1984 (12) TMI 293 - SC - Indian Laws

Appeal granted due to unjust termination without inquiry, emphasizing need for reasons and natural justice principles.

The court allowed the appeal, finding the termination without inquiry unjustified and in violation of natural justice principles. It questioned the ... Whether the termination of services of Shri Manas Kumar Mukherjee is justified ? To what relief, if any is he entitled? Held that:- Once we hold that there was DO justification for dispensing with the enquiry, imposition of penalty of dismissal without disciplinary enquiry as contemplated by S- O 31 would be illegal and invalid. The amount of ₹ 1, 50,000 directed to be paid to the appellant by the respondent comprises backwages, and all other allowances admissible to him from year to year from 1970 upto the end of 1984. The amount shall be spread over from year to year. If because of the lump sum payment as directed herein the respondent is required to deduct Income- tax as enjoined by Sec. 192 of the y Income-tax Act, 1961, the appellant shall be entitled to relief under Sec. 89 of the Income Tax Act, 1961. Issues Involved:1. Justification of termination without inquiry.2. Scope and ambit of Standing Order 32.3. Violation of principles of natural justice.4. Validity of Standing Order 32.5. Appropriate relief for the workman.Issue-wise Detailed Analysis:1. Justification of Termination Without Inquiry:The central issue was whether the termination of services of the workman without holding any inquiry was justified. The employer dismissed the workman invoking Standing Order 32, which allows dismissal without inquiry if the General Manager is satisfied that it is inexpedient or against the interests of security to continue employing the workman. The Tribunal upheld the dismissal, stating that the employer was competent to pass the order without holding an inquiry as per S.O. 32.2. Scope and Ambit of Standing Order 32:The judgment scrutinized the scope and ambit of S.O. 32. It was noted that S.O. 32 allows dismissal without following the procedure laid down in S.O. 31 if the General Manager records reasons in writing for why it is inexpedient or against the interests of security to continue employing the workman. However, the judgment highlighted that S.O. 32 does not provide for dispensing with an inquiry into misconduct, but rather for dismissing a workman without inquiry under specific circumstances.3. Violation of Principles of Natural Justice:The judgment emphasized that the action taken by the employer violated principles of natural justice. It was noted that even if an inquiry into misconduct may be counter-productive in certain situations, the reasons for dispensing with the inquiry must be recorded in writing and must be germane to the issue. The court found that the reasons provided by the employer were not sufficient and did not justify dispensing with the inquiry.4. Validity of Standing Order 32:The judgment questioned the validity of S.O. 32, stating that it confers arbitrary and drastic power to dismiss an employee without recording reasons for dispensing with the inquiry. It was noted that such a standing order is violative of the basic requirement of natural justice. The court suggested that Hindustan Steel Ltd. should recast S.O. 32 to bring it in tune with the philosophy of the Constitution, failing which its validity would have to be examined in an appropriate proceeding.5. Appropriate Relief for the Workman:Given that the order of dismissal was found to be invalid, the court considered two options: allowing the General Manager to hold a disciplinary inquiry or remitting the matter to the Labour Court. However, considering the long duration since the dismissal (over 14 years), the court opted for a different remedy. The court directed the respondent to cancel the dismissal order, reinstate the workman, and accept his resignation on the same day. Additionally, the respondent was ordered to pay the workman Rs. 1,50,000 as back wages and future wages, spread over from the date of removal to the end of 1984.Conclusion:The appeal was allowed, and the court provided detailed directions for reinstating the workman and compensating him. The judgment underscored the importance of adhering to principles of natural justice and the need for public sector undertakings to align their standing orders with constitutional principles.