SHAMBU NATH GOYAL v. BANK OF BARODA AND OTHERS

Citation: [1984] 1 S.C.R. 85

Court: Supreme Court of India

Bench: D.A. DESAI, O. CHINNAPPA REDDY, A. VARADARAJAN

Case summary

·The Industrial Tribunal, Chandigarh ceased to exist before the matter could be taken ·np after the remand by this Court and therefore, there was no question of the Central Government takin~ ....

Judgment text

SHAMBU NATH GOYAL v. BANK:OF BARODA AND OTHERS September 27, 1983 (0. A. DBSAI, 0. CHINNAPPA RBDDY AND A. VARADARAJAN, JJ. Industrial Disputes 'Act, 1947-Secs. _10 and 33~Proceedings under- Employer's right to adduce additional evidence before Labour Court/Industrial Tribunal-Not an independent right-Application for that purpose must be made at the earliest stage. Labour Court may consider a11d refuse such a request if made at a late stage. The appellant was working as a clerk in a branch of the first respondent Bank. He was issued a notice· by Jhe Deputy General Manager of the Bank informing him about the decision to hold departmental enquiry against him and also that one Sen Gupta, Agent of another branch of the Bank had been appointed as the Enquiry Officer and that any appeal rising out of his Order could be made to the Chief Agent of the Bank at Delhi. The Enquiry Officer held an enquiry. found the appellant guilty of the .

,charges and proposed to award the punshment of dismissal. The a'ppellant protested against the proposed punisthment and stated that the enquiry was arbitrary, biased and improper. The Enquiry Officer diSmissed the appellant. An appeal filed by the appellant was dismissed by the appellate authority. On behalf of the appellant the 'Union raisCd an industrial dispute and the Central GoVernment ultimately made a reference to the Industrial Tribunal. The Tribunal held that the dispute · was not an industrial dispute. In appellant's appeal by special leave this court held that the dispute was an industrial dispute and remanded the matter to the Tribunal. The Tribunal held that the doll)estic -enquiry was vitiated 'and not in accordance with the principles of riatural justice. The Tribunal further held. that Sen Gupta was not clothed with an.

Y authority to award the punishment of dismissal as disciplinary authority and that no useful purpose would, therefore, be served·by allowing the management to lead fresh evidence in the enquiry be,fore it as requested by the management in its appli.. cation. The Tribunal set aside the disn1issal and ordered reinstatement of the appeUant with full back wages. The High Court took the view that Sen Gupta was also the disciplinary authority as per the notice of enquiry arid quashed the Tribunal's Award and remitted the Cnquiry to the Tribunal for affording an opportunity to the management for letting in further evidence to support the charges before the Tribunal. In this appeal the appellant submitted that the Enquiry Officer was nOt the appointing autbority and that the order of dismiss~l passed by him is invalid in law. Allowing the app~al, "86 • SUPRllMB COURT REPORT~ (1984) 1 s. c. R. \ HELD : It is diffi.

Cult to say that the order of dismissal suffers from any lack of authority of Sen Gupta to award that punishment. The 1nanagement's reqi. Iest for giving an Opportunity to lead further evidence tO support th~ charges before the Tribunal made at that late stage cann,ot be allowed. [99 H; 103 DJ From the fact that Sen Gupta has been appointed as the Enquiry Officer in the notice. of enquiry dated 23-7-1965 and that it has been stated in that notice that any appeal from his order could be made to Majumdar, Chief Agent of the Bank at Delhi, it could be inferred tl:iat Sen' Gl,lpta had been constituted also as the 'disciplinary· authority as otherwise it would not have becri stated in that notice that any appeal against his order which cOuld naturally include an order in1posing punishment pursuant to any finding,, recorded in the. domestic enquiry conducted by him should be presented before· the Chief Agent of the Bank at Delhi.

The workman also understood Sen Gupta to be functioning also as the disciplinary authority in the enquiry when . , he did not question his authority to award the punishn1ent but 1nerely stated that the enquiry was·arbitrary, biased and improper. It would appear from para 521(12) of the Sa~tri Award which has been bodily incorporated in para 18. 20(12) of the Desai Award that. it is not necessary that only the appointing authority or any authority superior to that authority can be the disciplinary auttority in regard to·employees of a ban~ and, that on the oth~r hand the . bank should d. ecide . which officer shall be empowered (Q take disciplinary actiOn in the case of each office or establishment and that it should also make Provision for appeals. against orders passed in disciplinary matters to an officer or body not lower in status than the Manager.

But what is required by that para in the Awards is that the names of the officer or body···competent to pass the original ofders or bear appeals shall from time to . time be published on the Bank's notiCe boards. In the instant case, the workman has not contended anywhere ·inclu. ding in the course of arguments advanced on his behalf even ' ' before us that there" was no)uch publication jn the notice board in regard . to the Jullunder Branch of the Ba! Jk where he was employed at the time of his suspension. [98 C·F; 99 B-DJ , - The rights which the employer has in_ law to adduce additional evidence in a proceeding before the Labour Court of Industrial Tribunal either under s. 10 or s. 33 of the Industrial Disputes Act questioning the legatity of the order terminaiing the service· must be availed of by the employer by making . a proper request at the time when it files its stateni. ent of claim or written state·_ m~nt or makes an application seeking either permission to take cert .

(I) (1979] 3 S. C. R. 1165. (2) (19621 3 S. C. R. 684, sN. GOYAL il.. BANK OF BARODA (besai, i. ) 89 termination of the service of the workman. The passage reads as under: "Therefore, it is crystal clear that the rights which the employer has in law to adduce additional evidence in a proceeding before the Labour Court or Industrial Tribunal either under s. I0 or s. 33 of the Act questioning · the legality of the order terminating service must be availed of by the employer by making a. proper request at ,the time when it fiies its statement of claim or written statement or makes an application seeking either permission to take a certain action or seeking approval of the . action , taken by it. If such a request is made in the statement of claim, application or written statemel)t, the Labour Court or the Industrial/Tribunal must give such an opportunity.

If the request is made before the proceedings are con· cluded the Labour Court or the Industrial Tribunal should ordinarily grant the opportunity to adduce evide. nce. But if no such request is made at any stage of the proceedings, there is no duty in law cast on the Labour Court or the Industrial Tribunal to give such an opportunity and if there is no such obligatory duty in law failure to give any such opportunity cannot and would not vitiate the proceedings. " If this pas. sage is examined divorced from the context in which it was drawn-up, we may feel that the contention of Mr. _Damania deserves to be accepted. But the journey through the courts of the point involved in dispute if kept in view, the passage explains itself. Most of the decisions bearing on the subject were examined in · Shankar Chakravarti's case, but firm reliance was placed in that case by the employer on the decision of this Court fn Cooper Engineering Ltd. v. P. P.

Mundhe(') and especially the following passage therein : "We are, there~ore, clearly of opinion that when a case of dismissal or discharge of an employee is referred for industrial adjudication the labour court should first decide as a preliminary issue whether the domestic enquiry has violated the principles of natural justice. When there is no domesti_c enquiry or defective enquiry is admitted by (I) [1976] 2 S. C. R. 361. 90 SUPREME COURT UPORTs [1984) i s. c.. R. ' the employer, there will be no difficulty. But when the matter is in. controversy between the parties· that question must be decided as a preliminary issue. On that decisio'n bejng pronounced it Will be for the management to decide whether it will adduce any evidence before the labour court. If it chooses not to ~dduce any evidence, it will not be thereafter permissible in any proceeding to raise ·the issue:" · I Relying on this stateme-nt of la;,, in Cooper Engineefing Ltd.

case(I}, 1 it' was contended in Shankar Chakravarti's case( ) that it is the obligatory duty of the Labour Courtilndustrial Tri. burial to frame a preliminary i§SUe whether the domestic enquiry is valid or vitiated ? After answering the issue, one way or the other, if it is held that the domestic enquiry was vitiated, tlie employer has to be given an opportunity to lead evidence _to substantiate the charge of misconduct. And that is how the extracted passage was interpreted by the Division Bench of the Calcutta High Court in Shankar Chakravarti's i:ase. It was further contended that it is the obligatory duty of the Labour Court/Industrial Tribunal after deciding the preliminary issue in favour of the workman and agjlinst the management to call upon the employer to lead his . evidence to substantiate the ·charge of misconduct.

It is in this context that this Court observed that ·the employer must plead in the statement· of defence filed before the Labour Court/Industrial Tribunal th~t in t! ie event domestic enquiry which led to the termination of service is held to be vitiated or invalid, he must be given opportunity to lead evidence to sub;tantiate the charge of misconduct. Explaining how the pleading can be raised this Court observed that if such a relief is claimed in· the statement or" claim, application for approval of its action or written statement of defence, the Labour_ Court/Industrial Tribuna. l must give such an opportunity. The Court further observed that if the request is made before the proceedings are concluded, the Labour Court/Industrial Tribunal should ordinarily grant the opportunity to adduce evidence. , It . was further observed that 'if such a pleading is raised and an opportunity is sought, it is to be given, but if th. ere is no such pleading either.

in the original application or in the staiement of claim or written statement or by way of an applicatio_n during the pende~cy of. the proceedings, there is no duty cast fo law· or by the rules of justice, reason and fair play that·a quasi-judicial Tribunal like the Industrial Tribunal or the Labour Court should adopi an advisory role by S. N. GoYAL v. BANK OF BAllODA (Varadarajan, i. ) 9f informing the employer of its rights. • The statement that if an application is made during the pendency of the prooeedings docs not A' mean that some independent right to make an application at any time is conferred on the employer. Ordinarily, where a party claims relief, it must plead for the same. The pleading can be incorporated in a' statemen! of claim or a written statement of defence. . It was not 'for a moment suggested that an application at any stage of the · proceedings without explaining w! ly the relief was not claimed in the original pleading has to be granted.

If a separate 'application is made, . it would be open to the Labour Court/Industrial Tribunal to examine- . the question whether it should be granted or not depending upon the stage when it is made, the omission to daim the relief in the initial pleading,, the delay and the motivation for such delayed C · action ? Without being specific, it can be said that such an appli· • cation has to be examined as if it is an application for amendment of original pleadings keeping in view all the aforemtntioned considerations and if it does not appear to be bona·fide or has been made after . a long unexplained delay or the explanation for the omission of claill)ing the relief in the inital pleading is unconvincing, the Labour . Court/Industrial Tribunal would be perfectly justified in rejecting the same.

The observation was not made to lay down a proposition of law that as and when it suits the convenience of the employer at any stage of the proceedings, itmay make ·an application seeking such opportunity and the Labour Court/Industrial Tribunal wa~ obliged to grant the same. In the. facts of the present case, th. ere is hardly any. explan~tion for the delay in making 'the application and therefore, the . High Court was in ·error in remitting the case to the Labour Court. Accor~ingly this appeal must succeed and therefore, I c were filed by the workman. One of those applications w·as for the management being directed to produce three letters dated 2. 8. 1964, 15. 3. 1965 and 24. 5. 1965 which were stated to be very material for the workman's defence. It was stated in that application that if the documents were not produced by the management, three ' . named persons may be caused to be produced for being examined . __;.... _ as his-witnesses at the enquiry.

The Enquiry Officer who did not allow tμat application received written ~rguments from both sides and on l. N. GOYAL v. BANK OF llARODA (Varadar,ajan, J. ) 93 the conclusion of the enquiry recorded his findings holding the workman guilty of all the charges. On 29. 12. 1965 he proposed' to award the punishment of dismissal to the workman and heard { the workman who protested . against the p0nishment and stated that the enquiry was arbitrary, biased and improper. The workman was dismissed on the same day and his appeal was dismissed' by the Appellate Authority on 26. 11. 1966. . The Union rafaed an industrial dispute which was opposed by the managtment ~ut ultimately a reference was made by the Central Government to the Industrial Tribunal, Chandigarh on 11. 5. 1970. The management filed a written ;tatement on 12. 8. 1970 conteding 'interalia· that the dispute was not an industrial dispute. That contention found favour with the Tribunal.

The workman came up in appeal by special leave to this Court which allowed the appeal on 2. 2. 1978 holding that it is an industrial dispute and remanded the matter to_ the Tribunal for expeditious disposal. The matter was subsequently taken up by the Central Government Industrial Tribunal-cum-Labour Court, Delfii at the instance of the Central Government as the Tribunal' at Chandigarh had ceased to function meanwhile. The Tribunal framed two issues on the questions as to whether there was a fair and proper enquiry by . the Domestic Tribunal and whether the dismissal of the workman was justified. On the first question it was held by the Tribunal that the enquiry was vitiated and not in accordance with the principles of natural justice on the ground that the three letters or the witnesses required by _the . workman to be produced for proving his defence were not made available to him though they · were relevant and vital to prove his defence. The management moved an application on 8. 2.

1979 for an opportunity being given to it to lead evidence in support of the charges framed · against the workman in the event of the Tribunal holding against it on the first question relating to the_ conduct of the domestic enquiry. >- The Tribunal held that Sen Gupta had been appointed ·onl~ as Enquiry Officer and was flOt entrusted with any authority to award the punishment of dismissal as Disciplinary Authority and that no useful purpose would, therefore, be served by allowing the management to lead fresh evidence in the enquiry before it. The dismissal was held to be not justified and was set aside by the Tribunal and the workman was ordered to be reinstated with full back wages to the ·position held by him on the date of his suspension as mentioned \\hove by the awar hall be empowered to take disciplinary action in the case of each office or establishment and that it should also make provision for appeals against orders passed in disciplinary .

/ matters to an officer or body not lower m status than the Manager. But what is required by that para in the awards is that the names of the officer or body competent to pass the original orders or hear the appeals shall from time to time be published on the Bank's notice boards. The workman has not contended anywhere including in the course of arguments advanced on his behalf even before us that there was no such publication in (he notice board in regard to the Juliunder Branch of the Bank where he was employed at the time of hissuspension. In these circumstances we are unable to accept the argument of Mr. Rao that the order of dismissal suffers from any Jack of authority of Sen Gupta to award that punishment. Regarding the other main question of opportunity being afforded to the management to substantiate the charges before the Tribunal, Mr. Damania invited our attention to two decisions of this Court in Workmen of Motipur Sugar Factory (Private) Limited v.

Motipur Sugar Factory(') and Shankar Ghakravarti v. Britannia Biscuit Co. Ltd. and Anr. ('), to the latter of which one of us was party. In the first of those decisions it is observed as follows : . "Then w'> come to the question whether it was open to the tribunal when there was no enquiry whatsoever by the respondent to bold an enquiry itself into the question· • of go-slow. It was urged on behalf of die appellants that not only there was no enquiry in the present case but there was no charge either. We do not agree that (1) [1965) 3 S. C. R. 588. (2) {1979) 3 S. C. R. 11~5. (1984) 1 S. C. R. I was no charge by· the . respondent '. against the workmen concerned. The first part of the notice of December 15, 1960 which was served on each 'individual workman was certainly a charge by the respondent telling the workmen concerned that they were·guilty of go-slow for "' the period between November 27 and December 15, 1960.

It is true that the notice was not headed_ as a charge and it did not specify that an enquiry would follow, which is the usual, procedure when a formal charge is given. Even-so,'there can be no doubt that the ·workman concerned knew what was the charge against theni which 'was reaUy responsible for their discharge from December . 18, 19601 It is now well-settled by a number of decisions of . this Court that where an employer has failed to make an enquiry before dismissing or discharging a workman it is open to him to justify the action before the Tribunal_ by leading all relevant e\'idence before it. In such a case · the employer would not have the benefit which he had in cases where domestic inquiries have been held. The entire matter would be open before the tribunal which will have jurisdiction not only to go into the limited questions open to a· tribunal where domestic inquiry has · been properly held ((see Indian Iron & Steel Co. v. Their w'arkmen-[1958 S. C. R.

667] but also to satisfy itself on the facts adduced before it by the employer whether the dismissal or discharge ,was_ ju_stificd................ :.. . A defective enquiry in our opinion stands on the same F· footing as no enquiry and in either case the tribunal would have jurisdiction to go into the facts and the employer would have to satisfy the tribunal that on facts the order of dismissal or discharge was proper. " 'In the second decision it is observed as follows :- / "Earlier clear cut pronouncements of the Court in R. K. Jain's case. and Delhi Cloth & General. Mills Co. case that this right to adduce additional evidence is a ri(lht . of the management or the employer and it is to be s. N. GOYAL v. BANK OF BARODA (Varadarajan, J. ) toi availed of. by a req~est at appropriate stage and there is no duty in law cast on the Industrial Tribunal or the Labour ~ourt to give such an opportunity_ notwithstanding the fact that none was ever asked for or not , eveu departed from.

When we examine the matter on principle '! 'e would point out that a quasi-judicial Tribunal is under no such obligation to acquaint parties appearing before it about their rights more so in an adversary system which these quasi-judicial Tribunals have adopted. Therefore, it is crystal clear that the rights which the employer bas in law to adduce. additional evidence in a proceeding before the Labour Court or Industrial Tribunal either under s. JO or s. 33 of the Act questioning the legality of the order terminating service must be avail~d of by the employer by 1making a proper request at the time when it files its statement of claim or written st~tement or . make~ an appl~ation seeking either permission to take certain action or seeking approval of the action taken by it. If s11cb a request is made in the statement of claim, application or written statement, the Labour Co~rt or the Industrial Tribunal must give such an opportunity.

ff the request is made before the proceedings are concluded the Labour Court or the Industrial Tribunal sboujd ordinarily grant the ·opportunity to adduce evidence. But if no such request is made at any stage of the proceedings, there is no duty in law cast on the Labour Court or the Industrial Tribunal to give such an opportunity and if there is no such obligatory duty in law failure 'to give any such opportunity cannot and would not vitiate the proceedings". We think that th_e application of the management to seek the permission of the Labour Court or Industrial Tribunal for availing the right to adduce further evidence to substantiate the charge or charges framed against the workman referred to in the above passage in the application which may be. filed by the management·' during the pendency of its application made before the Labour Court or Industrial Tribunal seeking its permiss_ion under s.

33 of the Industrial Disputes Act, 1947 to take a certain action ·or grant approval of the action taken. by it. The management i,s made aware of the workman's contention regarding the defeat in the domestic enquiry by the written statement 9f defence filed by him in the application filed by the ma11agement under s. 33 of the Act. Then, if the management chooses to exercise its right it must make up its mind at the earliest stage and file the application for that purpose without any unreasonable delay. But when the question arises in a reference under s. 10 of the Act after the workman had been punish· ed pursuant to a findir.

g of guilt recorded against him ;n the domestic l enquiry there is no question of the management filing any appli· cation for permission to lead further evidence in support of the charge or charges framed against the workman, for the defeat in the domestic enquiry is pointed out by the workman in his written claim stat~ment filed in the Labour Court or Industrial Tribunal after the reference had been received and the management has the opportu· nity to look into that statement before it files its written statement ,of defence in the ·enquiry before the Labour Court or Industrial Tribunal and could make the request for the opportunity in the written statement itself. If it does not choose to do so at that stage . ' ·it cannot be allowed to·do it at any later stage . of the proceedings by filing any application for the purrose which may result in delay 'which ~"Y lead to wrecking the morale of the workman and compel him to surrel). der w,hich he may not otherwise do. ' .

It is true that in the present case an application way made by the management on 8. 2. l979 when the matter was ,before the Tribu. nal for the second time after it had been remanded by this Court on 2. 2. 1978 after rejecting the management's contention that the dispute is nQt an industrial dispute. That was done by the management nearly 14 years after the workman had been suspended· on 20. 7. 1965 and nearly 13 years after the workman had been 'found guilty in the domestic enquiry and dismissed from service on 28. 12. 1965. The management took the preliminary objection which found favowr with the Tribunal in the first instance on 25. 10. 1970 that the dispute is not an industrial dispute.. That objection, which was upheld by the Tribunal, forced the workman to seek his remedy in this Court which rejected the objection on 2. 2. '1978. It is only thereafter that the management filed the application dated 8. 2.

1979 for the first time seeking further opportunity to lead evidence before the Tribunal for substantiating the charges framed in 1965. The management is thus seen to have been taking steps periodically . to see· that the dispute is'not disposed of at an early date one way or the other. The blame for not framing an issue on the question whether or not the workman was gainfully employed in ·the intervening period cannot be laid on the Tribunal alone. It was equally the duty . of S. N. GOYAL V. BAN. I<! OF BARODA (Varadarajan, iJ. ) 103 the management to have got that issue framed by the Tribunal and adduce the necessary evidence unless the object was to nake up that question at some later stage to the disadvantage . of the workman as in fact it has been done. The management appears to have come forward with the grievance for the-first time only in the High Court. There is no. material on record to show that the workman was gain• fully employed anywhere.

The management has not furnished any I ·particulars in this regard even before this Court after such a long lapse of time. The workman could have been asked to furnish the necessary information at the earliest. stage. The management has not reso. rted to that course. The workman was not expected to prove the negative. In these circumst. ances, we do not think that it would be in the interest of justice to prolong any further the agony of the workman whosepower to endure the suffering of being out of employment for such a long time and to oppose the management Bank, a nationalised undertaking with all the money power at its disposal in this prolonged litigation is very limited by allowing the Bank to have the advantage belatedly sought in the application dated 8. 2. 1979 in an industrial. dispute which arose to early as in 1965. For the reasons stated above we are of the opinion tl\at the order oftbe High Court could not be sustained under the facts and circumstances of the case.

· The appeal is accordingly allowed with costs of the workman quantijjed at Rs. 5,000. The High Court's judgment is set aside and the Tribul)al's award directing reinstatement of the workman with full back wages and other benefits from the date of his suspension is restored. The amounts paid to the workman under this Court's orders dated 20. 2. 1980, 8. 4. 1980 and 27. 10. 1980 shall be taken into account in computing the wo~kmaμ's claim for full back wages and other benefits from the date of suspension to the date of his reinstatement. N. V. K. Appeal allowed.