duty) was not proved beyond reasonable doubt. It is settled law that in disciplinary proceedings "preponderance of probability" alone has to be seen, and since the inquiry had been held to have been conducted in a fair manner by the Tribunal itself on 31.01.1998, the charges having been found proved by the Inquiry Officer, leading to loss of confidence of the employer in the employees, it was sufficient for warranting the dismissal of the employees.

28. The writ petition for the reasons as mentioned hereinabove is allowed and the impugned award of the Labour Court dated 15.02.2000 published on 06.12.2000 in Adjudication Case Nos. 154 of 1994, 155 of 1994 and 279 of 1989 is set aside.

29. Parties to bear their own costs.

Order Date :- 04.05.2017

LBY