JUDGMENT
D. Desai, C.J.
1. The petitioner was appointed as Accounts Assistant in the Vikram Pharmaceutical Private Limited, Parwanoo (second respondent), with effect from the date of joining duty vide letter dt. Oct. 1, 1985. The appointment was on probation for a period of six months and was liable to be terminated at any time during the probationary period if his work was found to be unsatisfactory. The confirmation was to depend upon his work and conduct being found satisfactory during the period of probation. On Mar. 11, 1986, when the cash at the factory premises was verified and checked, a sum of Rs. 6471.67 paisa was allegedly found short. The responsibility therefore is stated to have been fixed upon the petitioner. In order to clear the shortage, he is alleged to have given three post-dated cheques, each of Rs.2000/-, and to have promised to pay the balance amount. The cheque(s) alleged to have been given accordingly is stated to have bounced when presented for encashment through bank on due date(s). Criminal/civil case(s) in connection with the said matter is stated to be pending in the court(s) in Chandigarh. By a communication dt. Mar.31, 1986, the petitioner’s period of probation is stated to have been extended by one month, that is up to April 30, 1986. During this period, the petitioner is also alleged to have been irregular in attending duty. Before the expiry of the alleged extended period of probation, his services were terminated on the ground of being no longer required vide letter dt. April 29, 1986. By the same letter he was asked to clear the shortage of Rs. 6471-67 paisa in his account on or before May 15, 1986. His name is stated to have been removed from the roll of the employees of the Company on and with effect from May 1,1986.
2. After the termination of service as aforesaid, the petitioner submitted a charter of demands before the Conciliation Officer (Labour Inspector), Nalagarh Circle, Parwanoo, which was received by the said authority on April 16, 1987. In the conciliation proceedings which followed, no fruitful progress was made. The petitioner thereupon requested the Conciliation. Officer to submit a failure report with a recommendation that the dispute be referred to the Labour Court, Himachal Pradesh. The Conciliation Officer was of the view that he could not recommend the reference of the dispute with respect to the reinstatement of the petitioner to the Labour Court keeping in view the fact that the services of the petitioner were terminated before the completion of 240 days “on the charge of misappropriation of funds the case is being tried in the court”. However, while submitting the failure report dt. Sept. 10, 1987, he left it open to the competent authority to consider the request of the petitioner. By a communication dt. Sept. 24, 1987, the Secretary (Labour) to the State Government called for certain further information from the Conciliation Officer which was supplied by way of a report dt. Oct. 1.1987. In the ultimate paragraph of the said report, the Conciliation Officer expressed the view that on the basis of the said fact finding report submitted after on-the-spot inquiry, the case was a fit one for reference to the Labour Court Industrial Tribunal, Himachal Pradesh, for adjudication.
3. On Oct.6, 1987, the Secretary (Labour) to the State Government wrote to the Manager of the second respondent stating, inter-alia, that from the report submitted by the Conciliation Officer it was evident that the petitioner was appointed as Accounts Assistant and not as Cashier, that no entrustment of money alleged to have been embezzled by him had been revealed during the course of the conciliation proceedings, that no charge-sheet was served nor any inquiry was conducted by the management with respect to the alleged misappropriation, that the procedure prescribed in Section 25 and Section 25-N of the Industrial Disputes Act, 1947 (hereinafter referred to as “the Act”) was not followed before terminating his services and that, therefore, the petitioner should be reinstated in service on and with effect from April 29, 1986 and he should also be paid all the dues. It was clarified however that it was open to the management to give a show-cause notice and to take appropriate action against him in accordance with law by following the proper procedure. The communication in question is couched in a language which would indicate that it was in the form of an order issued by the Secretary (Labour) to the second respondent. Pursuant to the aforesaid order, the petitioner appears to have reported for duty on Oct. 12, 1987 but he was not allowed to join duty. He then appears to have approached the Conciliation Officer who called upon the Manager and the Managing Director of the second respondent to abide by the directions issued by the Secretary (Labour). The efforts of the Conciliation Officer, however, were not fruitful since they took up the stand that the order in question was “meaningless” and lacked in power, authority and jurisdiction to order reinstatement of an employee whose services stood terminated. The Conciliation Officer made a report dt. Oct 17, 1987 in that behalf to the State Government.
The Managing Director of the second respondent thereafter met the Secretary (Labour) to the State Government and represented that the provisions of Section 25-F of the Act were not attracted on the facts and in the circumstances of the case since the petitioner had put in less than one year’s service with them. According to the State Government, upon re-examination of the case in light of the factual and legal position, the directions issued to the second respondent on Oct.6. 1987 were withdrawn on Mar 2, 1988 (after the present petition was registered and notice was ordered to issue thereupon)
4. The present petition, substantially seeking the relief of reinstatement with back wages, was registered on Jan 1,1988. Notice of the petition, returnable on Mar 8, 1988, was ordered to issue on Jan 7, 1988. On behalf of the respondents, separate affidavits in reply have been filed. The Under Secretary (Labour) to the State Government has filed the affidavit dt. Mar 7,1988 on behalf of the first respondent and the Managing Director of the second respondent has filed affidavit of even date on behalf of the said respondent.
5. On Mar. 23, 1988, the following interim order was passed by the court:
Having taken into consideration the legal and factual position emerging from a perusal of the entire material on record, the court is of the opinion that this is a fit and proper case in which the State Government should consider making a reference under Section 10(1) read with Section 12(5) of the Industrial Disputes Act, 1947. The State Government is, therefore, directed to give an opportunity of hearing to the parties on Mar. 30, 1988 at 11 A.M and thereafter to arrive at an appropriate decision in the matter in accordance with law and in light of the foregoing observation and bearing in mind the law declared by the Court in P.C. Thapliyal v. Union of India ILR (1985) Him Pra 426 and Ram Chand v. Union of India ILR (1985) HimPra451.
The notice of the hearing to be afforded to the parties as aforesaid has been accepted by the petitioner and the learned counsel for the second respondent. No separate notice will, therefore be required to be served on the parties.
The decision taken by the State Government shall be placed on the record of the case on or before April 5.1988.
6. On April 12, 1988, the learned Deputy Advocate General placed on record the decision recorded by the Commissioner-cum-Secretary (LEP) to the State Government pursuant to the aforesaid interim order. The operative part of the decision reads as follows:
The reporting Officer has gone through the rulings Ram Chand v. Union of India CWP No. 328/85 reported in ILR (1985) Him Pra 451 and P.C. Thapliyal v. Union of India C.W.P.No. 417/83 reported in ILR (1985) Him Pra 426 and has come to the conclusion that the circumstances in the two writ petitions quoted in the orders of Hon’ble High Court are not similar or identical to circumstances of the case under reference. In the instant case the mistrust and the reasons of mistrust are clear beyond doubt and from the circumstances of the evidence on record it transpires that it will not be in the interest of the petitioner and the Management that they should work together, for the petitioner especially when he feels that false cases have been instituted against him with a view to torture him and for the Management in the interest of their business. The Reporting Officer feels that forcing the two parties having gross mistrust, will put them to irreparable loss. Realizing “Time” is a very valuable item on earth the Reporting Officer does not feel convinced, in view of facts and law relevant to this case, that it is a fit case for reference to Labour Court.
Upon the request of the petitioner, the case was adjourned in order to enable him to move an amendment in order to challenge the said decision. The petitioner, who appears in person, has not moved an amendment but has, in tact, tiled a supplementary affidavit challenging the said decision.
7. A perusal of the text of the decision of the Commissioner-cum-Secretary (LEP), which runs into four and half pages, shows that the following issue is raised at the outset in the course of the said decision for its consideration by the authority on the basis of the “analysis of the evidence on record”:-
Whether letter of appointment and other prevalent law in the instant case confers a right on the petitioner for automatic confirmation and makes him liable not to be terminated without domestic enquiry?
The letter of appointment issued to the petitioner together with the alleged letter extending the period of probation have been thereafter closely examined. It has been found that automatic confirmation of the petitioner after the period of probation was not envisaged thereby and that there was evidence in the shape of “shortage of cash and non-credit of certain sold items in the Account Books”, besides availing of leave at frequent intervals, which led to the conclusion that the work and conduct of the petitioner were unsatisfactory. Then follow the further observations quoted herein below:
It does not appear appropriate that the two parties who have mistrust and fail to develop trust in spite of efforts of both parties should be forced to work together. In the instant case especially when the reasons for creation of mistrust is the money transaction and the duties of Shri Dutta are of the type and nature where he has to deal with monetary transactions.
The Model Standing Orders made under the Standing Orders Act, 1946 as well as the provisions of Section 25-F of the Industrial Disputes Act, 1947, are thereafter referred to in the course of the decision and it is pointed out that, on the facts and in the circumstances of the case, they do not cast an obligation on the second respondent to give one month’s notice in writing and of holding a domestic inquiry prior to the termination of services of the petitioner, since he was not in continuous employment for a period of not less than one year and the retrenchment was under an agreement which specified a date of termination of service. In this connection, the letter of appointment and the letter extending the period of probation are treated as an agreement between the petitioner and the second respondent and as also specifying a date of termination of service by reason of the prescription of the period of probation. It is also found reiterated that the petitioner not having rendered service for a continuous period of one year, Section 25-F was not attracted nor was he entitled to the privileges or concessions under the various labour laws.
8. Before proceeding to examine the validity of this decision, it would be appropriate to refer to the decision in P.C. Thapliyal v. Union of India (supra) in which this Court has laid down the law in the following terms:-
The perspective of the statutory power to make a reference is thus clearly defined by the pronouncements of the highest court in the above-cited decisions. In arriving at a decision whether or not to refer an industrial dispute for adjudication under S.10(l)read with Section 12(5) of the Act, the appropriate Government exercises a discretionary power or jurisdiction which operates in a very limited field. The appropriate Government may examine the merits of the dispute, prima facie, to ascertain whether the claim made is either perverse or frivolous or belated. If so satisfied, the appropriate Government may refuse to make a reference. When, however, the appropriate Government applies its mind to the materials on record for the purposes of a prima facie examination of the merits of the dispute to form an opinion whether or not the dispute calls for an adjudication, it has to be appreciated as a rule that: (a) if the dispute in question raises questions of law, the appropriate Government should not purport to reach a final decision on those questions and (b) similarly, on disputed questions of fact also, the appropriate Government cannot purport to reach final conclusions. Those matters fall appropriately within the jurisdiction of the Industrial Tribunal and the appropriate Government should be very slow to attempt an examination of the demand from those angles and should not arrive at a final adjudication of the demand itself on that basis and decline a reference on that ground. Any attempt on the part of the appropriate Government in that direction would not only rob the employees of an opportunity to place evidence before the Industrial Tribunal and to substantiate the reasonableness of the demand but also amounts to the usurpation of the powers conferred upon the Industrial Tribunal for adjudication of valid disputes. The Courts must be vigilant and should not permit the appropriate Government to do so, lest the provisions of Section 10 read with Section 12 of the Act are rendered nugatory.
To the similar effect is the decision in Ram Chand v. Union of India (supra)
9. When the decision of the Secretary (LEP) recorded on behalf of the State Government is examined against the background aforesaid, it becomes apparent that the said authority has no comprehension whatever of the statutory parameters of the power and jurisdiction exercisable under Section 10(1) read with Section 12(5) of the Act and of the scope of the inquiry while considering the question whether or not to refer an industrial dispute for adjudication. What is still more regrettable is that although in the interim order passed on Mar. 23, 1988, the attention of the said authority was specifically drawn to the two rulings of this Court having a direct bearing upon this legal issue, they have been summarily brushed aside with an observation that the circumstances in those cases were not “similar or identical to the circumstances of the case under reference”. If the mind had been really applied while gleaning those decisions in light of the observations made in the interim order and a diligent attempt had been made to appreciate the legal propositions therein laid down, there is no manner of doubt that an observation of this nature would not have found place in the decision of the authority. Ordinarily, under such circumstances, a legitimate presumption may also be raised that the authority has chosen not to follow the law declared by this Court and that may give rise to a further question whether there has been a willful disregard of the decisions rendered by the apex court in the State by an organ or agent of the executive branch of the State. On the facts and in the circumstances of the case, however, upon a more charitable view being taken, the failure to follow the rulings can be attributed to a total lack of perception or conception rather than to an intentional disobedience.
10. A more proper case for interference, in the exercise of the writ jurisdiction, with a decision like this, could not possibly have been brought before this Court. The real issue in controversy, namely, whether, on the facts and in the circumstances of the case, the impugned termination is simplicities or penal has been lost sight of, Some of the factual disputes have been virtually decided on merits instead of examining prima facie, whether the claim of the petitioner in that regard is either perverse or frivolous. Questions of law have been finally determined instead of being examined at first sight in order to decide whether the case raises legal issue requiring adjudication in the proper forum. The doctrine of loss of confidence, which is relevant in the field of industrial jurisprudence in case the termination is challenged as illegal or improper but the applicability whereof in a given case has to be thoroughly tested judicially, has been elaborately invoked in aid to justify the impugned termination and to deny a reference, Indeed, the confines of the power, authority and jurisdiction of the State Government while dealing with the question whether or not to refer an industrial dispute for adjudication under Section 10(1)and Section 12(5) of the Act have been totally obliterated and exceeded in all respects in the present case. The decision is so patently erroneous that no further reasons are required to be given to quash it. It cannot be overlooked also that the decision is a complete somersault vis-a-vis the stand of the State Government as evidenced by the letter dt Oct.6,1987, addressed by the Secretary (Labour) to the Manager of the second respondent, which was withdrawn after the present petition was filed.
11. For the foregoing reasons, the decision aforesaid of the State Government, which is in the form of a report submitted by the Commissioner-cum-Secretary (LEP) to this Court, is quashed and set aside. Ordinarily, the Court does not thereupon straightway direct the appropriate Government to refer a dispute to the Labour Court or to the Industrial Tribunal and leaves it to the appropriate Government to decide the matter in accordance with law and in light of the exposition of the law in the course of the judicial order. In the present case, such a course was once adopted but it has proved to be an abortive exercise. No useful purpose will be served by entering upon the same exercise once again having regard to the experience furnished by the decision which has been quashed. It will only result in a further wastage of time and delay in the adjudication of an industrial dispute. Under the circumstances, the State Government is directed to refer the following industrial dispute to the Labour Court, Himachal Pradesh, on or before May 5,1988:
Whether, on the facts and in the circumstances of the case, the termination of employment vide letter dt. April 29,1986 is just, legal and proper and whether or not the relief of reinstatement with back wages or any other appropriate relief should be granted?
12. Rule made absolute accordingly. The second respondent will pay to the petitioner the costs of this petition which are quantified at Rs. 500/- The costs shall be deposited in the Registry of this Court on or before May 7, 1988. Upon such deposit being made, the petitioner will be at liberty to withdraw the amount.