SUPREME COURT OF INDIA
Divisional Controller, N.E.K.R.T.C
Vs
H. Amaresh
Appeal (Civil) 7993 of 2004
(Dr. Ar. Lakshmanan and L. S. Panta, JJ)
17.07.2006
DR. AR. LAKSHMANAN, J.
This appeal is directed against the final judgment and order dated 22.07.2003
passed by the High Court of Karnataka at Bangalore in Writ Appeal No. 6439 of
2000. By the impugned judgment, the Division Bench, while disposing off the
appeal, confirmed the findings of the Labour Court and of the learned Single
Judge with regard to reinstatement and set aside the findings on back-wages.
Though the respondent has been served and the affidavit and proof of service
stating therein that the show cause notice was received by the sole respondent
on 04.11.2004, there was no response or representation on behalf of the
respondent. The respondent was also called absent. We, therefore, decided to
hear the appeal on merits and also carefully perused the pleadings, the order
of the Labour Court, judgment of the Single Judge and of the Division Bench of
the High Court and other relevant records.
We also heard the learned argument of Ms. Anitha Shenoy, learned counsel for
the appellant-Corporation.
BACKGROUND FACTS:
The respondent joined the Corporation as a conductor. While he was on duty, the
appellant-Corporation noticed that he was under the influence of alcohol and
did not issue tickets to the passengers. The appellant-Corporation issued
Articles of Charge to the respondent-conductor and he replied to the same. The
charges, which are grave in nature, are enumerated as below:
1. That it is reported that you are in a habit of consuming alcohol while on
duty and created bad scene of the Corporation among the public by spoiling the
image of the Corporation apart from financial loss to the Corporation. (not
proved)
2. That on 27.12.90 you were booked on Devadurga Hosur N/o Schedule No.16/B. 16
along with Sri. Allapa driver No. 2022 but you were not able to discharge
duties due to intoxication and after having consumed alcohol and you are not
able to perform the schedule duty. In place another conductor had to be
arranged inspite of acute shortage of conductor. (not proved)
3. Further the passenger of schedule No. 47 B/Hospet, 16B, Hosur N/o. were
unnecessarily detained at bus stand from 21-15 hours to 22-30 hours, and you
went away without getting dispatched from the controller. (not proved)
4. That on 28.12.90 after completion of the above said duties at about 14
hours, the KSRTC cash held by you was checked and found Rs. 360-95 as short and
you were found in drunken condition.(proved)
Not satisfied with the reply, the appellant-Corporation conducted the enquiry
in accordance with the principles of natural justice and 'Conduct &
Discipline' Regulations. The Inquiry Officer found the charges levelled against
the respondent proved. A true copy of the Inquiry Report dated 11.12.1991 has
been filed and marked as Annexure-P1. It is useful to reproduce the Inquiry
Officer's report in paras 4 and 5.
"4. That act of mis-appropriation noticed after checking the way bill
and many irregularities, namely failed to show the sale of tickets and over
writing. Several places not shown the number of passengers and trip wise
collection not mentioned target of revenue was Rs. 1250/- but the delinquent
deposit sum of Rs. 638/75 paise. Lastly cash was remitted very late; hence
these are the imputations of statement. The M.W.1 has given the detail as to
the manner how he notices the irregularities as violations and misconduct
having found in drunken state on duty.
In support he has got marked Ex. M.1 to 4, the documents which have not been
refuted nor tested the veracity of witness. I have carefully examined the
evidence of M.W.1 and the documents marked fully reveals that the delinquent
has committed not only misconduct but misappropriated the cash by short
remittance. I see no reason why the testimony of M.W.1 should be discarded when
delinquent has failed to test the statement by cross examination.
5. In reply by way of written in defense the delinquent has simply denied the
charges saying as baseless.
On case full consideration of all the aspects of case unhesitantly I can say
that the delinquent has not created a doubt of evidence led by management and I
hold that management has fully brought home the charges. There is no reason to
discard the testimony of M.W.1, accordingly I hold that all the charges have
been proved by the management. Hence this report."
The Disciplinary Authority, after perusing the details of the inquiry
proceedings, replied to the respondent to the Articles of Charge and other
available material, agreed with the findings of the Inquiry Officer and
dismissed the respondent from service. Aggrieved by the order of dismissal, the
respondent raised an industrial dispute under Section 10(4) of the Industrial Disputes Act, 1947 before the Labour Court,
Gulbarga to which the Corporation replied.
The Presiding Officer, Labour Court, by his order dated 30.08.1996, while deciding
the preliminary issue regarding the validity of inquiry proceedings held the
same to be illegal and invalid in view of the denial of reasonable opportunity
to the respondent.
The Labour Court, by its Award dated 17.12.1996, held that out of 4 charges
levelled against the respondent, the 4th charge regarding pilferage against the
respondent stood proved. As regards punishment, dismissal from service was
substituted with reinstatement and 75% backwages. Aggrieved by the award dated
17.12.1996, the appellant-Corporation filed the writ petition before the High
Court of Karnataka at Bangalore. The learned Single Judge, by his order dated
11.09.2000, upheld the findings of the Labour Court but modified the back-wages
and reduced it to 25%.
Aggrieved by the order of the learned Single Judge, the Corporation filed an
appeal before the Division Bench of the Karnataka High Court. The Division
Bench, by the impugned judgment and order, affirmed the findings of the Labour
Court and of the learned Single Judge with regard to reinstatement and set
aside the findings on back wages. Hence the special leave petition was filed by
the Corporation and notice was ordered on 17.11.2003. On 03.12.2004, none
appeared on behalf of the respondent and leave was granted.
We heard Ms. Anitha Shenoy, learned counsel appearing for the
appellant-Corporation. We have been taken through the pleadings, two orders
passed by the Labour Court, order of learned Single Judge and of the learned
Judges of the Division Bench. We have carefully perused those orders. A careful
perusal of the order dated 17.12.1996 of the Labour Court would only reveal the
total non-application of the mind by the Presiding Officer of the Labour Court,
Gulbarga and the inconsistent findings rendered by the said Court. There are
lot of discrepancies and mistakes in the award of the Labour Court on factual
as well as legal aspects of the matter. The Labour Court at one place has
observed as follows:-
"Ex.M.1 goes to show that the claimant was negligent in remitting the
amount. But no inference can be drawn against him that he was under the
influence of intoxication, and there was shortage of fund with the claimant.
The shortage of fund could be due to so many reasons. Therefore the claimant
has committed some misconduct which is not a simple in nature."
In another place, the Labour Court in para 22 has observed as under:-
"I have already stated above that the Respondent has not proved charges
1 to 3. But he has proved charge No.4. I have also stated above that the charge
No.4 is grave in nature and as such some reasonable punishment is
necessary."
There is absolutely no precision in regard to the factual aspects and findings
rendered by the Labour Court. In the said award, the Labour Court directed
reinstatement of the respondent despite holding him guilty of the charge of
pilferage levelled against him and directed reinstatement with back wages. In
our view and as rightly pointed out by learned counsel for the appellant any
dereliction of duty in this regard is highly detrimental to its financial well
being and against public interest. We shall now consider the judgment of the
High Court. The High Court, in our view, has erred in affirming the award of
the Labour Court insofar as the award of reinstatement is concerned. As rightly
urged by Ms. Anitha Shenoy that the charges of pilferage was established
against the respondent- workman such misconduct is grave and has the effect of
disrupting the services of a public transport system. This Court in the
judgment reported in 19 - Regional Manager,
RSRTC vs. Ghanshyam Sharma (3 Judges) held that the proved acts of misconduct
either to a case of dishonesty or of gross negligence and bus conductors who by
their actions and inactions cause financial loss to the Corporation ought not
to be retained in service. The judgment in Karnataka SRTC vs. B.S. Hullikatti
reported in 34 (2 Judges) was also referred to and relied on by the 3 Judges
Bench in the above judgment. This Court in
"It is misplaced sympathy by the Labour Courts in such cases when on
checking it is found that the Bus Conductors have either not issued tickets to
a large number of passengers, though they should have, or have issued tickets
of a lower denomination knowing fully well the correct fare to be charged. It
is the responsibility of the Bus Conductors to collect the correct fare from
the passengers and deposit the same with the company. They act in a fiduciary
capacity and it would be a case of gross misconduct if knowingly they do not
collect any fare or the correct amount of fare."
The High Court and the Labour Court failed to consider all the cogent evidence
and documents produced by the Corporation before them. The Labour Court has
miserably erred by not considering that the respondent was in a drunken
condition when there was no denial on the part of the workmen to that effect.
By not considering this, the High Court has also erred. The order of
reinstatement passed by the Labour Court and its affirmation by the High Court
is contrary to the law declared by this Court in 34
wherein it was held that it is misplaced sympathy by courts in awarding lesser
punishments where on checking it is found that the bus conductors have either
not issued tickets to a large number of passengers and deposit the same with
the Corporation. They act in a fiduciary capacity and it would be a case of
gross misconduct if knowingly they do not collect any fare or the correct
amount of fare. It was finally held that the order of dismissal should not have
been set aside. As already noticed, this view was reiterated by a 3 Judges
Bench of this Court in the Regional Manager, RSRTC case (supra).
In the instant case, the mis-appropriation 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 mis-appropriated funds of the
Corporation and the factors to be considered. This Court in a catena of
judgments held that the loss of confidence as the primary factor and not the
amount of money mis-appropriated 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 mis-appropriating a 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 State Road Transport
Corpn. Vs. B.S. Hullikatti, 34 was also
relied on in this judgment among others. Examination of passengers of 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 mis-conduct 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.
In this context, it is useful to refer to the findings of the domestic tribunal
which has already been extracted above in paragraph (supra). Before the Inquiry
Officer Exh. M1-M4 were marked, which have not been refuted nor was the
veracity of witness decided. The Inquiry Officer has stated that he has
carefully examined the evidence of MW.1 and the documents marked which fully
reveals that the delinquent has committed not only misconduct but
misappropriated the cash. MW 1 was not cross examined by the delinquent
employee. In reply, the delinquent has simply denied the charges stating it
baseless. The Inquiry Officer, on a careful consideration of all aspects of the
case, unhesitantly held that the delinquent was guilty of the charges and that
all the charges have been proved. Once a domestic Tribunal based on evidence
comes to a particular conclusion normally it is not open to the tribunal and
courts to substitute their subjective opinion in place of the one arrived at by
the domestic tribunal.
Coming to the question of quantum of punishment, this Court in Divisional
Controller, KSRTC (NWKRTC) vs. A.T. Mane, has held as under:-
"Coming to the question of quantum of punishment, One should bear in
mind the fact that it is not the amount of money misappropriated that becomes a
primary factor for awarding punishment; on the contrary, it is the loss of
confidence which is the primary factor to be taken into consideration. In our
opinion, when a person is found guilty of misappropriating the Corporation's
funds, there is nothing wrong in the Corporation losing confidence or faith in
such a person and awarding a punishment of dismissal."
We may also beneficially refer to a judgment rendered by a 3 Judges Bench of
this Court reported in M.P. Electricity Board vs. Jagdish Chandra
Sharma. This Court held that the tribunals would not sit in appeal over the
decision of the employer unless there exists a statutory provision in this
behalf. Moreover, Labour Courts must act within the four corners of the statute
concerned, in terms of the provisions thereof. When the Labour Court having
held that charge No.4 stood proved, no interference by the learned Single Judge
or by the Division Bench was called for. In the instant case, the jurisdiction
vested with the Labour Court has been exercised capriciously and arbitrarily in
spite of the finding that Charge No.4, with regard to the pilferage, has been
proved beyond any doubt. In our opinion, the conclusion arrived at by the High
Court in ordering reinstatement was shockingly disproportionate in the nature
of charge No.4 found proved. When charge No.4 is proved, which is grave in
nature, interference with the punishment of dismissal cannot be justified.
Similarly, the High Court gets jurisdiction to interfere with the punishment in
the exercise of its jurisdiction under Article 226 of the Constitution only
when it finds that the punishment imposed is shockingly disproportionate to the
charges proved.
Ms. Anitha Shenoy also cited a recent decision of this Court reported in
Rajasthan State Road Transport Corpn. and Others vs. Zakir Hussain (Ruma Pal
and Dr. AR. Lakshmanan, JJ). The respondent therein was also a conductor of the
appellant-Corporation. He challenged the termination of his service as being in
violation of the provisions of the Standing Order. However, without availing
the remedy available to him under the Industrial Disputes
Act, 1947 he approached the Civil Courts and obtained decrees in his
favour. It was challenged by the management before the High Court. The High
Court declined to interfere with the orders passed by the lower Court since
there is concurrent finding on fact by both the Courts below and that no substantial
question of law arises, the appellant-Corporation preferred the special leave
petition before this Court questioning the correctness of the orders passed by
the courts below and of the High Court particularly on the question of
jurisdiction of civil courts to entertain and try the suit instead of an
industrial dispute. This Court held that the civil court has no jurisdiction
and that the jurisdiction cannot be conferred by any order of the court and
that where an act creates an obligation and enforces the performance in a
specified manner the performance cannot be enforced in any other manner. It was
held that the employees of the State Road Transport Corporation are not civil
servants and, therefore, they are not entitled to protection under Article 311
of the Constitution and that their terms of appointment are governed by the
letter of appointment and, therefore, the management was well within its right
to terminate the services of the respondent during the period of probation if
their services were not found to be satisfactory during the said period and in
such an event the appellant- 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 instant case, even though charge No.4 has been proved beyond any doubt,
the Labour Court taking a lenient and sympathetic view, passed certain directions
which were modified by the learned Single Judge and of the Division Bench.
While entertaining this special leave petition, this Court has only ordered
notice to the respondent. The order of the High Court and of the Division Bench
has not been stayed even though the Division Bench observed that having regard
to the gravity of the charges proved against the respondent, it would be in the
interest of justice to modify the order passed by the learned Single Judge to
the extent he has directed the appellant- Corporation to pay 25% back wages.
The Division Bench deleted the direction in regard to the payment of back wages
but retained the order in regard to the reinstatement. The said order is ex-
facie illegal and contrary to the principles laid down by the various decisions
of this Court which have been referred to in paragraphs supra and also on the
proved facts and circumstances of the case. Having accepted all the facts that
the charges of short remittance was proved and yet the learned single Judge and
the learned Judges of the Division Bench proceeded to pass an order ordering
reinstatement which clearly goes against the mandate of the various judgments
of this Court. In our view, even short remittance amounts to mis-conduct and,
therefore, applying the rulings of this Court, the impugned order ought not to
have been passed by the Division Bench ordering reinstatement. We, therefore,
have no hesitation to set aside the order passed by the learned Judges of the
Division Bench and restore the order of dismissal of the respondent from
service. It is stated that pursuant to the order of the Labour Court the
respondent was reinstated in service. Since there was no stay granted by this
Court the respondent had continued in service of the Corporation. In view of the
law laid down by this Court and of the facts and circumstances of this case,
the respondent, in our opinion, has no legal right to continue in service any
further. We, therefore, direct the appellant- Corporation to immediately
discharge the respondent from service. However, we make it clear that the
salary paid to the respondent and other emoluments during this period shall not
be recovered from the respondent. We also make it further clear that in view of
the order of dismissal the respondent shall not be entitled to any further
emoluments.
For the foregoing reasons, we allow the appeal filed by the
appellant-Corporation and set aside the orders passed by the Labour Court,
learned Single Judge and also of the Division Bench as perverse and are against
the proved facts and circumstances of the case. No costs.
We place on record our appreciation for the able assistance rendered by Ms.
Anitha Shenoy, learned counsel for the appellant at the time of hearing.