Reportable

IN THE SUPREME COURT OF  INDIA CIVIL APPELLATE JURISDICTION

Civil Appeal No. 3086 of 2007

U.P. State Road Transport Corporation ……….Appellant  

Versus

Suresh Chand Sharma         ……...Respondent

With  

Civil Appeal No. 3088 of 2007

Suresh Chand Sharma         …….Appellant  

Versus

State of U.P. and Anr.  ……...Respondents

J U D G M E N T

Dr. B. S. CHAUHAN, J.

1. Both these appeals have been preferred against the impugned  

judgment and order of the High Court of Uttaranchal at Nainital  in  

Writ Petition No. 4143 of 2001 by which the Writ Petition filed by  

the  Respondent-employee  of  the  U.P.  State  Road  Transport  

Corporation (hereinafter referred to as the ‘Corporation’) has been  

allowed directing his re-instatement in service, but without back  

wages. The Corporation has filed appeal being aggrieved of the  

order of re-instatement and reversal of the Award of the Labour

Court  dated 28.4.1995, while Civil Appeal No.3088 of 2007 has been  

preferred by the employee Shri Suresh Chand Sharma claiming full  

back wages.  

2. Facts and circumstances giving rise to these appeals are  

that the said employee while working as a Conductor on bus No.UTL-

9194 on the route Haridwar-Rishikesh was found, on checking on  

24.5.1987, carrying 13 passengers without ticket from whom he has  

already recovered the fare and on 10.5.1988 on bus No.UGA-9059 on  

which  he was  working as  a Conductor,  10 passengers  were found  

without ticket.  However, the employee had already recovered the  

fare  from  them.  The  Corporation  served  charge  sheets  upon  the  

employee on 16.5.1988 and 7.7.1988 in respect of the mis-conducts  

dated 10.5.1988 and 24.5.1987.  Employee submitted his reply to the  

charge sheets. However, the management not being satisfied with his  

reply decided to proceed with the regular enquiry and one Shri H.L.  

Saxena, a retired I.F.S. Officer was appointed as Enquiry Officer.  

The  enquiry  was  conducted  on  both  the  charges  giving  full  

opportunity of hearing/defence to the employee. Enquiry Officer  

submitted the enquiry report wherein charges in respect of both the  

misconducts had been found proved.   The Disciplinary Authority  

accorded its concurrence thereto.  The management served the copy  

of  the  enquiry  report  and  issued  a  second  show  cause  dated  

14.12.1988  to the  employee to  which he  submitted his  reply on  

9.1.1999. The Disciplinary Authority was not satisfied with his  

reply and after considering the material on record, the Authority

passed the punishment order dated 29.1.1989 dismissing the employee  

from service.  

3. Being  aggrieved,  the  Employee  preferred  a  Departmental  

Appeal which was duly considered by the Appellate Authority and  

rejected  vide  order  dated  21.3.1990.   The  Employee  raised  an  

industrial  dispute  and  thus,  the  matter  was  referred  by  the  

Appropriate Government to the Labour Court vide reference dated  

19.12.1991 to the following effect:

“Whether the  termination of  the services  of the  applicant/workman  Shri  S.C.  Sharma  s/o  Late  Shri  Om  Prakash,  conductor  by  the  employer  from  29.1.1989  is  unjustified  and/or  illegal?  If  so,  which  benefit/compensation the applicant/workman is entitled and  to what extent?  

4. Both the parties appeared before the Labour Court, filed  

their replies and affidavits.   Both parties filed documentary  

evidence and also led oral evidence and advanced submissions in  

support of their respective cases.  The Labour Court considered  

all aspects and vide Award dated 28.4.1995 held that enquiry had  

been held strictly in accordance with law and both the charges in  

respect of both the incidents were found duly proved. Therefore,  

the employee was not entitled to any relief whatsoever.  

5. Being  aggrieved,  the  employee  challenged  the  Award  by  

filing  C.M.W.P.  No.9129  of  1996  before  the  High  Court  of  

Judicature at Allahabad which was transferred to the High Court at  

Nainital after Re-organisation of States and the said transferred  

case was registered as Writ Petition No. 4143 (M/S) of 2001. The  

High Court allowed the Writ Petition partly vide impugned judgment

and order dated 7.9.2005 and directed the re-instatement of the  

employee without back wages. Hence, these appeals.  

6. We have heard Shri Suraj Singh, learned counsel appearing  

for the Corporation and Dr. J.N. Dubey, learned senior counsel  

appearing for the employee. Large number of submissions have been  

made by the parties and it has been contended on behalf of the  

Corporation  that  the  High  Court  has  not  recorded  any  reason  

whatsoever while setting aside the Award of the Labour Court.  No  

fault could be found with the Award of the Labour Court and it was  

not necessary for the checking authority to record the evidence of  

the passengers who were found travelling without tickets nor it  

was necessary to check the cash at the hand of the employee.  The  

High  Court  mis-directed  itself  while  setting  aside  the  well-

reasoned  Award  of  the  Labour  Court  without  giving  any  reason  

whatsoever.  Thus, the appeal of the Corporation deserves to be  

allowed and Award of the Labour Court deserved to be restored.  

7. Per contra, Dr. J.N. Dubey, learned counsel  appearing for  

the employee has submitted that the High Court was justified in  

accepting the submissions on behalf of the employee that material  

witnesses  were  not  examined.  Thus,  no  disciplinary  proceeding  

could  be  initiated  against  the  employee.  There  was  no  

justification  for  imposing  the  punishment  of  dismissal  by  the  

authority and once the Award of the Labour Court is set aside, the  

employee was entitled to full back wages. Thus, the Corporation’s  

appeal is liable to the dismissed and appeal filed by the employee  

deserves to be allowed.

8. We have considered the rival submissions made by learned  

counsel for the parties and perused the record.  

9. The Labour Court has considered the matter at length and  

came to the conclusion that enquiry had been conducted strictly in  

accordance  with  law.  There  has  been  no  violation  of   the  

principles of natural justice  or any other statutory provision.  

The employee was given full opportunity to defend himself, cross  

examined the witnesses examined by the Corporation. The Enquiry  

Officer has rightly appreciated the evidence and found the charges  

proved  in  respect  of  both  the  incidents.  The  Disciplinary  

Authority has taken a right decision accepting the enquiry report  

and punishment order was passed after serving second show cause to  

the employee. The Labour Court  recorded the findings on facts as  

under:

“As far as the question of conclusions drawn by the  Enquiry officer is concerned, in the enquiry conducted in  respect  of  first  charge  sheet  dated  7.7.1988  Ext.E/2,  statement of Shri Atar Singh, Traffic Inspector has been  recorded wherein he has proved the report Ext.E/1 of Shri  Atar  Singh,  Traffic  Inspector.   Shri   Atar  Singh  had  checked the vehicle and 13 without ticket passengers have  been found travelling from whom the petitioner-workman had  already  taken  Rs..43/-  as   fare.  Shri  Atar  Singh  has  accordingly made a remark on the way bill and obtained the  signatures  of  petitioner-workman  also.  The  petitioner- workman did not ask any question in cross-examination to  this witness. The petitioner workman has also not asked  any question in cross- examination with the other witness  Shri Kailash Chandra, Traffic Inspector.” (Ephasis added)

10. The Labour Court recorded a finding of fact that in respect  

of  both  the  mis-conducts  the  passengers  were  found  travelling  

without  tickets  and  they  had  already  paid  fare  to  the

employee/Conductor. Thus, it is not a case where the said employee  

could  not  issue  the  ticket  and   recover  the  fare  from  the  

travelling passengers, rather the finding has been recorded that  

after recovering the fare from the passengers, he did not issue  

tickets to them.  Thus, there was an intention to mis-appropriate  

the fare recovered from the passengers who were found travelling  

without tickets at both the times.   

11. The High Court dealt with the matter in a most cryptic  

manner.  Relevant/main part of the judgment of the High Court  

reads as under:

“5…..The  Inspector  in  the  cross-examination  has  also stated on oath that the cash was not checked. The  learned counsel for the petitioner further submitted that  when the bus was checked, ten passengers were boarded on  the bus and they were drunk and they were also denying  taking  the  tickets.  The  learned  Tribunal  has  not  considered  this  fact  at  all.  I  find  force  in  the  contention of the learned counsel for the petitioner. The  learned Tribunal ought to have considered this fact that  neither the passengers were examined, nor the cash was  checked.  Therefore,  the  order  of  the  learned  Tribunal  cannot be sustained in the eye of law.” (Emphasis added)

12. The High Court has decided the Writ Petition only on the  

ground that the passengers found without tickets, had not been  

examined and the cash with the employee was not checked.  No other  

reasoning has been given whatsoever by the Court.  

13. In State of Haryana & Anr. Vs. Rattan Singh AIR 1977 SC  

1512,  this  Court  has  categorically  held  that  in  a  domestic  

enquiry,  complicated  principles  and  procedure  laid  down  in  the  

Code of Civil Procedure, 1908  and the Indian Evidence Act, 1872

do not apply. The only right of a delinquent employee is that he  

must be informed as to what are the charges against him and he  

must  be  given  full  opportunity  to  defend  himself  on  the  said  

charges. However, the Court rejected the contention that enquiry  

report  stood  vitiated  for  not  recording  the  statement  of  the  

passengers who were found travelling  without ticket. The Court  

held as under:

“We cannot hold that merely because statements of  passengers were not recorded the order that followed was  invalid. Likewise, the re-evaluation of the evidence on  the strength of co-conductor’s testimony is a matter not  for  the  court  but  for  the  administrative  tribunal.  In  conclusion, we do not think courts below were right in  over-turning the finding of the domestic tribunal.”   

14. In view of the above, the reasoning so given by the High  

Court cannot be sustained in the eye of law. More so, the High  

Court is under an obligation to give not only the reasons but  

cogent reasons while reversing the findings of fact recorded by a  

domestic tribunal.  In case the judgment and order of the High  

Court is found not duly supported by reasons, the judgment itself  

stands  vitiated.  (Vide  State  of  Maharashtra  Vs.  Vithal  Rao  

Pritirao Chawan, AIR 1982 SC 1215; State of U.P. Vs. Battan & Ors.  

(2001) 10 SCC 607); Raj Kishore Jha Vs. State of Bihar & Ors. AIR  

2003 SC 4664; and State of Orissa Vs. Dhaniram Luhar AIR 2004 SC  

1794.  

15. In State of West Bengal Vs. Atul Krishna Shaw & Anr. AIR  

1990 SC 2205, this Court observed that “giving of reasons is an  

essential element of administration of justice. A right to reason

is, therefore, an indispensable part of sound system of judicial  

review.”

16. In State of Uttaranchal & Anr. Vs. Sunil Kumar Singh Negi  

AIR 2008 SC 2026, this Court held as under:

“Right  to  reason  is  an  indispensable  part  of  a  sound  judicial system; reasons at least sufficient to indicate  an application of mind to the matter before Court. Another  rationale  is  that  the  affected  party  can  know  why  the  decision  has  gone  against  him.  One  of  the  salutary  requirements of natural justice is spelling out reasons  for the order made”.

17. In Raj Kishore Jha (supra), this Court observed as under:  

“Before we part with the case, we feel it necessary to  indicate that non-reasoned conclusions by appellate Courts  are  not  appropriate,  more  so,  when  views  of  the  lower  Court are differed from. In case of concurrence, the need  to again repeat reasons may not be there. It is not so in  case  of  reversal.  Reason  is  the  heartbeat  of  every  conclusion. Without the same, it becomes lifeless”.

18. In fact, “reasons are the links between the material, the  

foundation for these erection and the actual conclusions.  They  

would also administer how the mind of the maker was activated and  

actuated and their rational  nexus and synthesis with the facts  

considered and the conclusion reached”. (vide: Krishna Swami Vs.  

Union of India & Ors. AIR 1993 SC 1407)

19. Therefore, the law on the issue can be summarized to the  

effect that, while deciding the case, court is under an obligation  

to record reasons, however, brief, the same may be as it is a  

requirement of principles of natural justice.  Non-observance of  

the said principle would vitiate the judicial order.

Thus, in view of the above, the judgment and order of the  

High Court impugned herein is liable to be set aside.  

20. We do not find any force in the submissions made by Dr.  

J.N.  Dubey,  learned  Senior  counsel  for  the  employee  that  for  

embezzlement of such a petty amount, punishment of dismissal could  

not  be  justified  for  the  reason  that  it  is  not  the  amount  

embezzled   by  a  delinquent  employee  but  the  mens  rea  to  mis-

appropriate the public money.

21. In Municipal Committee, Bahadurgarh Vs. Krishnan Bihari &  

Ors., AIR 1996 SC 1249, this Court held as under:–

“In a case of such nature - indeed, in cases involving  corruption - there cannot be any other punishment than  dismissal. Any sympathy shown in such cases is totally  uncalled for and opposed to public interest. The amount  misappropriated may be small or large; it is the act of  misappropriation that is relevant.”

Similar view has been reiterated by this Court in Ruston & Hornsby  

(I)  Ltd.  Vs.  T.B.  Kadam,  AIR  1975  SC  2025; U.P.  State  Road  

Transport Corporation Vs. Basudeo Chaudhary & Anr., (1997) 11 SCC  

370; Janatha  Bazar  (South  Kanara  Central  Cooperative  Wholesale  

Stores Ltd.) & Ors. Vs. Secretary, Sahakari Noukarara Sangha &  

Ors., (2000) 7 SCC 517; Karnataka State Road Transport Corporation  

Vs.  B.S.  Hullikatti,  AIR  2001  SC  930; and  Regional  Manager,  

R.S.R.T.C. Vs. Ghanshyam Sharma, (2002) 10 SCC 330.

In Divisional Controller N.E.K.R.T.C. Vs. H. Amaresh, AIR 2006 SC  

2730; and U.P.S.R.T.C. Vs. Vinod Kumar, (2008) 1 SCC 115, this  

Court held that the punishment should always be proportionate to

the  gravity  of  the  misconduct.  However,  in  a  case  of  

corruption/misappropriation, the only punishment is dismissal.

22. Thus, in view of the above, the contention raised on behalf  

of  the  employee  that  punishment  of  dismissal  from  service  was  

disproportionate to the proved delinquency of the employee, is not  

worth acceptance.  

Appeal preferred by the Corporation i.e. Civil Appeal No.  

3086 of  2007 is allowed. The judgment and order of the High Court  

dated 7.9.2005 is hereby set aside and the Award of the Labour  

Court dated 28.4.1995 is restored.  The appeal preferred  by the  

employee i.e. Civil Appeal No.3088 of 2007 is hereby dismissed. No  

order as to costs.  

                …………………………………..J.

     (Dr. B.S. CHAUHAN)

…………………………………..J. (SWATANTER KUMAR)

New Delhi, May  26, 2010