Dismissed

The Secretary, Perinthalmanna Taluk Co-Operative Educational Society Ltd. v. M.Satheeratnam

Kerala HC20 Feb 2018WA/2650/2017

Case brief

AI extract

What is this about?

This writ appeal challenges the High Court Single Judge's direction to implement an award reinstating a teacher with full backwages. The Court upheld the award, ruling that when wrongful termination is established, full backwages are the rule unless the employer proves the employee was gainfully employed elsewhere.

What did the court decide?

The writ appeals were dismissed, holding that the appellant is bound to pay the full backwages awarded to the respondent as no contrary evidence was led.

The Secretary, Perinthalmanna Taluk Co-Operative… — Service and Employment | Kerala HC (2018)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE MR.JUSTICE P.N.RAVINDRAN &

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THE HONOURABLE MR. JUSTICE R. NARAYANA PISHARADI

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TUESDAY, THE 20TH DAY OF FEBRUARY 2018 / 1ST PHALGUNA, 1939

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WA.No. 2650 of 2017 IN WPC. 18580/2014

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AGAINST THE ORDER/JUDGMENT IN WP(C) 18580/2014 of HIGH COURT OF KERALA DATED 31-05-2017

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APPELLANT(S)/PETITIONERS

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1 THE SECRETARY,

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PERINTHALMANNA TALUK CO-OPERATIVE EDUCATIONAL SOCIETY

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LIMITED NO.M-358, PERINTHALMANNA.

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2 THE PRESIDENT

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PERINTHALMANNA TALUK CO-OPERATIVE EDUCATIONAL SOCIETY

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LIMITED NO.M-358, PERINTHALMANNA.

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BY ADV.SRI.U.K.DEVIDAS

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RESPONDENT(S):RESPONDENT

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M.SATHEERATNAM MUTHUVARA HOUSE, P.O.PERINTHALMANNA, MALAPPURAM DISTRICT, PIN-679 322.

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R BY SRI.P.P.JACOB

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THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 20-02-2018 ALONG WITH WA 2651/2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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“C.R.”

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P.N. Ravindran &

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R.Narayana Pisharadi, JJ.

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- - - - - - - - - - - - - - - - - - - - -- - - W.A.Nos.2650 and 2651 of 2017

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- - - -- - - - - - - - - - - - - - - - - - - - - Dated this the 20^th February, 2018

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JUDGMENT

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P.N.Ravindran, J.

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These appeals by a common appellant arise from the judgment delivered by a learned single Judge of this court in W.P.(C)No.18580 of 2014 and W.P.(C)No.17361 of 2013 respectively. The appellants are the petitioners in W.P.(C)No.18580 of 2014. The common respondent in these appeals is the petitioner in W.P.(C)No.17361 of 2013. By judgment delivered on 31.05.2017, the learned single Judge allowed W.P.(C)No.17361 of 2013 and directed the appellants to implement Ext.P2 award passed by the Co-operative Arbitration Court expeditiously and at any rate within two months from the date of receipt of a copy of the judgment. By the very same judgment, W.P. (C)No.18580 of 2014 filed by the appellant challenging the very same award passed by the Co-operative Arbitration Court and the order passed by the Co-operative Tribunal affirming it, was dismissed. The brief facts of the case are as follows:

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M.Satheeratnam, the sole respondent in W.A.No.2650 of 2017 and the first respondent in W.A.No.2651 of 2017 was appointed as

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teacher in a parallel college run by the appellants with effect from 01.07.1986. More than two decades thereafter, pursuant to a complaint received from the Principal of the College alleging unauthorised absence, the managing committee of the appellant Society that met on 12.7.2007 constituted a sub committee consisting of three members of the managing committee to conduct a preliminary enquiry into the said allegation and to submit a report. The sub committee conducted a preliminary enquiry and submitted a report without examining any witnesses and without notice to the petitioner. In that report, a copy of which is produced and marked as Ext.P2 in W.P.(C) No.18580 of 2014, the sub committee recommended appropriate action against the petitioner. Upon receipt of the said report, the President of the first appellant society placed the petitioner under suspension by order passed on 20.10.2007. Thereupon, Sri T.K.Sankaran, Advocate, a member of the Perinthalmanna Bar, was appointed as the Enquiry Officer. Though the said Enquiry Officer commenced the enquiry, he did not complete it and submit a report. Notwithstanding that fact, by Ext.P3 letter dated 16.7.2010, produced and marked in W.P.(C) No.18580 of 2014, the President of the first appellant society informed the petitioner that the managing committee has decided to disengage her from service. She in turn filed ARC

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No.167 of 2011 before the Co-operative Arbitration Court, Kozhikode, challenging Ext.P3 letter and seeking a direction to the appellants to reinstate her in service with full back wages and other service benefits.

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The appellants entered appearance and filed a written statement resisting A.R.C.No.167 of 2011. After considering the rival contentions and the evidence on record, the Co-operative Arbitration Court held in Ext.P4 award dated 01.03.2013 produced and marked in W.P.(C) No.18580 of 2014 that before the petitioner was disengaged, an enquiry into the charges levelled against her was not conducted. The Co-operative Arbitration Court also took note of the fact that she was not paid subsistence allowance. The Co-operative Arbitration Court accordingly set aside Ext.P3 order and directed the appellants to reinstate the petitioner in service with back wages. Challenging that order, the appellants filed Revision Petition No.50 of 2013 before the Kerala Co-operative Tribunal. By Ext.P5 order passed on 19.03.2014, the Kerala Co-operative Tribunal dismissed the revision petition. M.Satheeratnam thereupon filed W.P.(C) No.17361 of 2013 in this court for an order directing the appellants to implement the award passed by the Co-operative Arbitration Court by reinstating her in service with backwages.

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Upon receipt of notice in W.P.(C) No.17361 of 2013, the

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appellants herein filed W.P.(C) No.18580 of 2014 in this court, challenging Ext.P4 award passed by the Co-operative Arbitration Court and Ext.P5 order passed by the Kerala Co-operative Tribunal affirming it. The appellants had in W.P.(C) No.18580 of 2014 challenged the award passed by the Co-operative Arbitration Court/the order passed by the Kerala Co-operative Tribunal on the merits by raising various contentions including the contention that a detailed enquiry into the charges was conducted by the disciplinary sub committee, that it was based on the report of the sub committee that a decision was taken by the managing committee of the society to place the petitioner under suspension and that the Enquiry Officer could not complete the enquiry due to the non co-operation of the petitioner. The appellants also raised a further contention that the petitioner is not entitled to receive backwages and other benefits during the period of suspension and during the period when she was absent from the society. While the said writ petitions were pending, the appellants reinstated the petitioner in service on 15.07.2015. The writ petitions thereafter came up for final hearing before a learned single Judge of this court on 31.05.2017. On that day, after hearing learned counsel appearing on both sides, the learned single Judge dismissed W.P.(C) No.18580 of 2014 filed by the appellants. W.P.(C) No.17361 of 2013 filed by the

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first respondent was disposed of with a direction to the appellants to implement the award passed by the Co-operative Arbitration Court expeditiously and in any event within two months from the date of receipt of a copy of the judgment. The appellants have, as stated above, filed these appeals challenging the aforesaid common judgment.

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We heard Sri U.K.Devidas, learned counsel appearing for the appellants and Sri P.P.Jacob, learned counsel appearing for the writ petitioner. Sri U.K.Devidas, learned counsel for the appellants confined his submissions only to the award of backwages. Learned counsel contended, relying on the decisions of the Apex Court in C.M.Malla v. State of J & K and others (AIR 2009 SC 2739), and K.S.Ravindran

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v. Branch Manager, New India Assurance Co. Ltd. (AIR 2015 SC 2369) that the relief of reinstatement with backwages is not automatic and even in cases where termination of service of the employee is held to be illegal or contrary to the prescribed procedure, award of backwages may be wholly inappropriate. Learned counsel contended that in the instant case, the Co-operative Arbitration Court has not given any reason when it directed the appellants to reinstate the teacher in service with backwages and therefore, the impugned judgment in so far as it directs payment of entire backwages from the

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date of disengagement till the date of reinstatement, is liable to be interfered with. Learned counsel submitted that in any view of the matter, the award of backwages should be limited to 50%.

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Per contra, learned counsel for the employee submitted that with the passing of the order disengaging the petitioner, her source of income dried up, thereby affecting not only her individually but her entire family. Learned counsel submitted that having regard to the suffering undergone by the petitioner, no exception can be taken to the award passed by the Co-operative Arbitration Court directing reinstatement in service with backwages. Learned counsel also invited our attention to the decision of the Apex Court in Deepali Gundu

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Surwase v. Kranti Junior Adhyapak Mahavidyalaya (D.ED.) and

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others {(2013) 10 SCC 324}.

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We have considered the submissions made at the Bar by learned counsel on either side. We have also gone through the pleadings and the materials on record. The appellants have pursuant to the impugned award passed by the Co-operative Arbitration Court reinstated the petitioner in service on 15.07.2015. The appellants have

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given up the challenge to the award in so far as it directs reinstatement. They have confined their challenge only to the direction issued by the Co-operative Arbitration Court and affirmed by the

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Kerala State Co-operative Tribunal, regarding payment of backwages.

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It is relevant in this context to note that though the petitioner was placed under suspension with effect from 20.10.2007 she was not paid subsistence allowance. She was disengaged from service as per Ext.P3 letter dated 16.07.2010 produced and marked in W.P.(C) No.18580 of 2014. The non payment of subsistence allowance to the petitioner was the subject matter of W.P.(C) No.26173 of 2009. In that writ petition a learned single Judge of this court passed an interim order on 17.12.2009 directing the appellants to pay to the petitioner the admissible subsistence allowance, within two weeks. The appellants challenged that order by filing W.A.No.78 of 2010 which was heard and dismissed by a Division Bench of this court by judgment delivered on 8.2.2010. It is relevant in this context to note that while O.P.No.26173 of 2009 was pending, the appellants paid the writ petitioner the sum of Rs.36,563/- towards subsistence allowance on 9.11.2009 and a further sum of Rs.50,000/- on 26.10.2010. W.P.(C) No.26173 of 2009 was heard and disposed of on 23.03.2011 by one of us (P.N.Ravindran, J.) by Ext.P1 judgment produced and marked in W.P.(C) No.17361 of 2013. It is evident from a reading of the said judgment that though the petitioner was placed under suspension on 20.10.2007, she was not paid subsistence allowance until W.P.(C)

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No.26173 of 2009 was filed in this court. By Ext.P1 judgment this court overruled the contention of the appellants that the petitioner is not entitled to subsistence allowance and directed payment of arrears of subsistence allowance calculated at the applicable rate, after giving credit to the sum of Rs.86,563/- paid pending the writ petition. It was only thereafter that the arrears of subsistence allowance during the period from 20.07.2007 to 16.07.2010 was paid.

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The Co-operative Arbitration Court has in the impugned award (Ext.P2 in W.P.(C) No.17361 of 2013 and Ext.P4 in W.P.(C) No.18580 of 2014) held that the order of disengagement issued without conducting an enquiry is a process alien to law. In that view of the matter the Cooperative Arbitration Court set aside the order of disengagement and directed reinstatement of the petitioner with backwages. The Kerala Co-operative Tribunal, after independently considering the contentions of either side and the enquiry report submitted by the sub committee, came to the conclusion that the said report was prepared without complying with the principles of natural justice and without any evidence. The Tribunal also held that for that reason, the said report cannot be relied on to impose any punishment on the petitioner. In that view of the matter, the Tribunal further held that the award passed by the Co-operative Arbitration Court directing reinstatement in

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service with backwages cannot be interfered with.

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When this court's jurisdiction under Article 226 of the Constitution of India was invoked, the learned single Judge held that the appellants have not made out a case warranting interference with the impugned award/order. Though it was contended before us that the learned single Judge has not given any reason justifying the award of full backwages, we are of the opinion that having regard to the grounds raised in the writ petition no exception can be taken to the impugned judgment on that score. The appellants have not in the writ petition raised a specific contention that the Co-operative Arbitration Court erred in awarding backwages in full. The only ground raised in the writ petition, viz. in Ground B is that the respondent is not entitled to receive backwages and other benefits during the period of suspension and during the period of her absence from the society. The appellants have no case that she was otherwise gainfully employed from the date on which she was disengaged.

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The petitioner is a member of the Perinthalmanna Taluk Cooperative Education Society Limited, which is running a parallel college under the name and style Perinthalmanna Co-operative College. She was employed as a teacher in the said college. The appellants have not pleaded or proved that the petitioner was gainfully employed

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elsewhere after she was disengaged. The Apex Court has in Deepali Gundu Surwase (supra) held, after a survey of the case law on the point, that in the case of wrongful termination of service, reinstatement with continuity of service and backwages is the normal rule. The Apex Court has also enumerated the principles emerging from the various decisions of the Apex Court on the point. The relevant

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portions of the said decision, viz. paragraphs 38.1 to 38.7 are extracted below:

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“38 . The propositions which can be culled out from the aforementioned judgments are:

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

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

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38.3. 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

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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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38.4. 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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38.5. 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

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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 Articles 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. 38.6. 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 sufferer, i.e., the employee or workman, who can ill afford the

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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 (1979) 2 SCC 80.

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38.7. The observation made in J.K. Synthetics Ltd. v. K.P. Agrawal (2007) 2 SCC 433) 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 Apex Court has in paragraph 38.5 held that the courts

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must always keep in mind that in cases of wrongful/illegal termination of service, the wrongdoer is the employer and the sufferer is the employee/workman and there is no justification to give premium to the employer for his wrongdoings, by relieving him of the burden to pay to the employee/workman his dues in the form of full back wages. The Apex Court has in paragraph 22 of the very same decision observed as follows:

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“22. The very idea of restoring an employee to the position which he held before dismissal or removal or termination of service implies that the employee will be put in the same position in which he would have been but for the illegal action taken by the employer. The injury suffered by a person, who is dismissed or removed or is otherwise terminated from service

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cannot easily be measured in terms of money. With the passing of an order which has the effect of severing the employer employee relationship, the latter's source of income gets dried up. Not only the concerned employee, but his entire family suffers grave adversities. They are deprived of the source of sustenance. The children are deprived of nutritious food and all opportunities of education and advancement in life. At times, the family has to borrow from the relatives and other acquaintance to avoid starvation. These sufferings continue till the competent adjudicatory forum decides on the legality of the action taken by the employer. The reinstatement of such an employee, which is preceded by a finding of the competent judicial/quasi judicial body or Court that the action taken by the employer is ultra vires the relevant statutory provisions or the principles of natural justice, entitles the employee to claim full back wages. If the employer wants to deny back wages to the employee or contest his entitlement to get consequential benefits, then it is for him/her to specifically plead and prove that during the intervening period the employee was gainfully employed and was getting the same emoluments. Denial of back wages to an employee, who has suffered due to an illegal act of the employer would amount to indirectly punishing the concerned employee and rewarding the employer by relieving him of the obligation to pay back wages including the emoluments.”

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13. The Apex Court has in Deepali Gundu Surwase (supra)

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held that with the passing of an order which has the effect of severing

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the employer employee relationship, the latter's source of income gets dried up. Not only the concerned employee, but his entire family suffers grave adversities. They are deprived of the source of sustenance. The children are deprived of nutritious food and all opportunities of education and advancement in life. At times, the family has to borrow from the relatives and other acquaintance to avoid starvation. It was observed that these sufferings continue till the competent adjudicatory forum decides on the legality of the action taken by the employer. The reinstatement of such an employee, which is preceded by a finding of the competent judicial/quasi judicial body or court that the action taken by the employer is ultra vires the relevant statutory provisions or is in violation of the principles of natural justice, entitles the employee to claim full back wages. The Apex Court has also held that if the employer wants to deny back wages to the employee or contest his entitlement to get consequential benefits, then it is for him/her to specifically plead and prove that during the intervening period the employee was gainfully employed and was getting the same emoluments. It was held that denial of back wages to an employee, who has suffered due to an illegal act of the employer would amount to indirectly punishing the concerned employee and rewarding the employer by relieving him of the obligation to pay back

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wages including the emoluments.

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In the light of the law laid down by the Apex Court as above, we are of the opinion that no exception can be taken to the impugned award passed by the Co-operative Arbitration Court. As observed earlier, it was without even holding an enquiry that the appellants disengaged a teacher in their service. Necessarily, therefore, the finding entered by the Co-operative Arbitration Court that the order of disengagement cannot be sustained will have to be upheld. The appellants have, as stated in paragraph 7 above, given up their challenge to the direction to reinstate the petitioner in service. Consequently, as held by the Apex Court in Deepali Gundu Surwase (supra), an order of reinstatement with backwages should follow. As the appellants have not pleaded or proved any circumstance warranting withholding of backwages either in full or in part, they cannot in our opinion contend for the position that the teacher should not be paid backwages. Having regard to the conduct of the appellants and their failure to plead and prove that the teacher was otherwise gainfully employed, we are of the opinion that no exception can be taken to the award passed by the Co-operative Arbitration Court/ Kerala Co-operative Tribunal directing her reinstatement in service with backwages. Though the Co-operative Arbitration Court/Kerala Co-

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operative Tribunal have not discussed the issue regarding payment of backwages in detail, in the absence of any material on record either before this court or before the said authorities to show that the teacher was otherwise gainfully employed during the period of her absence from service following the order of disengagement, we see no reason or justification to take a different view and hold that the teacher is not entitled to backwages. As observed by the Apex Court, if such a view is taken in the instant case, it would amount to rewarding the employer who has committed the illegal act of terminating the services of an employee, without even holding an enquiry.

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For the reasons stated above, we hold that there is no merit in these writ appeals. The writ appeals fail and are accordingly dismissed.

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(P.N. Ravindran, Judge)

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(R.Narayana Pisharadi, Judge)

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kav/

The Secretary, Perinthalmanna Taluk Co-Operative Educational Society Ltd. v. M.Satheeratnam

Case brief

What is this about?

What did the court decide?

The Secretary, Perinthalmanna Taluk Co-Operative Educational Society Ltd. v. M.Satheeratnam

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

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