The Superintendent, Vengathanam Estate, Oorakkanadu P.O., Parathode, Kanjirappally, Kottayam District v. The General Secretary, Madhyamékhala Thottam, Thozhilali Union (HMS), Chittadi P.O., Parathode, Kottayam District; Labour Court, Ernakulam

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE P.R.RAMACHANDRA MENON** ## **&** **THE HONOURABLE MR.JUSTICE N.ANIL KUMAR** **MONDAY, THE 25TH DAY OF MARCH 2019 / 4TH CHAITHRA, 1941** **WA.No. 1001 of 2016** **AGAINST THE ORDER/JUDGMENT IN WPC 26837/2008 of HIGH COURT OF KERALA DATED 15-03-2016** ## **APPELLANT:** **THE SUPERINTENDENT, VENGATHANAM ESTATE, OORAKKANADU P.O., PARATHODE, KANJIRAPALLY, KOTTAYAM DISTRICT.** **BY ADVS. SRI.E.K.NANDAKUMAR (SR.) SRI.K.JOHN MATHAI SRI.BENNY P.THOMAS** ## **RESPONDENTS:** **1 THE GENERAL SECRETARY, MADHYAMEKHALA THOTTAM, THOZHILALI UNION (HMS), CHITTADI P.O., PARATHODE, KOTTAYAM, PIN-686 512. 2 THE LABOUR COURT, ERNAKULAM.** **BY ADVS. SRI.B.V.JOY SANKER SRI.THAMPAN THOMAS SR.GP SRI.P.N.SANTHOSH** **THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 08.03.2019, THE COURT ON 25.3.2019 DELIVERED THE FOLLOWING:** WA No. 1001 of 2016 :-2-: ## **W.A.NO.1001 OF 2016** **==> picture [138 x 11] intentionally omitted <==** ## **N.ANIL KUMAR,J:** The appellant was the petitioner in WP(C)No.26837/2008 and the respondents herein are the respondents in the writ petition. Being aggrieved by the judgment of the learned Single Judge dtd.15.3.2016 in WP(C) NO.26837/2008, the appellant preferred this Memorandum of Writ Appeal for setting aside the same. 2. The factual matrix of the case leading to filing the present writ appeal is succinctly stated as follows:- Sri.K.O.Mathew, Sunder Raj and M.J.Raju were employed as tappers and Sri.V.D.Sunny and Prasad were employed as general worker and spare tapper of the Vengathanam Estate. The disciplinary action was taken against them on the allegation that on 8.10.1994 at about 10 a.m., while the appellant was inspecting the work, where the new coffee plants were planted, the aforesaid five workmen advanced towards him showering abusive words. In order to avoid unpleasant incident, the appellant proceeded to the WA No. 1001 of 2016 :-3-: estate office by jeep. Then the aforesaid five workmen gheraoed the appellant in front of the office room without allowing him to go outside. At about 11 a.m., the Police came to the spot and removed the obstruction and allowed the appellant to go outside. The appellant gave a complaint to the Circle Inspector of Police, Kanjirappally on 8.10.1994. Sri.K.O.Mathew, one of the workmen above cited give a counter complaint against the appellant. 3. Based on the above incident, on 8.10.1994 at 10 a.m., the workmen were issued show cause notices calling upon for their explanation. Though the workmen submitted their explanations to the show cause notices issued, the same was found unsatisfactory by the Management. Consequently they were chargesheeted under Clause 22(h) of the Certified Standing Orders applicable to the Estate Workmen in Kerala alleging that they have committed gross misconduct of righteous or disorderly behavior in the premises of the estate or any other act subversive to discipline. On receipt of the memo of charges, the workmen sent a reply refuting the allegations contained in the memorandum of charges. Being dissatisfied with the WA No. 1001 of 2016 :-4-: explanations, the Management ordered a domestic enquiry by appointing an Advocate practising at the Kottayam Bar as an Enquiry Officer. The workmen were also allowed to represent through the President of the Union, who is a practising Advocate. Although adjournments were granted in the enquiry at the instances of the workmen and twice the workmen were set ex parte and the ex parte orders were subsequently set aside, the workmen absented themselves when the enquiry was finally posted to 14.8.1995 for evidence. Hence, they were declared ex parte. Five witnesses were examined through the charges. On analysing the evidence on record, the Enquiry Officer came to the conclusion that the charges levelled against the workmen were proved and submitted his report. 4. After following the formalities and considering the seriousness of the misconduct proved against the workmen, the Management decided to impose a punishment for dismissal from service with effect from 9.9.1995. 5. Challenging the dismissal from service, the first respondent raised an industrial dispute. On failure of conciliation proceedings, the State Government referred the following issues to the second respondent for adjudication. WA No. 1001 of 2016 :-5-: “1. Whether the dismissal of the workers (1)K.O.Mathew (2) Sunder raj (3) Prasad (4)V.D.Sunny and (5) M.J. Raju of the Vengathanam estate, Oorackanadu.P.O., Kanjirappally, Kottayam District is justifiable or not? 2. If not, the relief entitled to them?” On receipt of the reference order, the second respondent registered the industrial dispute as I.D.No.69/99. On receipt of notice from the second respondent, the parties entered appearance and filed their respective pleadings. 6. The Labour Court, Ernakulam, the second respondent in this case considered the validity of the domestic enquiry as a preliminary issue. To prove the enquiry, the Enquiry Officer was examined and the enquiry file was marked through him. Sri.Prasad, one among the workmen was examined on the side of the first respondent. The Labour Court set aside the enquiry, mainly on the ground that subsistence allowance was not paid to the workmen during the course of enquiry and also on the ground that an opportunity was not given to the workmen to cross-examine the management witnesses as per the ## WA No. 1001 of 2016 :-6-: request of the representative of the workmen dated 14.8.1995. Initially the appellant challenged the preliminary order before this Court. However, this Court was not inclined to interfere with the preliminary order as it would have resulted in piecemeal adjudication of the actual dispute between the parties. Hence, liberty was left open to the appellant to challenge the preliminary order while challenging the final order if such an occasion arises for consideration in future. 7. Before the court below, evidence was adduced by the appellant to prove the charges. Including the appellant, six witnesses were examined. However, no evidence was adduced by the side of the first respondent at the stage of final evidence. On a consideration of the entire evidence adduced, the court below is of the view that the appellant failed to establish the charges levelled against the workmen as contained in the memorandum of charges. Thus the dismissal of the workmen were found unjustifiable and directed the reinstatement with 50% backwages. The appellant challenged the award by filing WP(C)No. 26837/2008 before the learned Single Judge. Having considered the WA No. 1001 of 2016 :-7-: arguments advanced on either side as well as the pleadings and recital in the award of the court below, the learned Single Judge is of the view that the fact of non-payment of subsistence allowance to the workmen and their consequent inability to meaningfully take part in the enquiry was brought to the notice of the Enquiry Officer. It was also held that no steps were taken to disburse the allowance in spite of repeated intimations in this regard. Hence, the learned Judge found no illegality or arbitrariness in the preliminary award or final award passed by the court below. The learned Single Judge dismissed the writ petition holding that the dismissal of the workmen by the management is unjustified and the management is obliged to reinstate the workmen with 50% backwages as ordered by the court below with effect from 15.5.2008, the date of pronouncement of the award in open court. 8. When this case came up for consideration on 7.9.2016, this Court to which one of us is a party, after taking into consideration of the submissions made on either side, ordered to explore the chance for settlement and directed the parties to appear before the Nodal Officer, WA No. 1001 of 2016 :-8-: High Court Mediation and Conciliation Centre for proceeding with further steps in connection with the mediation. The report of the Mediator in the matter along with the enclosures would show as follows:- “Mediated on 07.99.2016 and 22.09.2016; but not settled.” On 6.12.2018, when the case came up for consideration before this Court, an order was passed on the following terms:- “Today, we have heard Smt.Rajasree, learned counsel appearing for the respondent Union at length. During the course of hearing, it is also pointed out that the attempt of the appellant is only to cause the evidence to be re-appreciated, which is not possible in view of the law declared by the Apex Court in [(2014) 6 SCC 434] and such other binding precedents. The learned counsel submits that there was no proper compliance of Section 17B as well, which however, is sought to be disputed by the learned counsel for the appellant, in reply. There is no dispute with regard to the fact that all the five workmen represented by the Union have now crossed the age of superannuation and as such, the residual question is only with regard to the back wages (50%) ordered to be WA No. 1001 of 2016 :-9-: paid. 2. The learned senior counsel for the appellant points out that 50% of the back wages as ordered by the Labour Court has already been satisfied by the appellant, apart from complying with Section 17B of the Industrial Dispute Act. 3. The appellant is required to file a statement before this Court as to the amount payable as awarded by the Tribunal and also showing the particulars of the amounts stated as paid by the appellant to all the five employees under the relevant heads. The statement as above shall be filed before this Court within one week. Post on 14.12.2018.” Upon instructions to the appellant pursuant to the direction issued by this Court on 6.12.2018, the appellant filed a statement on 14.12.2018 with reference to the amount payable as awarded by the Tribunal/Labour Court and also showing the particulars of the amounts stated to be paid by the appellant to all the five employees under the relevant heads. As noted above, the issue referred for adjudication before the Labour Court, Ernakulam was whether the dismissal of five workers was justified. Of the above five workers, WA No. 1001 of 2016 **==> picture [27 x 9] intentionally omitted <==** V.D.Sunny thereafter settled the dispute with the management and also gave evidence for the management as MW7. Consequently, the present dispute is being agitated by the remaining four workmen stated supra. 9. Considering the nature of dispute between the parties, we think, it is just and proper to narrate the amounts payable as awarded by the Tribunal/Labour Court and the particulars of the amount stated to be paid by the appellant in accordance with the statement submitted by the learned counsel for the appellant on 14.12.2018. ## **Amounts payable as awarded by the Tribunal/Labour Court:** ## **K.O.Mathew** |**O.Mathew**|| |---|---| |Date of entry into service:|03/05/82| |Date of dismissal:|09/09/95| |Years of service at the time of dismissal|13 years| |Date of superannuation:|22/03/20| |Wage at the time of dismissal:|52/22| |Present wages|408/60| |Backwages (50%) for the period between 09.09.1995<br>to 15.05.2008|Rs.1,21,157.00| |Actual wages from 06.10.2008 to 30.11.2018|Rs.9,17,269.96| |**Amounts payable as awarded by the Labour Court**|**Rs.10,38,426.96**| WA No. 1001 of 2016 ## :-11-: ## **M.J.Raju** |Date of entry into service:|01/04/87| |---|---| |Date of dismissal:|09/09/95| |Years of service at the time of dismissal|8 years| |Date of superannuation:|31/03/19| |Wage at the time of dismissal:|52.07| |Present wages|408/60| |Backwages (50%) for the period between 09.09.1995<br>to 15.05.2008|Rs.1,21,157.00| |Actual wages from 06.10.2008 to 30.11.2018|Rs.9,17,269.96| |**Amounts payable as awarded by the Labour Court**|**Rs.10,38,426.96**| ## **Sunder Raj** |Date of entry into service:|01/04/74| |---|---| |Date of dismissal:|09/09/95| |Years of service at the time of dismissal|21 years| |Date of superannuation:|11/05/10| |Wage at the time of dismissal:|52.57| |Present wages|167.64| |Backwages (50%) for the period between 09.09.1995<br>to 15.05.2008|Rs.1,21,157.00| |Actual wages from 06.10.2008 to 11.05.2010|Rs.81,175/-| |**Amounts payable as awarded by the Labour Court**|**Rs.2,02,332.88**| ## **Prasad** |Date of entry into service:|02/08/91| |---|---| |Date of dismissal:|09/09/95| |Years of service at the time of dismissal|4 years| |Date of superannuation:|09/07/28| WA No. 1001 of 2016 :-12-: |Wage at the time of dismissal:|51/65| |---|---| |Present wages|408/38| |Backwages (50%) for the period between 09.09.1995<br>to 15.05.2008|Rs.1,21,157.00| |Actual wages from 06.10.2008 to 30.11.2018|Rs.9,16,578.04| |**Amounts payable as awarded by the Labour Court**|**Rs.10,37,735.04**| ## **Particulars of the amounts stated to be paid by the appellant** ## **K.O.Mathew** Backwages (50%) for the period between Rs.1,21,157.00 09.09.1995 to 15.05.2008 17B wages paid for 06.10.2008 to 30.11.2018 Rs.1,66,164.04 **Amounts paid by the Appellant so far: Rs.2,87,321.04** ## **MJ Raju** Backwages (50%) for the period between 09.09.1995 to 15.05.2008 Backwages (50%) for the period between Rs.1,21,157.00 09.09.1995 to 15.05.2008 17B wages paid for 06.10.2008 to 30.11.2018 Rs.1,65,686.74 **Amounts paid by the Appellant so far: Rs.2,86,843.74** ## **Sunder Raj** Backwages (50%) for the period between 09.09.1995 to 15.05.2008 Backwages (50%) for the period between Rs.1,21,157.00 09.09.1995 to 15.05.2008 17B wages paid for 06.10.2008 to 31.08.2010 Rs.31,384.29 **Amounts paid by the Appellant so far: Rs.1,52,541.29** WA No. 1001 of 2016 :-13-: ## **Prasad** |**Prasad**|| |---|---| |Backwages (50%) for the period between<br>09.09.1995 to 15.05.2008|Rs.1,21,157.00| |17B wages paid for 06.10.2008 to 31.08.2010|Rs.1,64,350.30| |**Amounts paid by the Appellant so far:**|**Rs.2,85,507.30**| Indisputably, the appellant has paid 50% backwages in compliance with the directions of the Labour Court as also wages under Section 17B of the Industrial Disputes Act. 10. Reply statement was filed upon instruction given by the first respondent as answer to the statement filed by the appellant as per the order of this Court dated 6.12.2018. According to the learned counsel for the first respondent, Sri.Thampan Thomas, the employer has gained undue profit by keeping the workers out of the employment for a long period by abuse of process of court. The learned counsel contends that long pendency of cases has caused irreparable loss to the workers as well as improportionate enrichment for the employer. It is also contended that workers' entitlements are not calculated on the basis of the present wages and statutory benefits. In other words, it is argued that the increase in wages and benefits by way of WA No. 1001 of 2016 **==> picture [27 x 9] intentionally omitted <==** settlement during the pendency of cases is not added to the worksheet. 11. The learned Senior Counsel Sri.Nandakumar submits that the order of the court below setting aside the enquiry was not correct. Admittedly, the workmen were suspended from service w.e.f 24.10.1994. The Subsistence allowance was paid to them for 16 days which was upto 10.11.94. The Senior counsel submits that thereafter, payment of subsistence allowance was discontinued as the petitioner got reliable information that the said workers were gainfully employed elsewhere. Claiming subsistence allowance, the workmen moved the Deputy Labour Commissioner, who passed an order in their favour. The petitioner challenged the order before this Court by filing OP No. 7448/1996. This Court directed the petitioner to pay subsistence allowance and accordingly, the learned Senior Counsel submits that the entire subsistence allowances were paid to them on 19.3.1999. 12. Going through the proceedings of the enquiry, it can be seen that every opportunity was given to the workmen to participate in the enquiry and to prove their case. WA No. 1001 of 2016 **==> picture [27 x 9] intentionally omitted <==** There were altogether 17 postings. The workmen were declared ex parte on 27.5.1995. It was set aside on the request of their representatives. Subsequently, the enquiry was posted on 5.6.1995 and 21.6.1995 respectively. On 21.6.1995, none of the workers or their representatives presented for the enquiry and no adjournment was sought. Therefore, they were once again declared ex parte and ex parte evidence was taken. Thereafter, the enquiry was adjourned to 14.8.1995. On that day also, there was no representation from the side of the workmen and accordingly, the evidence was closed. On a perusal of the award of the court below, what was weighed with the court in setting aside the enquiry was that the request of the representative of the workmen dated 14.8.1995 was not favourably considered by the enquiry officer and he did not reopen the enquiry. 13. As indicated earlier, the petitioner challenged the preliminary order before this Court by filing a writ petition. The writ petition was dismissed with liberty to the petitioner to challenge the preliminary order by challenging the final award. Before the court below, evidence was adduced by the petitioner to prove the charges. WA No. 1001 of 2016 **==> picture [27 x 9] intentionally omitted <==** Including the petitioner, six witnesses were examined. True copies of the depositions of MW2 to MW7 would show that evidence was adduced on the side of the petitioner. On the other hand, no evidence was adduced on the side of the first respondent. The petitioner gave evidence to the effect that while he was inspecting the newly planted coffee plants in the seventh field of the top division, and giving instructions to one worker Indran (MW3), the workers involved in this case and one Rajasekharan, who was dismissed from service on the previous day, came towards him, shouting abusive words and by seeing their approach, reasonably suspecting that they intend to cause hurt to him and to prevent that he got himself into the jeep and proceeded towards the Estate Office which is about 3 kms., away. When he reached the office, the delinquents came there through a shortcut holding chappals and stones in their hand and stood in front of the office holding the grill, showered abusive words and threatened and shouted slogans by standing in front of the main gate. Practically, the petitioner was gharaoed by the delinquents, prevented him from attending his work till 11 a.m. until the Police reached and dispersed WA No. 1001 of 2016 **==> picture [27 x 9] intentionally omitted <==** the persons. The evidenced tendered by the petitioner was corroborated by the evidence of Mws.3 to 7. 14. True, the allegations levelled against the respondents are serious in nature, which would constitute a serious misconduct warranting removal from service. However, the court below is of the view that the facts of the non-payment of subsistence allowance to workmen and their consequent inability to meaningfully take part in the enquiry were brought to the notice of the enquiry officer and despite repeated intimation in this regard, no steps were taken in this regard. In para 5 of the statement of facts, the appellant before this Court has clearly admitted that the subsistence allowance was initially paid and subsequently stopped on reliable information and finding that the workmen were gainfully employed in the neighbouring small holdings. 15. Come to think of it, the above admission itself is sufficient to indicate that subsistence allowance was not paid in time by the employer. It is settled principle of law that the employee is entitled to subsistence allowance during an enquiry pending against him, but if that employee WA No. 1001 of 2016 :-18-: is in disgust by no payment, it is not just and proper to expect the employee to meaningfully participate in a departmental enquiry. There is no evidence adduced by the employer to show that the delinquents were gainfully employed in the neighbouring small holdings as contended. As far as the respondents are concerned, they were denied subsistence allowance for the reason that they were gainfully employed in the neighbouring small holdings. Delayed payment in disbursing subsistence allowance itself is a ground to vitiate the enquiry. Access to justice is a constitutional right available to every citizen. Free legal aid is provided even to a criminal. Under the circumstances, there is substance in contending that the delay in paying the subsistence allowance, which prevented the workers from effectively participating in the disciplinary enquiry itself is sufficient to vitiate the enquiry. However, the fact remains that the misconduct alleged against the workers is serious warranting appropriate disciplinary action in accordance with rules. 16. The disciplinary action was taken against the workers in respect of an occurrence on 8.10.1994. Nearly 25 WA No. 1001 of 2016 **==> picture [27 x 9] intentionally omitted <==** years are over from the date of occurrence. In case this Court confirms the award of the labour court as approved by the learned Single Bench of this Court, the enquiry proceedings are to be commenced afresh after giving an opportunity to the workers to take part in the enquiry meaningfully. In the case on hand, the Labour Court directed to reinstate the workmen with 50% backwages. The question arises for consideration is as to whether the relief by way of reinstatement with backwages is automatic even if termination of an employee is found to be illegal or is in contravention of the prescribed procedure. 17. Considering the peculiar facts and circumstances of this case, we are of the view that the relief of reinstatement with full backwages could not be granted automatically only because it would be lawful to do so. Keeping in view of the serious misconduct on the part of the workers, which forced the management to place them under suspension pending enquiry; that the services of the workers were suspended way back in 1994 and that the land of the plantation was given for pineapple cultivation as admitted by the workers in the reply statement filed on bahalf of the WA No. 1001 of 2016 :-20-: first respondent on 14[th] January,2019, we are of the opinion that this is not a fit case where the respondents could have been directed to be reinstated in service. While exercising a discretionary jurisdiction reinstating the workers in service, all the factors including the availability of the job at present should weigh with the court for determination of such an issue. The Supreme Court in a large number of decisions opined that payment of compensation in place of direction to be reinstated in service in cases of this nature, especially after 25 years from the date of enquiry would subserve the ends of justice. In **Senior Superintendent Telegraph (Traffic),Bhopal** v. **Santhoshkumar Seal and Others** [2010 KHC 4288], the Supreme Court in the facts and circumstances of the said case, held as follows:- “6. In last few years it has been consistently held by this Court that relief by way of reinstatement with back wages is not automatic even if termination of an employee is found to be illegal or is in contravention of the prescribed procedure and that monetary compensation in lieu of reinstatement and back wages in cases of such nature may be appropriate, (See U.P. State Brassware Corpn. Ltd. & Anr. v. Uday Narain Pandey, (2006) 1 SCC 479 Uttaranchal Forest Development Corpn. v. M.C. Joshi;(2007) 9 SCC 353,State of M.P. & Ors. v. Lalit Kumar Verma(2007)1 SCC 575, Madhya Pradesh Administration v. Tribhuban [(2007)9 SCC 748];Sita Ram & Ors. v. Moti Lal Nehru Farmers Training Institute[(2008) 5 SCC 75; Jaipur Development Authority v. Ramsahai & Anr.[(2006) 11 SCC 684; Ghaziabad Development Authority WA No. 1001 of 2016 ## :-21-: & Anr. v. Ashok Kumar and another, (2009)4 SCC 261 and Mahboob Deepak v. Nagar Panchayat, Gajraula & Anr. [(2008) 1 SCC 575]. 7. In a recent judgment authored by one of us (R.M. Lodha, J.) in the case of Jagbir Singh v. Haryana State Agriculture Marketing Board and Anr.,(2009)15 SCC 327, the aforesaid decisions were noticed and it was stated : "7. It is true that the earlier view of this Court articulated in many decisions reflected the legal position that if the termination of an employee was found to be illegal, the relief of reinstatement with full back wages would ordinarily follow. However, in recent past, there has been a shift in the legal position and in a long line of cases, this Court has consistently taken the view that relief by way of reinstatement with back wages is not automatic and may be wholly inappropriate in a given fact situation even though the termination of an employee is in contravention of the prescribed procedure. Compensation instead of reinstatement has been held to meet the ends of justice. * * * * * * * * * * 14. It would be, thus, seen that by a catena of decisions in recent time, this Court has clearly laid down that an order of retrenchment passed in violation of Section 25-F although may be set aside but an award of reinstatement should not, however, be automatically passed. The award of reinstatement with full back wages in a case where the workman has completed 240 days of work in a year preceding the date of termination, particularly, daily wagers has not been found to be proper by this Court and instead compensation has been awarded. This Court has distinguished between a daily wager who does not hold a post and a permanent employee". 18. The sequence of events in this case would show that both the parties are willing to settle the matter. During the course of hearing, the learned Senior Counsel Sri.Nandakumar, WA No. 1001 of 2016 :-22-: fairly submits before this Court that the appellant is willing to settle the matter out of court. Without prejudice to the contentions advanced in this appeal, the learned Senior Counsel submits that the appellant is willing to pay `50,000/- more in addition to the amount offered by the appellant as per statement dated 14.12.2018. However, the amount offered is not acceptable to the workers. In view of the aforesaid facts and circumstances and legal position, relief of reinstatement and backwages to them as ordered by the trial court cannot be said to be justified, instead, monetary compensation would sub-serve the ends of justice. In our considered view, a compensation of `75 **,000** /- (Rupees Seventy Five Thousand only) **each** , in addition to the amount paid to each of the workmen (Sri.K.O.Mathew, Sri.Sunder Raj, Sri.M.J.Raju and Sri.Prasad) in accordance with the statement dated.14.12.2018 submitted by the appellant before this Court, shall meet the ends of justice. We therefore order accordingly. We also make it clear that the aforesaid payment is distinct from gratuity and is over and above the admissible gratuity as per rules. The said sum shall be paid to the workmen (Sri.K.O.Mathew, Sri.Sunder Raj, Sri.M.J.Raju and Sri.Prasad)within eight weeks from the date of receipt of a copy of this judgment, failing which WA No. 1001 of 2016 :-23-: the same shall carry interest at the rate of 9% per annum. In the result, the appeal is allowed to the aforesaid extent. However, in the facts and circumstances of this case, there shall be no order as to costs. Sd/- **P.R.RAMACHANDRA MENON** , JUDGE sd/- **N.ANIL KUMAR** , JUDGE MBS/