Richardson and Cruddas (1972) Limited vs Additional Labour Court and Another

K.N. Mudaliar, J.—Richardson and Cruddas (1972) Limited is the petitioner who seeks to quash the award of the Labour Court dated

14th July, 1971.

The second respondent (Thiru S. Pitchamani) was employed as a head timekeeper in the petitioner-company. On 4th November, 1968, it was

alleged that, the second respondent instructed one cooly to remove four cardboard pieces in the dark room adjacent to the personnel office and he

also told the watchman that there was no need to have any gate-pass for taking the article from the said office. The second respondent was

charge-sheeted for the above act of misconduct and an enquiry was held into the charge. At the enquiry the second respondent was given every

opportunity to put forth his defence. The enquiry officer gave his findings to the office that the offence of theft had not been proved though the

second respondent could be held guilty of abetting and conniving at the theft. On the basis of the findings of the enquiry officer, the petitioner could

not repose confidence in the second respondent and hence discharged him from service by offering one month''s salary in lieu of notice,

The non-employment of the second respondent was referred to the first respondent as an industrial dispute. The non-employment was

challenged by the second respondent on the ground that the enquiry was not properly conducted and that Pitchamani was victimised for his trade

union activities. During the enquiry proceedings before the first respondent, the second respondent examined himself as his only witness.

The first respondent passed an award on 14th July, 1971, holding that the enquiry proceedings cannot be attacked as perverse or partial. The

first respondent also held that the findings of the enquiry officer are not perverse. As regards the allegation of victimisation, the first respondent

observed that it cannot be said the enquiry officer acted mala fide and there had been any victimisation or unfair labour practice and that from the

materials available before the enquiry officer his findings cannot be termed as completely baseless or perverse, and, therefore, the findings of the

enquiry officer will have to be upheld in this case.

According to the petitioner, the first respondent, particularly after having upheld the findings of the enquiry officer and negativing the plea of

victimisation, took the view that the punishment was disproportionate to the misconduct proved against the workman and, on that ground,

interfered with the order of discharge. The first respondent passed the award directing reinstatement of the second respondent in service with

continuity of service, but without back wages. Hence this writ petition.

The principal ground on which the validity of the award of the Labour Court is challenged is that the Tribunal fell into an error in considering the

propriety or adequacy of the punishment or whether it was excessive or too severe. Particulary after the first respondent having held that there was

no victimisation or unfair labour practice in dismissing the second respondent, the first respondent ought not to have interfered with the order of

discharge on the alleged ground of the punishment being disproportionate. The second respondent contested the writ petition principally on the

ground that the punishment is shockingly disproportionate to any lapse found against the second respondent and that in view of the total cost of the

property in question being only Rs. 3 or Rs. 4, the punishment of discharge is shockingly disproportionate.

The learned Counsel for the petitioner mainly argued that the Tribunal is not required to consider the propriety or adequacy of the punishment or

whether it was excessive or too severe and he relied upon a catena of cases in support of this proposition, viz., Amanda Bazar Patrika Pvt. Ltd. v.

Their Employees 1963 L.L.J. 429 : (1963) 26 F.J.R. 168, Hind Construction and Engineering Co. Ltd. v. Their Workmen (1964) 27 F.J.R. 232,

Hindustan Steel Ltd. v. A.K. Roy (1969) 40 F.J.R. 292. Francis Klein & Co. (P.) Ltd. v. Their Workmen 1971L.L.J. 615 : (1971) 40 F.J.R.

183, Workmen of Sudder Office, Cinnamara v. Management 1971 L.L.J. 620 : (1971) 41 F.J.R. 142, Air-India Corporation, Bombay v. V.A.

Rebello 1972 L.L.J. 501 : (1972) 41 F.J.R. 436, and Workmen of Firestone Tyre & Rubber Co. of India (Pvt.) Ltd. v. Firestone Tyre & Rubber

Co. of India (Pvt.) Ltd. (1973) 43 F.J.R. 315. The counsel for the second respondent went to the extent of arguing that the value of the cardboard

materials is about Rs. 3 1/2 or Rs. 4. This aspect of the value has not been controverted by the petitioner. The second respondent relied on the

rationale found in the decision in Western India Match Co. Ltd. v. Industrial Tribunal (1973) 26 F.L.R. 349 and contended that the offence

committed by the second respondent is of such a trivial nature that the punishment of discharge is out of proportion to the trivial infraction of law on

the part of Pitchamani.

The learned Counsel for the petitioner relied on the rationale extracted in the following cases. In Ananda Bazar Patrika (Pvt.) Ltd. v. Their

Employees, (supra), the Supreme Court has observed as follows (at page 175):

...We have repeatedly pointed out that though industrial adjudication can and must protect industrial employees from victimisation, a finding as to

mala fide or victimisation should be drawn only where evidence has been led to justify it ; such a finding should not be made either in a casual

manner or light-heatedly. In our opinion, no material was produced before the Labour Court in the present proceedings to justify its finding either

(hat the enquiry was unfair, or that the conduct of the appellant in discharging Mr. Sarkar was mala fide.

In Hind Construction & Engineering Co. Ltd. v. Their Workmen, (supra) the Supreme Court has observed (at page 235):

The next question is whether the Tribunal was justified in interfering with the punishment of dismissal after it had come to the conclusion that the

workmen had gone on a strike even though the strike was not illegal. Reference is made to a number of cases in which the principles for the

guidance of the Tribunals in such matters have been laid down by this Court. It is now settled law that the Tribunal is not to examine the finding or

the quantum of punishment because the whole of the dispute is not really open before the Tribunal as it is ordinarily before a Court of appeal. The

Tribunal''s powers have been stated by this Court in a large number of cases and it has been ruled that the Tribunal can only interfere if the conduct

of the employer shows lack of bona fides or victimisation of employee or employees or unfair labour practice. The Tribunal may in a strong case

interfere with a basic error on a point of fact or a perverse finding but it cannot substitute its own appraisal of the evidence for that of the officer

conducting the domestic enquiry though it may interfere where the principles of natural justice or fair-play have not been followed or where the

enquiry is so perverted in its procedure as to amount to no enquiry at all. In respect of punishment it has been ruled that the award of punishment

for misconduct under the standing orders, if any, is a matter for the management to decide and if there is any justification for the punishment

imposed, the Tribunal should not interfere. The Tribunal is not required to consider the propriety or adequacy of the punishment or whether it is

excessive or too severe. But where the punishment is shockingly disproportionate, regard being had to the particular conduct and the past record

or is such, as no reasonable employer would ever impose in like circumstances, the Tribunal may treat the imposition of such punishment as itself

showing victimisation or unfair labour practice.

In Hindustan Steel Ltd. v. A.K. Roy (1969) 40 F.J.R. 292 , it has been observed:

On a consideration of all the circumstances, the present case, in our view, was one such case. The Tribunal exercised its discretion mechanically

without weighing the circumstances of the case. That was no exercise of discretion at all. There is ample authority to the effect that if a statutory

Tribunal exercises its discretion on the basis of irrelevant considerations or without regard to relevant considerations, certiorari may properly issue

to quash its order (See: S. A. de Smith, Judicial Review of Administrative Action, 2nd edition, pp. 324-325). One such relevant consideration, the

disregard of which would render its order amenable to interference, would be the well-settled principles laid down in decisions binding on the

Tribunal in whom the discretion is entrusted. The refusal by the High Court to interfere was equally mechanical and amounted to refusal to exercise

its jurisdiction. Its order, therefore, becomes liable to interference. There is, therefore, no difficulty in holding that the order of reinstatement passed

by the Tribunal was liable to be quashed and that the High Court erred in refusing to interfere with it merely on the ground that it could not do so as

it was a case where the Tribunal had exercised its discretion.

In Francis Klein & Co. (P.) Ltd. v. Their Workmen, (supra) the following rationale is found at pages 188-189:

In our view, when an employer lose confidence in his employee, particularly in respect of a person who is discharging an office of trust and

confidence, there can be no justification for directing his reinstatement. The post of a durwan in an industrial concern, where valuable property,

both manufactured goods and assets require to be guarded, is such a post and when one of his colleagues calls on him to assist him in

apprehending a thief, the refusal to do so is certainly an act which justified the employer in losing confidence in him. Even the Tribunal in its order

recognised that the employer has lost confidence in Nayan Singh because, while directing the company to reinstate him, it says:

If the management considers that Nayan Singh should not be given guard duty because of the company''s loss of confidence in him, as claimed by

them, he may be allotted some other job of similar nature as found suitable.

''Even this direction is not a valid direction because if once the company has lost confidence in its employee it is idle to ask them to employ such a

person in another job. What job can there be in a company which a person can be entrusted with and which does not entail reposing of confidence

in that person ?

In Workmen of Sudder Office, Cinnamara v. Management (supra) the Supreme Court has laid down the following rationale at page 154:

Though, prima facie, it may appear that the management in this case was charging the workman in respect of a matter which may be a misconduct

under the standing orders, ultimately we are satisfied that the management has passed the order of termination simpliciter and the order does not

amount to one of dismissal as and by way of punishment.

Again, at page 156, in the same case. (1971) 41 F.J.R. 142, the Supreme Court has observed as follows:

...The management could have, no doubt, taken disciplinary action against the workman concerned, according to law. But, it has not done so in

this case. On the other hand, when the circumstances showed that the company can no longer place its trust and confidence in the workman, the

management terminated his services by making available to him all amounts that he will be entitled to in case of termination simpliciter under Clause

9 of the standing orders. The entire basis of the Labour Court''s award for holding that the order is one of dismissal is its view that the management

has invoked Clause 9 to camouflage its action. When that approach has been given up on behalf of the workman before the High Court, the

reasoning of the Labour Court falls to the ground and the High Court has acted within its jurisdiction under Article 226 when it set aside the order

of the Labour Court especially when there has been no finding of victimisation, unfair labour practice or mala fides recorded against the

management. To conclude, we are satisfied that the High Court was justified in setting aside the order of the Labour Court.

In Air India Corporation, Bombay v. V.A. Robella (supra) the Supreme Court has laid down the following rationale at page 449:

...Once bona fide loss of confidence is affirmed, the impugned order must be considered to be immune from challenge. The opinion formed by the

employer about the suitability of his employer for the job assigned to him, even though erroneous, if bona fide, is, in our opinion, final and not

subject to review by the industrial adjudication. Such opinion may legitimately induce the employer to terminate the employee''s services ; but such

termination can, on no rational grounds, be considered to be for misconduct and must, therefore, be held to be permissible and immune from

challenge.

In Workmen of Firestone Tyre & Rubber Co. of India Pvt. Ltd. v. Firestone Tyre & Rubber Co. of India Pvt. Ltd. (supra) the Supreme Court has

observed at page 340;

The Legislature, in Section 11A , has made a departure in certain respects in the law as laid down by this Court. For the first time, power has been

given to a Tribunal to satisfy itself whether misconduct is proved. This is particularly so, as already pointed out by us, regarding even findings

arrived at by an employer in an enquiry properly held. The Tribunal has also been given power, also for the first time, to interfere with the

punishment imposed by an employer.

It is true that the Labour Court negatived the plea of victimisation. The learned Counsel seems to have gone to the extent of saying that when once

the plea of victimisation is negatived, it necessarily follows that there cannot be the finding of shockingly disproportionate punishment. In other

words, the finding of non-victimisation cannot go with the finding of a shockingly disproportionate punishment. In my view, in rare cases, both can

co-exist. While the Labour Court can find, on the available evidence, that there has been no victimisation, nevertheless it can still find that the

punishment awarded to the workman is shockingly disproportionate. In this case, the Labour Court, in paragraph 7 of the award, has considered

all the aspects of the evidence and noticed that the workman had an. unblemished record of seventeen year''s service and that he had been offered

increments on several occasions for his meritorious work. The Labour Court further observes as follows:

The subject-matter of theft was some useless cardboard pieces worth 3 or 4 rupees, as spoken to by W.W. 1. Even assuming that the workman

abetted and connived at the commission of theft, an order of termination passed in this case, is quite disproportionate, shockingly disproportionate,

to the magnitude of the offence, alleged to have been proved in this case. Under these circumstances, I hold that though the finding of the enquiry

officer is quite correct, still, as the order of termination is unjust and disproportionate to the magnitude of the offence, it is a fit case in which the

workman should be taken back into service, with continuity of service, but without back-wages, in the circumstances mentioned above.

Certainly, even the petitioner cannot justly claim that the offence committed by the second respondent is so serious and grave that the punishment

of discharge alone is justified. He is only a head lime-keeper and the office which he holds cannot be said to be a fiduciary one, where the integrity

of the workman is often tested in the wake of any temptation. After all, his office is only to keep time, and, even by the most liberal imagination of

the duties of a head time-keeper, it cannot be stated that the second respondent is discharging fiduciary duties in the service of the petitioner. The

menial post of the second respondent is such that the petitioner cannot lay claim to loss of confidence or trust in the second respondent It would

have been a different matter if the second respondent were to be a cashier in charge of moneys.

I have no hesitation in holding that the award of the Labour Court is legally valid and unimpeachable. I do not find it difficult to hold that the

punishment of discharge inflicted on the workman, who had rendered seventeen years of service to the petitioner, is certainly shockingly

disproportionate, regard being had to the particular conduct and the past record of the second respondent.

The writ petition is dismissed with costs payable to the second respondent. Counsel''s fee Rs. 250. The petitioner has every right to deduct a

monthly sum of Rs. 100 paid to the second respondent with effect from 1st January, 1972, while calculating the back wages from the date of the

award till the date of disposal of this writ petition.