C.W.P No.5097 of 1995 -1-
IN THE HIGH COURT FOR THE STATES OF PUNJAB AND
HARYANA AT CHANDIGARH
C.W.P No.5097 of 1995
Date of Decision: 20.07.2009
Manmohan Sood .....Petitioner
Versus
The Presiding Officer, Labour Court, U.T. and another
...Respondents
Present: Mr. Rahul Sharma, Advocate
for the petitioner.
Mr. Ramesh Chopra, Advocate
for respondent No.2.
CORAM:HON’BLE MR. JUSTICE K. KANNAN
1. Whether Reporters of local papers may be allowed to see
the judgment ? Yes
2. To be referred to the Reporters or not ?Yes
3. Whether the judgment should be reported in the Digest?Yes
-.-
K. KANNAN J.
1. The point of reference before the Labour Court was whether
the workman, who was working as a Salesman in the Central
Cooperative Consumers Store Ltd., Chandigarh had been responsible
for a shortage that worked out to a loss of Rs.1,08,888.61 and whether
he was validly terminated from service. The Labour Court answered
the reference against the workman and upheld the contention of the
management. Aggrieved workman is the party before this Court that
challenges the award of the Labour Court by the writ petitioner.
2. The charge-sheet imputing allegations of misappropriation
germinated from the fact that the workman had confirmed his liability
in the liability register on 28.02.1987. There had been a balance as on
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06.03.1987 of Rs.1,08,888.61 against the workman which he was
called upon to reconcile. The workman had availed several
opportunities but did not reconcile the same. To the charge-sheet, the
reply was that he had not admitted his liability and his signature had
been taken in some paper on a representation that if he did not do so,
the management would give a complaint to the police. It was the
statement in defence that he had also paid Rs.40,000/- to cashier in
cash, which had not been brought to the books of account. At the
enquiry, the management examined Sh. Shugan Chand, who produced
photocopies of the register, which was Mark ‘A1’ to Mark ‘A4’ but
significantly they had not been exhibited as documents in evidence.
The workman pointed out to the fact that no documents had been
produced that could be said to admit his liability and his contention
was also that the witness brought on behalf of the management did not
himself know whether cash had been paid by the workman to the
cashier or not. He was also unaware about the correctness of entries
in the liability register and therefore, the contention was that
management had not established before the Enquiry Officer that there
had been any case of defalcation. The enquiry had been concluded
and report of guilt was returned. The order of termination was
subsequently passed and when the workman demurred and refused to
accept the finding, the adjudication was sought through reference to
the Labour Court.
3. Before the Labour Court, it was shown that the fundamental
flaw in the enquiry proceedings was that subsistence allowance had
not been paid and that the workman did not have the necessary
C.W.P No.5097 of 1995 -3-
wherewithal to put up a proper defence. The management conceded
to the inherent defect although it did not concede that the finding itself
was vitiated. It sought for a finding as a preliminary issue whether the
proceedings before the Enquiry Officer were to be held to be not fair,
the manager was prepared to prove the guilt before the Labour Court.
The Labour Court by its order dated 17.08.1993 found that the enquiry
had been vitiated and the management was given an opportunity to
prove the alleged misconduct in Court. The management examined
the accountant, Sh. Shugan Chand and another witness, Sh. Gurmit
Singh, a Law Officer of the department and also produced the enquiry
report. The workman examined himself.
4. Adverting to the objections of the workman that the liability
register itself had not been proved and there was nothing on record to
show that he had admitted his liability, the Labour Court ruled that
documents Mark A-1 to Mark A-4 which were photocopies had been
admitted before the Enquiry Officer and therefore, it was not possible
to deny the genuineness of the documents. The Labour Court also
commented on the fact that the workman could not be said to be
speaking the truth when he was contending that Rs.40,000/- had been
paid to the cashier and according to the Labour Court, it was
inconceivable that such a large amount could have been paid. It also
observed that the very fact that Rs.40,000/- was said to have been
deposited showed admission of guilt for, if no amount had been
misappropriated, there was no need for deposit of Rs.40,000/-.
5. At the outset, the power of the Labour Court to take
evidence and prove the guilt in cases where it was found that the
C.W.P No.5097 of 1995 -4-
enquiry before the Enquiry Officer was vitiated, was pointed out by
learned counsel appearing for the respondent as perfectly justified by
referring to a decision of the Hon’ble Supreme Court in
Cooper Engineering Limited Vs. P.P. Mundhe 1975 II LLJ 379 that
held that where a case of dismissal or discharge of employee is
referred for adjudication, the Labour Court must first decide as a
preliminary issue whether the domestic enquiry was following the
principles of natural justice and if it found that the enquiry was
vitiated for any reason, it was competent for the Labour Court to allow
the proof to be adduced before it for rendering an adjudication.
Although the manner of conduct of enquiry regarding examination of
witnesses or the adequacy of the evidence was itself not in challenge,
the management had conceded that the enquiry was vitiated by the fact
that subsistence allowance had not been paid to the workman and it
took upon itself the burden of establishing the alleged guilt of the
delinquent before the Labour Court. In view of the stand taken by the
management, the case of proof of guilt was required to be examined
only in the manner of how evidence had been adduced and how the
charge was sought to be proved before the Labour Court. The finding
of the Enquiry Officer itself loses value and so too nature of evidence
produced before the Enquiry Officer.
6. Learned counsel appearing for the workman, Sh. Rahul
Sharma contended that there was no document at all which had been
accepted as a document supporting the contention that there had been
any admission of liability. According to him, the finding of the
Labour Court that documents Mark A-1 to Mark A-4 had been
C.W.P No.5097 of 1995 -5-
established was wrong since the documents had not been exhibited as
evidence. Mere filing of documents, he contended would not amount
to proof of the same. In the absence of proof through any documents,
it could not be stated that even the so-called liability register had been
established. He pointed out to the evidence of Mr. Gurmit Singh, who
referred to document Mark-A, which was photocopy of indent
No.4355 that purported to show that material amounting to
Rs.84,000/- was taken under his signature by the workman. This
document was denied in evidence by the workman by contending that
he had not signed in the document and he had not received the
document amounting to Rs.84,000/-. Documents Mark-B to E were
purported to be letters written to the workman to reconcile liability
and the receipt of letters themselves were not denied and therefore,
even without reference to a document it might be noticed that the
management was at various time calling upon the workman to
reconcile liability. In the cross-examination, it was admitted by Sh.
Gurmit Singh that he had himself not prepared the indent nor was it
prepared in his presence. He also admitted that letters seeking for
reconciliation of accounts had not been issued by him and it was not
part of his duties to write letters which were Mark-B to Mark-E. He
also denied knowledge if the workman had deposited Rs.40,000/-.
Therefore, it could be seen that the evidence of Gurmit Singh itself
proved neither the indent register nor alleged admission of liability by
the workman.
7. The statement of Shugan Chand was placed before Labour
Court where he gave evidence to the effect that on 28.02.1987, the
C.W.P No.5097 of 1995 -6-
workman had confirmed his liability in the register. It has to be again
noticed that the liability register Mark A-1 to Mark A-4 from
December, 1986 to March, 1987 had not been accepted as evidence
and merely the photocopies had been referred to in the evidence. In
the cross-examination, he admitted that the liability register was being
maintained by a clerk and the liabili ty register was compared with the
indent as per records. Even the WW-1 had not been produced in
original and merely a photocopy had been filed. With reference to
document Ex.W-1 also, the management witness, Sh. Shugan Chand
admitted that he had not brought the original. A discrepancy was
confronted to the witness that indent No.4154 had been shown to have
been issued on 04.12.1986 whereas the particular indent whereby the
workman was alleged to have received materials amounting to
Rs.84,000/- was shown bearing No.4155 which was dated the
previous date. This discrepancy was also pressed with vehemence by
the learned counsel for the workman to point out that the alleged
indent which purported to prove the receipt of materials to the tune of
Rs.84,000/- had not been established at all, in spite of his denial that
he had received the materials and that he had signed the indent. Again
with reference to the payment of the workman to the extent of
Rs.40,000/- to the cashier, Shugan Chand, the accountant had denied
any knowledge about the same. He admitted that if there was any
payment, it could have been entered in the cash book but he had not
brought the cash book before the Court.
8. In order that the charge might stick, three things at least
were required to be established (i) that the workman had signed the
C.W.P No.5097 of 1995 -7-
indent and had received the materials. For this, the original indent
was not there and both the management witnesses gave no evidence of
the absence of the original or produced proof that the workman had
actually signed in the indent; (ii) The signature in the liability register
would have pinned down the liability of the workman. The liability
registers purporting to contain the signature of the workman were
again not produced before the Court nor was the clerk who had
admitted to have made the entries examined before the Labour Court;
(iii) the remittance of Rs.40,000/- in cash to the cashier was not even
specifically denied by the the accountant, Sh. Shugan Chand, who
merely said that he did not know whether Rs.40,000/- had been paid
to the cashier.
7. In spite of these deficiencies, the Labour Court went on to
observe that the management had proved the guilt by a sweeping
observation that all the documents, which were photocopies had been
admitted by the workman. While strict rules of evidence may not be
applied in an enquiry before the Enquiry Officer and leeway could be
made for certain deviation so long as there were cogent reasons and
proof in support of the contention of the management, the Labour
Court that passed an order rejecting the Enquiry Officer’s report and
undertaken a responsibility to direct the parties to give evidence
before it, could not have also thrown the rules of evidence to the
winds. In the absence of any evidence or production of documents
relating to the liability register, mere reference to documents Mark A-
1 to Mark A-4 could not have been relied on by the Labour Court to
establish admission of liability by the workman. It is not clear from
C.W.P No.5097 of 1995 -8-
the records as to what the workman had admitted before the Enquiry
Officer. Even admission to the existence of documents would not
amount to admission of the recitals in the documents nor would it
dispense with the necessity to prove the documents in the manner
required by law. The burden of proof of establishing the guilt and
misappropriation could never shift, it would lie anchored in the
management at all times. The onus of proof could shift to the
workman in case there was any evidence let in that was acceptable to
show that there was either proof of receipt of materials worth
Rs.84,000/- or there had been a shortfall of stocks to the tune of
Rs.1,08,888.61. The failure of the workman to turn up in spite of
notices for reconciling the account itself cannot amount to proof of the
charge-sheet. The charge was not after all the failure to reconcile
account but the charge was of misappropriation. Even independently
of his liability to turn up at the office and reconcile the accounts, there
was always the burden on the management to show that there had
been misappropriation to the tune imputed by them on the workman.
Such an evidence was just not available.
9. The Labour Court has rendered the finding of guilt against
the workman on evidence that did not exist; on admission that the
workman did not made; and on proof that the management did not
render. The finding of the Labour Court is vitiated by a complete lack
of evidence and I have no alternative except to reject the award passed
by the Labour Court as not conforming to law and evidence.
10. Under the circumstances, the award of the Labour Court is
set aside and the workman is entitled to reinstatement, back wages and
C.W.P No.5097 of 1995 -9-
continuity of service. The writ petition is allowed with costs assessed
at Rs.5000/-.
(K. KANNAN)
JUDGE
July 20, 2009
Pankaj*