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1) FINDINGS TO BE RECORDED BY THE ENQUIRY OFFICER
5.1)
The Enquiry Officer is responsible not only for conducting the enquiry but also for submitting a Report and Findings of the enquiry. The findings of an Enquiry Officer has a crucial role in determining the punishment that ought to be awarded to an employee for the misconducts alleged to have been committed by an employee. The Enquiry officer, therefore, has to be extremely cautious while drawing up findings. The findings of an Enquiry officer are an appraisal of the findings on record of the Enquiry proceedings. The appraisal has to be objective and logical. It has been time and again held that assessment of evidence on record of the Enquiry proceedings should be such that the conclusion reached should be one, which a reasonable man would come to. An Enquiry Officer cannot give his own reasons, i.e. based on personal knowledge - for accepting or rejecting the contentions of the delinquent employee, but only after he has recorded reasons for his acceptance or rejection as the case may be. The Report of the Enquiry Officer, therefore, in brief should be based on evidence on record of the proceedings, must indicate clearly with reasons the charges which have been established or charges which have not been established and the reasons so recorded should be one which is objective, logical and which a reasonable person could have reached.
5.2)
The essential requirements of a finding may be enumerated as below:
a) Narration of the incident/s leading to the charge sheet
b) Jist of the charges
c) Jist of defence of the delinquent in respect of which charge has been made
d) Jist of evidence, i.e. documentary and oral both on record of the enquiry proceedings.
e) Assessment of evidence in respect of each charge with reasons for reaching the conclusion.
5.3)
It is advisable to have a summary of findings of each charge separately indicating charges, which have been proved, charges, which have not been proved, and charges which have been broadly proved and the extent to which such charge has been proved.
5.4)
The enquiry finding, therefore, should be speaking in nature and should give brief reasons for the finding reached by the Enquiry Officer in adjudicating of a labour dispute arising out of dismissal or discharge of an employee pursuant to domestic enquiry is of great importance. The Industrial Tribunal or Labour Court critically appraises the findings recorded by the Enquiry Officer. The Enquiry Report & Findings, therefore, should be self-sufficient so that the entire case against the delinquent employee can be understood by reading the Report itself. The evidence relied upon by the Enquiry Officer for coming to a particular finding should be specifically referred to in the Report because if it is found that the findings have been reached on extraneous matters, i.e. not based on evidence on record, the Courts would be justified in setting aside the findings, by characterising the findings recorded as perverse.
5.5)
The Enquiry Officer, therefore, should ensure that the conclusions reached by him is supported by evidence, oral or documentary, or is not entirely opposed to the whole body of evidence laid before him. It is always advisable to ensure that the finding is direct and in simple language. An Enquiry Officer drawing up findings should avoid legal jargons. Clarity and accuracy of facts are characteristics of good and legal findings.
5.6)
In Madhya Pradesh Industries vs. Union of India (AIR 1966 SC page 671) the Supreme Court observed that a Speaking Order would at best be reasonable. The Supreme Court further observed that no particular form or scale of the reasons can be prescribed and the extent and the nature of the reasons depend upon each case. However, what is essential that the Domestic Tribunal ought to give reasons, which are adequate and based on facts brought on record of the proceedings.
5.7)
In Mahabir Prasad vs. State of U.P. (AIR 1970 SC 1302) the Supreme Court observed that satisfactory decision of a disputed claim might be reached only if it be supported by the most cogent reason that appealed to the authority. The Supreme Court further observed that this should all the more be so where the domestic enquiry may result in deprivation of livelihood or attach a stigma to the character. The Supreme Court deprecated the enquiry report which merely produced the stages through which the Enquiry passed and did not disclose any application of mind to the charges and evidence adduced in the proceedings. The Supreme Court observed that such "Order Sheet" findings are perverse and cannot be accepted.
5.8)
In Balkrishna Mishra vs. P.O., CGIT [1977 (35) FLR 11] the Supreme Court observed that the well settled law that is that a finding recorded in a Domestic Enquiry cannot be characterised as perverse by the Labour Court unless it can be shown that such a finding is not supported by any evidence or is entirely opposed to the whole body of evidence adduced. It further held that once a conclusion is deduced from the evidence it is not permissible to assail that conclusion even though it is possible for some other authority to come at different conclusion on the same evidence. Therefore, a finding based on evidence cannot be substituted by a Tribunal or Superior Court as to conclusion on facts. The Supreme Court categorically held that re-appreciation of evidence was not permissible but the finding could be set aside if the same was not based on evidence or unreasoned.
5.9)
A Constitutional Bench of the Supreme Court (Three Judges) in the case of Anil Kumar vs. Presiding Officer (1986 I LLJ 101) held that the Enquiry officer is under a duty to apply his mind to the evidence and reach conclusions supported by reasons. The Supreme Court held that Enquiry Report is in a quasi judicial enquiry must show the reason for the conclusion and cannot be an ipse dixit of the Enquiry Officer. The Supreme Court held that the minimum expectation of the Enquiry Report is that it should be a reasoned one. In such event the Court may not enter into adequacy or sufficiency of evidence.
2) SUPPLY OF FINDINGS
5.1)
The Report & Findings of the Enquiry Officer are now required to be forwarded to the delinquent employee. This has now been held as a facet of the principles of natural justice. It would be relevant to briefly trace the history relating to the right of a delinquent employee to receive the Report and Findings submitted by the Enquiry Officer.
5.2)
The Government of India Act, 1935 laid the seeds of the law on the subject. Section 240 (3) of the said Act provided that a Civil Servant shall not be dismissed or reduced in rank until he be given a reasonable opportunity to show cause against action proposed to be taken against him. The Section stipulates that a civil servant against whom punishment of dismissal or reduction in rank was proposed should be afforded a reasonable opportunity to show cause against the proposed action. The expression "against action proposed to be taken" was uniformly interpreted to mean the stage after the findings were reached. It was, therefore, held that a civil servant could show cause only upon receipt of the findings so that he could ascertain as to what adverse material was on record and which was utilised by the Enquiry Officer to hold him guilty. The object of Section 240(3) was held to be two fold in nature. Firstly it was to permit the delinquent Civil Servant to establish his innocence by pointing out how the findings were erroneous or could not be reached on the basis of the material on record. Secondly to address the punishing authority on the issue that even if the findings were held to be correct then the punishment proposed ought to be reduced or that it was disproportionate to the misconduct allegedly proved.
5.3)
The aforesaid safeguards were incorporated in Article 311 (2) of the Constitution of India. By the 15th amendment which came into force on 5th October, 1963 the expression "reasonable opportunity" was expanded and the scope of second show cause notice was broadened.
5.4)
The Supreme Court in the case of State of Gujarat vs. Teredesai (1970 I SCR 251) after taking note of series of decisions delivered by the Judicial Committee, the Privy Council, the Federal Court and the Supreme Court came to the conclusion that the expression "reasonable opportunity" would not be satisfied unless the entire report of the Enquiry Officer including his views in matters of punishment were disclosed to the delinquent public servant.
5.5)
Article 311 (2) was further amended by the 42nd amendment which came into force from 1st January, 1977. It expressly provided that a delinquent civil servant need not be provided an opportunity in respect of punishment proposed to be inflicted upon him.
5.6)
Consequent to the aforesaid amendment the Supreme Court in the case of Secretary, Central Board of Excise vs. K. S. Mahaingam (1986 (3) SCR page 35) held that in light of the 42nd amendment non supply of Report could not constitute a ground to set aside the penalty imposed upon the delinquent civil servant.
5.7)
In Union of India vs. E. Bashyan (1988 (3) SCC page 209) two Learned Judges of the Supreme Court formed an opinion that failure to furnish report of the Enquiry Officer to the delinquent employee deprived him of crucial and critical material which has been taken into account to hold him guilty. The Supreme Court then observed that though Second Show cause notice was dispensed by virtue of 42nd amendment the issue as to whether a Copy of the Enquiry Report ought to be furnished to the delinquent employee to enable him to point out anomaly, if any, requires to be addressed and opined that the said point required consideration of a larger bench.
5.8)
In K. C. Asthana vs. State of U.P. (1988 (3) SCC 600) three Learned Judges of the Supreme Court were of the view that it was not necessary to furnish the Report of the Enquiry Officer to the delinquent employee before the Disciplinary Authority arrived at his conclusions.
5.9)
In Union of India vs. Mohammed Ramzan (AIR 1991 SC 471) the Supreme Court traced the history of the growth of service jurisprudence relating to security of the civil service in the country. The Supreme Court also referred to several pronouncements rendered by the Privy Council, Federal Court and the Supreme Court and came to the conclusion that the 42nd amendment did not take away the right of an employee to receive a copy of the Enquiry Report. The Supreme Court held that the delinquent employee is entitled to such a Report and this entitlement was traced to the first part of Article 311(2) of the Constitution of India, viz. that it would form a part of the reasonable opportunity, which is to be afforded to a civil servant in respect of the charges.
5.10)
The Supreme Court did not specifically refer to K.C. Asthanan's case while rendering its decision in Mohammed Ramzan. As both the decisions were rendered by a bench of three Judges and as there was an apparent conflict the entire issue was referred to a bench of five judges. In the case of Managing Director, ECIL vs. B. Karunakar (1993 (2) CLR 1129). The Supreme Court once again re-traced the entire history of service jurisprudence and came to the conclusion that there was no apparent conflict between the aforesaid two decisions and the principles of law laid down in Mohammed Ramzan was the correct law. The Supreme Court in para 30 answered the questions raised in the Appeals and Petitions and categorically held that the delinquent employee is entitled to a copy of the Report and Findings of the Enquiry officer. It held that such a right accrued to employees in all establishments whether Government or non-government, public or private.
5.11)
Accordingly the law as laid by the Supreme Court now requires an employer to hand over a copy of the report to the delinquent employee before inflicting any punishment. Non-supply of Enquiry Report would per-se not vitiate the punishment. In para 31 of ECIL case the Supreme Court laid down that such non-supply of Enquiry Report ought to be tested on the touchstone of prejudice and if no prejudice was caused to the delinquent employee on account of non-supply the punishment cannot be set aside on that count.
5.12)
In the case of S. K. Singh vs. Central Bank of India reported in 1997 (75) FLR page 402 the Supreme Court after considering the judgment in ECIL case held that non supply of Enquiry Report did not vitiate the enquiry as the delinquent employee had failed to prove the prejudice caused to him by non furnishing of the Enquiry Report before the dismissal order was passed against him. It may be noted here that the Supreme Court in ECIL clarified that the ratio laid down in Mohammed Ramzan was prospective and, therefore, would only cover cases on and after 20th November, 1990.
3) QUANTUM OF PUNISHMENT
5.1)
The Standing Orders framed under the Industrial Employment (Standing Orders) Act, 1946 does not classify misconducts as minor and major misconducts. They only enumerate misconducts. However, the Courts have in a series of decisions held certain misconducts such as go-slow, forgery, mis-appropriation, etc. as major misconducts justifying punishment of dismissal. In certain cases Courts have held misconducts such as illegal strike by all employees, absenteeism, late coming as minor misconducts and have not approved the extreme punishment of dismissal.
5.2)
It is indeed a lacune in Industrial Law that there are no specific guidelines or set of rules, which categorize misconducts, which would justify the extreme punishment. It may also be simultaneously noted that the propensity of human mind to commit an act or omit to do something is so vast that it may be impossible to lay down any guidelines. However, a rough and ready guidelines is the need of the day especially because litigation resulting in setting aside an order of dismissal has huge repercussions both financial as well as administrative on companies and, therefore, a need to review the Standing Orders. This is all the more essential in light of Section 11 which empowers Labour Courts and Tribunals to interfere with orders of punishment imposed by the management.
5.3)
Lopes L.J. in Piers vs. Foster laid down the proposition as under:
"If a servant conducts himself in a way inconsistent with the faithful discharge of his duty in the service, it is misconduct which justifies immediate dismissal. That misconduct, according to my view, need not be misconduct in the carrying on of the service or the business. It is sufficient if it is conduct which is prejudicial or is likely to be prejudicial to the interests or to the reputation of the master and the master will be justified, not only if he discovered it at the time, but also if he discovers it afterwards, in dismissing the servant"
The above proposition laid down by Lopes was set aside by the Hon'ble Supreme Court in the case of S. Govinda Menon vs. Union of India 1967 II LLJ and held as under:
"The jurisdiction for grant of a Writ of prohibition is primarily supervisory and the object of the Writ is to restrain courts or inferior tribunals from exercising a jurisdiction which they do not possess at all or else to prevent their exceeding the limits of their jurisdiction. But the writ does not lie to correct the course, practice or procedure of an inferior tribunal or a wrong decision on the merits of the proceedings."
3.4)
In the case of J. J. Mody vs. State of Bombay reported in AIR 1962 Gujarat, 197 the Division Bench of the Bombay High Court catalogued grounds on which an employer would be entitled to dismiss his employee. The said grounds were as under:
(i) where the act or conduct of the servant is prejudicial or likely to be prejudicial to the interests of the master or to the reputation of the master;
(ii) where the act or conduct of the servant is inconsistent or incompatible with the due or peaceful discharge of his duty to his master;
(iii) where the act or conduct of a servant makes it unsafe for the employer to retain him in service;
(iv) where the act or conduct of the servant is so grossly immoral that all reasonable men will say that the employee cannot be trusted;
(v) Where the act or conduct of the employee is such that the master cannot rely on the faithfulness of his employee;
(vi) where the act or conduct of the employee is such as to open before him temptations for not discharging his duties properly;
(vii) where the servant is abusive or if he disturbs the peace at the place of his employment;
(viii) where the servant is habitually negligent in respect of the duties for which he is engaged; and
(ix) where the neglect of the servant though isolated, tends to cause serious consequences.
5.1)
The Hon'ble Madras High Court in the case of K. V. Vedivalu vs. Superintendent of Police reported in 1967 (15) FLR page 286 also enumerated misconducts which would justify dismissal. The Madras High Court did mention that the list was not exhaustive and there may be other instances of misconduct where an employer may justifiably dismiss his employee for acts of misconducts. Thus the Judiciary was also concerned with the task of addressing the question as to the situation in which an employer could be justified in awarding the extreme punishment of dismissal. However, due to lack of statutory provisions Courts found it difficult to interfere with an order of dismissal which was imposed after following the due process of law but which on the face of it could not be justified. Courts also observed that though charge of victimisation and unfair labour practice was each to make it was very difficult to prove and hence the Order of dismissal on this ground could not be easily dislodged even if it was found to be justified.
4) SCOPE OF SECTION 11-A OF THE I.D. ACT, 1947.
5.1)
The introduction of Section 11-A by amending Act effective from 15th December, 1971 has resulted in vesting with the Labour Court and Industrial Court powers which are more in the nature of an Appellate Authority sitting over the decision of the management on the quantum of punishment. The said Section empowers the Courts and Tribunals to substitute the punishment imposed by the management. This definitely has given wide powers to the Courts. The scope of power under Section 11-A as held by various Courts in a series of decisions may be briefly stated as a duty to find out if punishment imposed by management was just and proper or whether lesser punishment would meet the ends of justice.
5) ELEMENTS OF BACK
WAGES
5.1)
The term "Full Back Wages" has been elaborately explained in various judgments.
5.2)
In Lataben vs. Rajayaguru & Ors. (1997 I CLR 1043) the order of dismissal was quashed and set aside as null and void. The Court held that the Petitioner would be entitled not only to reinstatement but full salary for the period of non-employment. The term "Full Salary" was explained that she would be entitled to all consequential benefits such as seniority, right of consideration for promotion from the date her juniors were given promotion, fitment in appropriate scales and all allowances which were drawn by employees in her cadre or scale during the period of non-employment.
5.3)
In the case of Goa Bottlings vs. Pradeep
Sardesai (1992 II CLR 490) the Bombay High Court held that benefits of revised wages or salary arising out of revision of Pay scales as also yearly increments and revised Dearness Allowance should also enter the calculation of back wages. Leave encashment and bonus, if other workers in the same category have been paid would also be due on account of back wages.
5.4)
In the case of B. R. Rasaily vs. Presiding Officer the Delhi High Court held that the term "Full Back Wages" would ordinarily imply that all intervening increments that the employee would have earned but for his termination will have to be taken into account for computation of back wages. All earnings which the employee would have earned had he been in employment will have to be taken into account in such computation.
5.5)
In the case of S. D. Kasliwal vs. K.K. W.S. Karhana Ltd. the Bombay High Court clarified computation of back wages in these words "Back wages would include all amounts which would have been payable to the Petitioner had he not been dismissed from service"
5.6)
The off shoot of the aforesaid decisions is that back wages takes into account full salary with all revisions in pay scale together with yearly revisions, D.A. as paid on a month to month basis for the period under reference, all monthly emoluments and allowances, leave encashment, bonus, LTC and any other benefit which the employee would be entitled to had he been in employment.
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