Termination Of Service

Source: The Hitavada      Date: 05 Mar 2018 10:40:07


 

 

 

 

 

 

 

 

 

 

 

The question, which the Labour Court was expected to decide in the first instance as a ‘preliminary issue,’ was whether the domestic inquiry held by the appellant-employer was legal and proper. In other words, the question to be decided by the Labour Court was whether the domestic inquiry held by the appellant was conducted following the principles of natural justice or not.


IN THE judgement of the case – Kurukshetra University v. Prithvi Singh, delivered on February 15, 2018, while dealing with the fact of the Punjab & Haryana High Court upholding the award passed by the Labour Court, Ambala, in a Reference case, Justice R.K. Agrawal and Justice Abhay Manohar Sapre, at the Supreme Court, have ruled that the Labour Court had committed an error in not framing a ‘preliminary issue’ for deciding the legality of the domestic inquiry.

Further, the Labour Court did not allow the appellant to lead independent evidence to prove the misconduct/charge on merits. The Labour Court could not have treated termination of the respondent’s service as ‘retrenchment’. In the light of this finding, the Supreme Court has held that the Award of the Labour Court and judgement of the High Court were not sustainable. This led to remand of the case to the Labour Court, after allowing the appeal against the judgements of the two courts below, for deciding the Reference afresh, in the backdrop of the observations of the apex court in this judgement.


The appeal in this case was directed against the final judgement and order of September 22, 2006, passed by the Punjab and Haryana High Court at Chandigarh, whereby the HC division bench had dismissed the petition filed by the appellant herein and affirmed the Award of January 23, 2006, passed by the Presiding Officer, Labour Court, Ambala, in a Reference case.

The respondent was working as Security Guard in the appellant University as daily rated employee. In the considered opinion of the Supreme Court, neither the Judge of the Labour Court nor the Judges of the HC applied their judicial mind, while deciding the issues arising in the case and completely ignored the settled legal principles, which are applicable to the case in hand and proceeded to decide the case contrary to the principles laid down by this court. The court has stated that due to this reason, it has been compelled to interfere in the impugned judgement and remand the case to the Labour Court for deciding it afresh.


When the apex court examined the facts of this case in the light of the well-settled principles of law, it found that termination of service of the respondent was by way of punishment because it was based on the adverse findings recorded against the respondent in the domestic inquiry.
So the question, which the Labour Court was expected to decide in the first instance as a ‘preliminary issue,’ was whether the domestic inquiry held by the appellant-employer was legal and proper. In other words, the question to be decided by the Labour Court was whether the domestic inquiry held by the appellant was conducted following the principles of natural justice or not.


If the domestic inquiry was held legal and proper, then the next question which arose for consideration was whether the punishment imposed on the respondent-delinquent employee was proportionate to the gravity of the charge levelled against him or it called for any interference to award any lesser punishment by exercising the powers under Section 11-SA of the ID Act. If the domestic inquiry was held illegal and improper then the next question, which arose for consideration was, whether to allow the appellant-employer to prove the misconduct/charge before the Labour Court on merits by adducing independent evidence against the respondent-employee. The appellant was entitled to do so after praying for an opportunity to allow them to lead evidence and pleading the misconduct in the written statement.


Once the appellant-employer was able to prove the misconduct/charge before the Labour Court, then it was for the Labour Court to decide as to whether the termination should be upheld or interfered with by exercising the powers under section 11-A of the ID Act by awarding lesser punishment provided a case to that effect on facts is made out by the respondent –employee.


The Court has stated that it is constrained to observe that first, the Labour Court committed an error in not framing a ‘preliminary issue’ for deciding the legality of domestic inquiry and second, having found fault in the domestic inquiry committed another error when it did not allow the appellant to lead independent evidence to prove the misconduct/charge on merits and straightaway proceeded to hold that it was a case of illegal retrenchment and hence the respondent’s termination is bad in law.


By no stretch of imagination, in the Court’s view, the Labour Court could treat the respondent’s termination as “retrenchment” much less an illegal retrenchment. The Labour Court failed to notice the definition of retrenchment in Section 2 (oo) of the ID Act which, in clear terms provides that retrenchment does not include termination of the service if it is imposed by way of punishment.


In this case, the respondent’s services were terminated by the appellant, by way of punishment after holding a departmental inquiry and therefore, the termination in question could never be regarded as retrenchment. The Labour Court was therefore, wholly wrong in treating termination of the respondent as retrenchment.


The Court noticed that the Labour Court held on facts that the respondent had worked 240 days in one calendar year. The Court did not consider it proper to set aside this factual finding. Indeed, due to this finding, the respondent is held entitled to claim protection of Labour Laws.


The HC while deciding the appellant’s writ petition did not take note of any legal issues mentioned above and cursorily dismissed the writ petition.


In the light of this discussion, the Court has said that it cannot countenance the approach and the manner in which the Labour Court and the HC dealt with the issues arising in the case. The Award of the Labour Court and the judgement of the HC are, therefore, held per se as without jurisdiction and legally unsustainable.


In view of the discussion, the Court allowed the appeal, set aside the Award of the Labour Court, to the extent indicated as above and the judgement of the HC and remanded the case to the Labour Court for fresh decision.


The Labour Court has been asked to afford the appellant- employer an opportunity to lead evidence to prove the misconduct alleged by the employer in its written statement against the respondent-employee and depending upon the findings, which the Labour Court would record on the issue of misconduct, the issue of termination of service would be decided in the light of the observations of the Supreme Court in this judgement.