R.R.K Tripathi, J.:— In the aforesaid three writ petitions, counter and rejoinder-affidavits have been exchanged between petitioners and contesting respondent No. 2. The State though accepted notice long back but as usual no counter-affidavit has been filed in any of the writ petitions. Learned counsel for the parties have agreed that the writ petitions may be decided finally at this stage. In all the writ petitions common questions of law and fact are involved and they may be conveniently decided by a common judgment.
2. Petitioners are employees of Modipon Fibres Company, Modinagar, which is a division of M/s. Modipon Limited, Modinagar, district Ghaziabad. They were employed as clerks in the establishment. By the impugned orders dated 13th May, 1993 passed in Civil Misc. Writ Petition Nos. 18116 of 1993 and 18113 of 1993 and 12th May, 1993 passed in Civil Misc. Writ Petition No. 18117 of 1993, their services have been terminated under Clause 19(a)(bb) of the Certified Standing Orders which are in force in the establishment w.e.f 4th June, 1970. It is also stated that they were amended on 19th December, 1988. The orders also speak about payment of the compensation under Section 6-N of the U.P Industrial Disputes Act, 1947 and in lieu of the notice under Clause 19(a) of the Certified Standing Orders. Petitioners have challenged the Certified Standing Order, 1990 as unconstitutional, violative of Articles 14 and 16 of the Constitution and principles of natural justice, as orders have been passed by way of punishment without serving any charge-sheet, without holding enquiry and without giving any opportunity of hearing. Clause 19(bbb) of Certified Standing Orders, 1990 has also been challenged as arbitrary and unreasonable. Petitioners have stated that they were serving in the establishment as permanent employees since 1973 and they cannot be deprived of their jobs in this manner. It has also been stated that the petitioners have no equally, efficacious and alternative remedy before the Labour Court as they cannot challenge the validity of the Certified Standing Orders before the Labour Court. The claim of the petitioners has been resisted by respondent No. 2 by filing counter-affidavits and it has been stated that the respondent's establishment is not ‘State’ within the meaning of Article 12 of the Constitution and is an establishment in the private sector and public limited company and in view of this the decision of the Supreme Court appended to the writ petitions will not be applicable to this case. It has been further said that the petitioners were working in Stores and Transport Department. It was noticed on 3rd February, 1993 by the employer that one truck load of D.M.T which is raw-material for polyester yarn, has been suspected of having been taken away by the petitioners and their associates and has been sold in the market causing serious loss to the establishment and the answering respondent has lost confidence in petitioners and they are legally entitled to terminate their services, under Clause 19 of the Certified Standing Orders. Petitioners have been paid compensation. The orders passed are perfectly justified and do not suffer from any error of law.
3. Learned counsel for the petitioner has questioned the legality of the orders on the solitary ground that the provisions of Clause 19(a), 19(bb) and 19(bbb) of Certified Standing Orders are violative of Articles 14 and 16 of the Constitution of India and also violative of principles of natural justice. Learned counsel has said that the provisions of Standing Order have statutory effect, and they can be challenged in this Court under Article 226 of the Constitution and this Court can examine as to whether the provisions contained are in any way violative of Articles 14, 16 and 21 of the Constitution besides being unfair and unreasonable. Learned counsel has further submitted that as the relief sought by petitioners only rests on the examination of the legal question regarding validity of the provisions contained in Certified Standing Orders they have rightly approached this Court under Article 226 of the Constitution as the validity of the Standing Orders cannot be examined by the Labour Court. Learned counsel has further submitted that the petitioners are permanent employees of the respondent No. 2, they were serving since 1973 and all of sudden they have been deprived of their jobs without giving any opportunity of hearing. Learned counsel has submitted that if the respondents had any suspicion on basis of the material against petitioners they ought to have initiated proceedings under Clause 22(d) of the Certified Standing Orders and can hold enquiry and after giving opportunity of hearing to the petitioners they can punish-petitioners for the misconduct, but petitioners cannot be deprived of their livelihood merely on the basis of suspicion howsoever strong it may be. The impugned orders thus are violative of the principles of natural justice and are liable to be quashed on basis of the same.
4. Learned counsel for the respondents, on the other hard, has challenged the maintainability of the writ petitions on the ground of alternative remedy. It has been submitted that the petitioners can raise the dispute before the Labour Court by making reference under Section 4-K of the U.P Industrial Disputes Act, 1947, here-in-after referred to as ‘Act’, which is appropriate forum for the grievances raised. It has also been said that the challenge based on Article 14 of the Constitution is not maintainable against respondents who are private bodies. It has also been submitted that even assuming as alleged by petitioners that Certified Standing Orders are in any way unfair and unreasonable, they can be challenged before the Certifying Officer but till the Certified Standing Orders are in force, the respondent company has legal right to terminate the services of the petitioners under Clause 19(a), (bb) of the Standing Order. Learned counsel has further submitted that in Schedule of the Industrial Employment (Standing Orders) Act, 1946 item No. 8 specifically provides for termination of the employment and the notice thereof to be given by the employer to workman and Clause 19 of the Certified Standing Orders was rightly included in the draft Standing Order and rightly certified by the concerned authorities which are inforce since 1970 and cannot be challenged now. Petitioners have committed serious misconduct causing loss of confidence and the orders passed against petitioners do not suffer from any error of law. Learned counsel has submitted that Industrial Employment (Standing Orders) Act, 1946 is complete code and after referring several provisions of the Act of 1946 learned counsel for the respondents has submitted that if petitioners want to challenge the provisions of the Certified Standing Orders they should approach the authority under “the Act. Learned counsel has placed reliance on case of Satya Pal Singh Chauhan v. Chairman, Chief Executive Officer, New Okhla Industrial Development Authority, Noida Complex, Ghaziabad . 1984 49 FLR 41.. Learned counsel has also cited some authorities on the point that the writ cannot be issued under Article 226 of Constitution, against the private employer. Learned counsel has further submitted that the reasons are not required to be given in the impugned orders and they are to be supplied on demand made by the employees for which petitioners have never made any demand. In view of this it cannot be said that there is any violation of principles of natural justice.
5. After hearing learned counsel for the parties and perusal of the record, in my opinion, the validity of Clause 19 of the Certified Standing Orders is seriously in question in the present writ petitions and it would be appropriate to reproduce the provisions of Clause 19 at this place.
6. Termination of service by Establishment. —(a) For terminating the employment of a permanent workman, notice in writing shall be given by the employer, one month's notice or one month's pay, as the case may be, may be paid in lieu of notice.
(aa) For terminating the employment of a probationer, no notice will be required to be given by the management. The services of probationer would also be terminated during the period of probation at the sole discretion of the management without any notice and without assigning any reason. If a permanent workman is employed as a probationer in a new occupation, he may at any time during the period of probation, be reverted to his old permanent post without giving any notice and without assigning any reason.
(b) No temporary workman whether daily rated, monthly rated, weekly rated or piece rated shall be entitled to any notice or pay in lieu thereof if the services are terminated, but the services of a temporary workman shall not be terminated as a punishment unless he has been given an opportunity to explaining the charges of misconduct alleged against him in the manner prescribed in Standing Order No. 23.
(bb) The services of a permanent and temporary workman may be terminated by the employer for one or more of the following reasons:
(i) Loss of confidence, or
(ii) Disability and/or infirmity partial or total;
(iii) For the reasons permitted under Regulation 98 of Employees State Insurance (General) Regulations for discharging workman from the services.
(iv) Absent from work on account of being Under Police remand or conviction, imprisonment or any punishment or penalty awarded by any court constituted and/or appointed under the provisions of any law of the land.
Removal of the name of such workman for the above reasons from the muster roll of the establishment will not be considered punishment and there will, be no necessity to charge-sheet such workman or initiate any disciplinary action in such cases.
(v) Medically unfit to perform his duty.
(bbb) The reasons for termination of the employment of a permanent workman shall be communicated to him, if demanded by him unless such communication in the opinion of the management is considered undesirable from the point of view of the company and/or the management and/or employer or the person signing the communication open to criminal or civil proceedings at the instance of the workman.
(c) Where the employment of any workman is terminated by or on behalf of the employer, the wages earned by him shall be paid before the expiry of second working day from the day on which his employment was terminated in accordance with the provisions of the Payment of Wages Act for the time being in force.”
7. From perusal of the provisions contained in Clause 19(a) and 19(bb) of the Certified Standing Orders there remains no doubt that if the provisions contained therein are taken as such, the respondent is not required to state reasons for terminating the services of the employees on the ground provided under sub-clause (bb) of Clause 19, loss of confidence is the first ground mentioned therein. It cannot be disputed that the order of termination contemplated under Clause 19(a) read with (bb)(i) will amount to retrenchment under Section 2(s) of the Act and accepting this position respondents have made attempt to comply with the provisions of Section 6-N of the Act. However a perusal of the provisions contained in Section 6-N of the Act leaves no doubt that a workman is entitled for one month's notice indicating the reasons for retrenchment and he can be terminated from service after expiry of the period of notice or the workman has been paid in lieu of such notice wages for the period of the notice. A perusal of Section 6-N (a) leaves no doubt that even if in lieu of the notice wages have been paid for the period of notice, the reasons are yet to be communicated. The period of notice, can be avoided by making payment of wages for period but not the reasons for retrenchment. In my opinion, under Section 6-N (a) of the Act the employee is entitled to know the reasons of his retrenchment from the service and if this has not been done, it cannot be said that the provisions of Section 6-N of the Act have been complied with. From perusal of the impugned orders passed against petitioners it is clear that no reasons have been assigned for terminating services of the petitioners who are serving in the establishment for the last 15 years.
8. Now next question for consideration in this connection is as to whether provisions contained in the Certified Standing Orders which do not require the assignment of any reasons for passing order under Clause 19(a)(bb)(i) may prevail over the provisions of Section 6-N of the Act, in my opinion, they cannot. Industrial Employment (Standing Orders) Act, 1946 contains a general, provisions requiring employers in the industrial establishments to define terms and condition of the employment under them and to make such terms and conditions known to the workman employed by them, from the very beginning. The object is to avoid any chance of uncertainty with regard to the terms and conditions of the employment. The provisions of the Act of 1946 also ensures the uniform application of the Standing Orders to all the employees whether employed before or after enforcement of the Standing Orders in the industrial establishment. The Standing Orders thus even under the provisions of the Act of 1946 have statutory effect and stand substituted for the terms and conditions of the employment included in contract. But the provisions are general in nature whereas the provisions contained in Section 6-N of the Act of 1947 are special in nature and have special social object to achieve that no employee shall be deprived of his livelihood without knowing the reasons and shall also be paid compensation so that he may sustain himself and his family during the period of gap he gets another employment. In my opinion, the provisions of Section 6-N of the Act are towards the fulfilment of the provisions of Articles 14 and 21 of the Constitution. The impugned orders thus are liable to be quashed on the ground that they have been passed in violation of the provisions contained in Section 6-N of the Act.
9. There is yet another important aspect of the matter in this case. From perusal of the writ petitions, counter and rejoinder-affidavits it is clear that the services of the petitioners have been terminated on basis of suspicion against them with regard to the theft of one truck load of K.D.M.T Though the orders, on face of them appear to be simple orders of termination but it is not the form of action but substance of the order that is to be looked into. It is open to the court to lift the veil and gauge the effect of the impugned action to find whether its foundation is to impose punishment or is only a motive. From perusal of the material on record it leaves no doubt that the impugned orders of termination in fact have been passed by way of punishment and they are not simple orders of termination. Hon'ble Supreme Court in case of D.K Yadav v. J.M.A Industries Ltd..). while dealing with the termination of the service of employee under the Standing Order, after considering its various judgments has held that the order of termination of the service of an employee/workman visits with civil consequences of jeopardising not only his/her livelihood but also career and livelihood of dependents. Therefore before taking any action putting an end to the tenure of an employee/workman fair play requires that a reasonable opportunity to put forth his case is given and domestic enquiry conducted complying with the principles of natural justice. It would be appropriate to extract the relevant paragraphs No. 13 and 14 for better appreciation of the legal position:
“In Delhi Transport Corpn. v. D.T.C Mazdoor Congress, this Court held that right to public employment and its concomitant right to livelihood received protective umbrella under the canopy of Articles 14 and 21 etc. All matters relating to employment includes the right to continue in service till the employee reaches superannuation or until his service is duly terminated in accordance with just, fair and reasonable procedure prescribed under the provisions of the Constitution and the rules made under proviso to Article 309 of the Constitution or the statutory provisions or the rules, regulations or instructions having statutory flavour. They must be conformable to the rights guaranteed in Part III and IV of the Constitution. Article 21 guarantees right to life which includes right to livelihood, the deprivation thereof must be in accordance with just and fair procedure prescribed by law conformable to Articles 14 and 21 so as to be just, fair and reasonable and not fanciful, oppressive or at vagary. The principles of natural justice is an integral part of the guarantee of equality assured by Article 14. Any law made or action taken by an employer must be fair, just and reasonable. The power to terminate the service of an employee/workman in accordance with just, fair and reasonable procedure is an essential inbuilt of natural justice. Article 14 strikes at arbitrary action. It is not the form of action but the substance of the order that is to be looked into. It is open to the court to lift the veil and gauge the effect of the impugned action to find whether it is the foundation to impose punishment or is only a motive. Fair play is to secure justice, procedural as well as substantive. The substance of the order is the soul and the affect thereof is the end result.
It is thus well settled law that right to life enshrined under Article 21 of the Constitution would include right to livelihood. The order of termination of the service of an employee/workman visits with civil consequences of jeopardising not only his/her livelihood but also career and livelihood of dependents. Therefore, before taking any action putting an end to the tenure of an employee/workman fair play requires that a reasonable opportunity to put forth his case is given and domestic enquiry conducted complying with the principles of natural justice. In D.T.C v. D.T.C Mazdoor Congress (supra) the constitution bench, per majority, held that termination of the service of a workman giving one month's notice or pay in lieu thereof without enquiry offended Article 14. The order terminating the service of the employees was set aside.”
10. If the relevant Standing Orders Clause 19(a) and 19(bb) are read in the light of the law laid down by the Hon'ble Supreme Court in the aforesaid judgment, it cannot be said that the principles of natural justice have to be complied with for passing order of termination, even though it has not been specifically required therein. If the Standing Orders are interpreted in the way that no opportunity of hearing is required to be given, it shall become arbitrary, unjust and unfair and violative of Article 14 of the Constitution, to avoid it, in my opinion, in the present case also the provisions of Certified Standing Orders Clause 19(a) should be so read, so as to require the observance of the principles of natural justice necessary before passing order of termination. If for observing the principles of natural justice the opportunity of hearing was obligatory on the respondents to be given to the petitioners for passing the order, it is admitted position that this opportunity has not been given and the impugned orders are thus violative of the principles of natural justice. It is well established legal position that the suspicion howsoever strong may be, cannot be made basis for depriving an employee of his job and livelihood. He cannot be allowed to be condemned unheard. For these reasons the impugned orders are arbitrary having been passed in violation of the principles of natural justice and are liable to quashed.
11. At this stage, it would also be appropriate to reply the contention of the learned counsel for the respondents with regard to the maintainability of the present writ petitions on the ground of alternative remedy. As clear from the discussions made above for determining the controversy involved in the present case, no disputed questions of facts are involved. Petitioners have approached this court for challenging impugned orders passed against them mainly on a legal question which has been answered in their favour. The impugned orders are clearly in violation of the principles of natural justice and this violation is apparent on the face of record and even otherwise admitted, though sought to be justified under the provisions contained in the relevant Certified Standing Orders. In these facts and circumstances, in my opinion, it shall not serve any useful purpose if the petitioners are relegated to the alternative remedy by approaching State Government for making a reference to the Labour Court under the provisions of the U.P Industrial Disputes Act, 1947. In the facts and circumstances of the case, the objection raised by the learned counsel for the respondents regarding the maintainability of the writ petitions on this ground cannot be accepted. At this stage submission made by the learned counsel for respondents, the writ cannot be issued against a private person or body, may also be considered. Normally it cannot be done but there are well established exceptions to this rule and one of them is that if impugned action is based on some rule or order having statutory force then writ can be issued. There is no doubt that Certified Standing Orders have statutory effect and hence order may be questioned under Article 226 of the Constitution of India if they are illegal, arbitrary and violative of principles of natural justice.
12. For the reasons recorded above, these writ petitions are allowed. The impugned orders dated 13th May, 1993 passed in Civil Misc. Writ Petition Nos. 18116 of 1993 and 181118 of 1993 and 12th May, 1993 passed in Civil Misc. Writ Petition No. 18117 of 1993 terminating their services are quashed. There will be no orders as to costs.
13. Petitions Allowed.