1996 JTR(SC) 1752
1997 AIR(SC) 252 ; 1996 AIR(SCW) 4427 ; 1997 1 CLR 13 ; 1997 90 FJR 1 ; 1996 74 FLR 2749 ; 1997 2 GLR 1053 ; 1996 9 JT 635 ; 1997 LIC 158 ; 1997 1 LLJ 1212 ; 1997 1 LLN 69 ; 1997 1 RSJ 252 ; 1996 7 Scale 791 ; 1996 6 SCC 590 ; 1996 SCC(L&S) 1484 ; 1996 SCR 762 ; 1997 1 SCT 338 ; 1996 KHC 983 ; 1996 2 KLT(Online) 1115 ; 1996 7 Supreme 734
1996(7) Supreme 734
SUPREME COURT OF INDIA
J.S. Verma and B.N. Kirpal, JJ.
New Shorrock Mills -Appellant
versus
Maheshbhai T. Rao Respondent
Civil Appeal No. 1959 of 1992
Decided on 25-10-1996
Counsel for the Parties :
For the Appellant : Dushyant Dave, Sr. Advocate, Pratap Venogopal, Advocate, (K.J. John), Advocate (NP).
For the Respondent : S.C. Patel, Advocate.
IMPORTANT POINT
The Labour while exercising jurisdiction u/s 78 of the Bombay Industrial Relations Act, 1946, having found that the employee was guilty of misconduct in an enquiry, cannot set aside the order of his discharge and substitute the same with an order of reinstatement with forty percent back wages.
Act Referred :BOMBAY INDUSTRIAL RELATIONS ACT : S.78, S.79
(A) Sections 78 and 79 of The Bombay Industrial Relations Act, 1946, empower the Labour Court to adjudicate disputes concerning the legality and propriety of an employers order of discharge under the Standing Orders. The Court may intervene if the punishment is disproportionate, but must respect the findings of a domestic inquiry conducted in accordance with law and natural justice. The appeal challenges the Labour Courts exercise of this jurisdiction in setting aside a valid discharge order and substituting reinstatement with back wages.
(B) The core legal principles are that a finding of misconduct based on a fair inquiry is binding on the Court, and the Courts power under Section 78 is not a revisiting court but one of limited jurisdiction to prevent shockingly disproportionate punishment. The managements discretion to punish is upheld unless it is perverse or without evidence, and prior misconduct records are relevant to the quantum of punishment.
Facts of the case:
The respondent, engaged as a Badli workman, engaged in abusive and threatening behaviour towards a Deputy Manager in December 1976. A show-cause notice under clause 22(1) of the Standing Orders was issued, and a domestic inquiry was held with full opportunity to defend. The Inquiry Officer found him guilty of misconduct and he was discharged in August 1977 with thirty days salary in lieu of notice. The Labour Court, invoking Section 79, set aside the discharge and ordered reinstatement with forty per cent back wages, deeming the punishment excessive. This appeal challenges that interference.
Findings of Court:
The Labour Court erred in substituting the managements order. The finding of misconduct was legal, proper, and supported by evidence. The discharge was not victimisation, and the management had not acted outside the scope of the inquiry. The punishment, while harsh, was not shockingly disproportionate given the respondents repeated prior misconduct and the fact that a lesser punishment had already been imposed by the management.
Issues:
Whether the Labour Court was justified in setting aside a lawful order of discharge based on findings of misconduct and substituting it with reinstatement and back wages under Section 78/79 of The Bombay Industrial Relations Act, 1946.
Ratio Decidendi:
Where an employee is found guilty of misconduct after a fair inquiry and the management imposes a valid punishment within its discretion, the Labour Court cannot interfere merely on the ground of severity unless the punishment is shockingly disproportionate to the conduct. The Court overlooked the respondents prior record and the adequacy of the punishment, leading to erroneous interference.
Result:
The appeal is allowed. The Labour Courts order of reinstatement with forty per cent back wages is set aside. No costs are awarded.
(A) Sections 78 and 79 of The Bombay Industrial Relations Act, 1946, empower the Labour Court to adjudicate disputes concerning the legality and propriety of an employers order of discharge under the Standing Orders. The Court may intervene if the punishment is disproportionate, but must respect the findings of a domestic inquiry conducted in accordance with law and natural justice. The appeal challenges the Labour Courts exercise of this jurisdiction in setting aside a valid discharge order and substituting reinstatement with back wages.
(B) The core legal principles are that a finding of misconduct based on a fair inquiry is binding on the Court, and the Courts power under Section 78 is not a revisiting court but one of limited jurisdiction to prevent shockingly disproportionate punishment. The managements discretion to punish is upheld unless it is perverse or without evidence, and prior misconduct records are relevant to the quantum of punishment.
Facts of the case:
The respondent, engaged as a Badli workman, engaged in abusive and threatening behaviour towards a Deputy Manager in December 1976. A show-cause notice under clause 22(1) of the Standing Orders was issued, and a domestic inquiry was held with full opportunity to defend. The Inquiry Officer found him guilty of misconduct and he was discharged in August 1977 with thirty days salary in lieu of notice. The Labour Court, invoking Section 79, set aside the discharge and ordered reinstatement with forty per cent back wages, deeming the punishment excessive. This appeal challenges that interference.
Findings of Court:
The Labour Court erred in substituting the managements order. The finding of misconduct was legal, proper, and supported by evidence. The discharge was not victimisation, and the management had not acted outside the scope of the inquiry. The punishment, while harsh, was not shockingly disproportionate given the respondents repeated prior misconduct and the fact that a lesser punishment had already been imposed by the management.
Issues:
Whether the Labour Court was justified in setting aside a lawful order of discharge based on findings of misconduct and substituting it with reinstatement and back wages under Section 78/79 of The Bombay Industrial Relations Act, 1946.
Ratio Decidendi:
Where an employee is found guilty of misconduct after a fair inquiry and the management imposes a valid punishment within its discretion, the Labour Court cannot interfere merely on the ground of severity unless the punishment is shockingly disproportionate to the conduct. The Court overlooked the respondents prior record and the adequacy of the punishment, leading to erroneous interference.
Result:
The appeal is allowed. The Labour Courts order of reinstatement with forty per cent back wages is set aside. No costs are awarded.
JUDGMENT
Kirpal, J.-The only question which arises for consideration in this appeal is whether the Labour Court, having found that the employee was guilty of misconduct in an inquiry held in accordance with law and in compliance with principles of natural justice, can set aside the order of his discharge and substitute the same with an order of reinstatement with forty per cent back wages.
2. The respondent was engaged as a Badli workman, by the appellant, some time in October, 1971. On 29th December,1976 the respondent entered the office of the Deputy Manager and started abusing him and threatened that the mill officers will not be safe outside the mill and that he did not care if he had to go to jail for murder of four to five officers.
3. In view of the aforesaid abusive behaviour of the respondent a show cause notice under clause 22(1) of the Standing Orders was served on him. This notice was based on the complaint dated 31st December, 1976 which was made by the said Deputy Manager to the management of the appellant Mill.
4. Thereafter, a domestic inquiry was held, witnesses were examined and full opportunity was given to the respondent to defend himself. After the inquiry proceedings concluded the respondent was served with a notice by the Inquiry Officer to show cause why he should not be discharged from the service of the Mill. A reply dated 30th July,1977 was filed by the respondent. The Inquiry Officer, after considering the entire material on record and also after taking into account the explanation offered by the workman, came to the conclusion that the respondent was in fact guilty of misconduct. By order dated 2nd August, 1977 the respondent was discharged from the service as Badli worker with immediate effect. He, however, was given thirty days salary in lieu of the notice period.
5. The respondent then moved the Labour Court under Section 79 of The Bombay Industrial Relations Act, 1946, inter alia, praying that the order of discharge dated 2nd August,1977 be declared as illegal and he should be reinstated with continuity in service and be paid the back wages. No oral on documentary evidence was led before the Labour Court which considered the entire material relating to the matter as had been placed before the Inquiry Officer.
6. The Labour Court passed an order dated 22nd June, 1990 and, inter alia, held as follows:-
(a) That the charge aganst the respondent was neither vague nor unclear:
(b) That the finding of the Departmental Enquiry was legal and proper;
(c) That the order of discharge was not passed by way of victimisation;
(d) That the Departmental Enquiry had been conducted legally and properly and the respondent was afforded reasonable opportunity of hearing;
(e) That in passing the order of discharge, the appellant management had not acted outside the scope of the enquiry;
(f) That the respondent workman had seriously misbehaved with his superior officers and was thus guilty of misconduct;
(g) That the finding of misconduct reached in the enquiry was neither perverse nor baseless but was proved on the basis of evidence on record.
Notwithstanding the fact that it had arrived at the aforesaid conclusion the Labour Court interfered with the punishment which was awarded by observing as follows:-
"Looking to the facts of this case and the facts of the evidence of the witnesses produced in this case, on the basis of the departmental inquiry against the applicant, the allegations levellad against the applicant are proved. But as discussed hereinabove having regard to the decisions, the punishment of discharging the applicant from the service imposed by the opponent mills company is excessive and harsh and it leads the applicant to economic destruction. On account of this the family members of the applicant may also have to suffer. The punishment of discharging from service may only be imposed when there is no alternative except to discharge the applicant. The Hon ble High Court and the Hon ble Supreme Court have in many cases adopted the course that in cases of such a nature, harsh punishment of dismissal of the applicant should not be imposed. The applicant of this matter also on the basis of the decisions stated hereinabove, the applicant is entitled to be reinstated in the opponent mill company in his original post with continuity of service.
7. The appellant filed a writ petition before the Gujarat High Court but the same was dismissed in limine by observing that the impugned judgment was just and proper and did not require to be interfered with under Articles 226 and 227 of the Constitution. This appeal arises on the special leave having beer, granted against the said decision of the High Court.
8. It appears to us that the Labour Court completely misdirected itself in ordering the respondent s reinstatement with forty per cent back wages. The Labour Court was exercising jurisdiction under Section 78 of The Bombay Industrial Relations Act, 1946. It had the jurisdiction, inter alia, to decide the disputes regarding the propriety and legality of an order passed by an employer acting or purporting to act under the Standing Orders. The Labour Court, in the present case, having come to the conclusion that the finding of the departmental inquiry was legal and proper, respondent s order of discharge was not by way of victimisation and that the respondent workman had seriously misbehaved and was thus guilty of misconduct, ought not to have interfeied with the punishment which was awarded, in the manner it did. This is not a case where the court could come to the conclusion that the punishment which was awarded was shockingly disproportionate to the emloyee s conduct and his past record. The Labur Court completely overlooked the fact that even prior to the incident in question the respondent had misconducted himself on several occasions and had been punished. According to the appellant there were atleast three other instances where the respondent had misconducted himself and that he had failed to improve his conduct despite his assurances from time to time. Another aspect which was overlooked by the Labour Court was that on the finding of the Inquiry Officer that the respondent had misbehaved with his superior officer and was guilty of misconduct, the appellant could have dismissed the respondent from service. The appellant chose not to do so. Instead it passed an order of discharging the respondent from service. Lesser punishment having been given by the management itself there was, in our opinion, no justifiable reason for the Labour Court to have set aside the punishment so awarded. We are unable to accept that the punishment imposed by the management was in any way disproportionate to warrant interference by the Labour Court. The direction of the Labour Court ordering reinstatement of the respondent with forty per cent back wages was clearly unwarranted.
9. For the aforesaid reasons while allowing this appeal the order dated 22nd June, 1990 of the Labour Court, Nadiad, in so far as the order of reinstatment of the respondent is concerned, is set aside. There will be no order as to costs.
Appeal allowed.
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