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Management Of Digwadih Colliery v. Tata And Iron Steel Co. Ltd.
Management of Digwadih Colliery v. Ramji Singh
Factual and Procedural Background
The respondent, Ramji Singh, had been employed by the appellant, the Management of Digwadih Colliery, for over ten years. On 17 May 1960 he was dismissed from service after a domestic enquiry found him guilty of misconduct under Standing Order 19(13), which prohibits lending money to or borrowing money from subordinate employees. Singh allegedly advanced a loan to a subordinate, Jay Narain.
Contending that his dismissal violated Section 33(2) of the Industrial Disputes Act, 1947 and was otherwise improper, Singh filed an application under Section 33-A before the Industrial Tribunal. The Tribunal upheld his contentions, ordered his reinstatement within one month, and awarded him half wages for the period of unemployment. The Management obtained special leave to appeal to the Supreme Court, resulting in the present decision.
Legal Issues Presented
- Whether a single act of lending money to a subordinate employee amounts to misconduct under Standing Order 19(13).
- Whether the respondent’s dismissal contravened Section 33(2) of the Industrial Disputes Act, 1947 owing to Reference No. 60 of 1959 allegedly pending between the Management and its employees.
- Whether the domestic enquiry was conducted fairly, particularly regarding the respondent’s opportunity to cross-examine witnesses.
Arguments of the Parties
Respondent’s Arguments
- The dismissal order violated Section 33(2) because Reference No. 60 of 1959 was pending, rendering him a “workman concerned” entitled to statutory protection.
- The domestic enquiry was unfair; he was allegedly not permitted to cross-examine the Management’s witness.
Appellant’s Arguments
- Standing Order 19(13) was clearly breached because any single act of lending money to a subordinate constitutes misconduct.
- Section 33(2) was not attracted since Reference No. 60 of 1959 concerned chaprasis and watchmen, whereas the respondent was a Grade III clerk and therefore not a “workman concerned.”
- The enquiry was fair; the record showed that the respondent declined to cross-examine the witness.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| New India Motors (P) Ltd. v. Morris, AIR 1960 SC 875; (1960) 1 LLJ 551 | Broad interpretation of the phrase “workman concerned” in Section 33(2) of the Industrial Disputes Act. | The Tribunal relied on the “broader view” stated in this judgment; the Supreme Court held that such reliance was misplaced because the respondent failed to establish the nature of the pending dispute and his connection to it. |
Court's Reasoning and Analysis
1. Misconduct under Standing Order 19(13): The Court held that clause 19(13) prohibits any act of lending or borrowing money between an employee and a subordinate; it does not require proof of running a “money-lending business.” Consequently, even a single loan violates the Standing Order. The Tribunal’s contrary view, influenced by the wording of the chargesheet (“money-lending business”), was found erroneous.
2. Applicability of Section 33(2): To claim protection under Section 33(2), the respondent had to show that he was a “workman concerned” in Reference No. 60 of 1959. The application contained no details of the pending dispute, and the Management asserted that the reference involved only chaprasis and watchmen. Without evidence of the dispute’s nature or the respondent’s involvement, the Tribunal’s finding of contravention was deemed unsustainable.
3. Fairness of the Domestic Enquiry: The Tribunal found the enquiry unfair because the respondent could not cross-examine a witness. The Supreme Court examined the enquiry record, which stated that the respondent had himself declined cross-examination. The Court held that merely challenging the record’s accuracy did not prove it incorrect and that the enquiry had been properly conducted. Having determined that the enquiry was fair and that the factual findings were not perverse, the Court accepted the Enquiring Officer’s conclusion of misconduct.
Holding and Implications
Appeal Allowed; Tribunal’s award set aside; respondent’s application under Section 33-A dismissed.
The immediate effect is that Ramji Singh is not entitled to reinstatement or back wages, and there is no order as to costs. The judgment turns on factual application of Standing Order 19(13) and the evidentiary burden under Section 33(2); it does not announce a new legal principle of wider precedent.
Gajendragadkar, J.— The respondent Ramji Singh was in the service of the appellant the Management of Digwadih Colliery for over 10 years. On May 17, 1960, he was dismissed from service. Thereupon he made an application to the Industrial Tribunal under Section 33-A of the Industrial Disputes Act. He alleged that the order of dismissal passed against him by the appellant contravened the provisions of Section 33(2) of the Act and was otherwise improper and illegal. The Tribunal in substance has upheld both these contentions. In the result the Tribunal has ordered the appellant to reinstate the respondent in its service within one month and to pay him half the wages during the period of his forced unemployment. It is against this award that the appellant has come to this Court by special leave.
2. It appears that the respondent was served with a charge-sheet that he had committed misconduct under Standing Order 19(13) of the appellant, and the respondent was told that an enquiry would be held into the alleged misconduct. An enquiry was accordingly held where evidence was led and a report was made by the enquiring officer that the charge under 19(13) had been proved against the respondent. Acting on that report the respondent had been dismissed.
3. The case against the respondent was that he had given a loan to another employee of the appellant, Jay Narain by name, and the appellant held that lending money to a subordinate employee constituted misconduct under clause 19(13) of the Standing Orders. The Tribunal has taken the view that even if this loan is held to be proved a single transaction of lending money to a subordinate employee cannot be said to constitute money-lending business for he has observed that “one swallow does not make a summer”. In coming to this conclusion the Tribunal has unfortunately based itself solely on the charge which uses the word “money-lending business”. In deciding the question as to whether the facts proved constituted the contravention of 19(13) it was clearly necessary to consider the provisions of 19(13) itself, and if the Tribunal had considered the said provision it would have immediately found that what is prohibited by the said clause is lending money to, or borrowing money from, subordinate employees. Now, the words used in the relevant clause do not permit the introduction of consideration as to what would be money-lending business. A single transaction of lending money or borrowing money would fall within the terms of clause 19(13). Therefore, the view taken by the Tribunal that even if the facts held to be proved are assumed to be correctly found that would not contravene 19(13) is wrong.
4. The Tribunal has then held that the appellant had contravened the provisions of Section 33(2) of the Act in dismissing the respondent. In coming to this conclusion the Tribunal has purported to follow a decision of this Court in the case of New India Motors (P) Ltd. v. Morris AIR 1960 SC 875, (1960) 1 LLJ 551 and it has observed that the broader view of the requirements of Section 33(2) enunciated by this Court in the said decision supported the respondent's case. In our opinion, this conclusion is also not justified.
5. Even if the broader construction of Section 33(2) is adopted it is necessary to enquire what was the subject-matter of Reference No. 60 of 1959. The respondent's case set out in his application appears to be that because there was Reference No. 60 of 1959 pending between the appellant and some of its employees Section 33(2) applied, but unless it is known as to what was the nature of the dispute pending in the said Reference it would plainly be impossible to decide whether the respondent is a workman concerned within the meaning of Section 33(2). In his application the respondent has made no averment about the nature of the said dispute; and so the Tribunal was clearly in error in holding that the broad construction of Section 33(2) automatically led to the conclusion that the respondent was the workman concerned and could therefore claim the protection of Section 33(2).
6. On the other hand the appellant denied before the Tribunal that the respondent was concerned in the said dispute; and in its statement of case the appellant has clarified the position by stating that the dispute in Reference No. 60 of 1959 was on behalf of the chaprasis and watchman of Jamadoba and Digwadih Collieries for withdrawal of their over-time wages, and the respondent is a clerk Grade III and it is urged he could not be said to be a workman concerned with this dispute. As we have just indicated even without this clarification it was necessary that the respondent should have satisfied the Tribunal by proving the nature of the dispute ending in Reference No. 60 of 1959, before asking the Tribunal to make a finding in his favour under Section 33(2), and in the absence of any such evidence, the Tribunal was not justified in holding that Section 33(2) applied and had been contravened. That being out view, we do not think it necessary to consider whether the alleged contravention is proved.
7. That takes us to the merits of the case. The Tribunal has held that the enquiry was not fair inasmuch as the respondent was not allowed to cross-examine the witness who deposed in the said enquiry. This finding is plainly inconsistent with the statement by the enquiring Officer on the record of the proceedings. That statement shows that the respondent declined to cross-examine the said witnesses. It is true that Mr Choudhri contends that the respondent does not accept the accuracy of the said record but from the mere fact that the respondent challenged the accuracy of the said record, it does not follow that the record is proved to be inaccurate. Under these circumstances, therefore, we do not think that the Tribunal was justified in holding that the enquiry was unfair. We have gone through the proceedings of the enquiry which have been filed before the Tribunal and we have looked at the report made by the Enquiring Officer. The dispute ultimately centred on a very narrow point. Jay Narain, to whom the respondent is alleged to have advanced a loan, has made inconsistent statements. In one statement, he supported the charge, while in another, he denied. The enquiring Officer took the view that Jay Narain had not the courage to stick to his statement that he had borrowed money from the respondent because he was under pressure. Whether that is correct or not is not a matter which the Tribunal was entitled to consider. If a domestic enquiry is held and conducted properly, the conclusions reached in the enquiry on questions of fact cannot be interfered with unless they can be properly characterised as perverse. In the circumstances of this case, we see no justification for holding that the said conclusion is perverse. Therefore, the finding of the Tribunal in the domestic enquiry that the appellant herein had contravened clause 19(13), must be taken to be correct, and if that is so, the order of dismissal is plainly consistent with the Standing Order. That being the position, we see no reason for upholding the order passed by the Tribunal, directing the appellant to reinstate the respondent.
8. The result is the appeal is allowed, the order passed by the Tribunal is set aside and the respondent's application under Section 33-A of the Act, is dismissed. There will be no order as to costs.
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