Kandasamy v. The Management, TNSTC (Kovai Division) Ltd.

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 4-7-2008CORAMTHE HONOURABLE MR.JUSTICE N.PAUL VASANTHAKUMARW.P.NO.15457 OF 2008Kandasamy...PetitionerVs.1.The Management,TNSTC (Kovai Division) Ltd.,Chennimala Road,Erode.2.The Presiding Officer,Labour Court,Salem....RespondentsPrayer: This writ petition is filed under Article 226 of Constitutionof India, praying this Court to issue a writ of Certiorari callingfor the records on the file of the second respondent in proceedingsI.D.No.426 of 2000 and dated 3.1.2008 and further quash the same asillegal, incompetent and without jurisdiction.For Petitioner : Mr.V.RaghavachariO R D E RPrayer in the writ petition is to quash the the proceedings ofthe second respondent in I.D.No.426 of 2000 dated 3.1.2008 upholdingthe order of dismissal of the petitioner from service.2.The petitioner has joined the service in the respondentCorporation as conductor on 3.2.1982 and he served at variousbranches. According to the petitioner, in his career spanning over 17years, he had not suffered any major punishments. In the year 1999,petitioner was placed at Anthiyur branch and he was on duty in thebus bearing registration No.TN-33-N-0697, plying between Coimbatore-Erode route. https://hcservices.ecourts.gov.in/hcservices/

3.On 28.6.1999 at about 10.20 a.m., when the petitioner wason duty in the bus plying from Coimbatore and while the bus wasnearing Tindal, the Checking Inspectors got into the bus forchecking. At that time, there were 30 passengers and according to thepetitioner he issued tickets to all of them and corresponding entrieswere also made in the invoice and the fares collected were alsorecorded. The Checking Inspectors found that four passengers onboard were travelling beyond the destination and they hold ticketsfor Rs.18/- but entry made in the collection book is for lesseramount. When the Checking Inspectors questioned, petitioner repliedthat the four passengers had to get down at Perundurai, but they hadoverstayed in the bus and the same was unnoticed by him as he wasclosing the invoice. According to the petitioner, he was continuouslycalled upon to go for trip for two nights and three days and hence hecould not rectify the mistakes. Not satisfied with the explanation,charges were framed against the petitioner alleging that he hadmisappropriated Rs.34.50. Subsequently petitioner was suspended witheffect from 2.7.1999 based on the charge memo. The order ofsuspension was revoked and the petitioner rejoined duty on 17.7.1999and he was transferred to Nambiyur branch as per the proceedings ofthe first respondent dated 20.7.1999.4.An enquiry was conducted against the petitioner and theEnquiry Officer found the petitioner as guilty, as there was excessof Rs.34.50 in the collection bag on 28.6.1999. Based on the reportof the Enquiry Officer, first respondent Corporation, by its orderdated 15.11.1999 dismissed the petitioner from service, against whichthe petitioner filed I.D.No.426 of 2000 before the Labour Court,Salem. The Labour Court by award dated 3.1.2008, dismissed thedispute confirming the order of dismissal passed by the firstrespondent. The said award of the Labour Court is challenged in thiswrit petition on the ground that the first respondent Corporation hasnot considered the explanation offered by the petitioner; as theamount collected was available within the collection bag andtherefore no question of misappropriation arises; and that only basedon the statement obtained during spot inspection, the petitionershall not be termed as offender.5.Heard the learned counsel for the petitioner.6.Petitioner having been dismissed from service by orderdated 15.11.1999, challenged the order of dismissal by raisingI.D.No.426 of 2000 before the second respondent Labour Court. TheLabour Court, after considering the entire materials includingexhibits, came to the factual conclusion and held as follows:"In point No.1 it is decided that thepetitioner has misappropriated the fare collectedfrom the passengers by preparing false carbon copyof the ticket by some adjustments and https://hcservices.ecourts.gov.in/hcservices/ misappropriated a portion of the amount collectedfrom passengers and thereby caused loss of incomeand reputation to the Corporation. The delinquentwho committed misappropriation deserve no sympathyand the punishment of dismissal is incommensuratewith the misconduct committed by the petitioner.Therefore, the order passed against the petitionerdismissing him from service is not liable to beset aside and he is not entitled to any relief andthe points are answered accordingly."7.The Labour Court came to the above conclusion by statingthat from the evidence of RW-1 it is clear that the petitioner hascollected proper fare from the passengers and prepared carbon copy ofthe bill by some adjustment showing lesser amount, thereby hemisappropriated Rs.3.50 per ticket, totalling Rs.14/-. Further, theexcess amount was found in the cash bag. The disciplinary authorityas well as the Labour Court found that the charge levelled againstthe petitioner is proved, particularly misappropriation. The saidfinding given by the Labour Court is just and proper and I am unableto see any perversity in the said finding, warranting interference.8.The learned counsel for the petitioner argued that thealleged amount of misappropriation is Rs.14/-, for which the extremepenalty of dismissal is ordered by the respondent, which is notproportionate to the gravity of the offence. The said submission ofthe learned counsel for the petitioner is not sustainable as theamount misappropriated is of no consequence while awardingpunishment.9.(a)In J.T. (1996) 3 SC 96 (Municipal Committee,Bahadurgarh v. Krishnan Behari and Others), the Honourable SupremeCourt held that in cases of misappropriation, there cannot be anyother punishment other than dismissal. It is further held that anysympathy shown in such cases is totally uncalled for and opposed topublic interest and that the amount misappropriated may be small orlarge, but it is the act of misappropriation that is relevant.(b)Imposing punishment is the discretion of the DisciplinaryAuthority and the High Court cannot interfere with the saiddiscretion as held by the Supreme Court in AIR 1997 SC 3387 (Union ofIndia v. G.Ganayutham). In paragraph 28 of the Judgment the SupremeCourt held as under,"The current position of proportionality inadministrative law in England and India can besummarised as follows:-(1) To judge the validity of anyadministrative order or statutory discretion, https://hcservices.ecourts.gov.in/hcservices/ normally the Wednesbury test is to be applied tofind out if the decision was illegal or sufferedfrom procedural improprieties or was one which nosensible decision-maker could, on the materialbefore him and within the framework of the law,have arrived at. The Court would consider whetherrelevant matters had not been taken into accountor whether irrelevant matters had been taken intoaccount or whether the action was not bona fide.The Court would also consider whether the decisionwas absurd or perverse. The Court would nothowever go into the correctness of the choice madeby the administrator amongst the variousalternatives open to him. Nor could the Courtsubstitute its decision to that of theadministrator. This is the Wednesbury test.(2)The Court would not interfere with theadministrator's decision unless it was illegal orsuffered from procedural impropriety or wasirrational in the sense that it was in outrageousdefiance of logic or moral standards. Thepossibility of other tests, includingproportionality being brought into EnglishAdministrative Law in future is not ruled out.These are the CCSU principles.(3)(a) As per Bugdaycay, Brind and Smith, aslong as the Convention is not incorporated intoEnglish Law, the English Courts merely exercise asecondary judgment to find out if the decisionmaker could have, on the material before him,arrived at the primary judgment in the manner hehas done.(3)(b) If the Convention is incorporated inEngland making available in principle ofproportionality, then the English Courts willrender primary judgment on the validity of theadministrative action and find out if therestriction is disproportionate or excessive or isnot based upon a fair balancing of the fundamentalfreedom and the need for the restrictionthereupon.(4)(a) The position in our country, inadministrative law, where no fundamental freedomsas aforesaid are involved, is that theCourts/Tribunals will only play a secondary rolewhile the primary judgment as to reasonableness https://hcservices.ecourts.gov.in/hcservices/ will remain with the executive or administrativeauthority. The secondary judgment of the Court isto be based on Wednesbury and CCSU principles asstated by Lord Greene and Lord Diplockrespectively to find if the executive oradministrative authority has reasonably arrived athis decision as the primary authority.(4)(b) Whether in the case of administrativeor executive action affecting fundamentalfreedoms, the Courts in our country will apply theprinciple of 'proportionality' and assume aprimary role, if left open, to be decided in anappropriate case where such action is alleged tooffend fundamental freedoms. It will be thennecessary to decide whether the Courts will have aprimary role only if the freedoms under Articles19, 21 etc., are involved and not for Article 14."In the said Judgment, the Supreme Court referred its earlierdecisions reported in (1997) 3 SCC 72 = JT 1997 (2) SC 367 (IndianOil Corporation Ltd & Another v. Ashok Kumar Arora) and (1995) 6 SCC749 = JT 1995 (8) SC 65 (B.C.Chaturvedi v. Union of India andOthers). In the case of B.C.Chaturvedi, in paragraph 18, the SupremeCourt held as under,"A review of the above legal position wouldestablish that the disciplinary authority, and onappeal the appellate authority, being fact-findingauthorities have exclusive power to consider theevidence with a view to maintain discipline. Theyare invested with the discretion to imposeappropriate punishment keeping in view themagnitude or gravity of the misconduct. The HighCourt/Tribunal, while exercising the power ofjudicial review, cannot normally substitute itsown conclusion on penalty and impose some otherpenalty. If the punishment imposed by thedisciplinary authority or the appellate authorityshocks the conscience of the High Court/Tribunal,it would appropriately mould the relief, eitherdirecting the disciplinary/ appellate authority toreconsider the penalty imposed, or to shorten thelitigation, it may itself, in exceptional and rarecases, impose appropriate punishment with cogentreasons in support thereof." (c)In AIR 2000 SC 3129 (Janatha Bazar v. Secretary, SahakariNoukarara Singh), it is held that once the act of misappropriation isproved, may be for a small or large amount, there is no question of https://hcservices.ecourts.gov.in/hcservices/ showing uncalled for sympathy and reinstalling the employee inservice.(d)In (2003) 3 SCC 605 (Regional Manager, U.P.SRTC v. HotiLal), in paragraph 10 the Supreme Court held thus,"It needs to be emphasized that the court ortribunal while dealing with the quantum ofpunishment has to record reasons as to why it isfelt that the punishment was not commensurate withthe proved charges. As has been highlighted inseveral cases to which reference has been madeabove, the scope for interference is very limitedand restricted to exceptional cases in theindicated circumstances. Unfortunately, in thepresent case as the quoted extracts of the HighCourt's order would go to show, no reasonswhatsoever have been indicated as to why thepunishment was considered disproportionate.Reasons are live links between the mind of thedecision taken to the controversy in question andthe decision or conclusion arrived at. Failure togive reasons amounts to denial of justice (SeeAlexander Machinery (Dudley) Ltd. v. Crabtree(1974 LCR 120 (NIRC)). A mere statement that itis disproportionate would not suffice. A partyappearing before a court, as to what it is thatthe court is addressing its mind. It is not onlythe amount involved but the mental set-up, thetype of duty performed and similar relevantcircumstances which go into the decision-makingprocess while considering whether the punishmentis proportionate or disproportionate. If thecharged employee holds a position of trust wherehonesty and integrity are inbuilt requirements offunctioning, it would not be proper to deal withthe matter leniently. Misconduct in such caseshas to be dealt with iron hands. Where the persondeals with public money or is engaged in financialtransactions or acts in a fiduciary capacity, thehighest degree of integrity and trustworthiness isa must and unexceptionable. Judged in thatbackground, conclusions of the Division Bench ofthe High Court do not appear to be proper. We setaside the same and restore order of the learnedSinge Judge upholding the order of dismissal."(e)In the decision reported in (2005) 7 SCC 338 (V.Ramana v.A.P.SRTC), the Supreme Court in paragraph 11 held as under, https://hcservices.ecourts.gov.in/hcservices/ "The common thread running through in allthese decisions is that the court should notinterfere with the administrator's decision unlessit was illogical or suffers from proceduralimpropriety or was shocking to the conscience ofthe court, in the sense that it was in defiance oflogic or moral standards. In view of what hasbeen stated in Wednesbury case ((1948) 1 KB 223)the court would not go into the correctness of thechoice made by the administrator open to him andthe court should not substitute its decision forthat of the administrator. The scope of judicialreview is limited to the deficiency in decision-making process and not the decision."(f)The Honourable Supreme Court, in the decision reported in(2006) 3 SCC 143 (Bharat Petroleum Corporation Ltd. v. T.K.Raju) inparagraph 16 held that the power of judicial review in the matter ofquantum of punishment awarded by the Labour Court is very limited andthe same shall not be done in a routine manner. The relevant portionreads thus,"The power of judicial review in such mattersis limited. This Court times without number hadlaid down that interference with the quantum ofpunishment should not be done in a routinemanner."(g)The Supreme Court in the decision reported in (2006) 1 SCC63 (Karnataka Bank Ltd. v. A.L.Mohan Rao) in paragraph 6 held asfollows:"..... It is not for the courts to interfere incases of gross misconduct of this nature with thedecision of the disciplinary authority so long asthe inquiry has been fair and proper andmisconduct proved. In such matters, it is for thedisciplinary authority to decide what is the fitpunishment. In any case on such a misconduct, itcould never have been said that termination ofservice is not the appropriate punishment."The above decision of the Supreme Court was followed by us inW.A.No.1062 of 2007 dated 6.9.2007 (M.Gunaseelan v. The PresidingOfficer, Principal Labour Court, Chennai & Another), wherein thisCourt confirmed the decision of the Labour Court refusingreinstatement.(h)In the recent decision reported in 2007 AIR SCW 4136 = JT2007 (8) SC 588 (Ramesh Chandra Sharma v. Punjab National Bank &Another), in paragraph 20, the Supreme Court held thus, https://hcservices.ecourts.gov.in/hcservices/ "The High Court itself has noticed a largenumber of decisions and formed the opinion thatthe charges levelled against the delinquentofficer were of grave nature. A major punishmentmay be inflicted even where no pecuniary loss wascaused to the Bank by reason of the act of thedelinquent officer. In support of theaforementioned proposition of law, the High Courtopined:"The charges levelled against the petitioner,which were found proved upon enquiry, are quiteserious in nature. The petitioner had engagedhimself in reckless lending causing huge financialloss to the Bank to the extent ofRs.1,14,87,164.76. It also shows that thepetitioner had disbursed loan through middlemenand demanded and received illegal gratificationfrom a borrower. We are of the considered opinionthat in such cases, the officers of the Bankshould not be permitted to continue in service atall.Once the employer has lost the confidence inthe employee and the bona fide loss of confidenceis affirmed, the order of punishment must beconsidered to be immune from challenge, for thereason that discharging the office of trust andconfidence requires absolute integrity. Anecessary implication which must be engrafted onthe contract of service is that the servant mustundertake to serve his master with good faith andfidelity. In a case of loss of confidence,reinstatement cannot be directed. Granting suchan employee the relief of reinstatement would be"an act of misplaced sympathy which can find nofoundation in law or in equity." (Vide Air IndiaCorporation, Bombay vs. V.A.Ravellow, AIR 1972 SC1343; The Binny Ltd. vs. Their Workmen, AIR 1973SC 1403; Kamal Kishore Lakshman vs. Management ofM/s.Pan American World Airways Inc & Ors., AIR1987 SC 229; Francis Kalein & Co. Pvt. Ltd., vs.Their Workmen, AIR 1971 SC 2414; RegionalManager, Rajasthan SRTC Vs. Sohan Lal, (2004) 8SCC 218; and Bharat Heavy Electricals Ltd. Vs.M.Chandrashekhar Reddy & Ors., 2005 AIR SCW 1232).In Kanhaiyalal Agrawal & Ors. Vs. FactoryManager, Gwaliar Sugar Co. Ltd. (2001) 9 SCC 609,the Hon'ble Supreme Court laid down the test forloss of confidence to find out as to whether therewas bona fide loss of confidence in the employee,observing that, (i) the workman is holding the https://hcservices.ecourts.gov.in/hcservices/ position of trust and confidence; (ii) by abusingsuch position, he commits act which results inforfeiting the same; and (iii) to continue him inservice/establishment would be embarrassing andinconvenient to the employer, or would bedetrimental to the discipline or security of theestablishment. Loss of confidence cannot besubjective, based upon the mind of the management.Objective facts which would lead to a definiteinference of apprehension in the mind of themanagement, regarding trustworthiness orreliability of the employee, must be alleged andproved." " (i)A Division Bench of this Court in the decision reported in(2005) 3 M.L.J. 375 (The Management of Hindustan TeleprintersEmployees Co-operative Thrift and Credit Society Limited v. ThePresiding Officer, Principal Labour Court) in paragraph 14 held thatin case of misappropriation, whether, of small amount or largeamount, the only punishment which can be given is dismissal.10.The management also considered the petitioner's pastconduct in not issuing tickets by receiving ticket amount for ninetimes, for which he was earlier suspended ten days, and forremitting lesser amount 25 times for which 23 times he was imposedpenalty and two times awarded censure. The management taking allthese aspects, lost total confidence on the petitioner and dismissedthe petitioner. Hence, I am of the view that the punishment imposedagainst the petitioner by the respondent management is just andproper and the same is rightly confirmed by the Labour Court, whichrequires no interference.The writ petition is dismissed in limine.Sd/-Assistant Registrar/true copy/Sub Assistant RegistrarvrTo1.The Management, TNSTC (Kovai Division) Ltd.,Chennimala Road, Erode.2.The Presiding Officer, Labour Court, Salem.TM(CO)JJM 17.07.08 Order in W.P.No.15457 of 2008