JUDGMENT
R.J. Kochar, J.
1. The petitioner Association is registered under section 25 of the Companies Act, 1956 and under the Bombay Shops and Establishments Act, 1948. The petitioner has set out in the petition in detail the services rendered by it. The petitioner is aggrieved by the Award of the Labour Court given on 6th July, 1995 whereby the Labour Court held that the impugned termination order was not discharge simplicitor but was a punitive order. The Labour Court also decided that the enquiry held by the petitioner was not fair and proper. The reference is pending before the Labour Court for adjudication of the propriety and legality of the impugned order of the termination on merits.
2. It appears that on the basis of the pleadings of the parties the Labour Court framed three issues which were answered as stated hereinbefore. It further appears that as a sequetal of the enquiry having not been held fair and proper, the petitioner was put at the stage of adducing evidence before the Labour Court to justify its action of discharge simplicitor which was held to be punitive, as it alleged loss of confidence in the respondents-employees. Being aggrieved by the aforesaid Award of the Labour Court, the petitioner has approached this Court under Article 226 of the Constitution of India. According to the petitioner its enquiry was fair and proper and therefore, there was no question of leading any fresh evidence on the merits before the Labour Court.
3. Both the learned Counsel have taken me extensively through the proceedings including the evidence before the Labour Court and also before the Enquiry Officer. At this stage itself, it may be clarified that before the Labour Court, the petitioner not only relied upon the enquiry held against the two employees before issuing the discharge order and the finding of the Enquiry Officer, the petitioner also adduced its oral and documentary evidence in support of the discharge order before the Labour Court. The respondent employees also examined themselves before the Labour Court in rebuttal.
4. The origin of the dispute has been traced by the petitioner to the fact that between the months of July and October 1980, there was a sudden influx of Hongkong nationals to become members of the petitioner association to obtain regular Indian driving licence as it enjoys privilege from the R.T.O. authorities to conduct road driving test and the letter of recommendation given by the petitioner is accepted by the R.T.O. and any applicant, through the petitioner is issued regular licence immediately. According to the petitioner these Hongkong nationals used to produce their learner’s licence to the staff of the petitioner and the respondent Nos. 2 and 3 omitted to comply with the mandatory road driving test in their cases. On the basis of the recommendations of the petitioner, the R.T.O. used to issue regular driving licence to the Hongkong nationals, it appears that the petitioners smelt a deep rooted scam in the fact that there was an abrupt increase in the membership of the petitioner association from Hongkong nationals and that they could convert their learner’s licence into regular Indian driving licence by a simple procedure without undergoing stringent driving test at Hongkong or at Mumbai. It appears that the petitioner found rempant mal practice in that regard. It was a sheer case of violation of traffic rules, that a driving licence was issued to a person without undergoing the stringent driving test, obviously by foul method of illegal gratification by the staff of the association. According to the petitioner association, the Hongkong nationals were found coming to the office of the association in search of the particular names of these respondents and they were found approaching them only and that such Hongkong Nationals were getting Indian driving licences within a day or two which according to the petitioner association was alarming. It further appears that the State Government also directed the Anti Corruption Bureau (A.C.B.) to investigate into the said complaints which were on a large scale. The A.C.B. enquiry was started in the year June 1981 and the same appears to have been completed in the year 1981 and the petitioner received a copy of the A.C.B. report on 22nd July, 1981.
5. Meanwhile, it appears that the respondent Nos. 2 and 3 were issued show cause notices which were followed by regular charge-sheets on 16th January 1982, alleging the serious acts of misconducts on their part. The show cause notice dated 25th September, 1981 had narrated all the details and gave particulars of the facts of allegations. By their letter dated 6th November, 1981, the delinquent respondents submitted their reply denying the charges. The respondents were charged under Clause 22(d) for fraud or dishonesty in connection with the employers business, taking illegal gratification, habitual breach of any law applicable to the establishment, habitual negligence or neglect of work and acts subversive of the discipline of standing orders and rules framed by the Government of Maharashtra.
6. It appears that the petitioner appointed an independent Enquiry Officer to hold enquiry in the charges levelled against the respondents. The petitioner allowed the respondents to be represented by Shri P. Shetty, an Advocate in the enquiry. The respondents fully participated in the enquiry and the witnesses who were examined by the petitioner in the enquiry were also fully cross-examined by Shri Shetty. It further appears that the respondents also gave their own statement in rebuttal. In the enquiry, the A.C.B. Officer Shri Rale was also summoned to give his evidence and to prove his report. The said officer was also cross-examined by Shri Shetty on behalf of the respondents. It further appears that on the basis of the findings and report of the Enquiry Officer, the petitioner preferred to issue letters of simple discharge to both the respondents, considering their long service with the petitioner association. It appears that the petitioner did not adopt a harsh attitude in passing an order of dismissal and took a lenient view to pass an order of simple discharge to enable them to get all their benefits including 12 months salary as compensation and gratuity in full. In the discharge order, however, it was specifically mentioned that their services were being terminated for loss of confidence. As far as the legal dues are concerned, it appears that the respondents had received all the legal dues in accordance with law.
7. The delinquent workmen raised an industrial dispute to challenge the prosperity and legality of the discharge orders and to demand reinstatement with full backwages and continuity of service. The State Government referred the said dispute to the Labour Court for adjudication. On receipt of the notices from the Labour Court, both the parties filed their pleadings and documents. As stated earlier, both the parties also adduced oral evidence on the basis of which the Labour Court recorded a finding that the enquiry held by the petitioner association was not fair and proper and that the discharge simplicitor order was punitive.
8. First I will deal with the question whether the order of discharge simplicitor was punitive. From the bare reading of the order it is crystal clear that the services of the respondent employees were terminated on the ground of loss of confidence. It is now well-settled that such orders are punitive and before passing such orders the employer must comply with the principles of natural justice. It is not necessary for me to cite any judgment on this point and if one is necessary the same is in the case of Kamal Kishore Laxman v. M/s. Pan American World Airways Inc. and others. The Supreme Court has observed that the loss of confidence by the employer in the employee is a feature which certainly affects the character or reputation of the employee and, therefore, the plea of loss of confidence in the employee indeed causes a stigma. Once the stigma is cast in the order of termination, such order per se becomes a punitive order and once a punitive order is passed, to uphold such order the employer must comply with the principles of natural justice and must give an opportunity of hearing to such employee. The order of discharge simplicitor on the ground of loss of confidence has been now held to be a punitive order and, therefore, there is no escape for the employer from complying with the principles of natural justice. Before passing such an order the employer must hold a domestic enquiry and must give to the delinquent workman, a reasonable and adequate opportunity to defend himself. The delinquent workman is entitled to know the material on the basis of which it was alleged against him that the employer had lost confidence. The Labour Court, therefore, was right in concluding that the order of discharge simplicitor for loss of confidence was a punitive one. I, therefore, do not find any fault with the conclusion of the Labour Court that the simple discharge order was a punitive order.
8-A. Now I would deal with the question of the enquiry being fair and proper. The Labour Court has held that the enquiry was not fair and proper mainly on the ground that the respondent workmen were not furnished with a copy of the report received by the petitioner from the A.C.B. The Labour Court also observed that another document demanded by the workman, Form A, filled up by the applicants for driving licence, was not given to them though demanded. According to Shri Cama, the learned Counsel for the petitioner, no such point was taken in the statement of claim that the enquiry was not fair and proper on the ground that the aforesaid two documents were not furnished to the delinquent workmen. He, however, further submits that it was an admitted fact that the representative of the delinquent workman, Shri Shetty, was given full inspection of the said report and he was allowed to take desired notes from the said statement and, therefore, there was no prejudice of any nature caused to the workmen. Shri Cama also submitted that the learned Advocate for the workmen cross-examined the author of the report who was offered for cross-examination in the enquiry. Shri Cama further submitted that no prejudice of any nature was pleaded in the statement of claim and before the Labour Court. The petitioners had examined as many as six witnesses in the enquiry in support of the allegations made against the workmen and all these witnesses were thoroughly cross-examined by Shri Shetty for the delinquent workmen in the enquiry. I agree with Shri Cama that fullest opportunity of hearing was given to the delinquent workmen and there is no substance in the objection on behalf of the workmen that the enquiry was not fair and proper, merely because a copy of the A.C.B. report was not given to the delinquent workmen. As far as Form A is concerned, the learned Counsel pointed out that in the absence of Form A what prejudice was caused to the workmen was never even whispered or explained. As far as the evidence on record is concerned, in my opinion, the A.C.B. report speaks volume against the workmen. There is no allegation against the A.C.B. report of the A.C.B. Officer. The officer had recorded the statements made by the workmen before him. From those statements, it appears to be clear that there was more than sufficient ground to find the workmen guilty of the charges levelled against them that they were helping foreign nationals to get the Indian driving licence by going out of way with the help of the R.T.O. As far as the report of the A.C.B. is concerned, it can be taken as an independent material to be replied upon and in my opinion the Enquiry Officer has rightly placed reliance on the said report. It cannot be said that merely because a copy of the said report was not given to the delinquent workmen, the enquiry gets vitiated even though the author of the report was offered for cross-examination and was cross-examined by the representative of the workmen. No grievance is made by the learned Advocate that he had not taken proper inspection or that he was not allowed to take full inspection of the report and that he could not cross-examine the author of the report effectively in the absence of a copy of the report in his hand. The Enquiry Officer has also relied upon the other material and evidence on record. I, therefore, do not find any substance in the allegations of the workmen that they were not given reasonable and adequate opportunity to defend themselves in the enquiry. I also do not find any merit in the submission on behalf of the workmen that before the order of termination was passed, the petitioners did not have a copy of the findings recorded by the Enquiry Officer. There is no material to substantiate the said allegation. The petitioner having appointed an independent Enquiry Officer, have received the report from the Enquiry Officer and they have acted on the basis of the report of the Enquiry Officer. Assuming that the Enquiry Officer had not submitted report in time, I fail to understand what prejudice is caused to the workman. In any case, even in the absence of a report of the Enquiry Officer, the petitioners were entitled to look into the evidence in the enquiry proceedings and to come to their own conclusions as happens in the case of a Disciplinary Authority when it does not itself hold a domestic enquiry, but receives the enquiry proceedings and takes its final decision, I, therefore, do not find any substance even in this attack levelled by Shri Ganguli on the enquiry held against the workmen.
9. According to Shri Ganguli, the order of discharge simplicitor reflects that the petitioners did not rely upon the enquiry proceedings and the report of the Enquiry Officer as there is no reference or mention in the order of discharge simplicitor. Shri Ganguli submitted that from the impugned order of discharge simplicitor, it is clear that the petitioner had actually abandoned the enquiry and did not want to rely upon the same and that there was time gap between the enquiry report and the final order of discharge simplicitor. There is absolutely no substance in this submission of Shri Ganguli merely because we do not find a reference of the enquiry in the discharge order it cannot be said that the petitioner had not considered and had not relied upon the enquiry before passing the order of discharge. There is no dispute that the workmen were issued show cause notices and charge-sheets and that enquiry was held against them in the said charges. The workmen had taken full part in the enquiry and thereafter, the order of discharge was passed. From the material on record, it is clear that the petitioner considered the long service put in by the workmen and therefore, they avoided to pass an order of dismissal in their interest. This good gesture shown by the petitioner cannot be interpreted against them that they should have passed an order of dismissal if they had relied upon the enquiry proceedings. It is obvious from the record that the petitioner contemplated a disciplinary action against the workmen for the charges levelled against them. There is no doubt that the charges levelled against them were of serious nature. However, the petitioner as a public organisation took a lenient view and considered their long period of employment as an extenuating circumstance to reduce the punishment from dismissal to discharge only to help them monetarily. In view of the order of discharge, the workmen received 12 months wages and also gratuity and retrenchment compensation. The workmen were fully benefited as a result of the order of discharge. If the petitioner were to pass an order of dismissal the workmen could not have received even a single farthing. It is, therefore, absurd to argue that as there is no mention in the order of discharge about the enquiry, it should be construed that the petitioners did not rely upon the enquiry. After lifting the veil from the order of discharge, the entire scene of the events becomes very clear and there is no doubt or dispute about the past events which preceded before the order of discharge. Merely because there was some delay in issuing the discharge order, it cannot be said that the petitioner had committed any error and on that ground its order gets vitiated. In any case, the delay did not cause any prejudice to the workmen as they were continued in employment and they were getting their regular remuneration. It is possible that the petitioner waited for a report from the A.C.B. to investigate in the alleged foul play in issuing the driving licence particularly to the foreign nationals in the given circumstances. It is shockingly significant to note that all the aforesaid foreign nationals were given driving licences without any driving test which appears to have been dispensed with on the basis of the remarks put by the workmen. It appears that the said foreign nationals were not required to undergo the usual driving test on road. The A.C.B. report is indicative of the irregularities and foul manner in which the events were taking place. It, therefore, cannot be said that merely because there is no mention in the discharge order about the enquiry, the petitioners had abandoned the enquiry.
10. From the material on record it is clear that the enquiry held by the petitioners was fair and proper and that there was sufficient material on record to come to the findings of guilt against the workmen. The material on record and the report of the A.C.B. read together substantiates the case of the petitioner that they had every reason to lose confidence in the working of these workmen. Since the charges were of serious nature and since the workmen were also given full opportunity to defend themselves by their representatives, nothing more was required for the employer to comply with the principles of natural justice. The employer was not and is not required to conduct an enquiry as a criminal trial. Even the Labour Court is not supposed to hold a session trial and to examine the material as if it was a criminal trial. The Labour Court has to examine whether there was sufficient material against the workmen for the employer to lose confidence in them. In the present case, the bona fides of the petitioner are not at all in doubt. The petitioner has given full opportunity to the workmen before coming to the conclusion of loss of confidence. There is no allegation of victimisation, malice or mala fides or ulterior motives against the petitioner. The petitioner has taken every step to give opportunity to the workmen and to act after sufficient material against the workmen is found. The wording of the discharge letter is not to be considered against the petitioners as in my opinion, their bona fides are beyond any doubt. The petitioners have acted in good faith as full fledged enquiry was held not only by them but even by the independent police machinery against which there is no charge of any bias or malice or use of force against the workmen. The workmen have made statements before the A.C.B. voluntarily. The petitioners have relied upon the said material and have passed the final order of loss of confidence.
11. The impugned Award of the Labour Court, therefore, suffers from illegality and infirmity in holding that the enquiry was not fair and proper. The enquiry held by the petitioners was fair and proper and the findings were not perverse. There is sufficient material before the petitioners for passing an order of loss of confidence. I, therefore, quash and set aside the impugned Award. The petition succeeds. Rule is made absolute in terms of prayer (a). No orders as to costs.
12. Since the matter is pending before the Labour Court, the Labour Court shall pass appropriate Award in accordance with law on the material already on record on the question of punishment and the relief, if any, C.C. expedited.