REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELALTE JURISDICTION

CIVIL APPEAL NO.  7406     OF 2008 [Arising out of Special Leave Petition (Civil) No. 8535 of 2007]

THE DEPOT MANAGER A.P.S.R.T.C.        ….. APPELLANT

Versus

P. JAYARAM REDDY       ….. RESPONDENT

J U D G M E N T

S.B. SINHA, J.

1. Leave granted.

2. Appellant is before us aggrieved by and dissatisfied with a judgment

and order dated 30.9.2005 passed by a Division Bench of the High Court of

Judicature of  Andhra Pradesh at  Hyderabad in  Writ  Appeal  No. 2013 of

2004 affirming a judgment and order dated 26.6.2003 passed by a learned

single judge of the said Court allowing the Writ Petition filed by respondent

herein challenging an award dated 9.8.1996 passed by the Presiding Officer,

Labour Court II, Hyderabad in Industrial Dispute No. 183 of 1993 to the

extent it denies the full back wages to the respondent.  

3. The admitted fact of the matter is as under:

Respondent  was  appointed  as  a  conductor  of  Siddipet  Depot  on

casual basis.  He was removed from service by an order dated 8.9.1987 for

alleged commission  of  a misconduct  relating to  sale  of  tickets  and other

irregularities in respect thereof.  However, a notification in the mean time

was issued notifying 300 vacancies of conductors on 2.9.1987.  The last

date for filing an application for appointment pursuant thereto was fixed as

14.9.1987.  He applied for the said post  and eventually appointed by the

appellant for its Zaheerabad Depot which is said to be 200 kilometers away

from Siddipet Depot.   

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4. Indisputably,  respondent  did  not  disclose  that  he  had  earlier  been

removed from service on the charges of misconduct.  His services were also

regularized.   However,  later  on  the  Corporation  came  to  learn  that  the

respondent had concealed the fact as regards his previous employment with

it and his removal therefrom.  A charge sheet was issued.  Pursuant thereto,

a  departmental  proceeding  was  initiated.  In  the  said  departmental

proceeding,  he  was found guilty of  the charges  levelled  against  him.  A

second show cause notice was issued to which respondent showed cause.

An order of removal from service was issued on or about 27.4.1992.  An

appeal preferred thereagainst was also dismissed by reason of order dated

20.10.1992.   

5. Respondent filed an application before the Labour Court questioning

the said order of removal as also the appellate order in terms of Section 2-A

(2) of the Industrial Disputes Act, 1947 (for short, “the Act”) praying for

setting  aside  the order  of  removal  and reinstatement  with  all  benefits  of

continuity  in  service  and  back  wages.   One  of  the  objections  taken  by

appellant  before  the  Labour  Court  was  that  respondent  had  obtained

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employment  upon  concealing  the facts  of  his  previous  employment.   By

reason of an award, the Labour Court although opined that the disciplinary

proceeding  held  against  the  respondent  was  valid  and  proper  and  the

principles of natural justice have been complied with, but relying on or on

the basis of a decision of the Andhra Pradesh High Court dated 28.7.1987

that there being no column in the application form for supply of information

with regard to  previous employment,  no misconduct  can be said to have

been committed by the employee in securing another employment, holding:

“The  contention  of  the  corporation  that  the proforma in that fashion was notified nor requiring specifically  to  furnish  information  of  the  past employment  of  the  candidate  is  intended  mainly for  the  fresh  candidate  but  not  in  case  of  an employee  who  was  already  removed  for  certain acts  of  misconduct  committed  and  that  the petitioner  ought  to  have  appealed  to  the  high officials against his removal orders during the past employment for consideration but not to apply for appointment  as  a  fresh  candidate,  cannot  be accepted  as  rightly  that  when  a  particular information was asked to be furnished there was no  duty  and  responsibility  cast  on  a  candidate seeking  for  employment.   On  an  overall consideration of all the material made available on record this court cannot persuaded itself to accept the contentions of the respondent and to justify the impugned removal orders in question before us but on the other  hand this  Court  is  satisfied that  the

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impugned punishment of removal imposed on the petitioner is very much harsh, disproportionate and unjustified  rendering  itself  liable  to  be  set  aside and entitling the petitioner to be reinstated with all benefits except with full backwages.”

6. A writ  petition  was  preferred  thereagainst  by  the  respondent  only

contending that the benefit  of payment of full  back wages was denied to

him.  A learned single judge of  the High Court  of  Judicature of  Andhra

Pradesh at Hyderabad allowed the said writ petition, opining:

“The  order  removing  him  from  service  having been  rightly  held  invalid  the  petitioner  ought  to have been granted the benefit of back wages too, for the period he was put out of service illegally and without any jurisdiction.

On  the  above  analysis  the  order  of  the Labour Court in I.D. No. 103/1993 dated 9.8.1998 to the extent it  denies the full  back wages to the petitioner is unsustainable and is set aside.  It  is brought  to  my  notice  by  Sri  Sai  Ram  Goud, learned  counsel  for  the  petitioner  that  the petitioner has obtained employment in November, 1996  soon  after  pronouncement  of  the  award  in I.D. No.  103/1993 and before  publication  of  the award in G.O. Rt. No. 244 dated 3.2.1997 and that this  fact  has  been  informed  to  the  respondent corporation.  It is therefore very fairly contended by  Sri  Sairam  Goud  learned  counsel  for  the petitioner that the entitlement of the petitioner for

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back  wages  would  be  only  from  27.4.1992  to October  1996  the  latter  being  the  month  after which  he  had  obtained  alternative  and  gain employment  and  was  therefore  no  longer  in service of the respondent corporation.”

7. An  intra  court  appeal  preferred  thereagainst  by  the  appellant,  as

noticed  hereinbefore,  has  been  dismissed  by  reason  of  the  impugned

judgment.   

8. Ms. Radha Rani, learned counsel appearing on behalf of the appellant

would  submit  that  in  view of  the  fact  that  the  Labour  Court  refused  to

exercise  its  discretionary  jurisdiction  in  favour  of  the  respondent  in  the

matter of grant of back wages, the High Court should not have interfered

therewith.

9. Mr. R.V. Kameshwaran, learned counsel appearing on behalf of the

respondent, on the other hand, submitted that the order of removal having

been  passed  by  the  Corporation  ignoring  the  binding  precedents  of  the

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decision of the High Court of Judicature of Andhra Pradesh at Hyderabad,

no interference with the impugned judgment is warranted.  

10. Indisputably,  the  respondent  was a  casual  employee.   His  services

were  terminated  on  the charges  of  grave  misconduct.   However,  he was

again  appointed  in  ignorance  thereof.   It  is  one  thing  to  say  that  the

respondent had no duty to furnish information thereabout but it is another

thing to say that the order of appointment was passed in ignorance of the

fact  that  his  services  had  been  terminated  on  the  charges  of  grave

misconduct.  The Labour Court did not arrive at a finding that the order of

removal  was  mala  fide  or  was  made in  colourable  exercise  of  power  or

amounted  to  victimization  of  the  employee  or  at  the  instance  of  a  rival

union.

11. An order of removal from services has some consequences.  It may

not bar future employment but the nature of the order and the consequences

are required to be judged keeping in view the entire factual scenario. {see

Dr.  Dattatraya  Mahadev  Nadkarni  since  deceased  by  His  L.Rs.  vs.

Municipal Corporation of Greater Bombay [(1992) 2 SCC 547].

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12. Although on general principle, an order of removal may not bar future

employment  but  indisputably  the  same would  mean  causing  vacation  of

office as a result of misconduct or misbehaviour or any other similar cause.

In a case where an employee occupying a position of trust is removed from

the office, a loss of confidence in him may occur. Had appellant, therefore,

any knowledge thereabout, the employee might not have been reappointed

at all.   

13. The  learned  Presiding  Officer,  Labour  Court  considered  the  entire

matter.  He opined that the punishment of removal from service imposed

upon  the  respondent  was  ‘very  much  harsh,  disproportionate  and

unjustified’.   There  is  no  finding  that  the  order  of  removal  was  wholly

illegal and, thus, void ab initio.  As noticed hereinbefore, the validity and/or

legality of the domestic enquiry was upheld.  The Labour Court in exercise

of its power under Section 11A of the Act may substitute one punishment

for the other in the event it  comes to the conclusion that the quantum of

punishment is disproportionate to the gravity of the misconduct wherewith

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the delinquent employee was charged.  It is one thing to say that the order of

reinstatement with back wages is a logical corollary of a finding that the

order  of  termination  is  wholly  illegal  and  without  jurisdiction  but  it  is

another  thing  to  say  that  the  punishment  imposed  being  very  harsh  and

disproportionate and, therefore, was found to be unjustified.  Whereas in the

former case, back wages may or may not be granted keeping in view the

facts and circumstances of the case but in the latter the labour court may

substitute  one  punishment  for  the  other.   The award  of  the  labour  court

belongs to the second category of cases.  If that be so, the High Court was

bound to consider as to whether it should interfere with such a discretionary

jurisdiction exercised by the Labour Court.  It has not been found by the

High Court that the discretionary jurisdiction exercised by the labour court

was otherwise arbitrary or perverse.  It posed unto itself a wrong question,

namely, whether the respondent was in gainful employment or not and not

the  right  question,  namely,  whether  the  jurisdiction  has  lawfully  been

exercised  or  not.   The  judgment  and  order  passed  by  the  High  Court,

therefore, amounted to misdirection in law.   

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14. In  P.G.I.  of  Medical  Education  &  Research,  Chandigarh  vs.  Raj

Kumar [(2001) 2 SCC 54], this Court held:

“9. The Labour Court being the final court of facts came to a conclusion that payment of 60% wages would  comply with  the  requirement  of  law.  The finding of perversity or being erroneous or not in accordance  with  law  shall  have  to  be  recorded with reasons in order to assail the finding of the Tribunal or the Labour Court. It is not for the High Court to go into the factual aspects of the matter and  there  is  an  existing  limitation  on  the  High Court  to  that  effect.  In  the  event,  however  the finding of fact is based on any misappreciation of evidence, that would be deemed to be an error of law which can be corrected by a writ of certiorari. The law is well settled to the effect that finding of the  Labour  Court  cannot  be  challenge  in  a proceeding  in  a  writ  of  certiorari  on  the  ground that  the  relevant  and  material  evidence  adduced before  the  Labour  Court  was  insufficient  or inadequate though however perversity of the order would warrant intervention of the High Court. The observation, as above, stands well settled since the decision  of  this  Court  in  Syed  Yakoob  v.  K.S. Radhakrishna [AIR 1964 SC 477]”

{See also  State of Rajasthan & ors.  Vs.  Sujata Malhotra [(2003) 9

SCC 286]}

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15. Reliance  has  however  been  placed  by  the  learned  counsel  for  the

respondent  on  a  decision  of  this  Court  in  J.K.  Synthetics  Ltd.  vs.  K.P.

Agrawal & Anr. [(2007) 2 SCC 433] wherein it was held:

“20.  But  there  are  two  exceptions.  The  first  is where  the  court  sets  aside  the  termination  as  a consequence  of  employee  being  exonerated  or being found not guilty of the misconduct. Second is  where the  court  reaches  a  conclusion  that  the inquiry was held in respect of a frivolous issue or petty misconduct, as a camouflage to get rid of the employee  or  victimize  him,  and  the disproportionately  excessive  punishment  is  a result of such scheme or intention. In such cases, the principles relating to back-wages etc. will  be the same as those applied in the cases of an illegal termination.

21.  In  this  case,  the  Labour  Court  found  that  a charge against the employee in respect of a serious misconduct was proved. It, however, felt that the punishment  of  dismissal  was  not  warranted  and therefore,  imposed  a  lesser  punishment  of withholding  the  two  annual  increments.  In  such circumstances,  award of back wages  was  neither automatic nor consequential.  In fact,  back wages was not warranted at all.”

Thus, the said decision itself is an authority that grant of back wages

is not automatic.   

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We may also notice that therein this Court emphasized that the Courts

or  the  Tribunals  while directing reinstatement are required to  apply their

judicial mind to the facts and circumstances to decide whether “continuity

of service” and/or “consequential benefits” should also be directed; and as

regards  back  wages  whether  the  same should  be  awarded  fully  or  only

partially would depend upon the facts and circumstances of each case.  The

said  decision  therefore  instead  of  assisting  the  case  of  the  respondent,

assists the case of the appellant.

16. In Amrit Vanaspati Co. Ltd. v. Khem Chand and Anr.[(2006) 6 SCC

325] , this Court held:

“In our opinion, the High Court while exercising powers  under  writ  jurisdiction  cannot  deal  with aspects  like whether  the  quantum of  punishment meted out by the management to a workman for a particular  misconduct  is  sufficient  or  not.  This apart,  the  High  Court  while  exercising  powers under  the  writ  jurisdiction  cannot  interfere  with the factual findings of the Labour Court which are based on appreciation of facts adduced before it by leading evidence. In our opinion, the High Court has gravely erred in holding that the evidence of Respondent  1 was not  considered by the Labour Court  and  had  returned  the  finding  that  the evidence  of  Respondent  1  did  not  inspire  any confidence.  We are of  the opinion that  the  High

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Court  is  not  right  in  interfering  with  the  well- considered  order  passed  by  the  Labour  Court confirming the order of dismissal.”

{See also U.P.S.R.T.C. Vs. Ram Kishan Arora [(2007) 4 SCC 627]}

17. We  furthermore  must  take  into  consideration  certain  subsequent

events.  Respondent did not join the services of appellant pursuant to the

award of reinstatement.  He obtained an alternative employment in October

1996.  He is still continuing in the said job.  He has already been paid a sum

of Rs.83,954/- by way of back wages.  

18. For the reasons aforementioned, the impugned judgment of the High

Court  cannot  be  sustained,  and  is  set  aside.   The  appeal  is  allowed

accordingly.  However, the amount of Rs.83,954/- already paid by way of

back wages may not be recovered from the respondent.   

In the facts and circumstances of the case, there shall be no order as

to costs.  

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……………….…..………….J. [S.B. Sinha]

..………………..……………J.    [Cyriac Joseph]

New Delhi; December 18, 2008

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