Chairman Baroda Up Gramin Bank Raibareli Vs U.O.I. Thru Secy.Ministry of Labour and Employment and Others

Neutral Citation No. - 2025:AHC-LKO:15762

Court No. - 19

Case :- WRIT - C No. - 4146 of 2017

Petitioner :- Chairman Baroda Up Gramin Bank Raibareli Respondent :- U.O.I. Thru Secy.Ministry Of Labour And Employment And Others

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Counsel for Petitioner :- Vinay Shankar,Avdhesh Shukla,Megha Pandey,Sharad Tewari Counsel for Respondent :- A.S.G.,Ajmal Khan,Prem Prakash Singh,Ravindra Kumar Verma,Sajjad Husain,Sanjay Shukla,Sharad Kumar Srivastava

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Hon'ble Manish Mathur,J.

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(Order on Application for recall of order)

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Application has been filed for restoration of writ petition to its original number by recalling order dated 10.05.2023 whereby the petition has been dismissed for want of prosecution. No objection to the application has been filed till date. Cause shown in the affidavit filed in support of the application is sufficient, as such, the order dated 10.05.2023 is hereby recalled restoring the writ petition to its original number.

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(Order on the Memo of Petition)

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The petition despite being restored today itself is being adjudicated upon on merits with the consent of learned counsel for parties.

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Heard Mr. Avadhesh Shukla learned counsel for petitioner & Mr. Sajjad Husain and Mr. Sanjay Shukla learned counsel for opposite party No.3. No one has appeared on behalf of opposite parties 1 and 2.

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Petition has been filed challenging award dated 25th April, 2016 passed in Industrial Disputes Case No. 36 of 2009 notified in the official gazette on 14th September,2016.

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Learned counsel for petitioner submits that opposite party

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No.3, Ram Kewanchal was Cashier with the petitioner bank and while in service was served with a charge sheet dated 25th November, 2005 for commission of misconduct in terms of Regulation 38 of the Kanpur Chhetriya Gramin Bank Officers and Employees Service Regulations 2002 whereafter inquiry was initiated in which ample opportunity of defence was given to petitioner whereafter inquiry report was submitted on 3rd July, 2006 finding petitioner guilty of all the charges levelled against him and therefore resulting in dismissal order dated 25th February, 2008, against which an appeal was preferred and has also been rejected by means of order dated 29th September, 2008.

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It is submitted that challenging the aforesaid orders, an industrial dispute was raised and was referred in terms of Section 4 of the Industrial Disputes Act 1947 whereafter impugned award has been passed.

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Learned counsel for petitioner submits that the Tribunal has erred in interfering with dismissal order ignoring the fact that all 11 charges imputed against opposite party No.3 (hereinafter referred to as 'delinquent employee') were found proved in the inquiry proceedings which were conducted in a fair and impartial manner after affording full opportunity of hearing to the delinquent employee.

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It is also submitted that Tribunal has ignored the fact that employees of the bank are supposed to maintain highest standard of honesty and integrity and their dismissal would be a result of loss of confidence of the bank upon the delinquent employee as in the present case and therefore judicial review on the point of quantum of punishment should not have been done in a routine manner as has been done by the impugned award.

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It is also submitted that the Tribunal has even otherwise

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committed manifest error of law in substituting its own findings as if it was exercising appellate jurisdiction. Learned counsel submits that the Tribunal has also committed gross illegality in ordering reinstatement of the delinquent employees with full back wages and consequential benefits which could not have been awarded in the present case once misconduct stood proved. In the alternative, it has been submitted that even if the Tribunal found certain lacuna in the inquiry proceedings, it should have directed the bank for conducting re-inquiry in terms of Section 11-A of the Industrial Disputes Act.

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Learned counsel has placed reliance on judgments in the cases of State Bank of India versus Ramesh Dinkar Punde , 2006 7 SCC 212; Francis Klein and Company Private Limited versus Workmen , 1972 4 SCC 569; State Bank of Bikaner and Jaipur versus Nemi Chand Nalwaya , 2011 4 SCC 584; Union of India versus Sardar Bahadur , 1972 4 SCC 618; J.K.Synthetics Limited versus K.P. Agrawal and another , (2007) 2 Supreme Court Cases 433.

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Learned counsel for opposite party No.3 (delinquent employee) has refuted submissions advanced by learned counsel for petitioner with submission that the Tribunal has clearly held that the inquiry proceedings were conducted in a cursory manner without any cogent evidence being adduced against petitioner. It is submitted that a bare perusal of the impugned award will make it evident that the employee has been held guilty of the charges levelled against him without any evidence in support thereof. It is also submitted that the award clearly indicates the fact that the charges were held to be proved against him without even requiring presence of the complainant in the inquiry proceedings. It is therefore submitted that the inquiry proceedings having not followed the relevant procedure prescribed, the Tribunal has correctly quashed the said

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proceedings as well as the dismissal order.

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It is also submitted that once the Tribunal has clearly recorded that charges were found proved against the employee without any material evidence, misconduct was not proved and therefore the full back wages and consequential benefits were awarded. He has placed reliance on the on judgment rendered by Hon'ble Supreme Court in the case of Deepali Gundu Surwase versus Kranti Junior Adhyapak Mahavidyalaya (D.Ed.) and others passed in Civil Appeal no. 6767 of 2013 arising out of SLP (C) No. 6778 of 2012.

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Learned counsel for delinquent employee at the very out set has raised a preliminary objection regarding maintainability of this petition in view of the fact that there is no compliance of Section 17(2) as well as Section 17-B of the Industrial Disputes Act.

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With regard to the aspect of maintainability of the petition, reliance has been placed by learned counsel for delinquent employee upon Section 17(2) of the Act which provides that subject to provisions of Section 17-A, the award published under Sub Section 1(1) shall final and shall not be called in question by any court in any manner whatsoever.

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So far as the aforesaid objection is concerned, it is settled law that such observations would be inapplicable in exercise of extra ordinary jurisdiction under Article 226 of Constitution of India and that the court is indicated in Section 17(2) would not include a court exercising writ jurisdiction. The same is fortified by the judgment rendered by Supreme Court in the case of Harshad Govardhan Sondagar versus International Assets. Reconstruction Co. Ltd. , AIR Online 2014 SC 294.

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With regard to second objection raised regarding maintainability of this petition in terms of Section 17-B of the

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Industrial Disputes Act 1947 pertaining to the aspect that where an award directs reinstatement of any workman, in any proceedings against such award in High Court or Supreme Court, the employer shall be liable to pay its workman during pendency of such proceedings full back wages last drawn by him inclusive of any maintenance allowance admissible if the workman had not been employed in any establishment during such period and an affidavit by such workman had been filed to that effect in such court. It is admitted by learned counsel for delinquent employee that he was was reinstated in pursuance of the impugned award and after completing his service has subsequently superannuated and during his tenure after reinstatement he has been paid his full wages. So far as the aspect of back wages is concerned, this Court by means of interim order dated 14th July, 2017 had stayed the operation of impugned award only so far as it related to payment of back wages with consequential benefits.

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In view of the fact that the delinquent employee had been reinstated and continued with his service with full wages till the superannuation i.e. 31st December 2022, the aspect of implementation of Section 17-B of the Act would not arise.

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Considering the aforesaid discussion, preliminary objection raised by learned counsel for delinquent employee stands rejected.

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On merits of the case it is evidenced that during his service with bank, delinquent employee while posted as Clerk-cumCashier was served with a charge sheet dated 25th November, 2005 indicating 11 charges being imputed against him. However a perusal of the charge sheet also is indicative of the fact that some of the 11 charges are interlinked and in fact the primary charges levelled against employee were that :-

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(a) He embezelled an amount of Rs. 10000/- from the cash box which was reported by him as missing and thereafter took a loan from the bank to make good the deficiency, which loan having not been repaid , the said amount was appropriated from his salary.

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(b) That the delinquent employee had obtained a loan of Rs. 40,000/- from one Mr. Santosh Kumar Srivastava, the repayment of which was sought to be made through cheque drawn on the bank, which was dishonoured thereby bringing the bank into dispute and caused loss of confidence in the employee, apart from being punishable under the Negotiable Instruments Act 1881. The charge sheet also indicates that the employee was in a habit of issuing cheques which were regularly dishonored.

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(c) That the loan obtained by employee from Mr. Santosh Kumar Srivastava was on the basis of forged documents allegedly issued by the bank indicting his salary.

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The eleven Charges indicated against employee are in fact an elaboration of aforesaid charges.

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With regard to charge No.1 pertaining to embezzlement of Rs.10,000/-, the Tribunal in the impugned award has recorded a finding that there was no specific charge indicated from charges No. 8 to 11 and they were merely a reiteration of the earlier charges. The award also finds it surprising that the charges were held to be proved on the basis of findings of charges 4,5 and 6 whereas finding has been given only on charges 1 to 6 and that the inquiry officer did not examine the aspect that there is no separate charge from Sl. No. 9 to 11 and charge No.8 is simply a gist of charges from 1 to 7. It was therefore held that since there was no charge, the inquiry officer was wrong in holding the employee guilty of charges 9 to 11.

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It was also noticed by the Tribunal that it was in fact the employee who reported a short fall of Rs.10,000/- from the cash box and thereafter the same was appropriated from his savings bank account and has therefore reached a conclusion that the said amount could not be said to be either stolen or embezzled since the amount was ultimately realized from the account of employee along with interest accrued thereupon. The Tribunal has also recorded a finding that the charge even otherwise could not be said to have been proved since the employee was permitted to make good the short fall by overdraft facility and by subsequent appropriation from his account and therefore held that the employee could had best be adjudged to be negligent in depositing the amount.

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With regard to second charge for obtaining a loan from Mr. Santosh Kumar Srivastava, the Tribunal has recorded a finding that the alleged forged pay slip was not filed in original but only a photocopy thereof was filed. It has also recorded a finding that the papers were received in the bank on complaint made by one Mr. Ram Babu Shukla Advocate who though being an important witness in the inquiry was not examined. It has also recorded a finding that since the loan was said to have been obtained from one Mr. Santosh Kumar Srivastava, he was an important witness but was not examined in the domestic inquiry. The Tribunal has recorded a finding that on that ground, the second aspect was held not to be proved.

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With regard to the third aspect of the pay slip being forged, the Tribunal has recorded a finding that the said paper was not admitted by the worker and since it was a photo copy, it even otherwise could not have been relied upon unless compared with the original and proved by the person who allegedly issued it. On the aspect of such lacuna, the third charge was also held not to be proved against the employee.

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Since all the remaining charges were held to be only an elaboration of the said three charges, the Tribunal found the findings recorded in the enquiry not proved by any evidence and the order of dismissal being shockingly disproportionate and thereafter only on the ground of negligence, modified the punishment to the extent of stoppage of three annual graded increments with cumulative effect.

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Juxtaposed to the enquiry report and the dismissal order, findings recorded by the tribunal are required to be examined and upon such comparison, with regard to the first charge, this Court finds the findings recorded by the Tribunal to be in consonance with those recorded in the enquiry report itself to the effect that the employee himself was the first person to indicate deficiency/short fall in the amount in the cash register. It is also evident that the said short fall was sought to be made good by the employee himself by means of an over draft on his account and upon failure thereof, appropriation of that amount by the Branch Manager from the account of employee along with interest was made.

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The enquiry report does not indicate anywhere or relies upon any evidence to substantiate the charge that the employee in fact embezzled that amount or merely misplaced it. In the considered opinion of this Court, embezzlement of amount would be quite contradictory to an amount merely being misplaced through negligence and for misconduct to have been attributed to the employee, a finding was necessary that the employee deliberately misappropriated the said amount. Such a finding having not been recorded in the enquiry report, misconduct attributed to the employee clearly is not made out.

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So far as the second charge is concerned pertaining to employee having obtained a loan, which was not repaid by him and resulted in dishonouring of cheque, finding recorded by the

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Tribunal appears to be borne out from the enquiry report itself to the effect that the said loan is said to have been obtained by the employee from one Mr. Santosh Kumar Srivastava and for repayment thereof, is said to have issued a cheque which also is alleged to have been dishonoured leading to loss of confidence by the bank in the employee.

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So far as the aforesaid aspect is concerned, the enquiry report also indicates that neither Mr. Santosh Kumar Srivastava nor the complainant Mr. Ram Babu Shukla, Advocate were examined in the domestic enquiry.

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In the considered opinion of this Court, the aspect of employee having obtained loan from Mr. Santosh Kumar Srivastava on the basis of forged pay slips and issuing a cheque for repayment thereof was the basic aspect required to be dealt with in the enquiry proceedings and could have been proved only by the production as witness of the aforesaid person. Such a procedure having not been followed, renders the enquiry proceedings clearly vitiated. Even otherwise a finding has been recorded in the enquiry proceedings that the employee is habitual in issuing such cheques which are subsequently dishonoured but no details thereof have been indicated or even the purpose for which such cheques have been issued.

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In the considered opinion of this Court, the tribunal has correctly recorded a finding that even otherwise dishonour of such cheque would come within realm of a private transaction with which the Bank cannot be said to be involved and therefore the aspect of loss of confidence by the Bank in the employee is clearly uncalled for.

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The Tribunal has also recorded a finding that the original of the alleged forged salary slip was also never produced in the enquiry proceedings nor was the person who allegedly issued

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such a salary slip produced in the enquiry proceedings. The aforesaid photo copy also does not appear to have been compared with original.

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Despite having recorded the finding that charges levelled against employee have not been proved by any evidence, the dismissal order was thereafter modified by the Tribunal to the extent of stoppage of three annual graded increments with cumulative effect on the ground of negligence of petitioner resulting in short fall of Rs.10,000/- from the cash register. The finding recorded by Tribunal that punishment of dismissal is shockingly disproportionate to findings recorded in the enquiry proceedings appear to be quite correct in view of discussion made herein above. This Court also does not find any reason to infere with the modified punishment order.

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The aspect of conduct and procedure of enquiry proceedings are indicated in the Service Regulations of 2002 as amended by the Baroda, Eastern U.P. Gramin Bank (Officers and Employees) Service Regulations 2006 which merely reiterate the aspect that in the enquiry proceedings, a proper opportunity of hearing and procedure pertaining to natural justice is required to be followed.

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As per procedure, it would be incumbent upon an enquiry officer to record findings based on material on record and after examination of material witnesses. Although specific procedure has not been described in the service regulations, nonetheless, the aspect of conduct of enquiry as enunciated by Hon'ble the Supreme Court in the cases of Roop Singh Negi versus Punjab National bank and others MANU/SC/8456/2008: (2009) 1 SCC (L & S) 398 and State of Uttar Pradesh and others versus Saroj Kumar Sinha reported in (2010) 2 SCC 772 are required to be followed.

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The relevant portion of Roop Singh Negi (supra) is as follows:

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"Indisputably, a departmental proceeding is a quasi judicial proceeding. The Enquiry Officer performs a quasi judicial function. The charges leveled against the delinquent officer must be found to have been proved. The enquiry officer has a duty to arrive at a finding upon taking into consideration the materials brought on record by the parties. The purported evidence collected during investigation by the Investigating Officer against all the accused by itself could not be treated to be evidence in the disciplinary proceeding. No witness was examined to prove the said documents. The management witnesses merely tendered the documents and did not prove the contents thereof. Reliance, inter alia, was placed by the Enquiry Officer on the FIR which could not have been treated as evidence."

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The relevant portion of Saroj Kumar Sinha (supra) is as follows :

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"27. A bare perusal of the aforesaid sub-rule shows that when the respondent had failed to submit the explanation to the charge-sheet it was incumbent upon the inquiry officer to fix a date for his appearance in the inquiry. It is only in a case when the government servant despite notice of the date fixed failed to appear that the inquiry officer can proceed with the inquiry ex parte. Even in such circumstances it is incumbent on the inquiry officer to record the statement of witnesses mentioned in the charge-sheet. Since the government servant is absent, he would clearly lose the benefit of cross-examination of the witnesses. But nonetheless in order to establish the charges the Department is required to produce the necessary evidence before the inquiry officer. This is so as to avoid the charge that the inquiry officer has acted as a prosecutor as well as a judge."

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"28. An inquiry officer acting in a quasi-judicial authority is in the position of an independent adjudicator. He is not supposed to be a representative of the department/disciplinary authority/Government. His function is to examine the evidence presented by the Department, even in the absence of the delinquent official to see as to whether the unrebutted evidence is sufficient to hold that the charges are proved. In the present case the aforesaid procedure has not been observed. Since no oral evidence has been examined the documents have not been proved, and could not have been taken into consideration to conclude that the charges have been proved against the respondents." "

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38.Upon applicability of aforesaid two judgments, the lacuna in the enquiry proceedings as noticed herein above are clearly made out.

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Learned counsel for petitioner has placed reliance on the judgments indicated herein above. In all the judgments cited by learned counsel for petitioner, the common thread emergent therefrom is that full back wages could not be the natural concomitant where a finding of misconduct is affirmed and only

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punishment is interfered with (as contrasted from cases were termination is held to be illegal or void). It has therefore been held that in cases where charge is held to be proved and reinstatement is itself a consequential benefit arising from imposition of a lessor punishment, award of back-wages for the period when the employee has not worked may amount to rewarding the delinquent employee and punishing the employer, which should be avoided. Relevant paragraph in the case of J.K.Synthetics Limited (supra) Limited is as follows: -

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"19. ............... What requires to be noted in cases where finding of misconduct is affirmed and only the punishment is interfered with (as contrasted from cases where termination is held to be illegal or void) is that there is no automatic reinstatement; and if reinstatement is directed, it is not automatically with retrospective effect from the date of termination. Therefore, where reinstatement is a consequence of imposition of a lesser punishment, neither back wages nor continuity of service nor consequential benefits, follow as a natural or necessary consequence of such reinstatement. In cases where the misconduct is held to be proved, and reinstatement is itself a consequential benefit arising from imposition of a lesser punishment, award of back wages for the period when the employee has not worked, may amount to rewarding the delinquent employee and punishing the employer for taking action for the misconduct committed by the employee. That should be avoided. Similarly, in such cases, even where continuity of service is directed, it should only be for purposes of pensionary/retirement benefits, and not for other benefits like increments, promotions, etc."

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Upon applicability of aforesaid judgments in the present facts and circumstances of the case, it is evident that there is no finding of misconduct against the petitioner as has been held by the Tribunal due to lack of material, cogent and reliable evidence, which was admissible.

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On the contrary Hon'ble the Supreme Court in the case of Deepali Gundu Surwase (supra) has enunciated the proposition with regard to full back-wages as follows:

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" 33. The propositions which can be culled out from the aforementioned judgments are:

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i) In cases of wrongful termination of service, reinstatement with continuity of service and back wages is the normal rule.

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ii) The aforesaid rule is subject to the rider that while deciding the issue of back wages, the adjudicating authority or the Court may take into consideration the length of service of the employee/workman, the nature of

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misconduct, if any, found proved against the employee/workman, the financial condition of the employer and similar other factors.

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iii) Ordinarily, an employee or workman whose services are terminated and who is desirous of getting back wages is required to either plead or at least make a statement before the adjudicating authority or the Court of first instance that he/she was not gainfully employed or was employed on lesser wages. If the employer wants to avoid payment of full back wages, then it has to plead and also lead cogent evidence to prove that the employee/workman was gainfully employed and was getting wages equal to the wages he/she was drawing prior to the termination of service. This is so because it is settled law that the burden of proof of the existence of a particular fact lies on the person who makes a positive averments about its existence. It is always easier to prove a positive fact than to prove a negative fact. Therefore, once the employee shows that he was not employed, the onus lies on the employer to specifically plead and prove that the employee was gainfully employed and was getting the same or substantially similar emoluments.

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iv) The cases in which the Labour Court/Industrial Tribunal exercises power under Section 11-A of the Industrial Disputes Act, 1947 and finds that even though the enquiry held against the employee/workman is consistent with the rules of natural justice and / or certified standing orders, if any, but holds that the punishment was disproportionate to the misconduct found proved, then it will have the discretion not to award full back wages. However, if the Labour Court/Industrial Tribunal finds that the employee or workman is not at all guilty of any misconduct or that the employer had foisted a false charge, then there will be ample justification for award of full back wages.

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v) The cases in which the competent Court or Tribunal finds that the employer has acted in gross violation of the statutory provisions and/or the principles of natural justice or is guilty of victimizing the employee or workman, then the concerned Court or Tribunal will be fully justified in directing payment of full back wages. In such cases, the superior Courts should not exercise power under Article 226 or 136 of the Constitution and interfere with the award passed by the Labour Court, etc., merely because there is a possibility of forming a different opinion on the entitlement of the employee/workman to get full back wages or the employer's obligation to pay the same. The Courts must always be kept in view that in the cases of wrongful / illegal termination of service, the wrongdoer is the employer and sufferer is the employee/workman and there is no justification to give premium to the employer of his wrongdoings by relieving him of the burden to pay to the employee/workman his dues in the form of full back wages.

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vi) In a number of cases, the superior Courts have interfered with the award of the primary adjudicatory authority on the premise that finalization of litigation has taken long time ignoring that in majority of cases the parties are not responsible for such delays. Lack of infrastructure and manpower is the principal cause for delay in the disposal of cases. For this the litigants cannot be blamed or penalised. It would amount to grave injustice to an employee or workman if he is denied back wages simply because there is long lapse of time between the termination of his service and finality given to the order of reinstatement. The Courts should bear in mind that in most of these cases, the employer is in an advantageous position vis-à-vis the employee or workman. He can avail the services of best legal brain for prolonging the agony of the

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sufferer, i.e., the employee or workman, who can ill afford the luxury of spending money on a lawyer with certain amount of fame.Therefore, in such cases it would be prudent to adopt the course suggested in Hindustan Tin Works Private Limited v. Employees of Hindustan Tin Works Private Limited (supra).

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vii) The observation made in J.K. Synthetics Ltd. v. K.P. Agrawal (supra) that on reinstatement the employee/workman cannot claim continuity of service as of right is contrary to the ratio of the judgments of three Judge Benches referred to hereinabove and cannot be treated as good law. This part of the judgment is also against the very concept of reinstatement of an employee/workman."

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The said judgment has therefore been recently followed by Hon'ble the Supreme Court in the case of Maharashtra State Road Transport Corporation versus Mahadeo Krishna Naik , Civil Appeal No.13834 of 2024 in the following manner:-

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"44. ..........Law, though, seems to be well settled that if the employer by reason of its illegal act deprives any of its employees from discharging his work and the termination is ultimately held to be bad in law, such employee has a legitimate and valid claim to be restored with all that he would have received but for being illegally kept away from work. This is based on the principle that although the employee was willing to perform work, it was the employer who did not accept work from him and, therefore, if the employer's action is held to be illegal and bad, such employer cannot escape from suffering the consequences. However, it is elementary but requires to be restated that while grant of full back wages is the normal rule, an exceptional case with sufficient proof has to be set up by the employer to escape the burden of bearing back wages."

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In view of aforesaid discussion, it being evident that the finding of misconduct cannot be said to be proved against the employee in the absence of any cogent or admissible evidence, this Court does not find any occasion to interfere with the award impugned.

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Resultantly, the petition fails and is dismissed. Parties to bear their own cost.

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Order Date :- 5.3.2025 prabhat

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Digitally signed by :- PRABHAT KUMAR High Court of Judicature at Allahabad, Lucknow Bench

Chairman Baroda Up Gramin Bank Raibareli v. U.O.I. Thru Secy.Ministry of Labour and Employment and Others

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Chairman Baroda Up Gramin Bank Raibareli v. U.O.I. Thru Secy.Ministry of Labour and Employment and Others

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