Delhi High Court
Bakhtawar Lal Nagpal & Anr vs Prabhu Mahto & Ors. on 8 August, 2019
$~4
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Decision: 08th August, 2019
+ W.P.(C) 14301-14302/2005 & CM APPL.11598/2019, 30829/2019
BAKHTAWAR LAL NAGPAL & ANR ..... Petitioners
Through: Mr.B.L. Chawla, Advocate along with
petitioner No.2 in person
versus
PRABHU MAHTO & ORS. ..... Respondents
Through: Mr.Akarsh Bhalla, Advocate along
with respondent No.1 in person.
CORAM:
HON'BLE MR. JUSTICE J.R. MIDHA
J U D G M E N T (ORAL)
1. The petitioner has challenged the award dated 12th February, 2004
passed by the Labour Court whereby the Labour Court has granted
reinstatement with 50% back wages to the respondent.
2. The respondent was working with the petitioner as a driver. The
petitioner terminated the respondent on 17th June, 1993 on account of his
alleged involvement in a serious crime against the petitioner in respect of
which the FIR was lodged with the police.
3. The respondent raised an industrial dispute which was referred to the
Labour Court. The Labour Court held the termination to be illegal on the
ground that no domestic enquiry was conducted by the petitioner.
4. Learned counsel for the petitioner submits that the petitioner lost
confidence in the respondent due to the crime committed by him and there is
no illegality in the termination without a domestic enquiry. Reliance is
placed on State Bank of Travancore v. Prem Singh, 2019 SCC OnLine Del
8258.
5. The law with respect to the loss of confidence is well-settled that the
reinstatement cannot be ordered when an employee acts in a manner by
which the management loses confidence in him. In case of loss of
confidence, only compensation can be awarded. Reference be made to the
recent judgment of this Court in State Bank of Travancore (supra) in which
this Court, after considering M/s Francis Klein & Co. Pvt. Ltd. v. The
Workmen, AIR 1971 SC 2414, Air India Corporation v. V.A. Rebellow,
AIR 1972 SC 1343, Anil Kumar Chakaborty v. M/s Saraswatipur Tea
Company Limited, AIR 1982 SC 1062, Chandu Lal v. Management of M/s
Pan American World Airways Inc., (1985) 2 SCC 727, O. P. Bhandari v.
Indian Tourism Development Corp. Ltd., (1986) 4 SCC 337, Workmen v.
Bharat Fritz Werner (P) Ltd. (1990) 3 SCC 565, A.K. Dass v. National
Fed. of Coop. Sugar Factories Ltd. 1994 SCC Supl. (2) 520, Punjab Dairy
Development Corporation Ltd. v. Kala Singh, (1997) 6 SCC 159, Sudhir
Vishnu Panwalkar v. Bank of India, (1997) 6 SCC 271, Kanhaiyalal
Agrawal v. Factory Manager, Gwaliar Sugar Co. Ltd., AIR 2001 SC 3645,
Divisional Controller, KSRTC (NWKRTC) v. A.T. Mane, (2005) 3 SCC
254, Bharat Heavy Electricals Ltd. v. M. Chandrasekhar Reddy, AIR 2005
SC 2769, T.N.C.S. Co. Ltd. v. K. Meerabai, (2006) 2 SCC 255, State Bank
of Bikaner & Jaipur v. Nemi Chand Nalwaya, (2011) 4 SCC 584,
Divisional Controller, Karnataka State Road Transport Corporation v.
M.G. Vittal, (2012) 1 SCC 442, On-Dot Couriers & Cargo Ltd. v. Anand
Singh Rawat, (2009) 165 DLT 89, All India Institute of Medical Sciences
v. O.P. Chauhan, 2007 LLR 435 (Del HC), Abheraj Jaswal v. M/s Godrej
Boyce Manufacturing, 2011 SCC OnLine Del 3301, Johnson and Johnson
Ltd. v. Gajendra Singh Rawat, (2016) 233 DLT 388, Lancers Convent
Senior Secondary v. Jai Prakash, 2018 SCC OnLine Del 7763, Sindhu
Education Society v. Kacharu Jairam Khobragade (1995) ILLJ 451 Bom,
Sanjiv Kumar Mahapatra v. A.L. Alaspurkar, 2003 (1) ALLMR 534,
National Institute of Mental Health & Neuro Sciences v. Sri G. Suggappa,
W.P. No.66/2013, Torrent Power Ltd. v. Chelabhai Nathabhai Luhar 2018
SCC OnLine Guj 3580 , summarised the principles as under:-
"Summary of Principles
31. When an employee acts in a manner by which the management
loses confidence in him, his reinstatement cannot be ordered because it
would neither be desirable nor expedient to continue the employee in
service. It may also be detrimental to the discipline or security of the
establishment. In case of loss of confidence, only compensation can be
awarded.
32. The plea of „loss of confidence‟ by the employer has to be
bonafide. Loss of confidence cannot be subjective. It has to rest on
some objective facts, which would induce a reasonable apprehension in
the mind of the management regarding the trustworthiness of the
employee and the power has to be exercised by the employer
objectively in good faith, which means honestly with due care and
prudence. Otherwise, a valuable right of reinstatement to which an
employee is ordinarily entitled to, on a finding that he is not guilty of
any misconduct, will be irretrievably lost to the employee.
33. The bonafide opinion formed by the employer about the
suitability of his employee for the job assigned to him, even though
erroneous, is final and not subject to review by the industrial
adjudication.
34. In case of misconduct resulting in loss of confidence, the
employer is not bound to hold any inquiry to visit the employee with
penal action even if such reason happens to be misconduct of the
employee. The employer, in its discretion, may invoke the power to
discharge simpliciter for loss of confidence while dispensing with
inquiry into the conduct of the workman. The departmental inquiry in
such a case is not necessary.
35. The reinstatement of an employee terminated for loss of
confidence cannot be ordered even if the inquiry held by the employer
has been held to be bad.
36. The reinstatement of an employee terminated for loss of
confidence for involvement in a criminal case cannot be directed even
if the employee is able to secure a acquittal or discharge in the
criminal case.
37. The reinstatement has not been considered desirable in cases
where there have been strained relationship between employer and
employee. The reinstatement is also denied when an employee has been
found to be guilty of subversive or prejudicial activities. The Courts
have also denied reinstatement in cases where long time has lapsed or
where the industry itself has become sick."
(Emphasis Supplied)
6. At this stage, learned counsel for the respondent submits that the
respondent does not press for reinstatement. Learned counsel for the
respondent however seeks reasonable compensation in terms of the
principles laid down in State Bank of Travancore (supra).
7. Learned counsel for the petitioner submits that the petitioner offered
Rs.1 lakh as compensation to the respondent No.1 on 07th February, 2019
which was not accepted by respondent No.1.
8. This Court is of the view that compensation of Rs.1,25,000/- is fair
and reasonable in the presence case.
9. The writ petition is allowed and the impugned award granting
reinstatement with 50% back wages is set aside. However, compensation of
Rs.1,25,000/- is awarded to respondent No.1.
10. Learned counsel for the petitioner has handed over a cheque for
Rs.1,25,000/- to respondent No.1 present in Court. The claim of respondent
No.1 in terms of this judgment stands satisfied.
11. This Court appreciates the assistance rendered by counsel for both the
parties in this matter.
12. The pending applications are disposed of.
13. Copy of this judgment be given dasti to learned counsel for the parties
under signature of Court Master.
J.R. MIDHA, J.
AUGUST 08, 2019
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