2014 (2) TMI 584 - HC - Indian Laws

Writ petition success: Reinstatement with back wages granted due to procedural lapses and lack of evidence

K. Ramesh Versus Presiding Officer, Principal Labor Court, Chennai and another

The writ petition was allowed, setting aside the Labour Court's award. The petitioner was granted reinstatement with back wages and other benefits. ... Suspension of employee - College property goes missing while petitioner was on leave - Petitioner lodged police complaint - Petitioner was held responsible for missing property - Tribunal upheld dismissal of petitioner - Held that:- person who is accused of a misconduct must clearly know the charges levelled against him. It is only when a person is made known to the charges, he will be able to submit his explanation and upon the said explanation, if it is not satisfactory, the Management can hold an enquiry. On the other hand, right from the beginning of the proceedings, the allegation of the Management against the petitioner was that he was responsible for the loss and that he should make good the loss. A charge of theft is a serious misconduct and it goes into the character of an employee and it cannot be lightly alleged. It is one thing to say that if there was entrustment of a property and there was loss of the same, then in respect of such loss of the property, an employee must make good the loss, that is somewhat a civil liability. But when an allegation of criminal liability is fixed, then there must be a charge to that effect and only when that charge is made, the question of Enquiry Officer going into the charges will arise. Under Section 7(2)(c) of the Payment of Wages Act, deductions from the wages of an employed person can be made for loss of goods expressly entrusted to an employed person for custody or where such loss is directly attributable to his neglect or default. But there is nothing wrong on the Management holding the petitioner responsible for the loss but before making any deduction towards loss, the payment of Wages Act also provides procedure under Section 10(1)(a), wherein the employee must be given an opportunity of showing cause against the deduction or otherwise than in accordance with such procedure as may be prescribed for making such deduction - no exception can be taken with reference to the petitioner moving the Police station with a criminal complaint. For his causing notice issued through his trade union can never be said to be a misconduct. In so far as the loss of material is concerned, it can be only fixed by civil liability as there was no allegation of theft under any part of the proceedings. Since no enquriy was held by giving a notice and on that score the finding rendered by the Labour Court in this regard are perverse and the impugned Award is liable to be set aside. Since this Court has held that the findings of the Lbaour Court itself are perverse and charges were not proved, the question of going into any proportionality of punishment does not arise - petitioner is entitled for reinstatement with backwages, continuity of service and other attendant benefits. However, it is open to the Management to proceed against the workman for recovery of loss of the coils entrusted to him after following due procedure established by law. This order will not stand in the way of the Management in proceeding against the recovery which is only a civil liability - Decided in favour of Petitioner. Issues Involved:1. Validity of the domestic enquiry.2. Allegations of theft against the petitioner.3. Petitioner's complaint to the police and the involvement of the Trade Union.4. The Labour Court's findings and its adherence to legal standards.5. The proportionality of the punishment imposed on the petitioner.Issue-wise Detailed Analysis:1. Validity of the Domestic Enquiry:The Labour Court did not frame any separate issue regarding the validity of the domestic enquiry. The enquiry was conducted by an Advocate, and the petitioner was not allowed assistance from a representative of his choice. The Enquiry Officer's neutrality was questioned as the petitioner was not given an opportunity to cross-examine the Accounts Manager. The Labour Court upheld the Enquiry Officer's report without addressing these procedural lapses.2. Allegations of Theft Against the Petitioner:The initial memo dated 27.03.2007 from the second respondent only held the petitioner vicariously liable for the missing coils and demanded Rs.16,200/- to cover the loss. There was no direct allegation of theft in the show cause notice or the dismissal order. The Enquiry Officer did not find the petitioner guilty of theft. However, the Labour Court inferred theft based on the petitioner's inability to explain the missing coils, which was not supported by the initial charges or the Enquiry Officer's findings.3. Petitioner's Complaint to the Police and the Involvement of the Trade Union:The petitioner reported the missing coils to the police after being asked to pay for the loss, which the Labour Court found suspicious. The Trade Union's involvement was also criticized. However, the court held that any person has the right to set the criminal law in motion, and approaching the Trade Union cannot be deemed misconduct. The Labour Court's adverse inference from these actions was deemed unwarranted.4. The Labour Court's Findings and its Adherence to Legal Standards:The Labour Court's findings were criticized for being based on assumptions rather than evidence. The court noted that the Labour Court did not refer to the documents marked before it and relied on the submissions made during the proceedings. The Labour Court's conclusion of theft was not supported by the charges framed or the Enquiry Officer's report, making its findings perverse and not in line with the legal standards.5. Proportionality of the Punishment Imposed on the Petitioner:The Labour Court upheld the petitioner's dismissal without considering whether the punishment was proportionate to the alleged misconduct. The court referred to Supreme Court precedents, emphasizing that charges must be specific and not vague and that the punishment should be proportionate to the gravity of the misconduct. Since the charges of theft were not proven, the question of proportionality of punishment did not arise.Conclusion:The writ petition was allowed, and the impugned award by the Labour Court was set aside. The petitioner was declared entitled to reinstatement with back wages, continuity of service, and other attendant benefits. However, the Management was allowed to proceed against the petitioner for the recovery of the loss of the coils following due legal procedure, treating it as a civil liability.