The General Manager, State Bank of India, Region II v. J. Alageswaran

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 8-07-2011CORAMTHE HON'BLE Mr. JUSTICE N. PAUL VASANTHAKUMARWrit Petition No.12078 of 2011M.P.No.1 of 2011The General Manager,State Bank of India,Region II, Maduram Complex,Dr.Ambedkar Road,Madurai....PetitionerVs.1.J. Alageswaran2.The Presiding Officer,Central Government Industrial Tribunaland Labour Court,Chennai.... RespondentsWrit petition filed under Article 226 of the Constitution ofIndia to issue a writ of Certiorari calling for the records of thecase pertaining to order dated 21.3.2011 in ID.No.6 of 2010 on thefile of the second respondent namely Central Industrial Tribunal-cum-Labour Court, Chennai and quash the same as illegal, arbitrary.For Petitioner : Mr.S.SethuramanFor 1st Respondent: Mr.K.M.RameshO R D E RThe prayer in the writ petition is to quash the preliminaryorder dated 21.3.2011 passed in I.D.No.6 of 2010 on the file of thesecond respondent Labour Court.2.The case of the petitioner bank is that the firstrespondent, while working as Cash Officer in Keelakarai branch, hasappraised/recommended for the sanction of 12 agricultural loans,wherein ornaments were pledged which were spurious, thereby the bankwas exposed to grave loss and thus the first respondent has actedprejudicial to the interest of the bank. According to the petitionerbank, the borrowers of the 12 agricultural loans have complained in https://hcservices.ecourts.gov.in/hcservices/ writing that the first respondent availed the loans in their names bypledging the ornaments owned by the first respondent for his personalbenefits and he utilised the loan amount for his personal benefitsand thus he has defrauded the bank to an extent of Rs.4,43,419/-,which is a gross misconduct.3.A charge memo was issued to the first respondent for whichthe first respondent did not submit his explanation. An enquiryofficer was appointed and the first respondent did not attend theenquiry on five occasions and thereafter sent a telegram stating thathe was sick and the enquiry may be postponed by one month. Since thefirst respondent did not appear on 6.10.2003 and 13.10.2003, he wasset exparte and exparte enquiry commenced on 14.10.2003. The EnquiryOfficer submitted his report on 25.12.2003, which was also forwardedto the first respondent along with letter dated 29.1.2004 thereceipt of enquiry report was acknowledged. However, he did notoffer any comments.4.The first respondent filed W.P.No.27722 of 2003 before thisCourt on the ground that the criminal case registered against him waspending, wherein no stay was granted. The said writ petition wasdismissed by this Court on 5.2.2004 on the ground that the exparteproceedings were already concluded. The disciplinary authority afterconsidering the enquiry findings, issued a notice regarding theproposed penalty on 21.1.2004 and thereafter passed an order ofdismissal on 11.3.2004. The first respondent preferred an appeal on23.4.2004 before the appellate authority which was also dismissed on7.7.2004, against which the first respondent raised I.D.No.6 of 2010.5.In I.D.No.6 of 2010 the first respondent raised apreliminary issue regarding the fairness of the enquiry by contendingthat the enquiry was proceeded when the first respondent wassuffering from illness and during pendency of the writ petitionbefore this Court. The said preliminary issue was contested by thepetitioner bank by contending that several opportunities were givento the first respondent to participate in the enquiry and that therewas no interim order granted by this Court in W.P.No.27722 of 2003.6.The Labour Court, considering the oral evidence and theexhibits marked viz., Exs.W-1, W-3 and Exs.M-1 to M-21, held thatthough no interim order was granted by this Court, the writ petitionwas pending and therefore the petitioner was justified in notattending the enquiry. It is further held that there is no proof ofserious illness preventing the first respondent from participating inthe enquiry proceedings. The Labour Court gave a finding that theenquiry conducted is not fair and proper, against which this writpetition is filed.7.The learned counsel appearing for the petitioner banksubmitted that the first respondent purposely avoided the enquiry https://hcservices.ecourts.gov.in/hcservices/ proceedings and therefore the Enquiry Officer conducted exparteenquiry and submitted a report on 23.12.2003, pursuant to which thefinal order was passed. The learned counsel also submitted that eventhough the writ petition filed by the first respondent inW.P.No.27722 of 2003 was admitted and pending, no interim order wasgranted preventing the petitioner from conducting the enquiry.Therefore the bank management was justified in proceeding with theenquiry and in passing the final order. In the said context thefindings given by the Labour Court should be treated as a perversefinding and the order is required to be interfered with.8.The learned counsel appearing for the first respondent onthe other hand submitted that the first respondent filed the writpetition before this Court with a prayer forbearing the petitionerbank management from proceeding with the charge memo, pendingfinalisation of the criminal proceedings and in the said writpetition W.P.M.P.No.33884 of 2003 was filed for injunction torestrain the petitioner bank management from proceeding further.Notice was ordered both in the writ petition as well as in theinterim petition and the said fact is also known to the writpetitioner management. The first respondent also sent arepresentation on 15.12.2003 to defer the enquiry pendingW.P.No.27722 of 2003 and W.P.M.P.No.33884 of 2003. The learnedcounsel also submitted that if the writ petition filed by the firstrespondent was a frivolous one, the management could have taken stepsto get the writ petition dismissed before proceeding with theenquiry. As the said writ petition and the interim petition werepending, the first respondent was justified in not participating inthe enquiry proceedings and the same is appreciated by the LabourCourt in the preliminary findings and the same cannot be treated as aperverse finding. The learned counsel also submitted that as againstthe preliminary findings given by the Labour Court, writ petitioncannot be entertained and the said issue is settled by the decisionsof this Court as well as Honourable Supreme Court.9.I have considered the rival submissions of the learnedcounsel for the petitioner bank as well as the learned counselappearing for the first respondent.10.The first respondent is charged with serious allegation ofdefrauding the bank to the tune of Rs.4,04,600/- by obtaining loan,pledging spurious ornaments. It is also the allegation that thefirst respondent recommended for the sanction of 12 agriculturalloans on the basis of the securities of spurious ornaments and theborrowers complained in writing that the first respondent availed theloan for himself in their names by pledging ornaments owned by himand used the loan amount for his benefit. A criminal case was alsoregistered against the first respondent and the same is pending. https://hcservices.ecourts.gov.in/hcservices/

11.The first respondent filed W.P.No.27722 of 2003 before thisCourt and prayed for issuance of a writ of mandamus forbearing themanagement and the Enquiry Officer from proceeding with the chargememo, pending finalisation of the criminal proceedings. Along withthe said writ petition the first respondent also filedW.P.M.P.No.33884 of 2003 and prayed for an order of interiminjunction. Notice was ordered both in the writ petition as well asin the interim petition and notice was also received by the bank aswell as by the Enquiry Officer. The bank also filed counteraffidavit in the said writ petition. Neither the interim petitionnor the writ petition was dismissed when the first respondent was setexparte and till the disciplinary proceeding was finalised and orderof termination was passed. The said writ petition and the interimpetition were dismissed only on 5.2.2004, not on merits. The writpetition was dismissed on the ground that during pendency of the writpetition the first respondent was set exparte in the enquiryproceedings and the enquiry was also concluded. Stating the saidreason the writ petition was dismissed as there was nothing toadjudicate further. In the order it is stated that the saiddismissal will not prejudice the first respondent's other legalrights. From the above order it is evident that the writ petition aswell as interim petition were dismissed only on 5.2.2004 and tillsuch time the same were pending.12.The first respondent also requested the management to deferthe enquiry by representation dated 15.12.2003 stating the reasonthat the writ petition is pending. The said letter was marked asEx.M-8 before the Labour Court. The Enquiry Officer proceeded withthe enquiry and submitted his report on 25.12.2003, pursuant to whichthe order of termination was passed. The order passed by this Courton 5.2.2004 is marked as Ex.M-14. In appreciation of the abovefacts, the Labour Court came to the conclusion that the exparteenquiry conducted by the management is not proper and the preliminaryfinding was given regarding the fairness of the enquiry. Since sucha finding is given by the Labour Court, it is for the management toadduce evidence before the Labour Court and justify the order oftermination by proving the charges. The said procedure adopted bythe Labour Court and the finding given cannot be treated as aperverse finding calling for interference.13.The learned counsel appearing for the first respondent isalso justified in contending that as against the preliminaryaward/findings of the Labour Court, normally writ petition is notentertainable. The said issue was considered by this Court inW.P.Nos.11564-11566 of 2006 by order dated 7.7.2010.14.(a)The Honourable supreme Court in the decision reportedin (1975) 2 SCC 661 (Cooper Engineering Ltd. v. P.P.Mundhe) inparagraph 22 held as follows, https://hcservices.ecourts.gov.in/hcservices/ "22....... when a case of dismissal ordischarge of an employee is referred forindustrial adjudication the labour Court shouldfirst decide as a preliminary issue whether thedomestic enquiry has violated the principles ofnatural justice. When there is no domesticenquiry or defective enquiry is admitted by theemployer, there will be no difficulty. But whenthe matter is in controversy between the partiesthat question must be decided as a preliminaryissue. On that decision being pronounced it willbe for the management to decide whether it willadduce any evidence before the labour Court. Ifit chooses not to adduce any evidence, it willnot be thereafter permissible in any proceedingto raise the issue. We should also make it clearthat there will be no justification for any partyto stall the final adjudication of the dispute bythe labour court by questioning its decision withregard to the preliminary issue when the matter,if worthy, can be agitated even after the finalaward. It will be also legitimate for the HighCourt to refuse to intervene at this stage. Weare making these observations in our anxiety thatthere is no undue delay in industrialadjudication."(Emphasis Supplied)(b)The Division Bench of this court in the decision reportedin 1995 (I) LLN 1022 (N.Gurumurthy v. Second Additional Labour Court,Madras) in paragraphs 5 and 8 held thus,"5.Therefore, the point that would arisefor consideration is as follows: Whether it isappropriate for this Court in a petition underArt.226 of the Constitution to interfere withinpreliminary order passed by the Labour Courteither on the question as to whether the domesticinquiry has been fair and proper or relating tojurisdiction of Labour Court.8.Taking into consideration all theseaspects we are of the view that the findingsrecorded by the Labour Court on preliminaryissues such as whether the domestic inquiry hasbeen fair or proper or the Labour Court hasjurisdiction to entertain the dispute or whetherthe person claiming the status as a workman is aworkman or not, should not be interfered with,unless such findings are recorded without noticeto any one of the parties or recorded without any https://hcservices.ecourts.gov.in/hcservices/ reason. The point raised for determination isanswered accordingly. ............"(c)In the decision reported in 1995(I) LLN 138 (Agro CargoTransport Ltd. v. E.Murugan and another) in para 5, another DivisionBench of this Court upheld the decision of the learned single Judgerefusing to interfere in the writ petition with regard to thepreliminary issue before passing final award by the Labour Court.(d)In the decision reported in 2007 (1) LLN 351 (R. Bojan v.Needle Industrial (India) Ltd.) also I had an occasion to decide asimilar issue and held that the writ petition filed challenging thepreliminary findings given by the Labour Court is not maintainable.15.In this case, the interim application filed by the firstrespondent seeking injunction from proceeding with the enquiry wasnot dismissed when the petitioner was set exparte. If the interimapplication was dismissed, the petitioner may be justified inproceeding with the enquiry.16.Taking into consideration all these aspects, I am of theview that the learned counsel for the first respondent is justifiedin his submissions that there is no perversity in the order passed bythe Labour Court.17.In the result, the writ petition is dismissed. The secondrespondent Labour Court is directed to proceed with I.D.No.6 of 2010and pass final award on merits, preferably within a period of sixmonths from the date of receipt of copy of this order. There is noorder as to costs. Connected miscellaneous petition is closed. Sd/- Deputy Registrar/True Copy/Sub.Asst.RegistrarvrToThe Presiding Officer,Central Government Industrial Tribunal and Labour Court,Chennai.+ 1 cc to Mr.S.Sethuraman, Sr.40588+ 1 cc to Mr.K.M.Ramesh, Sr.40346W.P.No.12078 of 2011BVR(CO)Eu 25.7.11