KERALA AGRO MACHINERY CORPORATION LTD. v. M.S. CHERIAN & LABOUR COURT, ERNAKULAM

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** # **PRESENT** **THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN** **&** **THE HONOURABLE MR. JUSTICE T.R.RAVI** **FRIDAY, THE 03RD DAY OF JULY 2020 / 12TH ASHADHA, 1942** **WA.No.1748 OF 2015** **AGAINST THE JUDGMENT IN WPC 22674/2009 DATED 11-06-2015 OF HIGH** **COURT OF KERALA** ## **APPELLANT/2ND RESPONDENT IN WPC:** **THE KERALA AGRO MACHINERY CORPORATION LTD. ATHANI, PIN - 683 585, ERNAKULAM DISTRICT, REPRESENTED BY ITS MANAGING DIRECTOR.** **BY ADVS. SRI.M.GOPIKRISHNAN NAMBIAR SRI.P.BENNY THOMAS SRI.K.JOHN MATHAI** ## **RESPONDENTS/PETITIONER & 1ST RESPONDENT IN WPC:** **1 M.S.CHERIAN KAVALAKKAL HOUSE, PALAPPRASSERY, CHENGAMANAD P.O., ERNAKULAM DISTRICT, NOW EMPLOYED AS OPERATOR IN KERALA AGRO MACHINERY CORPORATION, ATHANI, ERNAKULAM DISTRICT - 683 578.** **2 THE LABOUR COURT ERNAKULAM - 682 031. R1 BY ADV. SRI.C.ANIL KUMAR R1 BY ADV. SRI.B.UNNIKRISHNA KAIMAL SENIOR GOVERNMENT PLEADER SRI.N.K.THANKACHAN** **THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 03.07.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** - 2 - W.A.No.1748 of 2015 **K.VINOD CHANDRAN & T.R. RAVI,JJ. -----------------------------------------------W.A.No.1748 of 2015** **--------------------------------------------------** ## **DATED THIS THE 3[rd] DAY OF JULY, 2020 JUDGMENT** ## **T.R.RAVI, J.** The 1[st] respondent, while in the employment of the appellant, applied twice for leave for a period of 5 years for taking up employment abroad. Even before the leave was granted he went abroad. He once again sent a representation requesting for leave, which was rejected by the appellant. Disciplinary action was initiated wherein he was found guilty of the misconduct of unauthorised absence. He was dismissed from service by order dated 14.12.1992. A writ petition O.P.10426 of 1993 filed by the 1[st] respondent, challenging the dismissal was disposed of by judgment dated 18.11.1999, directing the 1[st] respondent to prefer a representation before the Management against the dismissal order. A representation submitted by the 1[st] respondent was rejected by the Mangement. The 1[st] respondent filed O.P.No.26380 of 2000, challenging the rejection of representation. By judgment dated 18.11.2000, this Court disposed of the original petition directing the 1[st] respondent to raise an Industrial Dispute against the dismissal. W.A.No.1748 of 2015 - 3 - 2. The Industrial Dispute raised by the 1[st] respondent was referred to the 2[nd] respondent, Labour Court, for adjudication. By a preliminary order dated 18.6.2008, the Labour Court found that the enquiry was conducted by the Enquiry Officer, after giving proper notice to the workman, that the report of the enquiry officer is based on the evidence tendered, that the report is proper and valid and that accepting the report the workman was dismissed from service. Thereafter, by Ext.P3 award, the Labour Court held that the 1[st] respondent was not unauthorisedly absent from duty and set aside the dismissal of the 1[st] respondent. The Labour Court directed the appellant to reinstate the 1[st] respondent with continuity in service, but without backwages. The appellant accepted the award and issued Ext.P4 order, reinstating the 1[st] respondent in service with effect from 27.2.2009 or any subsequent date on which the 1[st] respondent reports for duty but not later than 6.3.2009. The 1[st] respondent accepted the reinstatement order without any demur and joined duty on 5.3.2009. More than 3 months later, the 1[st] respondent challenged the award, to the extent it denied backwages, by filing the writ petition W.P.(c) 22674/2009, under Article 226 of the Constitution of India. 3. By judgment dated 11.6.2015, the writ petition was allowed by the Single Judge, setting aside the award to the extent - 4 - W.A.No.1748 of 2015 it denied backwages to the 1[st] respondent. By the impugned judgment the matter was remitted to the Labour Court to consider the question of entitlement of the 1[st] respondent to backwages afresh, after affording both parties reasonable opportunity of being heard and to adduce evidence and to produce all materials. It was found that the Labour Court did not properly consider the question whether the petitioner is entitled to get backwages, by looking into aspects like whether the petitioner was gainfully employed during the relevant period, and other circumstances warranting denial of backwages. Aggrieved by the judgment, the employer/appellant has filed this appeal. 4. Heard Sri. Jayamohan on behalf of the appellant and Sri. C.Anil Kumar on behalf of the 1[st] respondent. 5. The counsel for the appellant submits that the 1[st] respondent had joined duty pursuant to Exhibit P4 order dated 23.2.2009 reinstating him in service. He did so without reserving any right to challenge the award on the aspect of backwages. He was subsequently promoted to the officer cadre, after the filing of the writ petition. The counsel relied on the judgment of the Apex Court in **Sanat Kumar Dwivedi vs. Dhar Jila Sahkari Bhoomi Vikas Bank, Maryadit and others** reported in **[2001 (9) SCC 402]** in support of the contention that after accepting the order of W.A.No.1748 of 2015 - 5 - reinstatement and joining duty, it was not open for the workman to challenge the award on the denial of backwages. The counsel for the 1[st] respondent contends that the mere fact that the 1[st] respondent accepted the employment does not in any way take away his right to challenge the offending portion of the award. It is further contended that in the light of the judgment of the Hon’ble Supreme Court in **Hindustan Tin Works Limited v. Its Employees reported in [(1978)II LLJ 474]** , once it is found that the dismissal was illegal, reinstatement with backwages should follow. 6. Admittedly, the 1[st] respondent had proceeded abroad even before he had been sanctioned any leave to take up employment abroad. We find from Ext.P3 award that the 2[nd] respondent had in its preliminary order found that the enquiry conducted by the appellant was proper. However, the 2[nd] respondent has found fault with the termination of the 1[st] respondent, for the reason that the appellant had not rejected the application for leave submitted by the 1[st] respondent. The Labour Court solely on the above allegation, concluded that the absence was not unauthorised. We are quite conscious of the fact that there is no challenge made to the award of the Labour Court, by the Management. The Management has accepted the award and - 6 - W.A.No.1748 of 2015 reinstated the workman without backwages, deeming the denial of backwages as a punishment for the misconduct alleged and proved at the enquiry, which is permissible under Section 11A of the ID Act. The Management, however, on the further direction of the learned Single Judge to consider the issue of backwages afresh, has filed this appeal wherein the learned Counsel has challenged the manner in which the Labour Court has arrived at a finding that there is no unauthorized absence. It is also contended that the Management cannot be faulted for not challenging the award, since they accepted the order of reinstatement without any backwages. 7. At the outset we have to examine the contention of the management based on **Sanat Kumar Dwivedi,** that after having accepted the order of reinstatement without backwages the workman cannot turn around and challenge one portion of the award. We have looked at **Sanat Kumar Dwivedi** , wherein there was an order of reinstatement, presumably by the employer, with a condition of no entitlement to backwages; reviewing their own order of termination. Having accepted the said order of reinstatement the dispute was raised regarding backwages, which was held to be not maintainable. The Hon'ble Supreme Court relied on **State of Punjab v. Krishan Niwas [(1997) 9 SCC 31]** . The facts therein also indicate the removal of an employee from service - 7 - W.A.No.1748 of 2015 on conviction under Section 302 IPC. The order of conviction was modified to be one under Section 325 IPC in an appeal filed, wherein the sentence imposed was rigorous imprisonment for 1½ years. After undergoing imprisonment, the employee filed an appeal in which the appellate authority reduced the punishment to one of reduction to a lower scale and directed reinstatement without any backwages. After accepting the said order and obtaining reinstatement, the employee filed a Civil Suit for declaration that the entire proceedings taken against him were illegal. In both the aforesaid decisions the orders of reinstatement were of the employer; in the first one in an appeal and in the second by the original authority itself. We cannot draw a parallel, insofar as the challenge made to an award of the Labour Court. The first respondent, who was the employee herein, obtained an award of reinstatement without backwages and joined duty in accordance with the order of the employer complying with the award of the Labour Court. Within three months, the workman challenged the denial of backwages before this Court, which cannot be said to be grossly delayed. We do not find any application of the aforesaid decisions to the facts of the present case. 8. We have looked at the award of the Labour Court, which in fact finds the enquiry to be properly held and the order passed - 8 - W.A.No.1748 of 2015 by the Enquiry Officer to be based on the evidence tendered. However, the Labour Court has gone ahead and found that the employee had made two applications to the Management for sanctioning leave for five years to undertake foreign assignment, the first on 07.07.1992 and then on 23.08.1992. Admittedly though sanction was not accorded, the workman left for taking up the foreign assignment on 24.08.1992. On the sole ground that the Management had not rejected his application for leave, the Labour Court found that it cannot be said that he had unauthorisedly absented from duty. It was on the strength of such finding that the Management was directed to reinstate the workman without backwages. Obviously the directions were issued invoking the provisions of Section 11A of the ID Act. 9. Section 11A of the ID Act confers power on the Labour Courts and Tribunals taking up adjudication of industrial disputes relating to discharge or dismissal, to interfere with such orders on terms and conditions thought fit as also to give relief to the workman, including the award of a lesser punishment. The power conferred on the labour Court under Section 11A has been dealt with by the Hon'ble Supreme Court in _**Workmen v. Firestone Tyre and Rubber Co. [(1973) 1 SCC 813]**_ . We extract paragraphs 36 and 40 of the said decision, which succinctly states - 9 - W.A.No.1748 of 2015 the law as it stands after the introduction of Section 11A: "36. We will first consider cases where an employer has held a proper and valid domestic enquiry before passing the order of punishment. Previously the Tribunal had no power to interfere with its finding of misconduct recorded in the domestic enquiry unless one or other infirmities pointed out by this Court in _Indian Iron & Steel Co. Ltd. case_ existed. The conduct of disciplinary proceedings and the punishment to be imposed were all considered to be a managerial function with which the Tribunal had no power to interfere unless the finding was perverse or the punishment was so harsh as to lead to an inference of victimisation of unfair labour practice. This position, in our view, has now been changed by Section 11-A. The words “in the course of the adjudication proceeding, the Tribunal is satisfied that the order of discharge or dismissal was not justified” clearly indicate that the Tribunal is now clothed with the power to reappraise the evidence in the domestic enquiry and satisfy itself whether the said evidence relied on by an employer establishes the misconduct alleged against a workman. What was originally a plausible conclusion that could be drawn by an employer from the evidence, has now given place to a satisfaction being arrived at by the Tribunal that the finding of misconduct is correct. The limitations imposed on the powers of the Tribunal by the decision in _Indian Iron & Steel Co. Ltd. case_ , can no longer be invoked by an employer. The Tribunal is now - 10 - W.A.No.1748 of 2015 at liberty to consider not only whether the finding of misconduct recorded by an employer is correct; but also to differ from the said finding if a proper case is made out. What was once largely in the realm of the satisfaction of the employer, has ceased to be so; and now it is the satisfaction of the Tribunal that finally decides the matter. xxx xxx xxx 40. Therefore, it will be seen that both in respect of cases where a domestic enquiry has been held as also in cases where the Tribunal considers the matter on the evidence adduced before it for the first time, the satisfaction under Section 11-A, about the guilt or otherwise of the workman concerned, is that of the Tribunal. It has to consider the evidence and come to a conclusion one way or other. Even in cases where an enquiry has been held by an employer and a finding of misconduct arrived at, the Tribunal can now differ from that finding in a proper case and hold that no misconduct is proved”. 10. The Hon'ble Supreme Court has categorically held that the Labour Courts/Tribunals taking up adjudication of an industrial dispute with reference to a discharge or dismissal has the power to re-appraise the evidence in the domestic enquiry carried out to satisfy itself whether the said evidence relied on by the employer establishes the misconduct alleged against the worker. Even in cases where the Tribunal agrees with the finding of the Enquiry - 11 - W.A.No.1748 of 2015 Officer and is satisfied that the misconduct has been proved on the evidence recorded, the Tribunal could look at whether the punishment awarded is proportionate to the gravity of the offence proved and also consider any mitigating circumstance as discernible from the materials on record, as mandated by the proviso to Section 11A. We have to look at the award with the above principles in mind. 11. As has been observed, the Tribunal found that the Enquiry Officer's findings are based on evidence. Hence, the misconduct stood proved, even according to the Labour Court. After entering such a finding, there is no warrant for the Labour Court to hold that there is no unauthorised absence as alleged and proved at the enquiry. It is pertinent that there was no sanction for leave accorded and the workman had unauthorisedly absented from duty from the next day of his application for leave. The application was dated 23.08.1992 and it sought for leave for five years with effect from 24.08.1992. The evidence adduced as recorded by the Tribunal also indicates the application for leave was received after the workman absented from duty, i.e., on 28.08.1992. But for mere production of the letter dated 07.07.1992, by which the workman is said to have informed the Management about his foreign assignment, there is no evidence adduced of the same having been - 12 - W.A.No.1748 of 2015 received by the management. If at all, the earlier application could only provide a mitigating circumstance for the purpose of interfering with the punishment. It is also seen that the Management had on 28.08.1992 granted foreign assignment leave to 10 workmen, which was asserted to be the maximum permissible. But, even by that date the workman had already absented by himself; which definitely is unauthorised absence. In such circumstance, we do not find any reason to interfere with the award which denied the backwages. The denial of backwages in itself was held to be a punishment imposed upon the workman as has been held in **Jitendra Singh Rathor v. Shri Baidyanath Ayurved Bhawan Ltd. [(1984) 3 SCC 5]** and **Nicholas Piramal India Ltd. v. Harisingh [(2015) 8 SCC 272]** . 12. The contention of the 1[st] respondent that award of backwages should be automatic, if reinstatement is ordered finding that the dismissal is illegal, can no longer be accepted. In fact, the Single Judge has observed in paragraph 9 of the judgment that in subsequent decisions, the Apex Court has held that it is not an inevitable conclusion that every time a reinstatement is ordered, full backwages was the only consequence. A Division Bench of this Court in a recent decision in **Managing Committee v. State of Kerala and others** reported in **[2019(2) KLT 876]** , after W.A.No.1748 of 2015 - 13 - referring to the judgment of the Apex Court in **Senior Superintendent Telegraph (Traffic) Bhopal v. Santhoshkumar Seal and others** , reported in **[(2010) 6 SCC 773]** , reiterated the legal position that the relief of reinstatement with backwages is not automatic, even if termination of an employee is found to be illegal. 13. We are also of the opinion that the Labour Court cannot be found fault with for not granting backwages, while interfering with the punishment imposed by the Management, in exercise of its discretionary powers under Section 11A of the Industrial Disputes Act. The Apex Court has, in the decision in **Deepali Gundu Surwase v. Kranti Junior Adhyapak Mahavidyalaya (D.Ed) and others reported in (2013) 10 SCC 324** , referred to the earlier decisions regarding the question of grant of backwages and in paragraph 38 of the judgment culled out seven propositions. The Hon'ble Supreme Court has categorically held that **ordinarily, an employee or workman whose services are terminated and who is desirous of getting backwages is required to either plead or at least make a statement before the adjudicating authority or the court of first instance that he/she was not gainfully employed or was employed on lesser wages** . Ext.P2 is the Claim statement filed by the 1[st] respondent before the - 14 - W.A.No.1748 of 2015 Labour Court. There is absolutely no pleading regarding the aspect of not being gainfully employed or employed on lesser wages in the claim statement. Even in the writ petition filed before this Court, challenging the denial of backwages, there is no averment that the 1[st] respondent was not gainfully employed or was employed on lesser wages. Coupled with the above facts, it is admitted that the 1[st] respondent had proceeded abroad for seeking employment, applying for a leave for 5 years, which had not been sanctioned. In the above circumstances, we are of the opinion that there is no necessity to remit the matter again to the Labour Court, to render a finding on the question of backwages. In the light of the above, we allow the appeal, set aside the judgment of the Single Judge and dismiss the writ petition. In the circumstances of the case, there will be no order as to costs. Sd/- **K. VINOD CHANDRAN JUDGE** Sd/- **T.R. RAVI JUDGE** **dsn**