Dalbeer Singh,Medak Dist vs Ganapathi Sugar Industries ...
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       HON'BLE SRI JUSTICE NAGESH BHEEMAPAKA

             WRIT PETITION No. 31015 OF 2011

ORDER:

Calling in question the Award dated 14.07.2011 in

I.D.No. 64 of 2008 on the file of the 3rd respondent, petitioner is

before this Court.

2. The case of petitioner is that he joined the

respondent industry as Store Keeper originally in April 1995

and was promoted as Supervisor with effect from 01.10.1997. In

the course of employment, the respondents used to depute him

to make purchases of machinery in Jalandhar, Punjab. When

he was in one of such visits, show cause notice dated

20.09.2007 was served on him on 07.11.2007 alleging

irregularities in issuing canteen coupons. Petitioner is stated to

have submitted explanation that during his deputation to

Jalandhar from 2004 to 2007, coupons were issued by some

other employees under the supervision of Mr. Raghuveer, Junior

Manager (Personnel). However, petitioner was suspended on

04.12.2007 and after conducting internal enquiry, without

serving charge sheet and without conducting departmental

enquiry, he was dismissed from service vide proceedings dated

23.06.2008. Therefore, petitioner raised the dispute before the

3rd respondent Labour Court and the same was also dismissed

duly confirming the removal order dated 23.06.2008.

3. Learned counsel for petitioner Sri B.H.R. Chowdary

submits that in the absence of any charge sheet the enquiry

conducted by the Management is only an internal audit and

regular enquiry was not conducted, in those circumstances,

removing an employee on the basis of internal enquiry is void

and illegal as laid down by this Court in U. Shankaraiah v.

District Cooperative Central Bank 1. It is submitted that

petitioner was not served any enquiry report which is in

violation of the principles of natural justice, as was held by the

Hon'ble Apex Court in Managing Director of ECIL v.

Karunakaran 2. According to the learned counsel, the Enquiry

Officer submitted the report on 02.05.2008 and the

management issued the show cause notice of dismissal on

10.05.2008 and sought reply within 48 hours. It is submitted

that the finding that delinquent employee committed fraud to

the tune of Rs.2,79,913/- from January 2004 to August 2007 is

not based on record. The management simply assumed that

2000(3) ALT 404

1993(4) SCC 727

during this period the subsidized coupons worth

Rs.39,35,233/- were issued, whereas there is provision only to

the extent of Rs.36,45,330/-, thus, it was assumed that he

committed fraud. This finding is related for 3 ½ years over the

work force of 600 employees who work on three shifts per a day.

Moreover this petitioner is in-charge for only one shift and there

are other two employees who issued coupons under the

direction of junior manager. It is stated that the finding of the

Enquiry Officer is that fraud was committed by a group of

persons including the delinquent, Mr. Raghuveer and others.

Under such circumstances, fixing accountability on one of the

employees for the entire shortage of stock amounts to different

opinion. The show cause notice of dismissal dated 23.06.2008

shows that management already pre-determined to dismiss the

employee, therefore, the show cause notice issued cannot be

treated as the one required to be given in such a case as

conclusion arrived much before petitioner was given opportunity

to explain why the proposed punishment may not be imposed

on him. It is stated that allegation of receiving Rs.1500/- per

month towards gratification from contractor of the canteen is

also not based on any charge sheet / direct evidence, the

contractor Mr. Ajayan was not examined but the allegation

made by him that he paid Rs.1500/- per month to this

delinquent is relied upon. It is submitted that all of a sudden

the respondents conducted the inventory of the stores and

discovered there is shortage of coupons worth Rs.2,79,913/-

over a period of four years which shows bye-laws are not

followed.

Respondents 1 and 2 filed counter-affidavit,

wherein it is stated that petitioner while working as Assistant

Supervisor in the respondent factory committed serious

irregularities of fraud and dishonesty in connection with the

employer's business by issuing canteen coupon to the workmen

without following due procedure and thereby misappropriated

the funds of the company to an extent of Rs.2,79,903/-. Not

satisfied with the explanation submitted by him, enquiry was

ordered and after considering the entire material available on

record, petitioner was found guilty of misconduct, particularly

fraud in issuing the subsidized canteen coupons to the

employees of the company during January 2004 to August

2007. The observations of the Enquiry Officer establishes that

during the said period, petitioner being the senior-most

assistant in time office entrusted with the responsibility of

placing indents with the stores for issuing subsidized canteen

coupons according to the records, if all the eligible employees

are issued the subsidized coupons without even omitting a

single employee, the cost of the coupons issued by petitioner

should not exceed Rs.36,45,330/- which is purely based on the

eligible manpower engaged by the management during the said

period but whereas the canteen contractor claimed more than

the said amount. It is stated that during the said period,

petitioner with a fraudulent view collected coupons from stores

to a value of Rs.39,35,233/- and excess coupons valued at

Rs.2,79,903/- were neither handed over to the department nor

accounted for in the Register. It is stated that in the said

register during the month of May 2005, petitioner had

mentioned that no employee has collected meals coupons and

made an entry 'NIL'.

It is stated that petitioner recorded in the register

for the month of May 2007, opening balances of coupons of the

subsidized items, issues and balances as 'opening balance of

coupons of tea, tiffin and meals as 43, 47 and 73 respectively

and received coupon books 363, 367 and 393 respectively that

on hand coupons books there were tea 406, tiffin 414 and meals

466, but he had recorded that petitioner had issued for the

same month tea 163, tiffin 175 and meals 159. In case of such

issues, closing balance should have been tea 243, tiffin 239 and

meals 307. Whereas, petitioner had shown tea 200, tiffin 192

and meals 234 which figures are totally false. If these figures are

to be believed, petitioner is answerable for 43 tea books, 47 tiffin

books and 73 meals books valuing Rs.22,035/- exclusively for

the said month itself. It is stated that during the course of

domestic enquiry, petitioner has also admitted that he made

some excess entries in the register and thereby accepted the

charges leveled against him by the management. In view of the

findings of the Enquiry Officer that charges were duly proved in

the enquiry, management had issued show cause notice dated

10.05.2008 proposing the punishment of dismissal. The

respondents after considering the gravity of the misconduct

proved against petitioner and after considering his past record,

dismissed him from service.

It is stated that canteen contractor vide letter dated

20.09.2007 clearly informed the 2nd respondent that petitioner

was collecting Rs.1500/- every month by giving some tokens.

When confronted, petitioner did not deny in clear terms and in

his cross-examination by the management he admitted that 'I

am aware that I have recorded excess issue of the subsidized

coupons'. It is further stated that on 15.06.2005, petitioner

made request for tea coupons - 170 books, tiffin coupons- 170

books and meals coupons - 140 books, whereas in the coupon

register maintained by him in his own hand-writing, he

mentioned tea coupons - 200 books, tiffin coupons - 200 books

and meals coupons - 170 books. In view of the same, canteen

contractor has drawn excess money from the management

without providing any food items for which, petitioner was paid

an amount of Rs.14,500/- every month.

5. Learned counsel for respondent industry submits

that respondents after conducting full-fledged domestic enquiry

and also following the procedure, had terminated petitioner

from service. It is denied that petitioner was not given scope for

defending himself, as, as a matter of fact, before commencement

of enquiry, the 'Enquiry Officer read over and explained the

contents of the show cause notice and further petitioner was

assisted by co-worker who was working as President of

Ganapati Sugar Industries Employees Union. It is submitted

that mere non-supply of enquiry report will not vitiate the

proceedings. In support of his contentions, reliance has been

placed on the following judgments:

In High Range Estate Employees Association v.

Industrial Tribunal 3,the High Court of Kerala held as under:

" 2. The second contention is that the enquiry files did not contain charge sheets and therefore the enquiries must be deemed to have been conducted without charge sheets.

3. Regarding the second contention the enquiry officer, who gave evidence before the Tribunal, categorically deposed that the memos of charges were read out to the workmen at the beginning of the enquiries and they had denied the charges levelled against them in those memos of charges.

5. The procedure to be followed in domestic enquiries are not statutory in nature. They are laid down by judicial decisions. It is settled law that mere violation of such procedures itself does not amount to violation of principles of natural justice. The Rules of natural justice are not of from but of substance. Whether rules of natural justice have been followed or not would depend upon the facts and circumstances of each case. Breach of bare technicalities cannot be equated with violation of rules of natural justice. The resultant effect of the violation of the rules of natural justice should result in some sort of sufferance, handicap or prejudice to the workman. The watch word is "prejudice". The very word 'domestic' which is often used for describing such enquiries denotes the lack of formalities in such enquiries. What is necessary in such enquiries is to adopt a procedure which would not prejudice the right of the workmen to defend themselves. Any procedure which does not prejudice such right would be a valid procedure notwithstanding the failure to conform to a formal pattern of proceedings as in Courts. Disciplinary action being essentially a managerial function any procedure which is not prejudicial to the right of the workmen to effectively defend themselves in the enquiry and to prove their innocence would be valid. Therefore the workmen, should, in addition to violation of procedure, plead and prove that because of the procedure adopted by the management, prejudice has been caused to the workmen in the matter of defending themselves in the enquiry.

7. In any event, there is no law laid down that in every domestic enquiry the management shall appoint a presenting officer. As already stated, disciplinary action is purely a managerial function. The only requirement for validity of that action is that the same should be in compliance with the principles of natural justice. Such proceedings cannot be regarded as proceedings of a Court of Tribunal and cannot be circumscribed by any rules of procedure unless -of course such procedure is incorporated in the Standing Orders applicable to the workmen,

2008(3) LLJ 43

In Uttarakhand Transport Corporation v.

Sukhveer Singh 4, the Hon'ble Apex Court held as under:

7. It is clear from the above that mere non-supply of the inquiry report does not automatically warrant re-instatement of the delinquent employee. It is incumbent upon on the delinquent employee to plead and prove that he suffered a serious prejudice due to the non-supply of the inquiry report. We have examined the writ petition filed by the Respondent and we find no pleading regarding any prejudice caused to the Respondent by the non-supply of the inquiry report prior to the issuance of the show cause notice. The Respondent had ample opportunity to submit his version after perusing the report of the inquiry officer. The Respondent utilised the opportunity of placing his response to the inquiry report before the disciplinary authority. The High Court committed an error in allowing the writ petition filed by the Respondent without examining whether any prejudice was caused to the delinquent employee by the supply of the inquiry officer's report along with the show cause notice. We are satisfied that there was no prejudice caused to the respondent by the supply of the report of the inquiry officer along with the show cause notice. Hence, no useful purpose will be served by a remand to the court below to examine the point of prejudice.

8. The Respondent contended that the punishment of dismissal is disproportionate to the delinquency. It is submitted that he was working as a driver and the irregularity in issuance of tickets was committed by the conductor. We are in agreement with the findings of the inquiry officer which were accepted by the disciplinary authority and approved by the appellate authority and the labour court that the Respondent had committed the misconduct in collusion with the conductor. It is no more res integra that acts of corruption/misappropriation cannot be condoned, even in cases where the amount involved is meagre. (See - U.P.SRTC v. Suresh Chand Sharma 2010 6 scc 555 at Para 21-

23)

In Bank of Baroda Employees Union v. Bank of

Baroda 5, it has been held by the High Court of Madras (D.B.)

as follows:

" 8. From the admission of guilt as was made by the employee, it would be evident that the admission is not conditional. He admitted the charges. What he actually made conditional was that the enquiry need not be held, as he wanted to derive the advantage of paragraph 19.12(e). Therefore, the only condition was that no enquiry was required to be held. In spite of the same, if enquiry officer held any enquiry, that will not render the order of punishment illegal, as it is always open to the disciplinary authority to

2017 Law Suit (SC) 1158

2008 Law Suit (Mad) 2376

punish the delinquent employee if guilt is admitted, without taking into consideration the enquiry report.

10. So far as the case of "Delhi Transport Corporation vs. Shyam Lal"

reported in 2004 (8) SCC 88, is concerned, the Supreme Court observed that the settled position of law is that admission is the best piece of evidence against the person making the admission. However, it is open to the person making the admission to show why the admission is not to be acted upon. In the present case, no case has been made out on behalf of the employee as to why his admission is not to be acted upon.

11. The other decision is the judgment of this Court rendered by a learned single Judge in the case of "V.Radhakrishnan vs. Indian Bank" reported in 1986 (II) LLJ

443. That was a case in which the learned single Judge held that even if the employee had admitted the charges, still, as per paragraph 19.12(e) of the bi-partite settlement arrived at between the Bank and its employees, an enquiry has to be held on those charges as the alleged admission has not been made after knowing the nature of punishment to be imposed on those charges.It would be evident from paragraph 19.12(e) of the bi-partite settlement that the said provision is specific which stipulates the condition in which no enquiry need be held. Therefore, the question of holding enquiry under paragraph 19.12(e) does not arise. If one or other charge is not admitted by the charge-employee, then in that case, paragraph 19.12(e)(iii) of the bi-partite settlement cannot be invoked. It is only when the guilt in respect of all the charges are admitted by the employee, the said provision can be invoked.We accordingly hold that the judgment rendered by the learned single Judge in the decision reported in 1986 (II) LLJ 443 (cited supra) does not hold good in the eye of law.This apart, after knowing the nature of punishment, as the employee never denied the allegations and intended for an enquiry under the law, the employee cannot derive the benefit of the said judgment.

However, we are not inclined to accept such proposition of law, as it is settled law that in cases of admission of the guilt, it is always open for the disciplinary authority not to hold enquiry, apart from the fact that paragraph 19.12(e)(iii) of the bi- partite settlement is specific in this regard.

13. So far as the quantum of punishment is concerned, the Industrial Tribunal as well as the learned single Judge have looked into the matter and came to the definite conclusion that the quantum of punishment is proportionate to the gravity of the charges. We are also of the same view."

In Bank of India v. Degala Suryanarayana 6, the

following proposition has been laid down by the Hon'ble

Supreme Court of India:

" Strict rules of evidence are not applicable to departmental enquiry proceedings. The only requirement of law is that the allegation against the delinquent officer must be established by such evidence acting upon which a reasonable person acting reasonably and with objectivity may arrive at a finding upholding the gravamen of the charge against the delinquent officer. Mere conjecture or surmises cannot sustain the finding of guilt even in departmental enquiry proceedings. The Court exercising the jurisdiction of judicial review would not interfere with the findings of fact arrived at in the departmental enquiry proceedings excepting in a case of malafides or perversity i.e., where there is no evidence to support a finding or where a finding is such that no man acting reasonably and with objectivity could have arrived at that findings. The Court cannot embark upon reappreciating the evidence or weighing the same like an appellate authority. So long as there is some evidence to support the conclusion arrived at by the departmental authority, the same has to be sustained, in Union of India v. H.C. Gael, [1964] 4 SCR 718 the Constitution Bench has held :-

"the High Court can and must enquire whether there is any evidence at all in support of the impugned conclusion. In other words, if the whole of the evidence led in the enquiry is accepted as true, does the conclusion follow that the charge in question is proved against the respondent? This approach will avoid weighing the evidence. It will take the evidence as it stands and only examine whether on that evidence legally the impugned conclusion follows or not."

                     In    Divisional          Controller,           N.E.K.R.T.C.            v.    H.

Amaresh 7, the Hon'ble Supreme Court held that:

           "         Loss of confidence was the primary factor and not the amount of

money misappropriated and there would be no place for generosity or misplaced sympathy -High court in ordering reinstatement was shockingly disproportionate in nature of charge of pilferage found proved-Impugned order was liable to be set aside".Paras 16 to 19,22,24&25.

18. In the instant case, the misappropriation of the funds by the delinquent employee was only Rs 360.95. This Court has considered the punishment that may be awarded to the delinquent employees who misappropriated the funds of the

(C.A.Nos. 3053-54/1997 dated 12.07.1999)

2006 LLR 930

Corporation and the factors to be considered. This Court in a catena of judgments held that the loss of confidence is the primary factor and not the amount of money misappropriated and that the sympathy or generosity cannot be a factor which is impermissible in law. When an employee is found guilty of pilferage or of misappropriating the Corporation's funds, there is nothing wrong in the Corporation losing confidence or faith in such an employee and awarding punishment of dismissal. In such cases, there is no place for generosity or misplaced sympathy on the part of the judicial forums and interfering therefore with the quantum of punishment. The judgment in Karnataka SRTC v. B.S. Hullikatti [(2001) 2 SCC 574 : 2001 SCC (L&S) 469] was also relied on in this judgment among others. Examination of the passengers of the vehicle from whom the said sum was collected was also not essential. In our view, possession of the said excess sum of money on the part of the respondent, a fact proved, is itself a misconduct and hence the Labour Court and the learned Judges of the High Court misdirected themselves in insisting on the evidence of the passengers which is wholly not essential. This apart, the respondent did not have any explanation for having carried the said excess amount. This omission was sufficient to hold him guilty. This act was so grossly negligent that the respondent was not fit to be retained as a conductor because such action or inaction of his was bound to result in financial loss to the appellant irrespective of the quantum.

23.Corporation was not obliged to hold an enquiry before terminating the services. In the concluding part of the judgment, this Court has observed that since the respondent workman has not acted bona fide in instituting the suit, the respondent was not entitled to any back wages and having regard to the facts and circumstances of the said case, it would not be appropriate to order refund of the back wages paid to him and that he shall not be allowed to continue in service any further and shall be discharged forthwith.

In The General Secretary, South Indian Cashew

Factories Worker's Union v. The Managing Director, Kerala

State Cashew Development Corporation Ltd. 8, it has been

held:

" 16. The Labour Court had earlier held that the enquiry was properly held and there was no violation of the principles of natural justice and that the findings were not perverse. The vitiating facts found by the Labour Court against the enquiry are erroneous and are liable to be set aside. If enquiry is fair and proper, in the absence of any allegations of victimization or unfair labour practice, the Labour Court has no power to interfere with the punishment imposed. Section 11A of the Act gives ample power to the Labour Court to re-appraise the evidence adduced in the enquiry and also sit in appeal over the decision of the employer in imposing punishment. Section 11A of the Industrial Disputes Act is only applicable in the case of dismissal or discharge of a workman as

Civil Appeal No. 2521 of 2000

clearly mentioned in the Section itself. Before the introduction of Section 11A in Indian Iron and Steel Co. Ltd. v. Their Workmen [(1958) SCR 667] this Court held that the Tribunal does not act as a Court of appeal and substitute its own judgment for that of the Management and that the Tribunal will interfere only when there is want of good faith, victimisation, unfair labour practice, etc. on the part of the management. There is no allegation of unfair labour practice, victimisation etc. in this case. The powers of the Labour Court in the absence of Section 11A is illustrated by this Court in Workmen of Firestone Tyre and Rubber Co. of India (Pvt.) Ltd. v. The Management [(1973) 1 SCC 813]. When enquiry was conducted fairly and properly, in the absence of any of the allegations of victimisation or malafides or unfair labour practice, Labour Court has no power to interfere with the punishment imposed by the management. Since Section 11A is not applicable, Labour Court has no power to re-appraise the evidence to find out whether the findings of the enquiry officer are correct or not or whether the punishment imposed is adequate or not. Of course, Labour Court can interfere with the findings if the findings are perverse. But, here there is a clear finding that the findings are not perverse and principles of natural justice were complied with while conducting enquiry.

6. Heard learned counsel for both the parties

extensively and perused the material on record.

7. The case of petitioner is simplicitor 1) the alleged

misappropriation took place in his absence; and 2) the

respondents have not conducted the enquiry procedurally, they

did not serve any charge sheet nor provided him an opportunity

to defend his case and they straight away served the order of

dismissal with immediate effect. On the other hand, the

respondents' submission is that they have followed the

procedure scrupulously, however, cited the above-named

judgments to justify their action. In this regard, right from the

Apex body of justice-rendering system as well as various other

High Courts repeatedly have been emphasizing that there is no

law laid down that in every domestic enquiry the management

shall appoint a presenting officer. Disciplinary action is purely

a managerial function. The only requirement for validity of that

action is that the same should be in compliance with the

principles of natural justice. Such proceedings cannot be

regarded as proceedings of a Court or Tribunal and cannot be

circumscribed by any rules of procedure unless of course such

procedure is incorporated in the Standing Orders applicable to

the workmen. It is equally settled that once an act of

misappropriation is proved, may be for a small or large amount,

there is no question of showing uncalled for sympathy towards

the employee.

That too, in this case, petitioner admitted his guilt

as is evident from his statement given to the Enquiry Officer.

When queried, at question No. 10 and 13, the reply is he has not

brought to anybody's notice about tampering of records by Mr. P.

Raghuveer and Mr. M. Shankar Rao or anybody else from 2004 to

2007 i.e. 44 months. He did not know the value of the excess

books issued as per the register but he is aware that he had

recorded excess issue of the subsidized coupons. This statement

was supported by the letter addressed by canteen contractor to

the extent that petitioner also gave some tokens and took

Rs.1,500/- per month. It has already been laid down by the

Hon'ble Supreme Court that in cases of admission of guilt, it is

always open for the disciplinary authority not to hold enquiry.

If there is an admission of misconduct or if the employee pleads

guilty in respect of the charge or if the employee consents to the

alteration of any terms and conditions of service or where the

employee himself seeks alteration in conditions of service, there

is no need for holding an enquiry or for giving an opportunity to

the employee to be heard or show cause. Holding an employee

guilty of misconduct on admission, or altering the conditions of

service with consent, without enquiry or opportunity to show

cause, does not violate principles of natural justice. Whether the

action of disciplinary authority is vitiated for violation of

principles of natural justice is to be seen in the background of

conduct of the petitioner (see Himachal Pradesh Road

Transport Corporation v. Hukum Chand 9, State of Punjab

v. Gurnam Kaur 10, Canara Bank v. H.T. Koli 11).

8. This is not in dispute that petitioner accepted his

guilt in course of inquiry. Memo of charge was served upon him.

Nothing has been brought on record to demonstrate that he

(2009) 11 SCC 222

(2009) 11 SCC 225

1999(1) LLN 197

denied any of the charges levelled against him. In such

circumstances, petitioner cannot have a grievance that finding

of guilt with respect to the charges, arrived at by the Inquiry

Officer are without any basis.

9. In view of the clear law laid down on the subject

and in the light of the admission made by the petitioner, this

Court do not find any reason warranting interference with the

impugned Award.

10. The Writ Petition is accordingly, dismissed. No

costs.

11. Consequently, the miscellaneous Applications, if

any shall stand closed.

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NAGESH BHEEMAPAKA, J 19th October 2023

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