Taj Mahal Hotel vs Industrial Tribunal-I & Ors
2010 Latest Caselaw 2577 Del

               *IN THE HIGH COURT OF DELHI AT NEW DELHI
13
+                             W.P.(C) 2221/2000

%                                               Date of decision: 14th May, 2010


         TAJ MAHAL HOTEL                                           ..... Petitioner
                       Through:             Mr. Vinay Bhasin, Sr. Advocate with
                                            Mr. Amit Bhasin, Advocate.


                                       Versus

         INDUSTRIAL TRIBUNAL-I & ORS                  ... Respondents
                        Through:  Mr. Harvinder Singh, Advocate for
                                  Respondent No.2 to 6.

CORAM :-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
1.       Whether reporters of Local papers may
         be allowed to see the judgment?                   yes

2.       To be referred to the reporter or not?            yes

3.       Whether the judgment should be reported           yes
         in the Digest?

RAJIV SAHAI ENDLAW, J.

1. The petitioner by this writ petition impugns the order dated 6th March,

2000 of the Industrial Tribunal holding the domestic / departmental inquiry

conducted prior to the dismissal of the respondent Nos. 2 to 6 workmen to be

legally invalid and vitiated. After holding so, the Industrial Tribunal gave liberty

to the petitioner to prove the charges against the workmen before the Industrial

Tribunal.

2. The petitioner however, instead of proving the charge of misconduct

before the Industrial Tribunal, filed this writ petition, notice whereof was issued

to the respondent workmen. Subsequently, vide order dated 7th July, 2000 Rule

was issued in the petition and the operation of the order aforesaid impugned in

this writ petition was stayed. The said interim order was, on 11th January, 2002,

made absolute till the disposal of the writ petition. Resultantly the further

proceedings before the Industrial Tribunal on the reference "Whether the

dismissal of services of Shri B.S. Rawat, Ramvir, Shankar Lal, Ramphool and

Mukesh Shakun, is illegal and / or unjustified and if so, to what relief are they

entitled and what directions are necessary in this respect?" remain held up.

3. On 2nd September, 2002 the counsel for the petitioner sought time to

check up whether the witnesses necessary to prove the charges against workmen

before the Industrial Tribunal were still available to give testimony or not. The

counsel for the petitioner on 30th September, 2002 informed the Court that none

of the witnesses were so available. The counsels for the parties have been heard.

4. The Industrial Tribunal has held the domestic / departmental inquiry to be

invalid and vitiated only on the ground of bias. One Shri Alok Bhasin was

appointed by the petitioner as the inquiry officer. The respondent workmen

raised an objection to his appointment as the inquiry officer on the ground that he

had conducted about 50 inquiries on behalf of the petitioner against the workmen

and had given findings in each of them in favour of the petitioner; that he had

been appearing in conciliation proceedings before the authorities under the Delhi

Shops and Establishments Act and before Labour Courts and Industrial Tribunals

on behalf of the petitioner and is a regular consultant and advocate of the

petitioner and thus could not be expected to act as an unbiased person and the

workmen apprehended that they would not get fair treatment from him.

Notwithstanding the said protest by the respondent workmen, the petitioner

continued with the inquiry proceedings through the aforesaid Shri Alok Bhasin.

5. The Industrial Tribunal found that Shri Alok Bhasin, appearing as the

witnesses before the Industrial Tribunal on behalf of the petitioner admitted in

his cross-examination that he had been appearing for the petitioner before

authorities under the Delhi Shops and Establishments Act on behalf of the

petitioner and in a proceeding against some of the respondent workmen; that he

had appeared as the representative of the petitioner in a meeting of Ministers of

the Delhi Government; that in a span of 8 to 9 years he had conducted

approximately 30 inquiries against the employees of the petitioner and in all

these inquiries he had held the workmen guilty of the charges; that the inquiry

proceedings were conducted in the Guest House of the petitioner; that the

respondent workmen had during the inquiry proceedings also objected to his

conducting the enquiry but he had overruled the said objection; that even in the

instant case before the Industrial Tribunal he was representing the petitioner and

had a signed letter of authority on behalf of the petitioner.

6. The Industrial Tribunal on a consideration of the circumstances found

merit in the objections raised by the respondent workmen to the appointment of

Shri Alok Bhasin as the inquiry officer. Placing reliance on Sh. N.K. Sareen Vs.

Punjab National Bank (1994) LLR 676 laying down that an impartial enquiry is

an essential feature, it was held that a case of reasonable apprehension of bias

having been made out, the inquiry has to be treated as non-est. Accordingly, it

was held that the inquiry was not held/conducted in accordance with the

principles of natural justice requiring that such inquiries be conducted by

unbiased and impartial persons.

7. Mr. Vinay Bhasin, Senior counsel for the petitioner has at the outset stated

that the sole question for adjudication is whether an inquiry conducted by a Legal

Advisor of the employer management can be said to be per se bad. He contends

that the case of the petitioner will sink or swim on the said premise only

inasmuch as it has already been informed that the petitioner after long lapse of

time is not in a position to avail the opportunity given by the Industrial Tribunal

to prove the misconduct before the Industrial Tribunal. It is further urged that

bias arises from the conduct of the proceedings and not by the identity of the

inquiry officer. It is urged that there is no finding that Shri Alok Bhasin, in the

conduct of the inquiry, had shown any bias against the respondent workmen or

had favoured the petitioner. The senior counsel for the petitioner contends that

there is no bar in law to an employer conducting the inquiry himself to ascertain

the misconduct of the workmen; in bigger/larger establishments inquiries are

nearly always conducted by other employees of the same employer/management.

It is contended that the impugned order is thus bad for the reason of finding bias

merely for the reason of Shri Alok Bhasin being the advocate and the legal

advisor of the petitioner or for the reason of him having conducted inquiries

against other workmen of the petitioner. It is contended that the Industrial

Tribunal inspite of noticing the following judgments has erred in applying the

principles thereof to the case at hand:

(i) Aligarh Muslim University Vs. Mansoor Ali Khan 2001 (91) FLR 28,

wherein the Supreme Court has held that prejudice must be proved and some real

prejudice having been caused must be shown by the complainant and there is no

such thing as mere technical infringement of natural justice.

(ii) Saran Motors Private Ltd. Vs. Vishwanath (1964) 2LLJ 139 where the

Supreme Court rejected the argument that just because a person is sometimes

employed by the employer as a lawyer he becomes incompetent to hold a

domestic inquiry and reiterated that the requirement only was that the inquiry

must be fairly conducted and if not found to have been fairly conducted is liable

to be set aside and an inquiry is not bad just because it is conducted by an officer

of the employer. It was further held that if the inquiry held by an officer of the

employer was not bad, an inquiry by a lawyer of such employer also could not be

bad.

(iii) Narendra Pratap Vs. Jagmohan Bharti, FLR 1976 (32) 218 where a

Single Judge of this Court in the absence of any proof of personal ill will or of a

conspiracy between the management and the inquiry officer, reversed the order

of the Tribunal holding the inquiry to be vitiated. It was further held that merely

because the inquiry officer was connected with the Law Firm which was the

legal advisor to the management could not lead to the conclusion that the inquiry

officer has deliberately and willfully held against the workmen. It was further

held that bias has to be personal to the inquiry officer and must be clearly proved.

I may notice that the same set of Advocates and inquiry officer, as in the present

controversy, were involved in that case also.

8. The Senior Counsel for the petitioner himself drew the attention to a

recent judgment of Division Bench of this Court in Indian Refrigeration

Industries Vs. Ram Rattan Sharma 2006 LLR 548 where though holding that

there is no absolute bar to an Advocate or an officer of the company being an

inquiry officer, it was noticed that in the facts of that case the inquiry officer was

also authorized to represent the management in the hearing of the approval

application under Section 33(2)(b) as well as in the industrial dispute and a case

of clear bias was held to have been made out. It was further held that if the

inquiry officer himself appears as an Advocate for the management in the

reference against the termination of service based on the inquiry which he had

himself held, this obviously shows bias. The said situation was found akin to a

Trial Judge who convicts an accused appearing as a counsel for the prosecution

in the appeal against the conviction. The Senior Counsel for the petitioner

contends that the said judgment of the Division Bench is not good law in view of

the earlier judgments of Division Benches of this Court as well as the judgments

aforesaid of the Supreme Court. It is further contended that the said judgment

contains no reasoning and no ratio and hence ought not to come in the way of the

petitioner.

9. The respondent workmen in their counter affidavit have also challenged

the maintainability of the present writ petition. It is their contention that no writ

lies against the decision on a preliminary issue as in the present case and the

challenge, if any, can only be to the final award on an industrial reference.

Responding to the said plea, the Senior Counsel for the petitioner contends that

in the face of the statement earlier given that the petitioner is now not in a

position to adduce evidence of misconduct before the Industrial Tribunal, the

order impugned in this writ petition is as good as a final order on the industrial

reference inasmuch as only the formality of answering the reference would

remain hereinafter. It is contended that in the event of the finding of the

Industrial Tribunal of the inquiry being vitiated is upheld, the industrial reference

would be answered against the petitioner and in the event of the order of the

Industrial Tribunal being set aside, the industrial reference would necessarily be

answered in favour of the petitioner. Reliance in this regard is also placed on:-

(i) Assistant General Manager, M/s Hyderabad Engineering Industries Vs.

Chairman, Hon'ble Additional Industrial Tribunal 2004 LLR 770 where a

Single Judge of the Andhra Pradesh High Court has held that a writ petition on a

decision on a preliminary issue with respect to inquiry, as in the present case, is

not barred though it is restricted.

(ii) St. Thomas Mission Hospital Vs. State of Kerala 2007 LLR 610 where a

Division Bench of the Kerala High Court held that in appropriate case where the

Labour Court for totally misconceived reason invalidates an inquiry, the

management cannot be directed to wait till the final award is passed to challenge

the preliminary order also and the High Court should interfere at the first stage

itself without relegating the management to the circuitous process.

10. Per contra, the counsel for the respondent workmen contends that the

statement of the petitioner before this Court that it does not want to adduce

evidence to prove misconduct before the Labour Court would not make this writ

petition maintainable inasmuch as the award still remains to be passed by the

Industrial Tribunal and the order impugned remains an interlocutory order. He

further contends that in the present case, the respondent workmen had raised an

objection to the inquiry officer at the very threshold. It is contended that the

judgments of the Supreme Court relied upon by the petitioner only hold that

merely because the inquiry officer is an Advocate of the employer, the same does

not amount to bias. It is contended that in the present case, specific bias is shown

by the inquiry officer appearing against the respondent workmen not only in the

proceedings under the Delhi Shops and Establishments Act as well as in the

proceedings (from which this petition has arisen) before the Industrial Tribunal.

It is contended that the said appearance of the inquiry officer before the

Industrial Court is not as an Advocate but under a letter of authority from the

petitioner and as an office bearer of the petitioner. It is contended that thus a

commonality of interests is spelled out between the inquiry officer and the

petitioner; it is not as if the inquiry officer was appearing in other cases of the

petitioner; here the inquiry officer was representing the petitioner in disputes

with the respondent workmen themselves. It is further contended that the finding

of the Industrial Tribunal of bias is a finding of fact and a possible finding in the

facts and circumstances aforesaid and this Court in the exercise of writ

jurisdiction ought not to interfere with the same. It is urged that it is a basic

principle of natural justice that a person should not be a judge in his own cause

and that justice should not only be done but also be seen to be done and that bias

is to be seen from the point of view of the respondent workmen, and seen in that

perspective, a case of bias is made out. It is further urged that the petitioner by

preferring this misconceived writ petition has held up the disposal of the

industrial reference for the last 10 years and the respondent workmen are entitled

to be compensated for the same. Reliance is placed on M/s Luxco Electronics

(Paper Cone) Vs. Presiding Officer 2004 All L.J. 1669 where a Single Judge of

the Allahabad High Court on the basis of the inquiry officer being the authorized

representative of the employee in several cases and also the son of the inquiry

officer being the representative of the management in the same case, held a case

of bias to have been made out. On the maintainability of the writ petition,

attention is invited to Cooper Engineering Ltd. Vs. P.P. Munde 1975 (2) LLJ

379, D.P. Maheshwari Vs. Delhi Administration 1983 Lab IC 1629 (SC) and

National Council for Cement and Building Materials Vs. State of Haryana

1996 (2) LLJ 125 (SC). Attention is also invited to Ashok Kumar Monga Vs.

UCO Bank 1999 LLR 1171 where a Single Judge of this Court held that the test

of personal bias is not whether there was actual prejudice and that the courts

would interfere if the facts tend to establish that there was a real likelihood of

bias or reasonable suspicion of bias and in deciding the question of bias, one has

to take into consideration human probabilities and ordinary course of human

conduct.

11. The counsel for the respondent workmen also contends that the present

proceedings are in fact infructuous. It is contended that owing to the pendency of

an industrial dispute, the petitioner had sought approval of its action of dismissal

of the respondent workmen from service by filing an application under Section

33(2)(b) of the I.D. Act. It is stated that the inquiry officer was the authorized

representative of the petitioner in the said approval application also. It is

contended that the said approval application has since been withdrawn. Relying

on Jaipur Zila Sahakari Bhumi Vikas Ltd. Vs. Ram Gopal Sharma 2002 Lab

IC 513 (SC), it is contended that on withdrawal by the petitioner of the approval

application, it has to be deemed that there is no order of dismissal of the

respondent workmen and hence no need for the adjudication of the industrial

dispute.

12. The Senior Counsel for the petitioner, in rejoinder, though admitting that

the inquiry officer had appeared against the respondent workmen in proceedings

under the Delhi Shops and Establishments Act contends that the said appearance

was much after the conduct of the inquiry and hence not material. It is further

explained that since the appearance of the Advocates is prohibited before the

Industrial Tribunal/Labour Courts, the Advocates appear as authorized

representatives by forming a society but the same does not mean that they have

any other/personal interest in the lis than while appearing before a Civil Court. It

is urged that objections to the inquiry officer are routine and always made by the

workmen to delay the inquiry and in the absence of any personal enmity as has

not been shown between the inquiry officer and the respondent workmen, no

case for bias is made out.

13. I have recently in Glaxo Smithkline Consumer Healthcare Ltd. Vs.

Presiding Officer, Labour Court MANU/DE/1034/2010 dealt with the

maintainability of a writ petition by an employer against the preliminary findings

of the Industrial Tribunal. It was held that such challenge which holds up the

decision on the reference by the Industrial Adjudicator is not maintainable. The

statement of the petitioner before this Court that it gives up the right to prove the

misconduct before the Industrial Tribunal will not change the said position. The

fact remains that by preferring the petition at this preliminary stage, the petitioner

has succeeded in preventing the decision of the reference for over 10 years. The

petitioner could have before the Industrial Tribunal also informed that it was not

in a position to establish misconduct before the Industrial Tribunal. On such

statement of the petitioner, the reference would have been necessarily decided

against the petitioner. If the petitioner had come to the Court then, the provisions

of Section 17B would have been available to the respondent workmen. The

purpose of Section 17B of the I.D. Act is to provide relief to the workmen on

account of delays occasioned by judicial review of awards of Industrial

Adjudicators. However, the petitioner by pre-empting the award against it, has

deprived the respondent workmen from the benefit of Section 17 B. Considering

that the order under Section 17 B is to be made at the rate of minimum wages

and considering the minimum wages in Delhi, the petitioner may have then

become liable to pay in excess of Rs.3 lakhs to each of the six respondent

workmen. I may notice that the respondent workmen during the pendency of this

petition filed applications in this regard which were contested by the petitioner.

There does not appear to be any precedent of Section 17B having been made

applicable in such circumstances. In any case now that the writ petition is for

final disposal. The respondent workmen, for the delay caused by the petitioner,

can only be compensated with costs.

14. I had in Glaxo Smithkline Consumer Healthcare Ltd. (supra) refrained

from deciding the writ petition on merits apprehending that such a decision might

lead to further proceedings thereby further delaying the decision of the industrial

reference. However, since the decision of the industrial reference, in view of the

statement of the petitioner is but a mere formality, it is deemed expedient to deal

with the challenge by the petitioner to the order of the Tribunal holding the

enquiry to be vitiated.

15. The judgment of the Division Bench of this Court in Indian Refrigeration

Industries (supra) cannot be viewed as bad law as has been contended by the

senior counsel for the petitioner. I do not find the said judgment to be contrary to

the grain of the judgments of the Supreme Court or of the earlier judgments of

this Court. The Division Bench has held that though by the mere status of the

inquiry officer as the Advocate for the management / employer, the inquiry

would not be vitiated but held the inquiry to be vitiated for two reasons. Firstly,

for the reason of the inquiry officer also representing the management in the

approval application and secondly for the reason of the inquiry officer

representing the management in the industrial dispute. Both the said reasons exist

in the present case also. The inquiry officer Shri Alok Bhasin in his cross-

examination admitted the authorization on behalf of the petitioner filed by him in

the industrial dispute. The Senior Counsel for the petitioner has also not

controverted the argument, of the inquiry officer also being the authorized

representative of the petitioner in the approval proceedings under Section

33(2)(b) which were subsequently withdrawn. The facts of the present case are

therefore squarely covered by the judgment aforesaid of the Division Bench and

this Court is bound by the same. The judgment of the Division Bench also cannot

be said to be per incuriam as it notices the judgments on the basis whereof the

Senior Counsel for the petitioner urges the judgment of the Division Bench to be

not good law. Once a larger bench of this Court, after considering the relevant

judgments on the issue of the Supreme Court, has taken a particular view for the

reasons set out therein and the same reasons are found to exist in the present case

also, the said judgment cannot be ignored.

16. I am even otherwise unable to accept the contention of the petitioner that

bias is required to be established as a fact. It is almost impossible to so establish

bias. It is sufficient if there is a real likelihood of bias or bona fide suspicion of

bias or substantial possibility of bias. The likelihood of bias is to be looked into

in the mind of the party and not in the mind of the inquiry officer. Even if the

inquiry officer is impartial but if a right minded person would think, in the

circumstances of the case, there was real likelihood of bias on his part, then the

inquiry officer could not function as such and if he functions and renders the

decision, that decision gets invalidated on the ground of bias. The Court will not

inquire whether the inquiry officer, in fact, favoured one side unfairly. Suffice if

a reasonable person would think that he did. The Supreme Court in Indrani Bai

Vs. Union of India 1994 Supp. (2) SCC 256 has held that when a representation

against the impartiality of the inquiry officer is made at the earliest requesting a

change in the inquiry officer, the authority should have acceded to the request

and appointed an inquiry officer other than the one whose objectivity is doubted.

That having not been done, the Supreme Court held the inquiry to be vitiated,

reiterating that justice should not only be done but also be seen to be done.

17. The established facts in the present case are that the lawyers firm, of

which the inquiry officer forms a member of „the core-team‟ (as described in the

website of the law firm) is the Legal Advisor of the petitioner. The authorization

in the industrial dispute wherefrom the present petition has arisen, was filed on

behalf of the petitioner on a standard form bearing the name of the inquiry officer

as well as Mr. S.K. Bhasin, Advocate who conducted the cross-examination and

urged arguments before the Industrial Tribunal. The present writ petition on

behalf of the petitioner is filed by the same firm of advocates, the printed

Vakalatnama in whose favour also bears the name of the inquiry officer. In the

normal course of business, the petitioner which is a large professionally managed

company would not have taken the decision of suspending the respondent

workmen and charge sheeting them without consulting their Legal Advisors and

of whom the inquiry officer formed a part. It can thus safely be assumed that the

inquiry officer was first a part of the decision making process which resulted in

the respondent workmen being suspended and charge sheeted and after giving

the report in favour of the petitioner and against the respondent workmen has

been supporting his report, first before the Industrial Tribunal and thereafter

before this Court. From the said admitted facts, a case of bias is made out.

18. The Supreme Court in State of Uttaranchal Vs. Kharak Singh 2008 (8)

SCC 236 has held that domestic inquiries must be conducted bona fide and care

must be taken to see that the inquiries do not become empty formalities. It was

held that if an officer is a witness to any of the incidents or if the inquiry was

initiated on a report of an officer, then in all fairness he should not be the inquiry

officer and the task of holding an inquiry should be assigned to some other.

Recently, in Biecco Lawrie Ltd. Vs. State of West Bengal AIR 2010 SC 142 the

said question was again up for consideration. The inquiry officer in this case also

was the company lawyer. The Supreme Court laid down the test of nemo judex in

re sua (a man may not be a judge in his own cause) and though upholding the

inquiry by the company lawyer, the Supreme Court held that bias arises when the

functions of a judge and the prosecutor are combined and it was further held that

departmental fraternity and loyalty militates against the concept of fair hearing;

conversely where the function of initiation of enquiry and decision of the enquiry

were discharged by two separate persons, even though affiliated, it was held that

no bias is made out.

19. Applying the said test and in view of the admitted facts, I find that the

inquiry officer as part of the team initiating the disciplinary proceedings against

the respondent workmen had disqualified himself from being the judge (inquiry

officer). The inquiry officer in discharge of his duties as a Legal Advisor having

advised the successful dismissal of the respondent workmen from service, cannot

be seen as impartial in the inquiry proceedings. In the ordinary course of the

human behaviour, an Advocate / legal advisor would not allow the legal advice

rendered by him to be proved wrong and which would have been the case had the

charge not been established against the respondent workmen. Thus not only is

the inquiry officer found interested in establishing the charge against the

respondent workmen but has thereafter also been found to be consistently

supporting the same.

20. Any discussion on "bias" would be incomplete without reference to Ranjit

Thakur Vs. UOI AIR 1987 SC 2386. The test of likelihood of bias was held to

be the reasonableness of the apprehension in that regard in the mind of the party.

The Supreme Court quoted with approval, a passage from the judgment of the

Queen‟s Bench to the effect that the question is not, whether in fact he was or

was not biased - The court cannot inquire into that; public policy requires that in

order that there should be no doubt about the purity of administration, any person

who is to take part in it should not be in such a position that he might be

suspected of being biased.

21. Applying the said ratio, a lawyer advising the employer on ways, means

and procedure for terminating the services of an employee has to make a choice.

Either he can remain such advisor and assist the client in successfully

dismissing/punishing the employee or he has to let that function be performed by

another and in which case he is entitled to act as an inquiry officer. He cannot be

both. Unfortunately in the present case the lawyer / legal advisor of the

petitioner has chosen to be both. The objection of the respondent/workmen of

bias taken at the very first instance, was thus justified. However, the lawyer

acting as the inquiry officer even then persisted with the inquiry. This Court now

has no option but to declare the same a nullity or coram non judice.

22. Resultantly, Rule is discharged and the petition is dismissed. The

parties are directed to appear before the concerned Industrial Tribunal on 13th

July, 2010. The Industrial Tribunal is directed to decide the reference after

giving opportunity to the parties of being heard within 45 days thereof.

Further, the petition having been found to have been not maintainable at this

stage and the respondent workmen having been found to have been thereby

deprived of the benefits, if any, due under Section 17B of the ID Act, the

petitioner to also pay costs of this petition of Rs.40,000/- to each of the

respondents 2 to 6 workmen on or before 13th July, 2010 and as a condition to

further participation in the proceedings.

RAJIV SAHAI ENDLAW (JUDGE)

14th May, 2010 bs

(corrected and released on 29th May, 2010)