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PETITIONER: RAJINDER KUMAR KINDRA

       Vs.

RESPONDENT: DELHI ADMINISTRATION THROUGH SECRETARY (LABOUR) AND ORS.

DATE OF JUDGMENT27/09/1984

BENCH: DESAI, D.A. BENCH: DESAI, D.A. MADON, D.P.

CITATION:  1984 AIR 1805            1985 SCR  (1) 866  1984 SCC  (4) 635        1984 SCALE  (2)428

ACT:      Industrial Disputes  Act, 1947-Section  11-A-Arbitrator and Court can reappraise evidence led in domestic enquiry to satisfy whether  misconduct against  workman is established. Arbitrator and  the Court  can reject evidence of misconduct based on no legal evidence,      Constitution of  India-Article  136-Supreme  Court  can reject findings of misconduct based on no legal evidence.      Words and  Phrases-Misconduct-Whether keeping one’s own cheque book  unattended amounts to misconduct on the part of the employee.      Gainful employment-What is-In the absence of employment staying with  and helping one’s father-in-law in his work is not gainful employment.

HEADNOTE:      The appellant  was working as a salesman at a show room of a company. The company charge-sheeted the appellant inter alia on  the ground of misconduct. The misconduct imputed to the appellant  was that  he was  negligent  in  keeping  his cheque-book in relation to his own private account in such a manner that  it enable  the Manager-cum-Cashier  of the show room of the company in which the appellant was a salesman at the relevant  time to  misuse the  cheque forms  and thereby defraud the  company. An  Inquiry Officer  was appointed  to enquire into  the charges.  The company  examined some  with cases and  adduced evidence.  The Inquiry  Officer found the appellant guilty  of all  the charges.  On the  basis of the findings of  the Inquiry  Officer the  company dismissed the appellant from  service. The  appellant raised an industrial dispute and  the same  was, by  agreement, referred  by  the appropriate Government  to an  arbitrator as  provided under Sec. 10(A)(1)  of the  Industrial Disputes  Act,  1947.  The company submitted  that the  arbitrator cannot sit in appeal over  the  findings  of  the  inquiry.  In  his  award,  the arbitrator held  that the  findings of  the Inquiry  Officer were  based  on  no  legal  evidence  and  were,  therefore, perverse and  the enquiry  was therefore  vitiated. Before a formal final  order could  be made by the arbitrator, he was elevated as  a Judge  of the Delhi High Court. That led to a second reference.  The second arbitrator found the appellant guilty of all the charges and held that The dismissal of the

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appellant was  not wrongful.  The  appellant  filed  a  writ petition under Art. 226 in the High Court question- 867 ing the  correctness, validity and the legality of the award of the second arbitrator. A Division Bench of the High Court dismissed the  matter in  limine observing  that the  matter depends upon  assessment of  evidence and  the Court  cannot reappraise the  same under  Art. 226  of  the  Constitution. Hence this appeal by special leave.      Allowing the appeal, ^      HELD: The  charge levelled  against the  appellant is a composite charge  and has  two limbs.  The first limb of the charge refers  to negligence in handling his private cheque- book so  that in  conspiracy with  the Manager  cheque forms contained in  the cheque-book  issued to  the appellant  for operating his  private account  were used  by the Manager to defraud the  company. When  a cheque-book  is  issued  to  a holder of  an account  by the  bank, there  is no  law which requires him to keep his cheque-book in safe custody. He may keep his cheque book anywhere be likes and even if it is not in safe  custody he  does so  at his  own peril. Some one so minded to forge cheque and to withdraw money from some one’s account may  use anybody’s cheque-book. In such a situation, the owner  of the  cheque-book unless he has participated in the conspiracy  in any manner for facilitating withdrawal of the amount  cannot be  attributed any misconduct for keeping his cheque-book unattended or not in safe custody. Therefore first limb of The charge can be rejected as per se untenable without anything  more. The  second limb  of the charge that since the  appellant left  his  cheque-book  unattended  the appellant was negligent and guilty of wilful disobedience in performance of  his duties  as a  salesman,  has  no  force. Keeping one’s  own cheque-book  unattended  is  no  part  of performance of  duties of  the employees  and there  was  no order by  the  employer  how  appellant  should  handle  his private cheque-book.  Therefore, the charge apart from being frivolous is  ludicrous and could not have been even framed. Even if the allegation in the charge is left unquestioned it does rot  constitute misconduct. The employer could not have framed such  charges without any evidence in support of them yet and  the second  arbitrator holds them proved. Therefore the second  arbitrator accepted  the findings of the Inquiry Officer which  were per  se perverse.  Not only  the  second arbitrator did  not apply  his mind to the submission of the appellant that  the findings  were perverse  but  he  merely recorded his  ipse dixit  without in any manner analysing or examining or  applying his mind to the evidence only to find out whether  there was  any  evidence  to  substantiate  the charge and  whether any  reasonable man  would arrive at the conclusion which  the Inquiry Officer had reached. The award of the  second arbitrator,  apart from  the fact  that it is based on  no Legal  evidence  suffers  from  the  additional infirmity of  total non-application  of mind. Any finding of misconduct based on total absence of evidence must fall.                          [875 B-C; D-E; G-H; 878 H; 879 A-B]      The contention  that once the second arbitrator came to the conclusion that the appellant was given full opportunity to participate  in the  domestic enquiry  neither High Court under Art.  226 nor  this Court  under Art.  136 can  sit in appeal  over   the  findings  of  the  Inquiry  Officer  and reappraise the  evidence, has  no force.  In exercise of the jurisdiction  conferred  by  Sec.  11-A  of  the  Industrial Disputes Act,  1947  both  arbitrator  and  this  Court  can reappraise the  evidence led  in the  domestic  enquiry  and

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satisfy itself whether 868 the evidence  led by  the  employer  established  misconduct against the  workman. It  is too  late in the day to contend that the arbitrator has only the power to decide whether the conclusions reached  by the  Inquiry Officer  were plausible one deducible  from the  evidence led  in enquiry and not to re-appreciate  the   evidence  itself   and  to   reach  the conclusion  whether   the  misconduct  alleged  against  the workman has been established or not.                          [879 C-E]      Workmen of  M/s Firestone  Tyre and  Rubber Company  of India (P)  Ltd. v.  Management and Others, [1973] 3 SCR 587, referred to.      It  is   well-settled  that   where  the   findings  of misconduct are based on no legal evidence and the conclusion is one to which no reasonable man would come, the arbitrator appointed under Sec. 10-A or this Court in appeal under Art. 136 can  reject such  findings as perverse. Holding that the findings are  perverse does  not constitute  reappraisal  of evidence,  though  this  Court  would  have  been  perfectly justified in  exercise of powers conferred by Sec. 11A to do so. [880 A-B]      Gujarat Steel Tubes Ltd. v. Gujarat Steel Tubes Mazdoor Sabha, [1980] 2 SCR 146, referred to.      It is  equally well-settled that where a quasi-judicial tribunal or  arbitrator records  findings based  on no legal evidence and the findings are either his ipse dixit or based on conjectures  and surmises,  the enquiry  suffers from the additional infirmity  of non-application  of mind and stands vitiated. The  industrial tribunal  or the  arbitrator or  a quasi-judicial authority  can reject  not only such findings but also  the conclusion based on no legal evidence or if it is merely  based on  surmises and  conjectures unrelated  to evidence  on  the  ground  that  they  disclose  total  non- application of mind. [880 C-D]      In the  instant case,  viewed from  either  angle,  the conclusion of  the Inquiry  Officer as well as of the second arbitrator are  wholly perverse and hence unsustainable. The High Court  was clearly in error in declining to examine the contention that  the findings  were perverse  on the  short, specious and wholly untenable ground that the matter depends on appraisal of evidence [880 F]      Between  appraisal   of  evidence  and  total  lack  of evidence there  is an  appreciable  difference  which  could never be  lost sight of and the High Court ought not to have short circuited the writ petition. [880 F]      If there  is absolutely  no evidence  in support of the only allegation  of  misconduct  namely  negligence  in  not keeping one’s  private  cheque-book  in  safe  custody,  the conclusion is  not only not a plausible one but it in wholly perverse and  this Court  is in  complete agreement with the findings recorded  by the first arbitrator that the findings of Inquiry  Officer were perverse and the enquiry was wholly vitiated. [880 G] 869      Where the  order of dismissal is sought to be sustained on a  finding in  the domestic  enquiry which is shown to be perverse and  the enquiry is vitiated as suffering from non- application of  mind the only course open to court is to set it aside  and consequently  relief of  reinstatement must be granted. [880 G]      The submission  of the company that since the appellant was gainfully  employed during  the period of his dismissal, he should  not be  awarded back-wages  must fail.  The  only

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evidence was  that during his forced absence from employment since the  date of termination of his service, the appellant and the  members of his family were staying with his father- in-law and  during this period the appellant was helping his father-in-law who  had a  coal-depot. On  this  evidence  it cannot be  said that the appellant was gainfully employed so as to  reject the claim for back-wages. If this is gainfully employment as  contended by  the company,  the employer  can contend that  the dismissed  employee in  order to  keep his body and  soul together  had taken to begging and that would as well  be the gainful employment. Therefore, the appellant would be  entitled to  full back-wages and all consequential benefits. [881 C-E]

JUDGMENT:      CIVIL APPELLATE  JURISDICTION: Civil Appeal No. 2386 of 1984.      Appeal by  Special leave  from the  Judgment and  Order dated the  2nd March,  1983 of  the Delhi High Court in Writ Petition No. 314 of 1983.      Miss Mamta Sarin for the Appellant.      Pawan Kumar Jain and K. K. Gupta, for Respondent No. 2.      The Judgment of the Court was delivered by      DESAI. J.  Appellant Rajinder Kumar Kindra was inducted as a  peon by  M/s Raymond Woolen Mills Ltd. (’employer’ for short). In  1972 he  was promoted  as a  salesman and at the relevant  time  he  was  serving  at  the  Raymond’s  retail showroom in  Karol Bagh,  New Delhi.  One Shri R.S. Negi was the Manager-cum-Cashier  of the  Karol Bagh Show-room of the employer under whom the appellant was working. He was served with a  charge-sheet dated  December 11, 1975 which reads as under:           "That  you,   Shri  Rajinder   Kindra,  is  hereby      informed that  you, while  working  as  a  salesman  at      Raymonds’  Retail  Show-room,  2397/1,  Hardhian  Singh      Road, New Delhi-5 870      have misappropriated cash and funds from the amounts of      Raymonds’ Woolen  Mills Ltd.,  to  the  extent  of  Rs.      32,196/88 or  a part  thereof during the period 10.6.75      to 17.10.75  by manipulating  false accounts, submitted      bogus cheques  into the Mills Account or by taking cash      from the chest of the Retail Depot along with Shri R.S.      Negi, Manager-cum-Cashier  of  Raymonds’  Retail  Show-      room, 2397/1,  Hardhian Singh  Road,  Karol  Bagh,  New      Delhi.           That you  Shri Rajinder  Kumar Kindra while acting      as a  salesman aided,  abetted, connived  and conspired      with the Manager-cum-Cashier Shri R.S. Negi of the said      show-room and  issued various  cheques in the amount of      Rs. 15,027/75  from your  cheque book with the ulterior      motive and  design to  defraud the  Company of the said      amount by  submitting  these  bogus  cheques  into  the      Mills’ Account  and thereby  causing unlawful  gain  to      yourself and  causing unlawful  loss to  the Company in      collusion with Manager-cum-Cashier Shri R.S. Negi.           That you  Shri Rajinder Kumar Kindra has willfuly/      negligently permitted  the user of the cheques in order      to defraud  the company  of the amount of Rs. 15,027/75      in conspiracy  with Shri  R.S. Negi  and you  have been      habitually negligent  and willfully  disobedient in the      performance of your duties as salesman."      One Shri  V.K. Soni was appointed as Enquiry Officer to

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enquire into  the aforementioned  charges. In  the course of enquiry, the  appellant denied  the charges levelled against him. He  stated that  the cash  used to remain with Manager- cum-Cashier Shri  R.S. Negi  and it  is for  him to  explain about some  cheques  drawn  and  the  statement  of  account submitted by  him.  He  denied  himself  having  issued  any cheque. He  denied that  he was  negligent in performance of his duty.  The employer examined Shri O.D. Sharma, Shri G.L. Kapur, Shri V.K. Malhotra and Shri Nandan Singh as witnesses for the  management. The  appellant  gave  evidence  on  his behalf and  he was cross-examined on behalf of the employer. He also examined one Shri A.K. Godbole as his witness.      The Enquiry Officer Shri V.K. Soni submitted his report dated June  22, 1976. In the report, he Inter alia held that the appellant  had  been  guilty  of  gross  negligence  and misconduct in the 871 discharge of his duties and he was ’actively responsible for committing the  fraud on  the Company with Shri R.S. Negi to the extent  of Rs. 15027.75 and all the charges as contained in the  charge-sheet against the appellant were held proved. The employer accepted the report and dismissed the appellant from service with effect from August 25, 1916.      The appellant  raised an  industrial dispute inter alia contending that  the findings  of the  enquiry officer  were perverse and  there was no evidence in respect of either the charge of  negligence or  embezzlement of funds and that the dismissal from  service was wholly unjustified. The employer and the appellant by a written agreement agreed to refer the existing industrial  dispute arising  out of  the  dismissal from service  of the appellant to an arbitrator, as provided by Sec.  10 (A)  (1) of the Industrial Disputes Act (Act for short). The  first respondent  Delhi Administration pursuant to aforementioned  written agreement  referred the following dispute to  Shri G. C. Jain, Presiding Officer of the Labour Court, Delhi  who was  selected by  the parties  to  be  the arbitrator. It reads as under:-      "(1) Whether the  services of  Shri  R.K.  Kindra  were           terminated illegally and unjustifiably ?      (2)  Whether the  enquiry proceedings were initiated by           the principles of natural justice and equity ?      (3)  To what relief if any, is the worker entitled ?"      The employer  contended before  the arbitrator that the enquiry held  by him  is fair  and just and full opportunity was afforded to the appellant to participate in the enquiry, to cross-examine witnesses produced by the management and to lead  his  evidence.  It  was  further  contended  that  the conclusions reached  by the  enquiry  officer  and  findings recorded  by   him  are   borne  out  by  the  evidence  and permissible inferences  drawn from the evidence and they are such that  any reasonable person would reach on the evidence the conclusion  of guilt  of the appellant. It was submitted that the  arbitrator cannot  sit in appeal over the findings of the enquiry officer. It was further contended that at any rate  there  is  satisfactory  evidence  to  show  that  the appellant negligently  kept his  cheque book  in relation to his private  banking account  in such  a  manner  as  to  be accessible to  any one  to misuse the same and this was done intentionally, so as to facilitate the commission of fraud 872 presumably by  Manager-cum-Cashier Shri  R.S. Negi.  In  the ultimate analyses this was the only misconduct attributed to the present appellant.      The arbitrator  held that  none of the witnesses of the employer has  stated that  the appellant misappropriated any

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amount of  the Company  or he had manipulated false accounts or had  submitted  bogus  cheques  in  the  account  of  the employer or  had taken away any amount from the chest of the retail depot  or had  abetted, aided,  conspired or connived with Shri  R.S. Negi  or issued  any cheque  to defraud  the Company. Thus  the employer  failed  to  lead  any  evidence before the  arbitrator  to  impute  any  misconduct  to  the appellant as  alleged in  the charge-sheet.  The  arbitrator concluded that  there was  no evidence  in support of charge No. 1 and 2 and there was no evidence to prove Charge No. 3. The conclusion reached by the arbitrator may be extracted:           "In conclusion,  I hold  that the  findings of the      Inquiry Officer  were based  on no  legal evidence  and      were, therefore,  perverse. The  enquiry is, therefore,      vitiated. I hold accordingly."      On these  findings nothing  remains save and except the consequential order  that the  dismissal from service of the appellant must be quashed and set aside and the appellant be reinstated in service with all consequential benefits unless of course  the employer  had sought  an opportunity  to lead evidence before  the arbitrator to substantiate the charges. No such opportunity was sought and therefore as held by this court in Shanker Chakraborte v. Britannia Biscuits Co. Ltd., nothing further  was required  to  be  done  and  the  award reinstating   the    appellant   should    have    followed. Unfortunately  making   of  this   consequential  order  was postponed. The  finding of  the arbitrator  is dated May 24, 1976.  It  appears  that  soon  thereafter  Shri  G.C.  Jain arbitrator was  elevated as  a Judge of the Delhi High Court and he  consequently before taking his oath did not make the final order  which was  merely a  formal part of his duties. That unfortunately  led to  a second  reference.  This  time reference was  made under  Sec. 10  (A)  (1)  to  Shri  N.L. Kakkar, retired  Additional  District  and  Sessions  Judge, Delhi as  an arbitrator. The same three points were referred to Shri Kakkar for his decision. Shri Kakkar after narrating the evidence  that was led before the enquiry officer summed up his findings as under:- 873      (a)  "That the  services of  Shri R.K. Kindra, were not           terminate  illegally   or  unjustifiably   but  on           account of charges having been successfully proved           against him,  especially the third charges that is           with regard  to willfully/negligently  permit  the           user of cheques in order to defraud the company in           conspiracy with  Shri R.S.  Negi and negligence in           the performance of his duties as a salesman.       (b)  That the enquiry proceedings were not vitiated by           the principles  of natural  justice and  equity as           full opportunity  was given  to the workman and no           prejudice was  caused to  him by  any act  of  the           management, although he was given full opportunity           to lead  his evidence  and  to  cross-examine  the           witnesses of the management and particularly there           was no enmity between the work man and the enquiry           officer  and   the  dismissal   as  such  was  not           wrongful.      (c)  That the  workman is  not entitled  to any relief,           and is  not entitled  to reinstatement  with  back           wages and  continuity of service since he has been           gainfully employed  with Shri  Tara Chand  at  his           coal depot ever since his dismissal.           The  reference   by  way   of  award  is  answered           accordingly."      The appellant  filed a  writ petition under Art. 226 in

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the  High   Court  of  Delhi  questioning  the  correctness, validity and  the legality of the award made by Shri Kakkar. A Division  Bench of  the High Court dismissed the matter in limine, observing that the matter depends upon assessment of evidence and the Court cannot reappraise the same under Art. 226 of the Constitution. Hence this appeal by special leave.      Let it  be made absolutely clear at the outset that the only misconduct  imputed to  the appellant  was that  he was negligent in  keeping his cheque-book in relation to his own private account  in such  a manner that it enabled Shri R.S. Negi,  Manager-cum  Cashier  of  the  Branch  in  which  the appellant was  a salesman at the relevant time to misuse the cheque forms and thereby defraud the employer. Mr. P.K. Jain learned counsel for employer specifically 874 conceded  that  the  only  misconduct  alleged  against  the appellant consists  of his  negligence in  keeping  his  own cheque-book by  which  he  could  operate  his  own  private account in  such manner  as to  enable someone  so-minded to misuse the  cheque forms.  He was repeatedly asked what law, rule, regulation or a standing order, if there be any, which requires an  employee to  keep his  own private  cheque-book under lock  and key  or safe  custody so  that no one except himself can  have access  to it and we waited for the answer in vain. It was conceded that the appellant is not guilty of any  embezzlement   or  misappropriation  of  funds  of  the employer though  a grandiose  albeit flamboyant  charge  was framed that  he misappropriated  cash  and  funds  from  the accounts of  the employer  to the extent of Rs. 32,196.88 p. or part  thereof during  the period June 10, 1975 to October 10, 1975  by manipulating  false accounts,  submitting bogus cheques into  the employer’s  account or by taking cash from the chest  of the  branch alongwith Shri R.S. Negi, Manager- cum-Cashier of the Branch. There is not a tittle of evidence in  support   of  the   allegation  of  misappropriation  or embezzlement of  funds or  manipulation of  accounts by  the appellant. This was in terms conceded. The allegation, to be specific, of  the employer  is that Shri R.S. Negi, Manager- cum-Cashier misused the cheque forms from the cheque-book of the  appellant   in  respect  of  his  private  account  and embezzled funds  of the employer. It was not the case of the employer that  applicant drew cheques or embezzled cash from the  chest.   Another  allegation  was  that  the  appellant abetted, aided,  connived at  or conspired with Manager-cum- Cashier Shri  R.S. Negi,  in charge of the branch and issued various cheques  in the  amount of Rs. 15,027.75 p. drawn on forms  of  cheques  contained  in  the  cheque-book  of  the appellant issued  to  him  for  operating  his  own  private account with  ulterior motive  of defrauding the employer by submitting bogus  cheques into  the account  of the employer and thereby  caused wrongful  gain to  himself and  wrongful loss to  the employer,  in collusion  with Shri  R.S.  Negi. Again it  was conceded  that there is absolutely not an iota of evidence  which could  indicate that the appellant issued any a cheques himself or that he aided or abetted someone to issue the  r bogus  cheques. These  were the  allegations in charges Nos. 1 and 2 and the finding by Mr. Kakkar that they are proved can be styled as perverse on the admission of the employer himself  because not a single witness in the course of domestic enquiry so stated. Mr. Jain, learned counsel for the respondent  could not  point out  one single sentence of evidence in support of these two charges. 875      Mr. P.K.  Jain urged that the third charge which was to the effect  that the  appellant permitted  the  use  of  the

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cheques from  the cheque-book  issued to  him by the Bank in which he  was maintaining his own private account to defraud the employer  to the  tune of Rs. 15,027.75 p. in conspiracy with Shri R.S. Negi and that he was negligent and was guilty of wilful  disobedience ill  performance of  his duties as a salesman was  substantiated. It  is a  composite charge. The first limb  of the  charge refers  to negligence in handling his private cheque book so that in conspiracy with Shri R.S. Negi cheque forms contained in the cheque-book issued to the appellant for  operating his  private account  were used  by Shri R.S.  Negi  to  defraud  the  employer.  Rejecting  the language improperly  used the  charge is  that the appellant kept his  private cheque  book unattended  or  not  in  safe custody so  that Mr. R.S. Negi misused the cheque forms from this  cheque  book.  In  support  of  this  allegation,  the evidence is  that the appellant did not keep his cheque-book under lock  and key  or in  safe custody so that no one else except himself will have access to the same We have not been able to understand apart from appreciating this charge. When a cheque  book is  issued to  a holder  of an account by the Bank, there  is no law which requires him to keep his cheque book in safe custody. He may keep it in any manner and if in the process  some one misuses the cheque and withdraws money from the  account of  the holder,  the bank  will be able to disown its  liability pleading  negligence of  the holder of the account.  A man  can keep  his cheque  book anywhere  he likes and  even if  it is  not in safe custody he does so at his own  peril. In  the event  of  misuse  as  a  result  of negligent handling of the cheque book, the Bank will be able to disown its liability if someone by misuse of the forms of cheques withdraws  any amount from the account in respect of which the  cheque book is issued. That is not the case here. The accusation is that the appellant kept his cheque book in such a  manner as  to be accessible to any one and that some one unscrupulously  removed the  forms of  cheques from  the cheque book of the appellant and used them to withdraw money from  the   appellant’s  account  but  from  the  employer’s account. Some  one so minded to forge cheque and to withdraw money from some one’s account may use anybody’s cheque book. In such  a situation, the owner of the cheque book unless he has  participated  in  the  conspiracy  in  any  manner  for facilitating withdrawal  of the  amount cannot be attributed any misconduct for keeping his cheque book unattended or not in safe  custody. There  fore first limb of the charge No. 3 can be rejected as per se untenable without anything more. 876      The second  limb  of  the  third  charge  is  that  the appellant was negligent and guilty of wilful disobedience in performance of  his duties  as  a  salesman.  Not  a  single witness has  spoken of  any negligence  on the  part of  the appellant in  performance of  his duties.  There is  not the remotest suggestion  in the  evidence to  that effect. Not a single witness  has spoken  about any wilful disobedience in performance of duty. Some flamboyant charges appears to have been cooked  up by the employer without any regard for truth or without  any regard  for responsibility  ill making  such heinous allegation  and levelling serious accusation without an iota of evidence in support of it We repeatedly asked Mr. P.K. Jain, learned counsel for the employer to show from the evidence led  before the  inquiry officer which order of the employer  was   disobeyed  much   less  unwilfully   by  the appellant, as  also  acts  of  omission  and  commission  in performance of  duty to spell out negligence. The only reply we received  was that  the appellant  kept his  cheque  book unattended. Keeping  one’s own  cheque book unattended is no

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part of  performance of duties of the employee and there was no order  by the  employer how  appellant should  handle his private cheque book.      Let is be made distinctly clear that this Court in this appeal is  not re-appreciating  evidence. Mr. G.C. Jain, the first Arbitrator  who completed  a major part of the enquiry in the  reference made  to him  under sec.  10 (A) (1) after meticulously examining  the evidence  led on  behalf of  the employer in the enquiry proceedings concluded as under:-           "22.  I   have  carefully   examined  this  entire      evidence. None  of the  witnesses has  stated that Shri      Kindra had misappropriated any amount of the Company or      he had  manipulated false  accounts, or  had  submitted      bogus cheques  in the  mills account and had taken away      any amount  from the  chest of  the retail depot or had      abetted, aided  conspired or  connived with  Shri  R.S.      Negi or  issued any cheque to defraud the company. What      PW-1 to  PW-3 said  is that Shri Negi used five cheques      from the  cheque book  of this  workman to  defraud the      company. There  is no evidence to show any fraud on the      part  of   Shri  Kindra   or  to   connect   him   with      misappropriation by  Shri Negi.  The mere fact that his      cheques were used is not sufficient to hold that he had      entered into  conspiracy with  Shri  Negi  or  that  he      wilfully  or  negligently  permitted  the  use  of  the      cheques in  order to  defraud the company to the amount      of Rs. 877      15,027.75 p.  Or part  thereof Management’s own witness      have stated  that these  cheques were  utilised  either      with the  connivance of  Shri R.K. Kindra or because of      his negligence in respect of the same. None of them has      stated with  certainty that  Shri Kindra was a party to      this misappropriation. No doubt the evidence shows that      he was  not very  careful in  keeping his  cheque  book      under lock  and  key.  But  this  circumstance  is  not      sufficient  to  hold  that  he  had  entered  into  any      conspiracy with  Shri R.S.  Negi or  was a party to the      misappropriation. Thus there was no evidence in support      of charge  No. 1  and 2. There is no evidence that Shri      Kindra wilfully  permitted the user of his cheque book.      There is no evidence that his negligence in keeping the      cheque book  in a drawer without a lock was with a view      to defraud  the company.  There is  no evidence that he      was habitually  negligent or  willfully disobedient  in      the discharge  of his duties. The manner of keeping his      personal cheque  book was  not a  part of his duties as      salesman. Thus  there was  no evidence  to prove charge      No. 3 as well."      He further  concluded in paragraph 23 of his award that the findings  of the  enquiry officer were based on no legal evidence and  were therefore  perverse and  the enquiry  was vitiated. The  employer never  sought an opportunity to lead evidence before  arbitrator to  substantiate the charges. In fact on  the conclusion  recorded by Mr. G.C. Jain he should have made  a consequential  order of setting aside the order of dismissal and directing reinstatement with back wages but he unnecessarily  procrastinated and  then before  he  could attend to  the remainder of the work, he was elevated to the bench of  the Delhi High Court leaving the appellant to face the music  of a fresh enquiry and a complete sommer sault by the new arbitrator.      A fresh reference was made to Sh. N.L. Kakkar, Mr. P.K. Jain, learned  counsel for  the employer/contended that this Court is only concerned with the award of Mr. Kakkar and the

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findings recorded by Mr. G.C. Jain are not relevant. We have serious reservations  about this  submission, but  it is not necessary in  this case  to decide  that point. We would now confine ourselves to the award of Shri Kakkar.      In Paragraph 1 to 5, the history of the dispute and the charges 878 framed against  the appellant  have  been  set  out  by  Mr. Kakkar. Paragraph 6 deals with what the enquiry officer did. Paragraph 7  reproduces the  contentions on  behalf  of  the appellant. Paragraph  8 summarises the contentions on behalf of the  employer. Paragraphs  9, 10  and 11  deal  with  the manner in which the enquiry was held. Paragraph 12 refers to the written  arguments submitted  on behalf of the employer. In the  concluding paragraph  13, Mr. Kakkar states that the circumstances of  the case  and the evidence produced by the parties before the enquiry officer as well as in the present proceedings and  on the consideration of the documents filed and proved,  it is  held as therein stated. He then recorded his ipse  dixit not  discussing the  evidence or  the  total absence of  it. It  may be pointed out that in the course of the enquiry  held against  the appellant  by Mr.  U.K. Soni, enquiry officer,  the  employer  had  examined  4  witnesses namely Shri O.D. Sharma, Shri G.L. Kapur, Shri V.K. Malhotra and Shri  Nandan Singh.  No witness was examined before Shri G.C. Jain  and the  employer relied  upon the  report of the enquiry officer  and the  evidence  of  the  four  witnesses recorded by  the enquiry  officer. When  the matter  came up before Mr. Kakkar, the employer had not examined any witness but had  submitted the report of the enquiry officer and the evidence of  the aforementioned witnesses. Therefore when it was contended  before the arbitrator that even accepting the evidence of  the four  witnesses,  as  if  unchallenged,  no reasonable man  could ever  come to  the conclusion that the misconduct imputed  to the appellant in charges No. 1, 2 and 3 could  be said  to be proved, it was incumbent upon him to examine the  evidence. We invited Mr. P.K. Jain to point out to us  which evidence is being relied upon in support of the charge of  embezzlement and  the charge  relating to alleged misappropriation of  funds. He could not lay his hand on any piece of  evidence. Conceding  that there  is no evidence in support of  the charge  of embezzlement and misappropriation of funds  simultaneously conceding  that charges No. 1 and 2 are not  proved, he  repeatedly  emphasised  that  the  only conducts of  which appellant is guilty is that the appellant had so deliberately left his cheque book unattended as to be accessible to  anyone who may misuse it and this constitutes negligence in  performance of  duty. Even at the cost of the repetition, we  must point  out that  keeping one’s  private cheque book  in any  manner is no par. Of the performance of the duty  of the employee. To say the least the charge apart from being  frivolous is  ludicrous and  could not have even framed. Even  if  the  allegation  in  the  charge  is  left unquestioned it does not constitute misconduct. The employer could not  have framed  such charges without any evidence in support of them yet 879 Mr. Kakkar  holds them proved. Therefore Mr. Kakkar accepted the findings  of the  enquiry  officer  which  were  per  se perverse. Not  only Mr. Kakkar did not apply his mind to the submission of  the appellant that the findings were perverse but he  merely recorded  his ipse  dixit without  any manner analysing or  examining or applying his mind to the evidence only  to   find  out  whether  there  was  any  evidence  to substantiate the charge and whether any reasonable man would

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arrive at  the conclusion  which  the  enquiry  officer  had reached. The  award of  Mr. Kakkar, apart from the fact that it is based on no legal evidence suffers from the additional infirmity of  total non-application  of mind. Any finding of misconduct based on total absence of evidence must fail.      Mr. Jain  contended that  once Mr.  Kakkar came  to the conclusion that  the appellant was given full opportunity to participate in the domestic enquiry neither High Court under Art. 226  nor this  Court under  Art. 136  can sit in appeal over the  findings of the enquiry officer and reappraise the evidence. We  have not at all attempted to re-appreciate the evidence though in exercise of the jurisdiction conferred by sec.  11-A   of  the  Industrial  Disputes  Act,  1947  both arbitrator and this court can reappraise the evidence led in the domestic enquiry and satisfy itself whether the evidence led by  the  employer  established  misconduct  against  the workman. It  is too  late in  the day  to contend  that  the arbitrator  has  only  the  power  to  decided  whether  the conclusions reached  by the  enquiry officer  were plausible one deducible  from the  evidence led in the enquiry and not to re-appreciate  the  evidence  itself  and  to  reach  the conclusion  whether   the  misconduct  alleged  against  the workman has  been established  or not. This court in Workmen of M/s  Firestone Tyre  Rubber Company  of India (P) Ltd. v. Management &  Others, held  that since  the introduction  of sec.  11-A   in  the  Industrial  Disputes  Act,  1947,  the Industrial tribunal  is now  equipped  with  the  powers  to reappraise the  evidence in the domestic enquiry and satisfy itself whether the said evidence relied upon by the employer establishes the  misconduct alleged  against the workman. It is equally  well-settled that the arbitrator appointed under Sec. 10-A  is comprehended  in  sec.  11-A.  This  court  in Gujarat Steel  Tubes Ltd.  v. Gujarat  Steel  Tubes  Mazdoor Sabha, held  that an arbitrator appointed under sec. 10-A of the Industrial  Disputes Act,  1947 is  comprehended in sec. 11-A and  the arbitratal  reference apart  from sec. 11-A is plenery  in   scope.  Therefore   it  would  be  within  the jurisdiction 880 both of  the  arbitrator  as  well  as  this  court  to  re- appreciate the  evidence though it is not necessary to do so in this  case.  It  is  thus  well-settled  that  where  the findings of  misconduct are  based on  no legal evidence and the conclusion is one to which no reasonable man would come, the arbitrator  appointed under  sec. 10-A  or this court in appeal under  Art. 136 can reject such findings as perverse. Holding that  the findings  are perverse does not constitute reappraisal of evidence, though we would have been perfectly justified in exercise of Powers conferred by sec. 11-A to do so.      It is  equally well-settled that where a quasi-judicial tribunal or  arbitrator records  findings based  on no legal evidence and the findings are either his ipse dixit or based on conjectures  and surmises,  the enquiry  suffers from the additional infirmity  of non-application  of mind and stands vitiated. The  industrial tribunal  or the  arbitrator or  a quasi-judicial authority  can reject  not only such findings but also  the conclusion based on no legal evidence or if it is merely  based on  surmises and  conjectures unrelated  to evidence  on  the  ground  that  they  disclose  total  non- application  of   mind.  Viewed   from  either   angle,  the conclusion  of  the  enquiry  officer  as  well  as  of  the arbitrator  Mr.   Kakkar  are   wholly  perverse  and  hence unsustainable. The  High  Court,  in  our  opinion,  was  in clearly error  in declining  to examine  the contention that

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the findings were perverse on the short, specious and wholly untenable ground  that the  matter depends  on appraisal  of evidence.      Between  appraisal   of  evidence  and  total  lack  of evidence there  is an  appreciable  difference  which  could never be  lost-sight of and the High Court ought not to have short circuited the writ petition.      If there  is absolutely  no evidence  in support or the only allegation  of  misconduct  namely  negligence  in  not keeping one’s  private cheque  book  in  safe  custody,  the conclusion is  not only not a plausible one but it is wholly perverse and  we are  in complete  agreement  with  findings recorded Mr.  G.C. Jain that the findings of enquiry officer were perverse and the enquiry was wholly vitiated.      Where the  order of dismissal is sought to be sustained on a  finding in  the domestic  enquiry which is shown to be perverse and  the enquiry is vitiated as suffering from non- application of  mind the only course open to us is to set it aside and  consequently  relief  of  reinstatement  must  be granted and  nothing was  pointed to  us why  we should  not grant the same. 881      It was  next contended  on behalf of the appellant that reinstatement with  full back-wages  be awarded  to him. Mr. P.K. Jain, learned counsel for the employer countered urging that there  is evidence  to  show  that  the  appellant  was gainfully employed  since the  termination  of  service  and therefore he  was not  entitled to back wages. In support of this submission  Mr. Jain  pointed out that the appellant in his cross-examination  has admitted  that during  his forced absence from employment since the date of termination of his service, he  was  maintaining  his  family  by  helping  his father-in-law Tara  Chand who owns a coal depot, and that he and the  members of  his family lived with his father-in-law and that  he had  no alternative  source of  maintenance. If this is  gainful employment,  the employer  can contend that the dismissed  employee in  order to keep his body and soul, together had  taken to  begging and  that would as well be a gainful employment.  The gross  perversity  with  which  the employer had  approached this  case has  left us stunned. If the employer  after  an  utterly  unsustainable  termination order of service wants to deny back-wages on the ground that the appellant  and the  members of  his family  were staying with the  father-in-law of  the appellant  as there  was  no alternative source  of maintenance  and during  this  period appellant was helping his father-in-law Tara Chand who had a coal-depot,  it  cannot  be  said  that  the  appellant  was gainfully employed. This was the only evidence in support of the submission  that during  his forced absence from service he was gainfully employed. This cannot be said to be gainful employment E so as to reject the claim for back-wages. There is no  evidence on the record to show that the appellant was gainfully employed  during the  period of  his absence  from service. Therefore,  the appellant would be entitled to full back-wages and all consequential benefits.      Accordingly, the appeal is allowed and the award of the arbitrator Shri Kakkar is set aside and the appellant is re- instated in  service with  full back-wages and consequential benefits to  which he  would have  been entitled  had he not been unlawfully  thrown out  from service,  and the costs of this appeal  quantified at Rs. 3,000. The back-wages payable to the  appellant and the costs awarded herein shall be paid to him  within 2  months from  today. The appellant shall be physically reinstated  in service  within a week from today. The appellant  shall be  entitled to  all the  consequential

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benefits f his continuous service. H.S.K.    Appeal allowed. 882