No legal evidence in misconduct findings makes dismissal unsustainable; reinstatement with full back wages follows absent gainful employment.

A misconduct finding and dismissal cannot stand where the domestic enquiry and arbitral award rest on no legal evidence, conjecture, or surmise rather than proof of actual misappropriation or wilful misuse. The Supreme Court of India noted that such findings are perverse and unsustainable, permitting interference despite the usual limited review of evidence. Once the dismissal was held vitiated, reinstatement followed as the normal relief. The employer also failed to prove gainful alternative employment, so denial of back wages was unwarranted. The workman was therefore treated as entitled to reinstatement with full back wages and consequential service benefits.

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Issues: (i) Whether the findings in the domestic enquiry and the arbitral award sustaining dismissal were vitiated for being based on no legal evidence and perverse; (ii) whether the appellant was entitled to reinstatement with back wages and consequential benefits.

Issue (i): Whether the findings in the domestic enquiry and the arbitral award sustaining dismissal were vitiated for being based on no legal evidence and perverse.

Analysis: The only substantial allegation against the workman was negligence in keeping his private cheque book in a manner said to have enabled misuse by another employee. The record disclosed no evidence that the workman misappropriated funds, manipulated accounts, issued cheques to defraud the employer, or wilfully permitted misuse of the cheque book. Findings of guilt resting on conjectures, surmises, or an ipse dixit, without legal evidence, were held to be perverse and indicative of non-application of mind. In such a situation, the arbitrator and the Court could interfere notwithstanding the limited scope ordinarily attaching to appreciation of evidence.

Conclusion: The findings of misconduct and the award sustaining dismissal were illegal, perverse, and unsustainable.

Issue (ii): Whether the appellant was entitled to reinstatement with back wages and consequential benefits.

Analysis: Once the dismissal was founded on a vitiated enquiry and unsupported findings, reinstatement followed as the normal relief. The employer's attempt to deny back wages on the basis that the workman had merely lived with and assisted his father-in-law at a coal depot did not amount to gainful employment. No reliable material showed alternative gainful employment during the period of forced unemployment.

Conclusion: The appellant was entitled to reinstatement with full back wages and all consequential benefits.

Final Conclusion: The dismissal was set aside and the workman's service was restored with full monetary and service consequences.

Ratio Decidendi: A finding of misconduct and an award sustaining dismissal cannot stand where they are based on no legal evidence or on conjecture, and in such a case reinstatement with full consequential relief ordinarily follows.

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