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U.P State Road Transport Corpn. v. Subhash Chandra Sharma And Others
Factual and Procedural Background
Respondent 1, a driver with the U.P. State Road Transport Corporation (“the appellant”), was served a charge-sheet dated 16-8-1989 alleging three acts of misconduct:
- Habitual absence from duty between June 1988 and May 1989 and non-submission of mileage forms.
- Unauthorisedly moving Bus No. 8680 from Badaun to Bareilly on 19-5-1989 after telling the conductor the vehicle was defective, and making a false entry regarding the defect.
- Entering the cash room on 24-5-1989 in a drunken state, demanding money from the Assistant Cashier, abusing him and threatening assault.
The enquiry, conducted by a retired District Judge (Shri S.C. Jain), found the first charge unproved, the second partly proved (unauthorised removal of the bus without the conductor), and the third fully proved. A show-cause notice was issued on 12-8-1991 and the respondent was removed from service by order dated 31-8-1991.
An industrial dispute was referred to the Labour Court on 31-3-1993. By award dated 6-12-1996, the Labour Court upheld the enquiry’s validity but held the penalty of removal “excessive,” substituting it with stoppage of one wage increment and 50% back wages. The appellant’s writ petition was summarily dismissed by the High Court on 27-4-1998. The present appeal before the Supreme Court followed.
Legal Issues Presented
- Whether, after affirming the validity of the domestic enquiry, the Labour Court had jurisdiction under Section 11-A of the Industrial Disputes Act, 1947 to substitute the penalty of removal with a lesser punishment on the facts of this case.
- Whether the High Court, in writ jurisdiction, erred in declining to interfere with the Labour Court’s reduction of penalty.
Arguments of the Parties
Appellant's Arguments
- Once the Labour Court found the departmental enquiry free from infirmity, it had no authority to interfere with the quantum of punishment unless the penalty was shockingly disproportionate.
- The High Court should have corrected this error and restored the order of removal.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| B.C. Chaturvedi v. Union of India (1995) 6 SCC 749 | Section 11-A empowers Labour Courts/Tribunals to modify punishment; High Courts may interfere only when the punishment is “shockingly disproportionate.” | Used to frame the standard of review: reduction of penalty is permissible only within the limits of proportionality. |
| Colour-Chem Ltd. v. A.L. Alaspurkar (1998) 3 SCC 192 | Reiterated that dismissal can be set aside as “legal victimisation” if grossly disproportionate to the misconduct. | Invoked, with quotation, to illustrate circumstances under which interference with penalty is justified. |
| Hind Construction & Engineering Co. Ltd. v. Their Workmen, AIR 1965 SC 917 | Earlier authority relied on in Colour-Chem for the proposition regarding disproportionate punishment. | Cited indirectly to reinforce the proportionality principle. |
Court's Reasoning and Analysis
The Supreme Court reiterated that Section 11-A confers limited discretion on Labour Courts to alter punishment; such discretion is circumscribed by the test of whether the penalty is “shockingly disproportionate.” Applying this yardstick, the Court held:
- The third charge—entering the cash room in a drunken state, demanding money, abusing and threatening the Assistant Cashier—constitutes serious misconduct.
- Given the gravity of the proved misconduct, the punishment of removal could not be characterised as shockingly disproportionate.
- The Labour Court’s substitution of removal with a minor penalty was therefore “capricious and arbitrary.”
- The High Court failed to exercise its supervisory jurisdiction under Article 226 by summarily dismissing the writ petition and allowing the erroneous award to stand.
Holding and Implications
Appeal Allowed. The Supreme Court set aside both the High Court’s judgment dated 27-4-1998 and the Labour Court’s award dated 6-12-1996, thereby restoring the appellant’s original order of removal dated 31-8-1991. No order as to costs.
Implications: The decision reinforces that Labour Courts may reduce a dismissal to a lesser penalty only when the punishment is demonstrably disproportionate; mere disagreement with the employer’s choice of penalty is insufficient. It underscores the High Court’s duty to correct such jurisdictional errors in writ proceedings.
S. Saghir Ahmad, J.— Leave granted.
2. Respondent 1 (hereinafter referred to as “the respondent”), who was a driver in the U.P State Road Transport Corporation (the appellant), was charge-sheeted on 16-8-1989 for disciplinary proceedings. Three charges were indicated in the charge-sheet. The first charge related to his habitual absence from duty for the period June 1988 to May 1989, regarding which he also did not submit the mileage form. The second charge was that on 19-5-1989, when he reached Badaun at about 9 p.m with Bus No. 8680, he informed the Conductor, Dinesh Kumar, that the bus had developed some defects and, therefore, he parked the bus in Badaun Workshop. Dinesh Kumar, Conductor, went to sleep in another bus, but when he woke up in the morning he found that the bus was taken by the respondent to Bareilly, regarding which an information was also given by Dinesh Kumar to the Station-in-Charge, Badaun. The bus was also seen coming back from Bareilly. It was noticed that in order to cover up his act of taking the bus to Bareilly, the respondent got a remark entered in his duty form by Rampal, Vulcanizer of Badaun Depot, about the defect in the bus. The third and last charge against the respondent was that on 24-5-1980 at about 8.30 p.m, he, along with Shiv Kumar Sharma, Conductor, went to Ramesh Chandra, Assistant Cashier, in the cash room in a drunken state. He demanded money from Ramesh Chandra and when the latter refused, the respondent abused and threatened to assault him, which was treated as an act of misconduct. The charges were inquired into by Shri S.C Jain, a retired District Judge, who was appointed as the Enquiry Officer.
3. The Enquiry Officer submitted the report on 21-9-1990, in which he found that the charge about habitual absence was not proved against the respondent. The other charge relating to taking the bus to Bareilly was also not established, but it was established that he had taken out the bus unauthorisedly from Badaun Workshop to some place without taking the Conductor in the bus. The third charge of misconduct was found fully established. Thereafter, a show-cause notice was issued to the respondent on 12-8-1991, and by order dated 31-8-1991, he was removed from service.
4. On an industrial dispute being raised by the respondent, a reference was made on 31-3-1993 to the Labour Court for adjudication. The Labour Court, by its award dated 6-12-1996, came to the conclusion that though the departmental enquiry did not suffer from any infirmity, the punishment of “removal” was excessive. It consequently set aside the order of removal and substituted the punishment of removal by the punishment of stoppage of one-wage increment and payment of 50% of the back wages. The award was challenged by the appellant before the High Court in a writ petition which was dismissed summarily on 27-4-1998.
5. Learned counsel appearing for the appellant has contended that once it was found by the Labour Court that the departmental enquiry conducted against the respondent was proper and it did not suffer from any infirmity, it was not open to it to interfere with the quantum of punishment. It is contended that the High Court should have, on that ground, set aside the award and maintained the order of removal passed against the respondent.
6. Whether it is open to the Industrial Tribunal or the Labour Court or the High Court to interfere with the quantum of punishment is, no longer, res integra, as the question has been answered by this Court several times in its various decisions. In B.C Chaturvedi v. Union of India (1995) 6 SCC 749, (1996) 32 ATC 44 a three-Judge Bench of this Court has held that Section 11-A of the Industrial Disputes Act, 1947 confers power on the Industrial Tribunal/Labour Court to apply its mind on the question of proportion of punishment or penalty. It was held that this power is also available to the High Court under Article 226 of the Constitution, though it was qualified with a limitation that while seized with this question as a writ court, interference is permissible only when the punishment/penalty is shockingly disproportionate. Again, a three-Judge Bench of this Court in Colour-Chem Ltd. v. A.L Alaspurkar (1998) 3 SCC 192 relying upon an earlier decision in Hind Construction & Engg. Co. Ltd. v. Workmen AIR 1965 SC 917, (1965) 2 SCR 85, (1965) 1 LLJ 462 laid down as under:
“Consequently it must be held that when looking to the nature of the charge of even major misconduct which is found proved if the punishment of dismissal or discharge as imposed is found to be grossly disproportionate in the light of the nature of the misconduct or the past record of the employee concerned involved in the misconduct or is such which no reasonable employer would ever impose in like circumstances, inflicting of such punishment itself could be treated as legal victimisation.”
7. Section 11-A of the Industrial Disputes Act provides as under:
“11-A. Powers of labour courts, tribunals and national tribunals to give appropriate relief in case of discharge or dismissal of workmen.—Where an industrial dispute relating to the discharge or dismissal of a workman has been referred to a labour court, tribunal or national tribunal for adjudication and, in the course of the adjudication proceedings, the labour court, tribunal or national tribunal, as the case may be, is satisfied that the order of discharge or dismissal was not justified, it may, by its award, set aside the order of discharge or dismissal and direct reinstatement of the workman on such terms and conditions, if any, as it thinks fit, or give such other relief to the workman including the award of any lesser punishment in lieu of discharge or dismissal as the circumstances of the case may require:
Provided that in any proceeding under this section the labour court, tribunal or national tribunal, as the case may be, shall rely only on the materials on record and shall not take any fresh evidence in relation to the matter.”
8. This section, as interpreted by this Court, no doubt, vests the Labour Court with discretion to substitute the order of discharge or dismissal of a workman into an order of reinstatement of the workman on such terms and conditions, if any, as it thinks fit or give such other relief to the workman including the award of any lesser punishment in lieu of discharge or dismissal as the circumstances of the case may require. In the present case, the following industrial dispute was referred to the Labour Court for adjudication:
“Whether the termination of the service of their workman Shri Subhash Chandra Sharma, s/o Shri Nathimal, Driver by the employer by order dated 31-8-1991 is proper and legal. If not, what is the relief (with details) which the workman is entitled to.”
9. The Labour Court, while upholding the third charge against the respondent nevertheless interfered with the order of the appellant removing the respondent from the service. The charge against the respondent was that he, in a drunken state, along with the Conductor went to the Assistant Cashier in the cash room of the appellant and demanded money from the Assistant Cashier. When the Assistant Cashier refused, the respondent abused him and threatened to assault him. It was certainly a serious charge of misconduct against the respondent. In such circumstances, the Labour Court was not justified in interfering with the order of removal of the respondent from the service when the charge against him stood proved. Rather we find that the discretion exercised by the Labour Court in the circumstances of the present case was capricious and arbitrary and certainly not justified. It could not be said that the punishment awarded to the respondent was in any way “shockingly disproportionate” to the nature of the charge found proved against him. In our opinion, the High Court failed to exercise its jurisdiction under Article 226 of the Constitution and did not correct the erroneous order of the Labour Court which, if allowed to stand, would certainly result in a miscarriage of justice.
10. We, therefore, allow the appeal, set aside the impugned judgment of the High Court and the award dated 6-12-1996 of the Labour Court. There shall, however, be no order as to costs.
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