[Cites 1, Cited by 0]
Bombay High Court
Ankush R. Khatkale vs M/S. Shree Mineral Products on 13 March, 2026
2026:BHC-OS:6555
Megha 48_WP_2380_2007_fc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO.2380 OF 2007
Ankush R. Khatkale ...Petitioner
V/s.
M/s. Shree Mineral Products ...Respondent
________________
Mr. Arshad Shaikh, Senior Advocate with Ms. Namrata Agashe & Ms.
Vinsha Acharya i/b. Mr. Vinod Shetty for the Petitioner.
None for the Respondent.
________________
CORAM: SANDEEP V. MARNE, J.
RESERVED ON: 20 FEBRUARY 2026.
PRONOUNCED ON : 13 MARCH 2026
JUDGMENT:
1) Petitioner-workman has filed the present Petition challenging
Part- I Award dated 6 February 2006 holding that the enquiry is fair and
proper, Part-II Award dated 8 November 2006 holding that findings of the
Enquiry Officer are not perverse and Part-III Award dated 7 April 2007
answering the Reference in the negative. The Reference was with regard
to the Petitioner's demand for reinstatement with full backwages.
2) Briefly stated, facts of the case are that the Respondent is a
Partnership Firm, engaged in the business of production of Silica Sand
and Silica coated sand. The Petitioner was appointed in June 1995 as
Clerk-cum-Chemist. On 4 March 2000, the Petitioner was on leave. When
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he reported for duties on 5 March 2000, he was not allowed to resume
duties. He raised a demand by letter dated 25 March 2000 calling upon
the Respondent-Company to reinstate him with full backwages.
According to the Petitioner, the Respondent sent a backdated charge-
sheet dated 25 March 2000 to the Petitioner, which he received on 5 April
2000. He responded the charge-sheet by denying all allegations on 7
April 2000. The Respondent-Company however, initiated enquiry against
the Petitioner, which commenced on 10 April 2000 and concluded on 29
July 2000. At the end of the enquiry, report and findings were submitted
by the Enquiry Officer on 13 September 2000 holding the Petitioner
guilty of misconduct alleged in the charge-sheet. The Respondent-
Company thereafter issued order dated 19 September 2000 dismissing
the Petitioner from service w.e.f. 25 September 2000. The Petitioner sent
Demand Letter dated 16 February 2001 calling upon the Respondent-
Company to reinstate him with full backwages and continuity of service.
Following conciliation proceedings, which ended in a failure report, the
Petitioner's demand was referred to third Labour Court at Mumbai for
adjudication and the Reference was numbered as Reference (IDA) No.749
of 2001.
3) The Petitioner filed Statement of Claim, which was resisted by the
Respondent-Company by filing written statement. The Petitioner led
evidence on the issue of fairness of enquiry. The Respondent examined
the Enquiry Officer. The learned Judge, third Labour Court, Mumbai,
passed Part-I Award dated 6 February 2006 holding that the enquiry is
fair and proper. The Petitioner thereafter examined himself on the issue
of perversity in the findings of the Enquiry Officer. The Labour Court
thereafter passed Part-II Award on the twin issues of -Enquiry Officer's
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adherence to fair play and principles of natural justice and perversity in
his findings. Both the issues were answered against the Petitioner in
Part-II Award dated 8 November 2006. The Petitioner thereafter led
evidence on the remaining issues. The Respondent-Company did not
lead any further evidence. After hearing the parties, the Labour Court
passed Part-III Award dated 7 April 2007 rejecting the Reference.
4) Aggrieved by Part-I, II and III Awards dated 6 February 2006, 8
November 2006 and 7 April 2007 passed in Reference (IDA) No.749 of
2001, the Petitioner has filed the present Petition. By order dated 3
December 2007, the Petition came to be admitted.
5) Mr. Shaikh, the learned Senior Advocate appearing for the
Petitioner submits that the Labour Court has grossly erred in delivering
Part-I, II and III Awards against the Petitioner and in ultimately
dismissing the Reference relating to demand for setting aside dismissal
order and for reinstatement. That the charges levelled against the
Petitioner in charge-sheet dated 25 March 2000 were absolutely vague.
That the Labour Court has failed to record any findings on the point of
vagueness of the charges. That the charge-sheet lacked material
particulars in support of charges levelled against the Petitioner and it is
impossible to comprehend the exact allegations based on the charges
levelled in the charge-sheet. He submits that the charge relating to
acquisition of property is difficult to comprehend as the same alleges
purchase of 'plot of land', which is shown to have been situated at fourth
floor of a building. That mere purchase of property does not per se
amount to misconduct. Similarly, mere deposit of amounts in the bank
account cannot per se lead to presumption of misappropriation. He
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submits that advancement of loans to workers again cannot amount to
misconduct. He therefore, submits that most of the allegations in the
charge-sheet, even if accepted as correct, do not amount to any
misconduct.
6) He further submits that so far as the charge of misappropriation is
concerned, the same is levelled on the basis of mere entries in the diary.
Though during the course of enquiry, it got established that diary was
required to be maintained by the Petitioner for recording incurring of
expenditure for the employer, mere entries in the diary is not a ground
for alleging misappropriation. That charges relating to sale of raw
materials are absolutely vague as no details of alleged sale of raw
material are indicated in the charge-sheet.
7) Mr. Shaikh further submits that the enquiry has been conducted in
an unfair and improper manner since Enquiry Officer refused to allow
defence representative of the Petitioner to ask pertinent questions. That
Petitioner was denied opportunity to defend himself. That the
documents demanded by the Petitioner were not made available to him
for his defence. That duplicate diary was admittedly in possession of the
Respondent, which was not produced despite being demanded by the
Petitioner.
8) Mr. Shaikh further submits that Part-II Award of the Labour Court
is also illegal, improper and bad in law and that findings of the enquiry
are totally perverse, vague and conjectural and unsupported by any
evidence. That no supporting evidence is produced by the Management
to prove the misconduct. That the findings of the Enquiry Officer are
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contrary to the evidence adduced before the Labour Court. That Findings
of the Enquiry Officer are unreasoned and based on mere ipse dixit. That
no reasons are assigned by the Labour Court for holding that the findings
of the Enquiry Officer are based on evidence. That the Labour Court has
observed that the Enquiry Officer deliberately omitted to consider
answers to questions put by Defendant's representative and erred in
holding that it is not necessary to consider answers given by the
witnesses to the said questions by the Enquiry Officer.
9) Mr. Shaikh would further submit that the Labour Court has erred in
holding that the punishment is not disproportionate to the misconduct.
That the Petitioner is victimised by the Management by deliberately
including the word 'misappropriation' in the charge-sheet so as to give
flavour of seriousness to the allegations, which are otherwise absolutely
vague and totally baseless. Mr. Shaikh would accordingly pray for setting
aside the impugned Awards.
10) None has appeared on behalf of the Respondent -Company when
the Petition is called out for final hearing. It appears that the Respondent
used to be represented by a Firm of Advocates, who appeared in the
Petition till June-2024. However, thereafter there is consistent non-
appearance on the part of the Respondent on several dates. Accordingly,
the Petition is heard in absence of any representation by the
Respondent.
11) Having considered the submissions canvassed by Mr. Shaikh, it is
seen that the Petitioner faced following broad allegations :-
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(i) Misappropriation of monies of the Company while
reimbursements made in cash to him.
(ii) Sale of raw material as well as finished products without
counting the same and using the monies for personal gain.
(iii) Sale of 35 empty drums of sister concern and
misappropriating Rs.7,000/- being the sale proceeds.
(iv) Destruction of a shed due to Petitioner's negligence
putting the management to loss of Rs.75,000/- for repairs.
(v) Advancement of loans to other workers out of
misappropriated amounts.
(vi) Deposit of large amounts in the bank accounts earned
through misappropriation.
(vii) Purchase of 'plot of land' in own name out of the
misappropriated amount.
12) It is the case of the Management that the Company trusted the
Petitioner and allowed him to handover cash of the Company for
purchase and sales activities. According to the Management, Petitioner
was given a free hand in day to day functioning of the Company. The
Management apparently came across a diary maintained by the
Petitioner, in which entries were made relating to certain sums. The total
of such entries was Rs.97,733/-. Details of those entries were provided to
the Petitioner as annexure to the charge-sheet. In the domestic enquiry
conducted against the Petitioner all the charges are held to be proved
and punishment of dismissal from service was imposed on him by the
Management vide letter dated 19 September 2000.
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13) The first preliminary issue before the Labour Court was about
fairness in the enquiry. The Tribunal went into evidence led by the
Petitioner and of Enquiry Officer led by the Management on the issue of
fairness of enquiry. There is no dispute to the position that the
Petitioner has cross-examined all the Management witnesses. He was
represented by a defence representative, who has conducted indepth
cross-examination of all the Management witnesses. The Labour Court
has observed that the Petitioner did not file on record any application for
production of documents. After scanning the entire evidence on record
the Labour Court has observed that ample opportunity was given to the
Petitioner for defending himself in the enquiry. The findings recorded by
the Labour Court about grant of full opportunity of defence to the
Petitioner therefore do not warrant any interference in exercise of
jurisdiction of this Court under Article 227 of the Constitution of India.
14) One of the facets of issue of fairness of enquiry was Petitioner's
allegation of vagueness in the charges. It is sought to be contended
before this Court that the charges were vague and lacked material
particulars. Here, it must be noticed that for a vice of unfairness, the
charges must be found to be so vague that vice of vagueness results in
denial of opportunity of defence to the delinquent employee. However
considering the facts of the case, it cannot be held that the Petitioner did
not comprehend the charges and was denied opportunity to defence.
15) So far as the first charge is concerned, same was based on diary
entries and thus full particulars about misappropriated amounts were
given. So far as the allegations of deposit of amount in the bank account
and purchase of a flat are concerned, the same are only additional facets
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of charge of misappropriation. This is because both the allegations
relating to deposits in bank accounts and purchase of flat relate to the
allegation of misappropriation. Similar is the case in respect of
advancing of loans to co-workers, which allegation again has direct co-
relation with allegation of misappropriation. It is only the three
allegations in respect of sale of raw materials and finished products, sale
of empty drums of sister concern and destruction of shed, which had no
connection with allegation of misappropriation.
16) Allegation of vagueness is considered and decided by the Labour
Court partly in both Part-I and Part-II Awards. However, the charge of
destruction of the shed causing loss of Rs.75,000/- to the Management
was not proved in the enquiry also. The allegations relating to raw
materials and finished products and empty drums are apparently not
considered by the Labour Court while rendering impugned Awards
against the Petitioner.
17) The Management produced sufficient evidence for proving the
allegation of misappropriation against the Petitioner. The Petitioner was
earning salary ranging between Rs.3,000/- to Rs.5,000/- prior to his
dismissal from service. As against the salary earned by him it appears
that he deposited total amount of Rs.43, 837/- in his bank account during
short time gap of 3 August 1998 to 26 March 1999. It was fully proved
during the course of enquiry that the Petitioner advanced loan of
Rs.20,000/- to driver and Rs.8,000/- to another worker and charged
exorbitant interest @4% per month from both of them. Both the workers
were examined in the enquiry and gave evidence of advancement of loan
and charging of hefty interest @4% per month, which comes to 48% per
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annum. Thus, it is got proved in the enquiry that the Petitioner was
carrying out activities of a private money lender. I am not impressed by
the submissions of Mr. Shaikh that of advancing of loan per se is not
misconduct. Here, Petitioner did not advance friendly loan to a co-
worker. He acted as a private money lender by charging exorbitant
interest @ 48% per annum, which clearly amounts to misconduct.
Furthermore, how Petitioner was in a position to advance loans to co-
workers upto Rs.28,000/- when his salary was ranging between Rs.3,000/-
to Rs.5,000/- becomes difficult to comprehend. It has also an admitted
position that the Petitioner purchased a flat at Mulund and could not
produce any evidence of having availed any loan for purchase of the flat.
Mere inadvertent error in the charge in description of the purchased land
as 'plot of land' caused no prejudice to the Petitioner, who correctly
understood the exact purport of the charge levelled against him.
18) In my view, the allegation of misappropriation on a large scale got
clearly proved against the Petitioner, who was found disbursing loans at
exorbitant rate of interest, depositing large sums of money in personal
bank accounts and purchasing a flat, which is not found commensurate
to his salary. Diary entries are proved to be 'personal' to the Petitioner.
Considering the other activities of the Petitioner of lending loans and
depositing large sums in the bank accounts, it is difficult to accept
Petitioner's defence that the entries made in the diary were in respect of
the expenditure incurred for the Company.
19) Contention of the punishment being disproportionate is raised
only for being rejected. If the employee is found misappropriating the
amounts of the employer, punishment of dismissal is clearly warranted.
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Petitioner faced grave charges and the charge of misappropriation has
been proved. The punishment of dismissal therefore cannot be treated as
disproportionate by any stretch of imagination.
20) Considering the overall conspectus of the case, I do not find any
reason to interfere in the impugned Awards. Writ Petition is devoid of
merits. It is accordingly dismissed. Rule is discharged. There shall be no
orders as to costs.
[SANDEEP V. MARNE, J.]
Signed by: Megha S. Parab Page No.10 of 10
Designation: PA To Honourable Judge 13 March 2026
Date: 13/03/2026 18:03:28
