Md. Fakhruddin vs The Presiding Officer, Labour Court and Another

B.P. Jha and M.P. Varma, JJ.—The workman has challenged the validity of an order as contained in annexure-6 in a writ petition. Annexure-6 contains the order of the Labour Court u/s 26(5) of the Bihar Shops and Establishments Act, 1953 (Act VIII of 1954) (hereinafter referred to as ''the Act''). In the present case, there was a domestic enquiry by Messrs. Lipton (India) Ltd. (hereinafter referred to as ''the company''). The domestic enquiry was held on 11th and 13th December, 1971. On 8th February, 1972 (vide annexure-3), the petitioner was discharged from the service of the company. Thereafter, the petitioner lodged a complaint before the Labour Court u/s 26(2) of the Act on the ground that no prior one month''s notice was served on him before passing the order of discharge as well as on other grounds.

The Labour court recorded the evidence u/s 26(5)(a) of the Act. On the evidence recorded by the Labour court, it held that the discharge order passed by the management of the company was a correct order.

Learned counsel for the petitioner attacks the validity of the order for non-compliance with Section 26(1) of the Act it is relevant to quote Sub-sections (1), (2) and (5) of Section 26 of the Act which run as follows:--

Notice of the dismissal or discharge (1) No employer shall dismiss or discharge or other wise terminate the employment of any employee who has been in his employment continuously for a period of not less than six months, except for a reasonable cause and after giving such employee at least one month''s notice or one month''s wages in lieu of such notice.

Provided that such notice shall sot be necessary where the services of such employee are dispensed with on a charge of such misconduct as may be prescribed by the State Government, supported by satisfactory evidence recorded at an enquiry held for the purpose.

Provided further that an employee who has been in continuous employment for a year or more and whose services are dispensed with otherwise than on a charge of misconduct shall also be paid compensation equivalent to fifteen days average wages for every completed year of service and any part thereof in excess of six months before his discharge in addition to the notice or pay in lieu of notice as prescribed above.

(2) Every employee, dismissed or discharged of whose employment is otherwise terminated, may make, a complaint in writing, in the prescribed manner, to a prescribed authority within 90 days of the receipt of the order of dismissal or discharge or termination of employment on one or more of the following grounds, namely:--

(i) there was reasonable cause for dispensing with his services; or

(ii) no notice was served on him as required by Sub-section (1); or

(iii) he had not been guilty of any misconduct as held by the employer; or

(iv) no compensation as prescribed in Sub-section (1) was paid to him before dispensing with his service.

X X X X X

(5)(a) The prescribed authority shall cause a notice to be served on the employer relating to the said complaint, record briefly the evidence adduced by the parties, hear them and after making such enquiry as it may consider necessary pass orders giving reasons therefor.

(b) In passing such order the prescribed authority shall have power to give relief to the employee by way of reinstatement or money compensation or both.

On a perusal of Sub-section (2) of Section 26 of the Act, it is clear that the workman can challenge the validity of the order of discharge or dismissal on the ground that no notice was served on him as required by Sub-section (1) of Section 26 of the Act. It is clearly mentioned in Paragraph no. 3 of the complaint petition that no notice was served on the petitioner as required by Sub-section (1) of Section 26 of the Act. In reply to the allegation made in paragraph no. 1(viii) of the written statement that the petitioner was paid one month''s wages in lieu of notice at the time of his discharge from service. This fact is not mentioned in the discharge order as contained in Annexure 3. It is for this reason that the learned counsel for the petitioner contends that there was no material on the record to hold that the petitioner was paid one month''s wages in lieu of such notice at the time of discharge or before discharge. We are, therefore, of the opinion that if any ground is taken by the complainant in respect of the non-service of the notice as required by Sub-section (1) of Section 26 of the Act, it is the mandatory duty of the labour court to give a finding on this point; more so when the fact has been disputed between the parties.

The factum of payment of one month''s wages in lieu of notice becomes important and goes in favour of the petitioner when this fact is not at all mentioned in the discharge order contained in Annexure 3. The discharge order is of about nine pages. It is a matter of great surprise that this important fact about the payment of one month''s wages is not at all mentioned in the order of discharge at the time of discharge. We are not giving any finding on this point. It will be within the discretion of the Labour court to come to any conclusion on the basis of the existing materials on the record. We also direct all the Labour courts in the State of Bihar to give a finding about the compliance with the provisions of Section 26(1) of the Act in all the cases. The issue of one month''s notice u/s 26(1) of the Act gives jurisdiction to the employer to discharge or dismiss a person. It no notice or one month''s pay in lieu of notice has been given or no enquiries has been made u/s 26(1) of the Act by the employer, the order of discharge or termination is totally illegal.

Therefore, where a complaint is lodged u/s 26(2) of the Act, the labour court is directed to find out as to whether one month''s wages in lieu of such notice were given to the employee or not. Further, the labour court is also required to find out as to whether any enquiry into the misconduct of the workman was conducted by the employer or not. So far as the present case is concerned, it is said that there was an enquiry held by the company. On a perusal of the enquiry report as contained in Annexure-Y to the counter-affidavit, it is clear that the enquiry was held on 11th and 13th December, 1971. It is also mentioned therein that the petitioner was given all opportunities to adduce evidence and give statements. It is, therefore, clear that the petitioner was given an opportunity to adduce evidence in his defence by the enquiring officer. When the enquiry was held on 11th and 13th December, 1971, then the enquiring officer should have fixed a clear date for examining the defence witnesses which has not been done by the enquiring officer. This aspect of the matter was not at all examined by the Labour Court which is necessary in order to give a finding in respect of the first proviso to Section 26(1) of the Act. The first proviso to Section 26(1) of the Act requires that if one month''s notice has not been given or one month''s wages in lieu of notice has not been given, then the alternative procedure is to hold an enquiry into the misconduct of the workman. The word ''enquiry'' in the first proviso to Section 26(1) of the Act means that in that enquiry satisfactory evidence must be recorded from both the sides. In other words, an opportunity should be given to the workman also to adduce evidence in support of his case. In the present case, this opportunity was not at all given to the workmen. Hence, it can be well argued by the workmen that there was no enquiry as envisaged under the first proviso to Section 26(1) of the Act. Learned counsel for the petitioner also challenged the validity of the enquiry on other grounds which we do not feel necessary to mention here. On a perusal of Annexure-6, we find that there is no finding in respect of the compliance with the provisions of Section 26(1) of the Act and the first proviso thereto. Hence, we quash the order contained in Annexure-6. We are remanding the matter and directing the labour court to give the findings, as mentioned above, on the basis of the existing materials on the record. The labour court is directed to hear the parties and dispose of the matter within three months from the date of the receipt of the record.

In a case lodged on a complaint u/s 26(2) of the Act, the proceeding before the Labour Court is an original trial. It is for this reason Sub-section 5(a) of Section 26 of the Act has been enacted. The labour court is competent to record she evidence adduced by the parties and, after making such an enquiry, the labour court shall pass the orders after giving reasons therefore, but while considering the evidence under Sub-section 5(a) of Section 26 of the Act, the labour court is directed to consider about the propriety and legality of the enquiry, if any, made by the employer. No doubt, the labour court shall give the decision on the basis of the materials before him, yet the court is also required to give it finding about the correctness and legality of the enquiry as envisaged by the first proviso to Section 26(1) of the Act.

Learned counsel for the company contends that the depot is not an establishment within the meaning of the Act. On the other hand, learned counsel for the petitioner says that the depot is an establishment within the purview of the Act. Since we are remanding the matter, let this matter be kept open for the decision of the Labour court. In this circumstance, we are remanding the whole matter for a fresh decision in accordance with law on the basis of the existing materials on the record. In the result, the petition is allowed. Annexure-6 is hereby quashed. The case is remitted back to the Labour court for fresh decision in accordance with law as well as on the basis of the observations made above. The parties shall bear their own costs.