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CASE NO.: Appeal (civil)  9676 of 2003

PETITIONER: Viveka Nand Sethi

RESPONDENT: Chairman, J & K Bank Ltd. & Ors.  

DATE OF JUDGMENT: 03/05/2005

BENCH: N. Santosh Hegde & S.B. Sinha

JUDGMENT: J U D G M E N T

                                       W I T H

CIVIL APPEAL NO.9678 OF 2003

S.B. SINHA, J :

       These two appeals arising out of a common judgment and order dated  10.2.2003 passed by the High Court of Jammu & Kashmir at Jammu  were  taken up for hearing together and are being disposed of by this common  judgment.   

       Interpretation of a bipartite settlement dated 8.9.1983 is in question in  these appeals which arise out of the aforementioned judgment and order  passed by a Division Bench of the said court dismissing an appeal preferred  by the Jammu & Kashmir Bank Ltd. (hereinafter referred to as ’the Bank),  affirming a judgment and order dated 15.12.1999 passed by a learned  Single  Judge of the said court whereby and whereunder an award dated 4.10.1995  passed by the Central Government Industrial Tribunal-cum-Labour Court,  Chandigarh, directing the workman to be reinstated in service with the  benefit of past service without any back wages had not been interfered with.    

       The workman was working as a Cashier-cum-Clerk with the Bank.   He was transferred to Kolkata on or about 2.4.1981; but he did not join the  said office or before 14.4.1981, when he was supposed to do so.  On his  failure to report to Kolkata office  by 14.4.1981, a notice was issued by the  Bank on 22.6.1981 asking him to show cause as to why disciplinary  proceedings should not be initiated against him.  Taking however a lenient  view, he was transferred to Amritsar on 6.8.1981 and then to Samba on a  representation having been made in this behalf.  He later on was transferred  to Amritsar again.  He joined Amritsar Branch on 29.7.1982.  A leave for a  period of 28 days was sought for and sanctioned in favour of the workman  on an application made therefor by him on or about 9.10.1982.  A further  leave of 9 days was sanctioned by an order dated 17.11.1982.  Yet again he  filed an application seeking leave for one month on 19.5.1983; although he  had only 25 days accumulated leave to his credit and his leave account had  already been deducted by 50 days’ medical leave.   A bipartite settlement was entered into by and between the  management of 58 Banks including the Appellant-Bank herein and their  workmen; clause 2 whereof is as under :

       "2.     Voluntary Cessation of employment by the  employees.

       Whereas an employee has not submitted any  application for  leave and absents himself from work for

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a period of 90 or more consecutive days without or  beyond any leave to his credit or absents himself for 90  or more consecutive days beyond the period of leave  originally sanctioned or subsequently extended and  where there is satisfactory evidence that he has taken up  employment in India and the management is satisfied that  he has no present intention of joining duties, the  management may at any time thereafter give a notice, to  the employee’s last known address calling upon the  employee to report for duty within 30 days of the notice  stating, inter alia, the grounds for the management  coming to the conclusion that the employee has no  intention of joining duties and furnishing necessary  evidence, where available.  Unless the employee reports  for duty within 30 days or unless he gives an explanation  for his absence satisfying the management that he has not  taken up another employment or avocation and that he  has no intention of not joining duties, the employee will  be deemed to have voluntarily retired from the bank’s  service on the expiry of the said notice.  In the  event of  the employee submitting a satisfactory reply, he shall be  permitted to report for duty thereafter within 30 days  from the date of the expiry of the aforesaid notice  without prejudice to the Bank’s right to take any action  under the law or rules of service."    

       Despite the expiry of the period of leave in June 1983,  the workman  did not report back for duties, whereupon the Branch Manager, Amritsar,  informed him by a letter dated 2.11.1983 that he should rejoin his duties,  which was not complied with.  An explanation was sought for from him by  Memorandum dated 2.11.1983 whereby and whereunder he was asked to  show cause as to why he had been on unauthorized leave for such a long  period.  Such an explanation was to be filed  by 10.11.1983.  He had further  been asked to join duties.  Despite service of  the said memo., the workman  failed to join his duties by 31.12.1983.  Consequently, a show cause notice  dated 31.12.1983 served on him whereby and whereunder he was intimated  that in the event of his failure to resume his duties by 15.1.1984 he would be  deemed to have been discharged from the services of the Bank.  In reply  thereto, a telegram from one Krishan Chand Sethi was received stating that  the workman being unwell could not join his duties by 15.1.1984.  He again  applied for grant of  leave on medical ground on 15.2.1984.  As by reason of  the aforementioned act on the part of the workman, the  Bank felt a great  deal of inconvenience, a memorandum was served on 20.2.1984, pursuant  whereto again he requested for sanctioning of leave.  His services were  dispensed with by invoking clause (2) of the bipartite settlement stating :

"3.  Consequent upon receipt of these applications from  Mr. V. Sethi, the bank had no alternative but to make  confidential enquiries about the state of his health in  pursuance of which it was revealed that Mr. V. Sethi was  keeping a good health and even attended to his family  business.  This convinced the bank that Mr. Sethi was not  at all interested in the services of the bank, which  prompted it to issue an order vide No. Per/Disp/84-448  dated 17.5.1984 in accordance with the provisions  contained in Memorandum of Settlements dated 8.9.1983  and Mr. Sethi was deemed to have voluntarily retired  from the services of the bank w.e.f.8.2.1984."

       A legal notice was served upon the Bank herein after a long time  demanding the reinstatement of the workman on or about  6.4.1989, to  which it was replied that he had been engaged in some business at Samba  and thus it was clear that he had no interest in continuing in the services of  the Bank.  Sometime in June 1989, a conciliation proceeding was initiated

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by him under the Industrial Disputes Act resulting in a reference made by  the Central Government in terms of a Notification dated 7.8.1990.   

Inter alia, on the ground that the bank allegedly did not place on  records the settlement dated 8.9.1983, the impugned award was passed.   In the writ petition filed thereagainst by the Bank it was specifically  averred :

"\005It is important to point out here that the relevant  Bipartite Settlement is applicable to the Management of  the Bank and the Staff Union of the Workmen is just in  the form of Book and the petitioner-bank while perusing  its case has placed that book of Bi-Partite Settlement  before the respondent No.2 but the respondent No.2  without considering that settlement has remained under  this impression that Bi-Partite Settlement is just a form of  some document consisting of some leaves and has not  placed on record which is not true.  The order passed by  the respondent No.2 is totally in contravention of Bi- partite Settlement and deserves to be quashed on this  score only.

                A writ petition was also filed by the workman questioning non-grant  of back wages.  Both the writ petitions were heard together.  In the said  proceedings, the workman filed an application purported to be under Section  17-B of the Industrial Disputes Act, which was not supported by an affidavit  as is required in law. The learned Single Judge although noticed the  contentions raised in both the writ petitions, but dealt with the one filed by  the workman only.  An appeal preferred thereagainst was also dismissed.  

       Mr. Rohit M. Alex, the learned counsel appearing on behalf of the  Bank, would submit that the Central Government Industrial Tribunal-cum- Labour Court as also both the learned Single Judge and the Division Bench  of the High Court proceeded on a wrong premise that it was obligatory on  the part of the Bank to conduct a full fledged departmental proceeding.   According to the learned counsel the Industrial Tribunal as also the High  Court erred in law insofar as they failed to take into consideration that the  principles of natural justice had been complied with as repeated  opportunities had been given to the workman to explain his position as also  report for duties.  Strong reliance, in this behalf,  has been placed on   Syndicate Bank vs. General Secretary, Syndicate Bank Staff Association and  Another [(2000) 5 SCC 65] and Punjab & Sind Bank and Others vs. Sakattar  Singh [(2001) 1 SCC 214].        

       Mr. Ashok Mathur, the learned counsel appearing on behalf of the  workman, on the other hand, would contend that as a plea for extension of  leave was raised by the workman, if the same had not been proved to be  satisfactory to the management, it was obligatory on its part to conduct a  departmental proceeding against him.  In any event, the learned counsel  would contend that the applicability of the bipartite settlement having not  been gone into by the Industrial Tribunal as also by the High Court, the  matter should be remitted to the Tribunal.

       Before the Industrial Tribunal, the workman did not deny or dispute  the existence of the bipartite settlement.  He merely raised a plea that the  same was not applicable.  The plea of the Bank, on the other hand, was that  the stipulations contained in the bipartite settlement were attracted if the  employer arrives at a satisfaction that that there were  sufficient grounds for  it to arrive at a conclusion that the employee was no longer interested to  continue in the service.

       The fact that there exists a bipartite settlement entered into by and  between the Banks and their workmen is not in dispute.  The workman was  all along aware about the said legal position inasmuch as, at all stages, viz.,

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issuance of notices and memorandums, passing of the order of termination,  the said settlement had been referred to.     

What fell for consideration before the Industrial Tribunal was the  interpretation and/or applicability of the said settlement.  The Industrial  Tribunal committed an error of record insofar as it proceeded on the basis  that the said settlement had not been proved.  The settlement being an  admitted document should have been considered in its proper perspective by  the Industrial Tribunal.  Clause (2) of the said settlement is a complete code  by itself.  It lays down a complete machinery as to how and in what manner  the employer can arrive at a satisfaction that the workman has no intention to  join his duties.  A bare perusal of the said settlement clearly shows that it is  for the employee concerned to submit a proper application for leave.  It is  not in dispute that after the period of leave came to an end in June 1983, the  workman did not report back for duties.  He also did not submit any  application for grant of further leave on medical ground or otherwise.  It is in  that situation the memorandum dated 2.11.1983 was issued and he was  asked to joint his duties.  It is furthermore not in dispute that despite receipt  of the said memorandum, the workman did not join duties pursuant whereto  he was served with a notice to show cause dated 31.12.1982.  He was  required to resume his duties by 15.1.1984.  The Bank received a telegram  on 17.1.1984 and only about a month thereafter he filed an application for  grant of leave on medical ground.  It is not the case of the workman that any  leave on medical ground or otherwise was due to him.  Opportunities after  opportunities indisputably had been granted to the workman to explain his  position but he chose not to do so except filing applications for grant of  medical leave and that too without annexing proper medical certificates.  

The bipartite settlement is clear and unambiguous. It should be given  a literal  meaning.  A bare perusal of the said settlement would show that on  receipt of a notice contemplated thereunder, the workman must either : (1)  report for duties within thirty days;  (2) give his explanation for his absence  satisfying the management that he has not taken any employment or  avocation; and  (3) show that he has no intention of not joining the duties.  It  is, thus, only when the workman concerned does not join his duties within  thirty days or fails to file a satisfactory explanation, as referred to  hereinbefore, the legal fiction shall come into force.  In the instant case  except for asking for grant of medical leave, he did not submit any  explanation for his absence satisfying the management that he has not taken  up any other employment or avocation and that he has no intention of not  joining his duties.  In the aforementioned fact situation we do not see any reason as to  why the Bank could not arrive at a satisfaction that the workman had no  intention to join his duties.  It is interesting to note that though the said order  was passed on 17.5.1984, a representation to the Bank was made by the  workman to reconsider the said decision after a period of 3 years and 2  months by a letter dated 31.7.1987 Yet again a dispute was sought to be raised by issuance of a legal  notice on the Bank only on 6.4.1989.   Mere sending of an application for grant of leave much after the  period of leave was over as also the date of resuming duties cannot be said to  be a bona fide act on the part of the workman.  The Bank, as noticed  hereinbefore, in response to the lawyer’s notice categorically stated that the  workman had been carrying on some business elsewhere.   

We cannot accept the submission of Mr. Mathur that only because on  a later date an application for grant of medical leave was filed, the same ipso  facto would put an embargo on the exercise of the jurisdiction of the Bank  from invoking clause (2 ) of  the bipartite settlement.

It may be true that in a case of this nature, the principles of natural  justice were required to be complied with but the same would not mean that  a full-fledged departmental proceeding was required to be initiated.  A  limited enquiry as to whether the employee concerned had sufficient

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explanation for not reporting to duties after the period of leave had expired  or failure on his part on being asked so to do, in our considered view,  amounts to sufficient compliance of the requirements of the principles of  natural justice.

Clause (2) of the bipartite settlement raises a legal fiction, which is of  wide import.  Once the action on the part of the employer is found to be fair,  the court in view of such legal fiction would call upon the workman to prove  contra.  It will bear repetition to state that the only defence which came to be  raised by the workman was non-applicability of the bipartite settlement.  The  notice dated 31.12.1983 refers to the said settlement by necessary  implication, as on the failure of the workman to resume his duties by  15.1.1984, it was stated that he would be deemed to have been discharged  from the services of the Bank.  Yet again in terms of the memorandum dated  20.2.1984, attention of the workman was drawn to the fact that his  application for grant of leave was neither in the prescribed form nor any  medical certificate was attached thereto.  It was pointed out that the medical  certificate shows that he was under the doctor’s treatment from 22.10.1983   to 22.1.1984 and as such he should have reported for duties on 23.1.1984  and as he failed to do so, it gave rise to an inference that he was not  interested to continue in Bank’s services.  He did not submit any satisfactory  explanation nor he filed any valid medical certificate.  It was in that  situation, the order dated 17.5.1984 was issued which again referred to the  provisions contained in memorandum of settlement dated 8.9.1983.  The  workman ex facie appears to have accepted the said order as for a long  period he maintained silence.  Had he been interested in the Bank’s services,  it was expected of him to resume his duties and/or file proper application for  grant of medical leave with a valid medical certificate.   

The principle of natural justice, it is trite, is no unruly horse.  When  facts are admitted, an enquiry would be an empty formality.  Even the  principle of estoppel will apply.  [See  Dr. Gurjeewan Garewal (Mrs.) vs. Dr.  Dumitra Dash (Mrs.) and Others [(2004) 5 SCC 263].  The principles of  natural justice are required to be complied with having regard to the fact  situation obtaining therein.  It cannot be put in a straitjacket formula.  It  cannot be applied in a vacuum without reference to the relevant facts and  circumstances of the case.  [See State of Punjab vs. Jagir Singh (2004) 8  SCC 129] and Karnataka State Road Transport Corporation & Anr. Vs. S.G.  Koturappa & Anr. 2005 (2) SCALE 493].

The contention raised at the Bar appears to be squarely covered by   two decisions of this Court relied upon by Mr. Alex.  In Syndicate Bank  (supra) Wadhwa, J. speaking for the Division Bench observed :           

"14. Two principles emerge from the decisions: (1)  principles of natural justice and duty to act in a just, fair  and reasonable manner have to be read in the Certified  Standing Orders which have statutory force. These can be  applied by the Labour Court and the Industrial Tribunal  even to relations between the management and workman  though based on contractual obligations; and (2) where  domestic inquiry was not held or it was vitiated for some  reason the Tribunal or Court adjudicating an industrial  dispute can itself go into the question raised before it on  the basis of the evidence and other material on record.

15. In the present case action was taken by the Bank  under clause 16 of the Bipartite Settlement. It is not  disputed that Dayananda absented himself from work for  a period of 90 or more consecutive days. It was thereafter  that the Bank served a notice on him calling upon him to  report for duty within 30 days of the notice stating  therein the grounds for the Bank to come to the

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conclusion that Dayananda had no intention of joining  duties. Dayananda did not respond to the notice at all. On  the expiry of the notice period the Bank passed orders  that Dayananda had voluntarily retired from the service  of the Bank."

It was further held : "18. The Bank has followed the requirements of  clause 16 of the Bipartite Settlement. It rightly held that  Dayananda has voluntarily retired from the service of the  Bank. Under these circumstances it was not necessary for  the Bank to hold any inquiry before passing the order. An  inquiry would have been necessary if Dayananda had  submitted his explanation which was not acceptable to  the Bank or contended that he did report for duty but was  not allowed to join by the Bank. Nothing of the like has  happened here. Assuming for a moment that inquiry was  necessitated, evidence led before the Tribunal clearly  showed that notice was given to Dayananda and it is he  who defaulted and offered no explanation of his absence  from duty and did not report for duty within 30 days of  the notice as required in clause 16 of the Bipartite  Settlement."

The aforementioned legal position was reaffirmed by a decision of  three-Judge Bench in Punjab & Sind Bank (supra), wherein it has been held :

"\005Under this rule the employee is given an opportunity  to rejoin duty within a stipulated time or explain his  position to the satisfaction of the management that he has  no intention of not joining duty, and a presumption will  be drawn that the employee does not require the job  anymore and will stand retired from service. Thus, there  is no punishment for misconduct but only to notice the  realities of the situation resulting from long absence of an  employee from work with no satisfactory explanation  thereto\005".            

In the fact situation obtaining therein it was held that there had been  sufficient compliance for principle of natural justice.

In Syndicate Bank (supra), this Court  noticed the decision of three- Judge Bench of this Court in D.K. Yadav vs. J.M.A. Industries Ltd. [(1993)  3 SCC 259] whereupon the Industrial Tribunal had placed strong reliance.   In D.K. Yadav (supra)  admittedly no opportunity was given to the workman  and no inquiry was held.  In that situation, it was observed :   "8. The cardinal point that has to be borne in mind, in  every case, is whether the person concerned should have  a reasonable opportunity of presenting his case and the  authority should act fairly, justly, reasonably and  impartially. It is not so much to act judicially but is to act  fairly, namely, the procedure adopted must be just, fair  and reasonable in the particular circumstances of the  case. In other words application of the principles of  natural justice that no man should be condemned unheard  intends to prevent the authority from acting arbitrarily  affecting the rights of the concerned person."

Keeping in view the fact that we have ourselves considered the  pleadings of the parties as also the materials on records, it is not necessary to  remit the matter to the Tribunal as it would not serve any purpose.  So far as  the appeal preferred by the workman is concerned, it is not necessary to

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entertain the same as it is evident that Section 17-B of the of the Industrial  Disputes Act cannot now be applied in view of the fact that the workman did  not file an affidavit before the learned Single Judge in support of his  contentions and as required under law. Having regard to the facts and circumstances of the case and for the  reasons stated hereinbefore, we are of the opinion that the appeal preferred  by the Bank should be allowed and that of the workman should be  dismissed.  However, in the facts and circumstances of the case, there shall  be no order as to costs.