Graphite India, Ltd. v. State Of West Bengal And Others

For Appellant.— Sri P.P Ginwalla, Sri Montosh Mukherji, Sri Satyen Dey and Sri Ramesh Chowdhury.

For Respondents.— Sri Arun Prakash Chatterjee and Sri Dipak Kumar Banerjee.

The Judgment of the Court was delivered by

M.M Dutta, J.:— This appeal is at the instance of Graphite India, Ltd., and it is directed against the judgment of a learned Judge of this Court whereby he discharged the rule nisi obtained by the appellant-company challenging the propriety of the award of the Ninth Industrial Tribunal, Durgapur. By the said award, the learned Tribunal reinstated respondent 4 Ratan Chandra Das Gupta in his post with effect from the date of his dismissal with all back-wages.

2. Respondent 4 was at all material time an inspector in the production control department of the appellant-company. On 3 July 1971, a chargesheet was served upon him by the management, inter alia, to the following effect:

(1) On 2 July 1971, he had been asked by the supervisor of the department to sample 10 × 132 × 861 mm. size anode but instead of acting according to the instructions of the supervisor he straightway refused to carry out according to the instructions in spite of several verbal and written warnings.

(2) On 26 June 1971, while he was handed over a letter by Sri J.K Agarwal he after going through the contents of the letter straightway refused to accept the same.

Both these acts constituted major misconduct under the model standing orders.

3. Respondent 4 was suspended pending further enquiry into the charges levelled against him. One Sri Bagla Prasanna Bhatta, a Labour Officer of the appellant-company was appointed the enquiry officer. As to the charge the defence of respondent 4 was, inter alia, that the sampling job of the anode in question could be done only with two helpers or by two inspectors and one helper. As two helpers were not provided to him he could not do the job. Regarding charge (2) it was alleged by him that he did not refuse to accept the letter but said to Sri J.K Agarwal that be would accept the same after having a talk with the manager. The case of the appellant-company was that the sampling job of the type of the anode mentioned in charge (1) could be done with only one helper or by two inspectors. It was also alleged that respondent 4 refused to accept the letter of warning mentioned, in charge (2). So far as charge (1) was concerned, evidence was adduced on both sides, to prove their respective cases. The appellant-company examined four witnesses while respondent 4 examined six witnesses. On the question, whether the sampling job as referred to in charge (1) required two helpers or not, another witness, namely, A.K Das Gupta was examined by the enquiry officer out of his own. The said A.K Das Gupta was alleged to have done the sampling job of the anode in question with only one helper. It appears that respondent 4 was not given an opportunity to cross-examine the said A.K Das Gupta. The enquiry officer placed reliance on the evidence of the said A.K Das Gupta and came to the finding that the job could be done by only one helper and as respondent 4 had refused to do the work with one helper, he was found guilty of the charge. The enquiry officer also found respondent 4 guilty of charge (2). The resident director of the appellant-company concurred with the finding of the enquiry officer and found respondent 4 guilty of the charges and by his order, dated 21 September 1971, dismissed him from the service of the appellant-company with immediate effect.

4. Thereafter, the appellant-company filed an application under S. 33(2)(b) of the Industrial Disputes Act, 1947, before the Ninth Industrial Tribunal for the approval of the action in dismissing respondent 4. The Tribunal by its order, dated 3 November 1971, held that proper and legal enquiry was held against respondent 4 as required under the law, and that the appellant-company was able to make out a prima facie case against respondent 4 and all principles of natural justice were also observed. Accordingly, the Tribunal by its said order approved of the action taken by the appellant-company in dismissing respondent 4 from the service of the company.

5. Subsequent to the order of the Tribunal under S. 33(2)(b) a reference was made by the State Government under S. 10 of the Industrial Disputes Act, 1947, to the Ninth Industrial Tribunal. The dispute that was referred to the Tribunal for adjudication was whether the dismissal of respondent 4 was justified and to what relief, if any, he was entitled. The Tribunal found that as respondent 4 was not given an opportunity to cross-examine the said A.K Das Gupta who was examined by the enquiry officer suo motu the finding of the enquiry officer as to charge (1) regarding the incident, dated 2 July 1972, was perverse and there was violation of the principles of natural justice. According to the Tribunal, the enquiry officer ought to have given respondent 4 an opportunity to cross-examine the said A.K Das Gupta. As to charge (2), the Tribunal found that in view of rule 27 (xx) of the model standing orders of the year 1969 providing that refusal to accept a charge-sheet, order or other communication intended for service of any worker was a misconduct, the conduct of respondent 4 in refusing the letter of warning tantamounted to misconduct. It was, however, pointed out by the Tribunal that rule 28(6) of the said standing orders provided that in awarding punishment the manager or the employer should take into account the gravity of the misconduct, the previous record, if any, of the workman and any other extenuating or aggravating circumstances that might exist. The Tribunal held that the management was not at all justified in dismissing respondent 4 for simply refusing to accept the letter of warning tendered to him by the said J.K Agarwal on 26 June 1977, on the plea that he would accept it after having a talk with the manager. According to the Tribunal a lesser punishment would have been sufficient. Ultimately, the Tribunal held that the management was not at all justified in dismissing respondent 4 on the basis of the findings of the enquiry officer on the above two charges. It was held that respondent 4 was entitled to be reinstated with effect from the date of his dismissal with all back-wages. The Tribunal also expressed the view that in the circumstances, it was not inclined to award any lesser punishment in lieu of dismissal.

6. Being aggrieved by the said award or the Tribunal, the appellant-company challenged the same by filing a writ petition and obtained a rule nisi. In upholding the finding of the Tribunal the learned Judge took the view that denying the delinquent an opportunity to cross examine the witness upon whose evidence the enquiry officer had placed reliance was violation of the principles of natural justice. Further, the learned Judge observed that it was not known under what provision of law or under what procedure the enquiry officer himself called his own witness to prove the case of the management and accordingly, that conduct itself showed that the enquiry officer was biased. The learned Judge held that, in the circumstances the entire enquiry conducted against respondent 4 was vitiated. In that view of the matter, the learned Judge discharged the rule nisi. Hence this appeal.

7. Sri Ginwalla, learned advocate appearing on behalf of the appellant-company, has urged the following contentions:

(1) Denial to a party of an opportunity of oral cross-examination is not necessarily the violation of the principles of natural justice because all that is required is an opportunity to criticize, comment on and rebut any material relied on against the party.

(2) Assuming that there has been violation of the principles of natural justice it is not open to the Tribunal so to hold after finding in the proceeding under S. 33(2)(b) of the Industrial Disputes Act, 1947, that there has been no such violation.

(3) Assuming that it is open to the Tribunal to come to the question again, the Tribunal having found that there has been violation of the principles of natural justice, it should have decided the issue excluding the evidence of the said A.K Das Gupta.

(4) The Tribunal has committed an error of law apparent on the face of the record in holding that the finding of the enquiry officer is perverse.

(5) Having come to the conclusion that the second charge was proved and the employer was entitled to dismiss respondent 4 the Tribunal had no valid ground and was not entitled in law to interfere with the decision on merit.

(6) The Tribunal ought to have considered whether compensation should be awarded in lieu of reinstatement.

8. The first contention made on behalf of the appellant-company involves the question whether the principles of natural justice were violated by the management in imposing an order of dismissal on respondent 4. It has been stated already that, the enquiry officer examined on his own the said A.K Das Gupta who was not cited as witness by appellant-company. The enquiry officer directed that the said A.K Das Gupta would be examined by him only. After the witness was examined by the enquiry officer, he did not offer respondent 4 any opportunity to cross-examine the witness. Indeed after the conclusion of examination of the witness, the enquiry officer called upon the defence representative to examine respondent 4. In finding respondent 4 guilty of the charges levelled against him, the enquiry officer mainly relied on the evidence of the said A.K Das Gupta, who was examined by him only. It does not appear from the report of the enquiry officer that he had applied his mind to or properly considered the evidence of witnesses examined by respondent 4. In these circumstances, the question that arises is whether the principles of natural justice were violated.

9. It has been urged by Sri Ginwalla that as respondent 4 was present at the time the said A.K Das Gupta was examined by the enquiry officer and had the opportunity to criticize, comment and rebut the evidence there was no question of violation of the principles of natural justice. In Sur Enamel and Stamping Works, Ltd. v. Workmen [A.I.R 1963 S.C 1914], it has been observed by the Supreme Court that an enquiry cannot be said to have been properly held unless:

(i) The employee proceeded against has been informed clearly of the charges levelled against him;

(ii) the witnesses are examined — ordinarily in the presence of the employee — in respect of the charges;

(iii) the employee is given a fair opportunity to cross-examine witnesses;

(iv) he is given a fair opportunity to examine witnesses including himself in his defence if he so wishes on any relevant matter; and

(v) the enquiry officer records his findings with reasons for the same in his report.

In State of Mysore v. Shiva basappa [A.I.R 1963 S.C 375] it has been observed by the Supreme Court that when the evidence is oral, normally the examination of the witness will, in its entirety, take place before the party charged, who will have full opportunity of cross-examining him. Further, it has been observed that the position is the same when a witness is called, the statement given previously by him behind the back of the party is put to him, and admitted in evidence, a copy thereof is given to the party, and he is given an opportunity to cross-examine him. In an earlier decision in Union of India v. T.R Varma [A.I.R 1957 S.C 882], the Supreme Court observed as follows:

“Stating it broadly and without intending it to be exhaustive, it may be observed that rules of natural justice require that a party should have the opportunity of adducing all relevant evidence on which he relies, that the evidence of the opponent should be taken in his presence, and that he should be given the opportunity of cross-examining the witnesses examined by that party, and that no materials should be relied on against his without him being given an opportunity of explaining them.”

10. The above decisions of the Supreme Court clearly lay down that when a witness is examined against a party that party, should be given an opportunity to cross-examine that witness. On behalf of the appellant-company, much reliance has been placed on a Bench decision of this Court in Kishanlal Agarwalla v. Collector of Land Customs [A.I.R 1967 Cal. 80]. In that case, a Division Bench of this Court observed as follows:

“No natural justice requires that there should be a kind of a formal cross-examination Formal cross-examination is procedural justice. It is governed by rules of evidence. It is the creation of Courts and not a part of natural justice but of legal and statutory justice. Natural justice certainly includes that any statement of a person before it is accepted against somebody else, that somebody else should have an opportunity of meeting it whether it is by way of interrogation or by way of comment does not matter. So long as the party charged has a fair and reasonable opportunity to see, comment and criticize the evidence, statement or record of which the charge is being made against him, the demands and the test of natural justice are satisfied. Cross-examination in that sense is not the technical cross-examination in a Court of law in the witness box.”

11. On behalf of the appellant in that case, the observation of the Supreme Court In T.R Varma case [A.I.R 1957 S.C 882], as quoted above and the decision of the Supreme Court in State of Mysore v. Shivabasappa [A.I.R 1963 S.C 375] (vide supra), were relied on. But the learned Judges in Kishanlal case [A.I.R 1967 Cal. 80] (vide supra), distinguished the said cases on the ground that they were governed by either rule 55 of the Fundamental Rules giving the aggrieved party the right to cross-examine or by the rules of service. We are, however, unable to distinguish the two Supreme Court cases particularly the observation in T.R Varma case quoted above on the ground as relied on by the learned Judges in Kishanlal case referred to above. In T.R Varma case (vide supra), the observation of the Supreme Court was not made on the basis of rule 55 of the Fundamental Rules, but on the general principle of natural justice, if under any rule the party charged has to be given an opportunity to cross examine any witness that may be examined against him and if no such opportunity is given to that party, it will be a case of violation of the rule and the question of violation of the principles of natural justice will not arise. In T.R Varma case (vide supra), the Supreme Court did not refer to rule 55 but laid down in a broad manner the principles of natural justice which included affording to the party an opportunity to cross-examine the witnesses examined against him. In Kishanlal case (vide supra), the learned Judges have placed reliance on the observation of Venkatarama Aiyar, J., in State Of Madhya Pradesh v. Chintaman Sadashiva Waishampayan [A.I.R 1961 S.C 1623], to the effect that the only obligation which the law casts on the Tribunals exercising quasi-judicial functions is that they should not act on any information which they may receive unless they put it to the party against whom it is to be used and give him a fair opportunity to explain it. Aiyar, J., was not considering the question whether rules of natural justice required that a party against whom certain witnesses had been examined should be afforded an opportunity to cross-examine the witnesses. All that has been laid down in the said observation of Aiyar, J., is that the Tribunals should not act on any information unless they put it to the party against whom it is to be used and given him a fair opportunity to explain it. In view of the decision in the case of Sur Enamel and Stamping Works Ltd. v. Workmen (vide supra), where it has been clearly laid down that giving to the employee a fair opportunity to cross-examine the witnesses examined against him is one of the principles of natural justice, the decision in Kishanlal case (vide supra), in so far as it holds that no natural justice requires that there should be a kind of formal cross-examination and the decision in Hari Pada Maitra v. President, Calcutta Improvement Tribunal [A.I.R 1970 Cal. 154], which followed Kishanlal case (vide supra), are contrary to the principles of law laid down by the Supreme Court in the above cases. Accordingly, we hold that the principles of natural justice require that a person against whom certain charges have been levelled should be given an opportunity to cross-examine the witnesses examined against him in support of the charges.

12. It has, however, been argued on behalf of the appellant-company that although A.K Das Gupta was examined by the enquiry officer, respondent 4 not having asked for an opportunity to cross-examine the said witness, there was no question of violation of the principles of natural justice. In support of that contention, reliance has been placed on behalf of the appellant company on a Bench decision of this Court in Sovachand Mulchand v. Collector of Central Excise and Land Customs [A.I.R 1968 Cal. 174]. In that case, it has been observed that if the accused does not ask for an opportunity to cross-examine after coming to know of the evidence adduced against him, the accused cannot later be heard to complain that the principles of natural justice were denied to him. The question to be considered is whether the aggrieved party was given a reasonable opportunity to cross-examine a witness and answer to that will depend on the facts and circumstances of each particular case. It may so happen that in a case the conduct of an aggrieved party may lead to the inference that he was not inclined to cross-examine a particular witness. In such a case, the contention that the principles of natural justice were denied to him would not be available to him. In the instant case, it is quite clear that such an opportunity was denied to respondent 4. The enquiry officer directed that the said A.K Das Gupta would, be examined by him only. The word “only” is significant and it excluded the question of cross-examining that witness by any other party in other words, the enquiry officer by his said direction made it clear to the parties that respondent 4 would not be allowed to cross examine the said witness. In the circumstances, there can be no doubt that it would have been futile for respondent 4 to ask for an opportunity to cross-examine the witness. The special feature of the instant case is, as stated already; that the enquiry, officer mainly relied on the evidence of A.K Das Gupta in holding respondent 4 guilty of charge (1). After considering the facts and circumstances, we have no hesitation in holding that respondent 4 was denied the principles of natural justice in defending him in the departmental proceeding relating to charge (1). In this regard, we affirm the finding of Tribunal of a learned Judge.

13. The second contention of the appellant-company is that in the proceeding under S. 33(2)(b) of the Industrial Disputes Act, the Tribunal having found that there had been no violation of the principles of natural justice, it was not open to the Tribunal, to hold to the contrary in the present proceeding. In other words, it is urged that the finding of the Tribunal in the proceeding under S. 33(2)(b) that a proper and legal enquiry was held against respondent 4 as required under the law would operate as res judicata in the present proceeding. It is now a well established principle of law that the finding on an issue in order to be res judicata in a subsequent proceeding, the issue must have been heard and finally decided. In a proceeding under S. 33(2)(b), the Tribunal may approve of the action of the employer against his employee on a prima facie finding that the enquiry held against the employee was proper and legal and that all the principles of natural justice were complied with. The Tribunal is, therefore, not to decide finally as to the legality and propriety of the enquiry but it comes to a prima facie finding in that regard. As the point cannot be said to have been finally decided by the Tribunal; there is no question of the finding of the Tribunal operating as res judicata in a subsequent proceeding. The Karnataka High Court in Amalgamated Electricity Company Ltd. v. Workmen [1975 I L.L.N 74], has laid down that the finding recorded in proceeding under S. 33(2)(b) regarding the validity of a domestic enquiry cannot be used as res judicata in a subsequent reference under S. 10 even though the questions that arise for consideration are the same. The Supreme Court in G. Mckensie & Co., Ltd. v. Its workmen [A.I.R 1959 S.C 389], has observed that as the purpose of S. 33 of the Industrial Disputes Act is merely to give of withhold permission and not to adjudicate upon an industrial dispute, any finding under S. 33 would not operate as res judicata and bar the raising of an industrial dispute. On behalf of the appellant-company a distinction has been sought to be made between the raising of an industrial dispute and the findings to be made by the Tribunal in such a dispute. It is contended that although there is no bar to the raising of an industrial dispute, the Tribunal will be precluded from holding against the legality of an enquiry by the employer against its workman on the ground of non-compliance of the rules of natural justice, if in a proceeding under S. 33(2)(b) the Tribunal upheld the enquiry as legally and properly held. We are unable to accept this contention. The principles of res judicata out the jurisdiction of the Court or Tribunal to entertain any suit or proceeding. If an issue operates as res judicata, it cannot be raised again in a subsequent suit or proceeding. It, therefore, follows that when the raising of a dispute is permitted and the Tribunal is entitled to entertain the same, there could be no question of res judicata preventing the Tribunal from determining that dispute. The contention made on behalf of the appellant-company in this regard is overruled.

14. We propose to consider the third and fifth contentions of the appellant-company last. The fourth point that has been urged on behalf of the appellant-company is that the Tribunal has committed an error of law apparent on the face of the record in holding that the finding of the enquiry officer on charge (1) is perverse. Submissions were made on behalf of either party as to the import and connotation of the word “perverse?” We do not think that it is necessary for us to lay down what is the true meaning and scope of the word “perverse” for the Tribunal held that the finding of the enquiry officer holding respondent 4 guilty of charge (1) was vitiated as the enquiry officer did not comply with the rules of natural justice by giving respondent 4 an opportunity to cross-examine the said A.K Das Gupta. We have upheld the said finding of the Tribunal and, as such, we do not think that we are called upon to consider whether the Tribunal was justified in observing that the finding of the enquiry officer on charge (1) was also perverse.

15. The sixth contention of the appellant-company is that the Tribunal ought to have considered whether compensation should be awarded in lieu of reinstatement. The same contention was made before the learned Judge. The learned Judge, after considering certain authorities on the point, overruled the same. It is contended that the employer having lost confidence in respondent 4 he should not be reinstated. Such a broad proposition is difficult to be accepted. There may be some special circumstances where it would be inexpedient to reinstate the workman, namely, where such reinstatement would be hazardous or prejudicial to the interest of the industry on the ground of security, where a workman is entrusted with an office of trust and confidence and where there is evidence that there is a reasonable possibility of recurrence of trouble. Reference in this connexion may be made to Hindusthan Steel, Ltd., Rourkala v. A.K Roy [(1969) 3 SCC 513: A.I.R 1970 S.C 1401]; Francis Klein and Company (Private), Ltd. v. Their workmen [1971 S.C.L.J 512], and Tulsi Das Paul v. Second Labour Court, West Bengal [1971 S.C.L.J 517], There is no evidence in the instant case of any such circumstance so as to justify awarding of compensation in lieu of reinstatement of respondent 4. The contention of the appellant-company, therefore, fails.

16. It has been found by the Tribunal that undoubtedly the act of respondent 4 in refusing to accept the letter of warning tantamounted to misconduct. In other words, the Tribunal finds that charge (2) has been proved against respondent 4. The Tribunal, however, has referred to rule 28(6) of the standing orders which provides that in awarding punishment, the manager or the employer shall take into account the gravity of the misconduct, the previous record, if any, of the workman and any other extenuating or aggravating circumstances that may exist. It has been held by the Tribunal that in the circumstances, the management was not at all justified in dismissing respondent 4 simply for refusing to accept the letter of warning tendered to him by the said J.K Agarwal on 26 June 1971. According to the Tribunal, a lesser punishment would be sufficient so far as charge (2) was concerned. The Tribunal, however, has not imposed such lesser punishment; on the contrary, the Tribunal has expressed its disinclination to award any lesser punishment in lieu of dismissal. It has dearly come to the finding that the act of respondent 4 tantamounted to misconduct. There can be no doubt that in view of S. 11A of the Industrial Disputes Act, 1947, the Tribunal had the jurisdiction to award a lesser punishment in lieu of dismissal. The Tribunal, however was not inclined to award any lesser punishment. No reason has been given by the Tribunal why it was not inclined to award a lesser punishment. The Tribunal also does not appear to have considered the service records of respondent 4. In the circumstances, the Tribunal does not appear to have considered the question properly in accordance with law. There is, therefore, some substance in the fifth contention made on behalf of the appellant-company.

17. The third contention of the appellant-company now remains to be considered by us. It is argued on behalf of the appellant-company that the Tribunal having found that there has been violation of the principles of natural justice, it was the duty of the Tribunal to decide charge (1) after excluding the evidence of A.K Das Gupta. The Tribunal only considered whether the rules of natural justice were complied with in the enquiry that was held against respondent 4. It came to the finding that the enquiry was not properly and legally held as respondent 4 was not given an opportunity to cross-examine the said A.K Das Gupta. Section 11A empowers the Tribunal to reappraize the evidence and examine the correctness of the finding arrived at the enquiry. The Tribunal has not considered the evidence adduced on behalf of either party in the enquiry proceeding as respondent 4 was not given an opportunity to cross-examine the said A.K Das Gupta. In our view the Tribunal has not properly discharged its duty as enjoined by S. 11A. The objectionable part in the enquiry was the evidence of the said A.K Das Gupta on which much reliance was placed by the enquiry officer in holding respondent 4 guilty of charge (1). The Tribunal could have easily excluded the evidence of A.K Das Gupta and thereafter considered the other evidence on record and come to a finding as to the guilt or otherwise of respondent 4. In this connexion, we may refer to a decision of the Supreme Court in Workmen of Firestone Tyre and Rubber Company of India (Private), Ltd. v. Firestone Tyre, and Rubber Company of India (Private), Ltd. [1973 I L.L.N 278], where it has been observed that it is only on the basis of the materials that the Tribunal is obliged to consider whether the misconduct is proved and the further question whether the proved misconduct justifies the punishment of dismissal or discharge. The expression “materials on record” occurring in the proviso to S. 11A has been considered by the Supreme Court as follows in Para. 46 at page 296:

“…the ‘materials on record’ in the proviso must be held to refer to materials on record before the Tribunal. They take in —

(1) the evidence taken by the management at the enquiry and the proceedings of the enquiry; or

(2) the above evidence and in addition, any further evidence led before the Tribunal; or

(3) evidence placed before the Tribunal for the first time in support of the action taken by an employer as well as the evidence adduced by the workmen contra.”

One of the materials, therefore, is the evidence taken by the management at the enquiry and the proceedings of the enquiry. The employer did not pray for adducing any evidence before the Tribunal. The Tribunal should have, on the basis of the materials on record, namely, the evidence adduced in the enquiry proceeding by the management as also by respondent 4 considered whether the misconduct of respondent 4 was proved and the further question whether the proved misconduct justified the punishment of dismissal or a lesser punishment in lieu thereof. The Tribunal has not, as stated already, applied its mind to the materials on record after excluding the evidence of A.K Das Gupta. In the circumstances, we are of the opinion that the case has not been properly considered by the Tribunal.

18. For the reasons aforesaid, we set aside the judgment of the learned Judge and the award of the Tribunal and send the matter back to the Tribunal with a direction to come to a finding as to the guilt or otherwise of respondent 4 in respect of both the charges upon considering the materials on record, that, is the evidence adduced on behalf of either party in the enquiry proceeding excluding, however, the evidence of the said A.K Das Gupta. If the Tribunal comes to the finding that the guilt of respondent 4 either under one or both the charges is proved, the Tribunal shall thereafter consider whether it would award a lesser punishment in lieu of dismissal. Needless to say. If the Tribunal comes to the finding that the guilt of respondent 4 has not been proved either under charge (1) or under charge (2), the Tribunal shall reinstate respondent 4 with effect from the date of his dismissal with all back-wages. As both sides have adduced sufficient evidence at the enquiry, the Tribunal shall not entertain any further evidence at the instance of either party. The Tribunal shall dispose of the proceeding as expeditiously as possible and if it is not otherwise inconvenient, it shall dispose of the same by the end of January 1980.

19. The appeal is allowed, but in view of the facts and circumstances of the case there will be no order for costs.

20. Sharma, J.:— I agree.