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Management of Ritz theatre (P) Ltd. Vs. Its Workmen - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtSupreme Court of India
Decided On
Judge
Reported inAIR1963SC295; [1962(5)FLR216]; (1962)IILLJ498bSC; [1963]3SCR461
AppellantManagement of Ritz theatre (P) Ltd.
Respondentits Workmen
Cases ReferredBharat Sugar Mills Ltd. v. Jai Singh
Excerpt:
.....relating tothe dismissal of an industrial employee, if it is satisfied teat no enquiry hasbeen held or the enquiry which has been held is not proper or fair or that thefindings recorded by the enquiry officer are perverse, the whole issue is atlarge before the tribunal. this position also is well settled. logically, it is only where the tribunalis satisfied that a proper enquiry has not been held or that the enquiry havingbeen held properly the finding recorded at such an enquiry are perverse, thatthe tribunal derives jurisdiction to deal with the merits of the dispute. we are satisfied that this literal and somewhatmechanical way of reading this solitary sentence in the judgment from itscontext is not justified. it is true thatthe tribunal has observed that the findings recorded at..........and come to his own conclusion. 9. it has also been held that if it appears that the departmental enquiryheld by the employer is not fair in the sense that proper charge had not beenserved on the employee or proper or full opportunity had not been given to theemployee to meet the charge, or the enquiry has been affected by other graveirregularities vitiating it, then the position would be that the tribunal wouldbe entitled to deal with the merits of the dispute as to the dismissal of theemployee for itself. the same result follows if no enquiry has been held atall. in other words, where the tribunal is dealing with a dispute relating tothe dismissal of an industrial employee, if it is satisfied teat no enquiry hasbeen held or the enquiry which has been held is not proper or fair or that.....
Judgment:

Gajendragadkar, J.

1. An industrial dispute between the appellant, the Management of RitzTheatre (Private) Ltd., and the respondents, its Workmen, from which thisappeal arises was referred for adjudication to the Industrial Tribunal at Delhiby the Delhi Administration on November 13, 1959. The dispute was in regard tothe termination of services of two of the appellant's employees, Jai Jai Ramand Mohd. Mia and the question referred for adjudication was whether the saidtwo workmen should be reinstated with full back wages and to what relief theywere entitled.

2. The appellant is a company which carries on the business of exhibitingcinema films in its theatre, the Ritz Cinema, and the two workmen had been itsemployees for several years past. It appears that in August, 1958, chargesheets were served on the two workmen. Against Jai Jai Ram, four charges wereframed. The first charge was that on 1st August, 1958, he along with Mohd. Miahad given a beating with slaps and fist blows while on duty to Mool KrishanNigam another employee at about 6 P.M. during the Matinee show of'Nausherwane-Adil'; the second charge was that he had misappropriatedcarbons belonging to the management; the third was that he had run Reel No. 9on the picture 'Bhabi' upside down on 19th August, 1958, during the6-30 P.M. show; and the last charge was that he had run over the Film Print ofpicture 'Mother India' and thereby damaged the film print.

3. Against Mohd. Mia, three charges were framed. The first was in regard tothe incident which took place on 1st August, 1958 in which he and Jai Jai Ramhad acted together in beating with slaps and fist blows Mool Krishan Nigam; thesecond was that on 25th August, 1958, at about 3 P.M. during the show, he hadthreatened Ramesh Chandra another employee and had abused him and pushed himout of the cabin; and the third was that on 23rd August, 1958, while on duty hehad left his cabin for half an hour without leave or permission or even withoutgiving any information and was found taking tea in the restaurant during dutyhours.

4. These charges were enquired into by the Enquiry Officer appointed by theappellant. At the enquiry, the appellant led evidence, both oral and documentary.Eleven witnesses were examined on behalf of the appellant whereas elevenwitnesses were examined on behalf of the workmen. The Enquiry Officer examinedthe evidence adduced before him by the respective parties, considered theirrival contentions and came to the conclusion that the charges firmed againstboth the workmen had been fully established. Accordingly, the Officerrecommended that the services of both the workmen should be dispensed with formisconduct. He added that in case his recommendation for dismissing theemployees was accepted, certain payments should be made to them as indicated inthe report. The appellant's case is that the report made by the Enquiry Officerwas accepted by it and in accordance with the recommendation made by the said report,Jai Jai Ram and Mohd. Mia were dismissed on 15th January, 1959, and Ist May,1959 respectively.

5. In the present dispute, the respondents' case was that the departmentalenquiry instituted by the appellant against the two workmen was unfair, unjustand inequitable and so it was urged that the termination of services of boththe workmen was not justified. In regard to Mohd. Mia, the respondents took anadditional specific plea that the said workman had not been dismissed but hadcontinued to be under suspension from 11th September, 1958 and on thisadditional plea, reinstatement of Mohd. Mia was claimed. Both these allegationswere denied by the appellant; it urged that the departmental enquiry held byits Officer was fair and just and that fullest opportunity had been given tothe employees to explain their position and meet the charges framed againstthem. In regard to Mohd. Mia, it was averred that after the management decidedto terminate his services, the order of dismissal was in fact served on him on1st May, 1959.

6. It is in the light of these pleadings that the Tribunal proceeded to dealwith the dispute referred to it for its adjudication. It appears that when thetrial began before the Tribunal, an application was made by the appellant askingfor permission to lead additional evidence. In this application the appellantstated that some additional evidence had come to its knowledge since theholding of the enquiry and so production of the said additional evidence may beallowed. Thereupon, the respondents urged that they should also be allowed anopportunity to adduce additional evidence, and on the 27th January 1960, theTribunal ordered that as both parties desired to lead further evidence,permission was granted; and in accordance with this order, evidence had beenled before the Tribunal both by the appellant and the respondents. In additionto the evidence thus led, the appellant produced before the Tribunal all thepapers of the departmental enquiry containing evidence recorded therein and thereport made by the Officer.

7. The Tribunal has held that since the appellant sought for permission toled additional evidence, it was open to it to consider the merits of thedismissal of the two employees for itself in the light of the whole of theevidence before it. It took the view that since the appellant wanted to citefurther evidence before it, the jurisdiction of the Tribunal to deal with themerits of the dispute became wider; and considering the evidence from thispoint of view, it came to the conclusion that the dismissal of Jai Jai Ram wasnot justified and that the findings recorded against him at the departmentalenquiry were baseless. In regard to the termination of Mohd. Mia's services,the Tribunal held that no order of dismissal had been served on him and so itcould not be said that his services had been duly terminated by an order ofdismissal at all. On these grounds, the Tribunal ordered reinstatement of boththe employees and gave them additional consequential reliefs. It is againstthis order that the appellant has come to this Court by special leave.

8. The first point which Mr. Andley has raised before us is that in dealingwith the dispute on the merits, the Tribunal has exceeded its jurisdiction.Industrial disputes arising from orders passed by employers terminating theservices of their employees have frequently come to this court in appeal andthe principles which govern the limits, and the due scope, of the exercise ofthe Industrial Tribunals jurisdiction in respect of such dispute have beenexamined by this Court on several occasions. It is well-settled that if anemployer serves the relevant charge or charges on his employee and holds aproper and fair enquiry, it would be open to him to act upon the report submittedto him by the Enquiry Officer and to dismiss the employee concerned. If theenquiry has been properly held, the order of dismissal passed against theemployee as a result of such an enquiry can be challenged if it is shown thatthe conclusions reached at the departmental enquiry were perverse or theimpugned dismissal is vindictive or mala fide, and amounts to an unfair labourpractice. In such an enquiry before the Tribunal, it is not open to theTribunal to sit in appeal over the findings recorded at the domestic enquiry.This Court has held that when an proper enquiry has been held, it would be opento the Enquiry Officer holding the domestic enquiry to deal with the matter onthe merits bona fide and come to his own conclusion.

9. It has also been held that if it appears that the departmental enquiryheld by the employer is not fair in the sense that proper charge had not beenserved on the employee or proper or full opportunity had not been given to theemployee to meet the charge, or the enquiry has been affected by other graveirregularities vitiating it, then the position would be that the Tribunal wouldbe entitled to deal with the merits of the dispute as to the dismissal of theemployee for itself. The same result follows if no enquiry has been held atall. In other words, where the Tribunal is dealing with a dispute relating tothe dismissal of an industrial employee, if it is satisfied teat no enquiry hasbeen held or the enquiry which has been held is not proper or fair or that thefindings recorded by the Enquiry Officer are perverse, the whole issue is atlarge before the Tribunal. This position also is well settled.

10. In regard to cases falling under this last category of cases, it ishowever open to the employer to adduce additional evidence and satisfy theTribunal that the dismissal of the employee concerned is justified. And in sucha case, the Tribunal would give opportunity to the employer to lead suchevidence, would give an opportunity to the employee to meet that evidence, anddeal with the dispute between the parties in the light of the whole of theevidence thus adduced before it. There can be little doubt even about thisposition.

11. Mr. Sastri however contends that there can be an intermediate class ofcases where the employer no doubt rests his case on the fact that an enquiryhas been held, but apprehensive about the validity of the enquiry, he seeks forpermission to lead evidence to justify his action before the Tribunal and hecontends that whenever the employer seeks to adduce additional evidence beforethe Tribunal after having produced the papers in regard to the enquiryproceedings, it should he held that the Tribunal is entitled to deal with themerits of the dispute for itself, because the course adopted by the employer inseeking to adduce additional evidence should by itself justify an inferencethat he concedes that the enquiry has not been proper. That is the view whichapparently the Tribunal has taken in the present proceedings and Mr. Sastrinaturally seeks to support it.

12. We do no think that this view can be accepted as correct. In enquiriesof this kind, the first question which the Tribunal has to consider is whethera proper enquiry has been held or not. Logically, it is only where the Tribunalis satisfied that a proper enquiry has not been held or that the enquiry havingbeen held properly the finding recorded at such an enquiry are perverse, thatthe Tribunal derives jurisdiction to deal with the merits of the dispute. It isquite conceivable, and in fact it happens in many cases, that the employer mayrely on the enquiry in the first instance and alternatively and withoutprejudice to his plea that the enquiry is proper and binding, may seek to leadadditional evidence. It would, we think, be unfair to hold that merely byadopting such a course, the employer gives up his plea that the enquiry wasproper and that the Tribunal should not go into the merits of the dispute foritself. If the view taken by the Tribunal was held to be correct, it would leadto this anomaly that the employer would be precluded from justifying thedismissal of his employee by leading additional evidence unless he takes therisk of inviting the Tribunal to deal with the merits for itself, because assoon as he asks for permission to lead additional evidence, it would followthat he gives up his stand based on the holding of the domestic enquiry.Otherwise, it may have to be held that in all such cases no evidence should beled on the merits unless the issue about the enquiry is tried as a preliminaryissue. If the finding on that preliminary issue is in favour of the employer,then, no additional evidence need be cited by the employer; if the finding onthe said issue is against him, permission will have to be given to the employerto cite additional evidence, instead of following such an elaborate andsomewhat cumbersome procedure, if the employer seeks to lead evidence inaddition to the evidence adduced at the departmental enquiry and the employeesare also given an opportunity to lead additional evidence, it would be open tothe Tribunal first to consider the preliminary issue and then to proceed todeal with the merits in case the preliminary issue is decided against theemployer. That, in our opinion, is the true and correct legal position in thismatter.

13. Mr. Sastri however contends that there are two decisions which supportthe view which has been accepted by the Tribunal in the present case. In thatconnection, he has invited our attention to the decision of this court in Bharat Sugar Mills Ltd. v. Jai Singh [1961] 2 L.L.J. 644. We do not think that thisdecision supports Mr. Sastri's contention at all, The argument which was urgedbefore this court in that case, and which this court rejected, was that in anenquiry before a Tribunal in respect of the dismissal of an industrialemployee, it would not be open to the employer to adduce additional evidenceand justify the dismissal on the merits apart from the enquiry. And this courtheld that it would be open to the employer to adduce additional evidence, Itwas observed in the course of the judgment that 'where there has been aproper enquiry by the management itself, the Tribunal, it has been settled by anumber of decisions of this Court, has to accept the finding arrived at in thatenquiry unless it is perverse and should give he permission asked for unless ithas reason to believe that the management is guilty of victimisation or hasbeen guilty of unfair labour practice or is acting mala fide.' Then thiscourt proceeded to add that 'the mere fact no enquiry has been held orthat the enquiry has not been properly conducted cannot absolve the Tribunal ofits duty to decide whether the case that the workman has been guilty of thealleged misconduct has been made out. The proper way for performing this dutywhere there has not been a proper enquiry by the management is for the Tribunalto take evidence of both sides in respect of the alleged misconduct.' Itwould thus be seen that this decision lays down the principle that even if noenquiry has been held and an industrial employee has been dismissed, where adispute is referred to the Industrial Tribunal for its adjudication, thefailure to hold the enquiry would not necessarily be fatal to the employer'scase and it would be open to him to justify the dismissal by citing evidencebefore the Tribunal in support of his case that the employee was guilty ofmisconduct which justified his dismissal. This conclusion cannot by any stretchof imagination support Mr. Sastri's contention that as soon as evidence is ledby the employer, the plea raised by him on the ground of the enquiry held byhim prior to the dismissal of the employee is not available to him and that theTribunal is at liberty to examine the question and decide it on the merits foritself.

14. The other decision on which Mr. Sastri has relied is a judgmentdelivered by this court in the Anglo American Direct Tea Trading Company Ltd.v. Workmen of Nahortali Tea Estate (1961) (2) L.L.J. 625. In that case, itappears that all that had happened in the course of the departmental enquiryheld by the employer was that certain questions were put to the employeeDhaneswar to which he gave answers. When he was asked to sign the statement, herefused to do so. Thereafter, no further enquiry was held and it did not appearthat Dhaneswar refused to take part in the enquiry. Before the Tribunal, theemployer sought to justify the dismissal by adducing evidence. It is in thelight of these facts that this court observed that from the fact that evidencewas led, 'it was practically accepted before the Industrial Tribunal thatthere was no proper managerial enquiry and it was left to the IndustrialTribunal to decide for itself whether the dismissal of Dhaneswar was justified.'Mr. Sastri reads this sentence literally and contends that it lays down theprinciples that whenever the employer seeks to lead evidence before theTribunal, it should be held that he accepts the position that there was noproper managerial enquiry. We are satisfied that this literal and somewhatmechanical way of reading this solitary sentence in the judgment from itscontext is not justified. Therefore we do not think that there is any authorityfor the proposition that wherever the employer seeks to lead additionalevidence before the Tribunal in support of the dismissal of his employee, itmust necessarily follow that he has given up his stand based on the previousdepartmental enquiry and the Tribunal is entitled to examine the dispute on themerits for itself; and on principle of fair play and justice the saidproposition is unsound. That is why we held that the Tribunal was in error inproceeding to examine the evidence for itself in coming to the conclusion thatthe dismissal of Jai Jai Ram was not justified on the merits. It is true thatthe Tribunal has observed that the findings recorded at the departmentalenquiry were baseless, but that clearly is the result of its appreciation ofthe whole of the evidence adduced before it and this course should not havebeen adopted by the Tribunal.

15. It appears from the award that no attempt was made before the Tribunalby the respondents to justify their plea that the enquiry was improper orunfair. In fact, as we have already indicated, the Tribunal took the view thatbecause evidence was led by the employer the scope of the enquiry automaticallybecame wider, However, we have heard Mr. Sastri in support of his argument thatin fact the enquiry was unfair. In dealing with this point, it may be necessaryto recall that the enquiry in the present case has been very elaborate. As wehave already pointed out, eleven witnesses each were examined by both theparties, and documentary evidence was also adduced; and the enquiry Officer hasmade an elaborate and well-considered report. He has examined the oral evidencecited before him, considered the documents to which his attention was drawn andhas also examined the probabilities in the case. Therefore prima facie, itwould be difficult to entertain the plea that the enquiry was unfair or thatthe conclusions reached by the Enquiry Officer were baseless. The record of theenquiry shows that all the witnesses examined by the employer werecrossexamined by the respondents and the record does not show that anyopportunity was refused to the respondents either to test the employer'sevidence or to lead their own evidence.

16. Mr. Sastri however contends that soon after the enquiry commenced, anapplication was made by the Secretary of the Union to which the two workmenbelonged setting forth in detail their objections to the course adopted by theEnquiry Officer (Ex. M/20 dated September 30, 1958). It is true that in thisapplication ten separate grounds had been set out alleging irregularitiescommitted at the said enquiry. But it is significant that no attempt has beenmade before the Tribunal to justify these allegations. The Secretary who signedthat document has given evidence in this case, but he has no personal knowledgeabout the said allegations and he has said nothing about them. Mohd. Mia hasalso given evidence but he has also not said anything about those allegations.Jai Jai Ram has not given evidence before the Tribunal. Therefore it is quiteclear that on the record before the Tribunal, there is no evidence whatever tojustify the several allegations made in the document on which Mr. Sastrirelies. That is why we think this ground of attack against the propriety or thefairness of the enquiry must be rejected.

17. Mr. Sastri has then contended that a fair opportunity was not given tothe respondents when the Enquiry Officer obtained a statement about the actualverification of the carbon consumption. It appears that the Enquiry Officerwanted an actual verification of carbon consumption, and so he directed that asort of mathematical stipulation should be submitted by the management in thatbehalf. That brings out clearly the thorough manner in which the EnquiryOfficer conducted the enquiry. The report shows that whilst this material wasbeing prepared, the workmen did not cooperate and Mr. Sastri's grievance isthat they were not given an opportunity to cooperate in this matter. Thiscontention is not justified by the record at all. It appears that Jai Jai Ramwanted that he should work the machines when the said material was beingcollected, and that request was naturally not accepted by the Enquiry Officer;but the fact that this request was turned down did not justify Jai Jai Ram'snon-cooperation when the calculations were made and documents were prepared inthat behalf. Therefore it seems to us that the Enquiry Officer was justified incriticising the employees for not co-operating with the employer when the saidstatement was prepared. The argument that a proper opportunity was not given tothe employee in that behalf must therefore be rejected. The result is that thegrievance made by Mr. Sastri before us that the enquiry was unfair or otherwiseimproper cannot be sustained. If that be the true position, it follows that theorder of dismissal passed against Jai Jai Ram must be sustained.

18. That takes us to the case of Mohd. Mia. The Tribunal has found that noorder of dismissal had been served on him. We have already noticed that thiswas the specific plea made by the respondents in their statement before the Tribunaland that had been specifically traversed by the appellant. In support of itsplea that the order of dismissal had been served on the employee, the appellanthad examined certain witnesses; and before deciding the question as to whetherthe finding of the Tribunal is based on any evidence or not, it may benecessary to consider that evidence broadly. It does appear that a document hadbeen produced by the appellant (Ex. M/8) which purports to be the order ofdismissal and which purports to bear the signature of Mohd. Mia. Mohd. Mia tookoath before the Tribunal that signature was not his and that in fact no orderhad been served on him. He has not been cross-examined on this point. But apartfrom this aspect of the matter, the evidence given by the appellant in supportof its case that the order of dismissal has been served on Mohd. Mia is socompletely discrepant that it must be discarded as worthless. Om Bahl who isthe Manager of the Ritz Theatre Stated that when he received the order ofdismissal of Mohd. Mia from the Managing Director's Head Office at Delhi, hegave it to the Assistant Manager to be served on the employee. He no doubtpurported to say that it contained the signature of Mohd. Mia; but he knewnothing about the actual service and so his evidence is not of much assistance.Om Parkash, the Assistante Manager stated that he in his turn gave the order ofdismissal to his staff to get it served on Mohd. Mia. He frankly stated thatMohd. Mia did not put his signature on the order in his presence, and so hisevidence also does not help. It would be noticed that the evidence of Om Bahland Om Parkash makes it clear that neither of them was present when the orderwas alleged to have been served on Mohd. Mia. Now, when we come to the evidenceof Kundan Lal, he stated that the order was given by Mr. Om Parkash to Mohd.Mia in his presence. In other words, the evidence of this witness purports toshow that the order of dismissal was served on Mohd. Mia by the AssistantManager in the presence of this witness, and that clearly is inconsistent withthe testimony of Om Prakash himself. Similarly, Bhagwati Prasad stated that OmPrakash, Om Bahl and Kundan Lal were all present when the order was served, sothat this witness went one step further when he stated that not only theAssistant Manager but the Manager was also present when the order was served.Having regard to the nature of this evidence there is no difficulty inappreciating how the tribunal came to the conclusion that the appellant hadfailed to prove its allegation that the order of dismissal had been served onMohd. Mia. It is to be regretted that the appellant should have taken this pleaand should have sought to support it by such discrepant and worthless evidence.

19. That takes up to the question as to the proper order which should bepassed in respect of Mohd. Mia. The grievance made by the respondents beforethe Tribunal was that Mohd. Mia had been suspended from September 11, 1958, andhad continued under suspension ever since. That is why they claimed that he wasentitled to reinstatement. Mr. Andley contends that though it may not bepossible for him to rely on the evidence led by the appellant in support of itsplea that the order of dismissal had in fact been served on Mohd. Mia, it wouldbe open to him to contend that atleast on the date of reference Mohd. Mia hadnotice that he had been dismissed and so the relationship of master and servantshould be deemed to have been terminated from that date in any event. We arenot prepared to accept this argument, particularly when we are satisfied thatthe appellant has taken a different plea and sought to support it by evidencewhich it should not have done. The relationship of the employer and theemployee can be effectively terminated in such a case not merely by thedecision of the employer to terminate the employee's services but by thecommunication of the said decision to the employee; and as it happened, such acommunication had not been made even till the date when the award was pronounced.We are told by Mr. Andley to-day, and Mr. Sastri concedes, that effective stepshave now been taken by the employer to terminate the services of Mohd. Mia andthat from to-day in any case he is not an employee of the appellant. That beingso, the further question which we have to consider is the amount which weshould direct the appellant to pay to Mohd. Mia. Mr. Andley has fairly concededthat in the model standing orders usually a provision is made that if anindustrial employee is suspended pending an enquiry into his misconduct theperiod of suspension should not extend beyond a fortnight. There are notstanding orders in the appellant's concern and Mr. Andley has thereforerequested us to hold that the suspension of Mohd. Mia was reasonable for theperiod of the enquiry before he is held entitled to claim his wages from theappellant. We are inclined to accept this argument partially; because in thecircumstances of this case, we think, it would be fair to hold that the orderof suspension passed on Mohd. Mia on September 11, 1958 was justified untilDecember 1, 1958; and so we direct that from December 1, 1958 until to-day theappellant should pay Mohd. Mia the wages to which he would have been entitledif he had been in the actual employment of the appellant and had been workingin its concern from day to day.

20. The result is the appeal partially succeeds. The order of reinstatementpassed by the Tribunal in favour of Jai Jai Ram is set aside and his dismissalis affirmed; and an order is made against the appellant to pay Mohd. Mia wagesas indicated. Mohd. Mia would not be entitled to reinstatement. There would beno order as to costs.

21. Appeal allowed in part.


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