1 Rule. Respondent waives service. By consent Rule is made returnable forthwith.
2 A short but interesting question of law arises for determination in this writ petition under Article 226 of the Constitution of India which is directed against an order dated 15th October 2010 delivered by the 12th Labour Court, Bombay in Reference (IDA) No.364 of 2004. The question of law can be framed thus: "Whether two distinct category of employees i.e one suspended pending departmental enquiry and other facing a de-novo inquiry in Court in a reference challenging his dismissal, can be equated, so as to permit the latter to claim subsistence allowance till conclusion of the reference u/s 10 of the Industrial Disputes Act, 1947?"
3 In other words, can such employee be held to be suspended pending enquiry into charges of misconduct so as to enable him to claim subsistence allowance.
4 A few facts need to be set out to decide the above framed question. The respondent was employed as higher grade clerk/typist by the petitioner-employer. He was chargesheeted for having committed misconduct under Model Standing Orders, namely, dishonesty in connection with the employer's activity, attempt to take bribe or illegal gratification and commission of an act subversive of discipline. He was dismissed from service after a departmental enquiry at which the charges were held to be proved. The respondent- employee sought a Reference and Appropriate Government referred the matter of his dismissal to the competent Labour Court. Before the Labour Court it was held that the enquiry conducted against the respondent-employee was not fair and proper and findings of the Enquiry Officer are perverse. This Award was rendered on 29th May 2010. The Labour Court thereafter afforded to the petitioner-employer the opportunity to prove the charges in Court. Thus, an opportunity was given to justify the termination of the services of the respondent- employee. It would be relevant to note that the services came to be terminated on 25th November 2002.
5 When the matter was pending and the Labour Court had directed the employer to lead evidence, an application was made by the respondent-workman on 16th August 2010 stating that since the de novo enquiry was to be held in Court, in order to enable him to participate in the same and fight the litigation, he should be paid an amount which was styled as subsistence/survival allowance. It was stated that if the enquiry before the Court drags on, it will not be possible for the respondent-employee to sustain himself as he is out of service and unemployed. Therefore, a provision in the Model Standing Orders, namely, section 10-A of the Industrial Employment (Standing Orders) Act, 1946 be invoked and applied so as to grant subsistence allowance to the respondent, from the date of the termination till the date his misconduct is proved in Court. The respondent submitted that in order to give him an opportunity to defend himself at this de novo enquiry, he should be paid subsistence allowance.
6 The foundation of the claim was that in law there is nothing which would enable the employer to conduct de novo enquiry in Court after, a declaration that the domestic/ departmental enquiry was not fair, just and proper and the findings therein are perverse, has been rendered. If no such opportunity is contemplated by law but the same is granted pursuant to judicial pronouncements, then, the same judicial pronouncements enable the respondent to claim financial assistance during the pendency of the matter before the Court. The enquiry before the Court is equivalent to an enquiry into the charges by an employer and, therefore, when the law permits claiming the subsistence allowance pending the domestic/departmental enquiry, then, the same principle should be applied and subsistence allowance at the rate of 75% of the last drawn wages be paid to the respondent- workman. Unless such a relief is granted, grave loss and serious prejudice will be caused. The same, therefore, be directed to be paid and therefore, the amount as claimed be directed to be paid to him. An affidavit in support of the said application was filed by the respondent. 7 In opposition, the petitioner-employer contended that the application is misconceived and untenable in law and should be rejected. The Labour Court has no power to grant such allowance or financial assistance. The Labour Court has to adjudicate the dispute as per the terms of reference. In the terms there is nothing which would enable the respondent to claim the subsistence allowance. It was contended that the legal right available to the petitioner to lead evidence before the Court to prove the misconduct and to justify the action taken against the respondent-employee is something which cannot be equated with a disciplinary or departmental enquiry conducted by the employer. Here, the dismissal order stands and its legality is being tested before a judicial forum. Once, it is being so tested, then, there is no question of any suspension pending domestic/departmental enquiry. Therefore, the question of applicability of Model Standing Orders does not apply. There is no prejudice to the employee. If the petitioner employer fails to prove the charges, the dismissal order will be set aside and appropriate award would be made by the Court including for backwages. Therefore, no prejudice will be caused to the respondent-employee. Instead prejudice will be caused to the petitioner if such untenable applications are granted and this can create a precedent in all cases of the present nature. On merits also there is no case made out for grant of any such relief. Therefore, the application be dismissed. This was the stand taken by the petitioner in its reply dated 30th August 2010. 8 Thereafter, the application was placed before the learned Judge of the 12th Labour Court and by the impugned order he held that the respondent is entitled to claim subsistence allowance which must be paid to him from the date of the termination. Accordingly, he directed the petitioner to pay subsistence allowance at the rate of 75% of the last drawn wages till the petitioner proves the alleged misconduct before the Court. The amount from 25th November 2002 till the end of October 2010 was directed to be paid within one month from the date of the order and thereafter the subsistence allowance at the rate of 75% of his last drawn wages was directed to be paid on tenth day of every successive month.
9 It is this order which is challenged in this writ petition under Article 226 of the Constitution of India.
10 Mr.A.V.Bukhari, learned counsel appearing on behalf of the petitioner contended that the impugned order is ex-facie erroneous and contrary to law. It suffers from serious errors apparent on the face of the record and can safely be termed as arbitrary. He submits that the application filed by the respondent was totally misconceived and not maintainable. The Labour Court exceeded its jurisdiction in granting the claim of the respondent. The claim was made on a basis which is untenable in law. The proceedings before the Court cannot be equated with a departmental/domestic enquiry by the employer. The learned Judge completely lost sight of the fact that he was dealing with a reference under section 10 of the Industrial Disputes Act, 1947. While dealing with the reference which arose out of the order of dismissal of the respondent dated 25th November 2002 the mandate was to go into the correctness and legality of the order of dismissal passed by the employer. That order was passed after a domestic enquiry was held into the charges of misconduct. The enquiry was held and the dismissal order was passed after which a reference was sought by the respondent and the matter came to be referred to the Labour Court. The Labour Court at the first stage decided the issue of fairness of the enquiry and correctness of the findings rendered by the Enquiry Officer. It held that the enquiry was not fair and proper and the findings of the Enquiry Officer are perverse. Thereafter, in law an opportunity is to be afforded to the petitioner to prove the misconduct in Court. Such a stage or situation can never be equated with suspension pending domestic enquiry. Therefore, there is no question of granting any subsistence allowance to the employee. The order of dismissal stands and if the employer is successful in proving the misconduct before the Labour Court, the Labour Court will uphold the dismissal order, which is already passed. In other words, the award of the Labour Court would then relate back to the date of the dismissal. In other words, the dismissal order is neither set aside nor is it held in abeyance as contended. Once such is the position in law, then, respondent's claim for subsistence allowance could not have been raised at all. If that could not have been raised and granted in law, then, the order of the Labour Court deserves to be quashed and set aside.
11 In support of his submissions Mr.Bukhari has relied upon a judgment of the Hon'ble Supreme Court reported in (1997) 1 Supreme Court Cases 9 (R.Thiruvirkolam v. Presiding Officer & Anr).
12 On the other hand, Mr.Pathak appearing for the respondent supported the impugned order. He submits that in such cases the enquiry before the Court into the same charges and to prove identical misconduct must be equated with a domestic enquiry or else serious prejudice will be caused to the workman. The experience is that the employers prolong the proceedings after it is held that the domestic enquiry was not fair, just and proper or the findings of the Enquiry Officer are perverse. The de novo enquiry before the Court is not held and completed expeditiously. The employee has no control over the judicial proceedings. They may drag on for decades together. In these circumstances, it will be difficult for the employee to sustain himself and particularly when he is facing a long legal battle. Therefore, in equity and in law the claim for subsistence allowance could have been made and granted. Drawing support from section 10A of the Industrial Employment (Standing Orders) Act, 1946 and the decision of the Hon'ble Supreme Court reported in 1980 Labour and Industrial Cases 1004 (Gujarat Steel Tubes Ltd etc v. Gujarat Steel Tubes Mazdoor Sabha & Ors) and a judgment of the learned single Judge of the Madras High Court reported in 2001 (2) Labour Law Notes 345 (Management of Auro Food Ltd, Auroville And Presiding Officer, Labour Court, Cuddalore & Anr), it is submitted by Mr.Pathak that Mr.Bukhari's arguments overlook the fact that the law does not contemplate a de novo enquiry in Court to prove the misconduct but such an opportunity is afforded by virtue of judicial pronouncements and particularly by virtue of the decision of the Hon'ble Supreme Court reported in 1973 Labour and Industrial Cases 851 = AIR 1973 Supreme Court 1227 (Workmen of M/s./Firestone Tyre & Rubber Co of India Pvt Ltd v. The Management & Ors). If the Industrial Disputes Act does not contemplate a de novo enquiry and the right is claimed by virtue of the judicial pronouncements, then, such pronouncements not prohibiting the grant of the subsistence allowance in equity and the situation being on par with a suspension pending domestic enquiry instituted by the employer, the workman in this case was entitled to apply for and equally the Labour Court was empowered to grant subsistence allowance. There is nothing shocking in the order of the Industrial Court as it is based on equity, fairness and justice. There is no protection for the poor employee who is forced to go to a Court of law for redressal of his grievance arising out of his wrongful dismissal and it is not expected that such protracted litigation can be conducted by him without any financial assistance. If financial assistance is granted in such deserving cases, then, the order need not be interfered with in this Court's jurisdiction under Article 226 of the Constitution of India. The said jurisdiction is equitable and discretionary. If by exercise of such jurisdiction a just order is interfered with, then, the very object and purpose of writ jurisdiction will be defeated. For all these reasons if the order of the Labour Court can be sustained otherwise, then, this Court should sustain and uphold it and dismiss this writ petition.
13 Mr.Pathak has relied upon following decisions in support of his above submissions:
(1)2004 (2) Maharashtra Law Journal 130 (Air India Ltd v. Libio Francisco Colaco & Anr);
(2)W.P.No.2234 of 2010 dt.27th October 2010 (Mumbai Cricket Association v. Pramod G. Shinde);
(3)1980 Labour and Industrial Cases 1004 (Gujarat Steel Tubes Ltd v. Gujarat Steel Tubes Mazdoor Sabha & Ors);
(4)2001(2) Labour Law Notes 345 (Management of Auro Food Ltd, Auroville v. Presiding Officer, Labour Court, Cuddalore & Anr);
(5)1973 Labour Industrial Cases 851 (The Workmen of M/s.Firestone Tyre & Rubber Co of India Pvt Ltd v. The Management and Ors); and
(6)1986 ICLR SC 440 (Fakirbhai Fulabhai Solanki v. The Presiding Officer & Anr)
14 For properly appreciating the rival contentions, it would be necessary to notice the admitted facts. The undisputed factual position is that the petitioner served a chargesheet on the respondent-employee and in accordance with the Model Standing Orders held a departmental enquiry. At the conclusion of such departmental enquiry the order of termination/dismissal was passed on 25th November 2002. That order of dismissal has been made the subject matter of a reference to the competent Labour Court. The referral order is very clear inasmuch as the Labour Court is called upon to consider as to whether order of dismissal is passed in accordance with law. The adjudication of this reference is in stages. At the first stage the Court considered whether the domestic enquiry held by the respondent- employer can be said to be fair and just and whether the finding of the Enquiry Officer in his report could be termed as perverse. After giving opportunity to both sides the Labour Court held that the enquiry in this case is not fair and proper and the findings of the Enquiry Officer are perverse. That order was delivered on 29th May 2010. However, at the same time the petitioner employer is allowed to prove the charges in Court by adducing evidence. This order of the Labour Court was challenged by the petitioner by filing a writ petition being Writ Petition No.2234 of 2010 but the learned single Judge refused to interfere with the said order and dismissed the writ petition on 27th October 2010.
15 Therefore, the reference is placed before the Labour Court for adjudication at the second stage, namely, whether the petitioner has proved the charges of misconduct. At such an adjudication opportunity will have to be given to the parties to lead evidence. The matter is pending at that stage. However, the respondent-workman made an application claiming subsistence allowance on the basis that the situation is akin to suspension pending domestic enquiry and therefore subsistence allowance be provided in terms of the provisions
contained in the Model Standing Orders. In other words, by the adjudication and the order delivered at first stage of the proceedings, the dismissal order is held in abeyance, if not set aside. If that cannot be given effect to until the employer proves the charges de novo, then, the employee can be held to be placed under suspension. The Labour Court has accepted this position and granted subsistence allowance.
16 In my view, the Labour Court has seriously erred in allowing the application. In a recent decision reported in AIR 2004 Supreme Court 4951 (Engineering Laghu Udyog Employees' Union v. The Judge, Labour Court and Industrial Tribunal & Anr) a three Judges' Bench of the Hon'ble Supreme Court was dealing with the controversy about effective date of termination and doctrine of relation back. It was held that by virtue of section 11A of the Industrial Disputes Act, 1947 a wide power is conferred on the Labour Court to give appropriate relief in case of discharge or dismissal of workman. While adjudicating on a reference made to it, the Labour Court if satisfied that the order of discharge and dismissal was not justified, it may, while setting aside the same, 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.
17 Thus, only in case a satisfaction is reached by the Tribunal that the order of the discharge or dismissal was not justified, same can be set aside. So long as the same is not set aside, it remains valid. But once where on the basis of the evidence brought on record in the domestic enquiry or by reason of additional evidence, the employer makes out a case justifying the order of dismissal, such an order of dismissal cannot be given effect to only from the date of the award but from the date of the order of punishment. Once the charges are proved before the Labour Court, the order of termination would relate back to the date of original order.
18 Referring to all the cases that have been brought to my notice by the counsel appearing for both sides, this is what is held by the Hon'ble Supreme Court:
"6. Section 11A of the Industrial Disputes Act, 1947 (for short 'the Act') confers a wide power upon the Labour Court, Tribunal or the National Tribunal to give appropriate relief in case of discharge or dismissal of workmen. While adjudicating on a reference made to it, the Labour Court, Tribunal or the National Tribunal, as the case may be, if satisfied that the order of discharge or dismissal was not justified, it may, while setting aside the same, 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. Thus, only in a case where the satisfaction is reached by the Labour Court or the Tribunal, as the case may be, that an order of dismissal was not justified, the same can be set aside. So long as the same is not set aside, it remains valid. But once whether on the basis of the evidences brought on record in the domestic inquiry or by reason of additional evidence, the employer makes out a case justifying the order of dismissal, we fail to understand as to how such order of dismissal can be given effect to only from the date of the award and not from the date of passing of the order of punishment. The distinction sought to be made by this Court in some of the matters including Gujarat Steel Tubes (supra), in our opinion, is not based on a sound premise, particularly when the binding decisions of this Court in Motipur Sugar Factory's case (supra) andWorkmen of Messrs Firestone Tyre and Rubber Company of India (P) Ltd v. Management and others, 1973 (3) SCR 387 have not been taken note of.
7. In the present case, we find that the charges were proved before the Labour Court and, thus, the High Court was correct in holding that the order of termination would relate back to the date of original order.
8. Learned senior counsel then urged that P.H.Kalyani's case (supra) in dissimilar as it was a case of defective inquiry. According to the learned senior counsel, there is a difference between a termination which is not followed by an inquiry and where an inquiry is found to be defective on account of procedural breach.
9. It is not in dispute that in a proceeding for obtaining approval of an order of dismissal from the Labour Court or the Tribunal as the case may be, in terms of Section 33(2)(b) of the Act or where a reference has been made under section 10 thereof, if it is found that an inquiry has been conducted in violation of the principles of natural justice, the employer is entitled to raise the said question in its written statement by way of preliminary issues and pray for grant of such an opportunity to prove the charges levelled against him.
10. In Workmen of Motipur Sugar Factory (Private) Ltd v. Motipur Sugar Factory, 1965 (3) SCR 588, this Court held: "It is now well-settled by a number of decision of this Court that where an employer has failed to make an enquiry before dismissing or discharging a workman it is open to him to justify the action before the tribunal by leading all relevant evidence before it. In such a case the employer would not have the benefit which he had in cases where domestic inquiries have been held. The entire matter would be open before the tribunal which will have jurisdiction not only to go into the limited questions open to a tribunal where domestic inquiry has been properly held (seeIndian Iron and Steel Cl v. Their Workmen, 1958 SCR 667 but also to satisfy itself on the facts adduced before it by the employer whether the dismissal or discharge was justified. We may in this connection refer to M/s.Sasa Musa Sugar Works (P) Limited v. Shobrati Khan, 1959 Supp SCR 836; Phulbhari Tea Estate v. Its Workmen, 1960 (1) SCR 32 and the Punjab National Bank Limited v. Its Workmen, 1960(1) SCR 806. These three cases were further considered by this Court in Bharat Sugar Mills Limited v. Shri Jai Singh, 1962 (3) SCR 684, and reference was also made to the decision of the Labour Appellate Tribunal in Shri Ram Swarath Sinha v. Belaund Sugar Co 1954 LAC 697. It was pointed out that "the import effect of commission to hold an enquiry was merely this: that the tribunal would not have to consider only whether there was a prima facie case but would decide for itself on the evidence adduced whether the charges have really been made out." It is true that three of these cases except Phulbari Tea Estate's case were on applications under S.33 of the Industrial Disputes Act, 1947. But in principle we see no difference whether the matter comes before the tribunal for approval under S.33 or on a reference under S.10 of the Industrial Disputes Act, 1947. In either case if the enquiry is defective or if no enquiry has been held as required by Standing Orders, the entire case would be open before the tribunal and the employer would have to justify on facts as well that its order of dismissal or discharge was proper. Phulbari Tea Estate's was on a reference under S.10, and the same principle was applied there also, the only difference being that in that case, there was an enquiry though it was defective. A defective enquiry in our opinion stands on the same footing as no enquiry and in either case the tribunal would have jurisdiction to go into the facts and the employer would have to satisfy the tribunal that on facts the order of dismissal or discharge was proper."
The employer thus, has got a right to adduce evidence before the Tribunal justifying its action, even where no domestic inquiry whatsoever has been held.
11. Yet again in Workmen of Messrs Firestone Tyre and Rubber Company of India (P) Ltd v. Management and others 1973(3) SCR 587 this Court while interpreting the provision of Section 11A of the Act held that in terms thereof, the management need not necessarily rely on the materials on record as while introducing Section 11A of the Act, the Legislature must have been aware of the decisions of this Court which are operating in the field for long time. This Court enunciated several principles bearing on the subject and, therefore, it held that it was difficult to accept that the expression materials on record; used in the proviso to section 11A was set at naught. The Court formulated the propositions of law emerging from the decisions rendered by this Court, the relevant portions whereof are as under:
"From those decisions, the following principles broadly emerge:-
(1) .... to (3) ...
(4) Even if no enquiry has been held by an employer or if the enquiry held by him is found to be defective, the Tribunal in order to satisfy itself about the legality and validity of the order, has to give an opportunity to the employer and employee to adduce evidence for the first time justifying his action; and it is open to the employee to adduce evidence contra.
(5) ...
(6) The Tribunal gets jurisdiction to consider the evidence placed before it for the first time in justification of the action taken only, if no enquiry has been held or after the enquiry conducted by an employer is found to be defective. (7) It has never been recognized that the Tribunal should straightway, without anything more, direct reinstatement of a dismissed or discharged employee, once it is found that no domestic enquiry has been held or the said enquiry is found to be defective.
(8) ....
Even in Firestone's case (supra), no distinction, thus, has been made between a defective inquiry and no inquiry.
12. In Gujarat Steel Tubes Ltd case (supra), 1980(2) SCR 146 Krishna Iyer, J sought to make a distinction between an approval which is required to be made under section 33 of the Act and a reference under section 10 thereof stating:
"Kalyani was cited to support the view of relation back of the Award to the date of the employer's termination orders. We do not agree that the ratio of Kalyani corroborates the proposition propounded. Jurisprudentially, approval is not creative but confirmatory and therefore relates back. A void dismissal is just void and does not exist. If the Tribunal, for the first time, passes an order recording a finding of misconduct and thus breathes life into the dead shall of the Management's order predating of the nativity does not arise. The reference to Sasa Musa in Kalyani enlightens this position. The latter case of D.C.Roy v. The Presiding Officer, Madhya Pradesh Industrial Court, Indore and others (supra) specifically refers to Kalyani's case and Sasa Musa's case and holds that where the Management discharges a workman by an order which is void for want of an enquiry or for blatant violation of rules of natural justice, the relation-back doctrine can be invoked. The jurisprudential difference between a void order, which by a subsequent judicial resuscitation comes into being de novo, and an order, which may suffer from some defects but is not still born or void and all that is needed in the law to make it good is a subsequent approval by a tribunal which is granted, cannot be obfuscated."
13. When in terms of the proviso appended to clause (b) of section 33 of the Act, an approval is sought for and is refused the order of dismissal becomes void. If an approval is not obtained still, the order of punishment cannot be given effect to. It is, therefore, not correct to contend that the Tribunal in a reference under section 10 of the Act, when passes an order recording a finding of misconduct, brings life into the dead. Unfortunately, the Court did not take notice of the binding decisions in Motipur Sugar Factory's case and Firestone's case (supra).
14. We may further notice that P.H.Kalyani's case (supra) has also recently been followed by another Constitution Bench in Jaipur Zilla Sahakari Bhoomi Vikas Bank Ltd v. Ram Gopal Sharma and others, 2002(2) SCC 244." 19 Once this legal position is taken into consideration, then, there is no scope for the arguments canvassed by Mr.Pathak. The order of dismissal remains and is not set aside. If upheld by the Court, it will be after the order of the Court in that behalf. However, it relates back to the date of punishment. If what is postponed is its coming into effect or operation, then, the argument of Mr.Pathak that it is held in abeyance must be straightway rejected. His argument would render doctrine of relation back completely nugatory. The Supreme Court has construed the provisions of the Industrial Disputes Act, 1947. The provisions give a right to the employer to adduce evidence before the Tribunal to justify its action in either cases, namely, where no domestic enquiry whatsoever has been held or where domestic enquiry has been held and the charges are proved thereat but the Court finds it to be defective. If the Hon'ble Supreme Court held that such a right is conferred by the provisions of Industrial Disputes Act and particularly section 11A thereof and that is how the Industrial and Labour Courts have been giving opportunity to the employer to adduce evidence after a conclusion is drawn that the domestic enquiry held by them is vitiated and the findings of Enquiry Officer are perverse, then, the dismissal order stands and is not set aside but what is postponed is the date of its coming into effect. That is the doctrine of relation back as explained in the foregoing paragraphs by the Hon'ble Supreme Court. To hold that the dismissal order is kept in abeyance because of such an exercise, would be contrary to law. Equally, such a situation cannot be held to be akin to a suspension pending domestic enquiry.
20 Mr.Pathak's arguments ignore the fact that subsistence allowance can be claimed in terms of the Model Standing Orders or section 10A of the Industrial Employment (Standing Orders) Act, 1946, when any workman is suspended by the employer pending investigation or enquiry into complaint or charges of misconduct against him then he is prevented from work and performing his duties until the investigation or enquiry is complete. A dismissal may or may not follow after such investigation or enquiry. Therefore, the legislature in its wisdom enacted section 10A and provided therein for payment of subsistence allowance.
21 Section 10A of the Industrial Employment (Standing Orders) Act, 1946 reads as under:
"10-A. Payment of subsistence allowance.-(1) Where any workman is suspended by the employer pending investigation or inquiry into complaints or charges of misconduct against him, the employer shall pay to such workman subsistence allowance-
(a) at the rate of fifty percent of the wages which the workman was entitled to immediately preceding the date of such suspension, for the first ninety days of suspension; and
(b) at the rate of seventy-five per cent of such wages for the remaining period of suspension if the delay in the completion of disciplinary proceedings against such workman is not directly attributable to the conduct of such workman. (2) If any dispute arises regarding the subsistence allowance payable to a workman under sub-section (1), the workman or the employer concerned may refer the dispute to the Labour Court constituted under the Industrial Disputes Act, 1947 (14 of 1947), within the local limits of whose jurisdiction the industrial establishment wherein such workman is employed is situate and the Labour Court to which the dispute is so referred shall, after giving the parties an opportunity of being heard, decide the dispute and such decision shall be final and binding on the parties. (3) Notwithstanding anything contained in the foregoing provisions of this section, where provisions relating to payment of subsistence allowance under any other law for the time being in force in any State are more beneficial than the provisions of this section, the provisions of such other law shall the applicable to the payment of subsistence allowance in that State.]"
22 A bare perusal of the same would indicate that it is enacted with a view to ensure social welfare and security. It is enacted so as to enable the employee to sustain himself pending investigation or enquiry into complaints or charges of misconduct against him. Further, the legislature takes care to clarify that the provision will come into play when any workman is suspended by the employer. Therefore, the suspension pending investigation or enquiry should not continue indefinitely so as to keep the employee out of work and ensure that the employer concludes proceedings/ investigation/ Enquiry expeditiously that section 10A has been inserted by Act 18 of 1982 with effect of 17th May 1982 in Industrial Employment (Standing Orders) Act, 1946.
23 I am unable to appreciate as to how this provision can be of any assistance to the respondent-employee in the present case. A departmental/domestic enquiry was already held against him by the petitioner employer at which it was concluded that the charges are proved. The Enquiry Officer, after such a conclusion was recorded by him in his report, forwarded it to the employer and the employer acting on the same has dismissed the respondent from service with effect from 25th November 2002. The employee sought a reference from the Appropriate Government and that is how the matter of his dismissal is referred to the Labour Court and that is how the Court is seized of the matter. The Court cannot be equated with an employer as it is only performing a judicial function of giving an opportunity to the petitioner to adduce evidence to prove charges of misconduct before it, and that is because the law postulates such an opportunity. The law does not equate this situation with suspension b the employer pending domestic enquiry or investigation into any complaints. The Supreme Court decision cannot be extended by analogy to such a situation as that would produce startling consequences. In all such matters merely because the Court grants the employer an opportunity to adduce evidence to prove the charges of misconduct, it will be obliged to direct the employer to pay subsistence allowance to the employee. That would mean that the order of dismissal already passed against the employee is set aside and substituted by his suspension. That would be creating a situation wherein the order of the Court permitting de novo enquiry means an order of suspension of the employee enabling him to claim subsistence allowance. If the charges of misconduct are grave and serious and the employee is already dismissed, then, paying him any subsistence allowance or sustenance allowance which may in a given case be 75% or more of his last drawn wages, would mean that he is allowed to resume work although the employer has already dismissed him. Ultimately, if the dismissal is justified by the employer, then, an order will have to be made directing the employee to bring back the monies already paid. Apart therefrom, allowing him to resume work or in lieu thereof pay him 75% of wages would be putting a premium on his misconduct and in a given case, fraud. That will be in contravention of the object and purpose sought to be achieved by industrial adjudication. 24 In AIR 1964 Supreme Court 737 (M/s.J.K.Cotton Spinning and Weaving Mills Co Ltd V. The Labour Appellate Tribunal of India & Anr) as far as industrial adjudication is concerned, the Supreme Court holds thus:
"19.Then Mr.Pathak was driven to contend that the ground of social justice given by the Labour Appellate Tribunal in support of its award is really not sound in law, and he referred us to the observations made by this Court on some occasions that the considerations of social justice were "not only irrelevant but untenable" vide J.K.Iron and Steel Co. Ltd., Kanpur v. Iron and Steel Mazdoor Union, Kanpur, 1955-2 SCR 1315: (AIR 1956 SC 231) and Muir Mills Co. Ltd. v. Suti Mills Mazdoor Union, Kanpur, 1955-1 SCR 991 : [(S) AIR 1955 SC 170]. In our opinion the argument that the considerations of social justice are irrelevant and untenable in dealing with industrial disputes, has to be rejected without any hesitation. The development of industrial law during the last decade and several decisions of this Court in dealing with industrial matters have emphasised the relevance, validity and significance of the doctrine of social justice : vide Messrs. Crown Aluminium Works v. Their Workmen, 1958 SCR 651: (AIR 1958 SC 30) and State of Mysore v. Workers of Gold Mines, 1959 SCR 895 : (AIR 1958 SC 923). Indeed, the concept of social justice has now become such an integral part of industrial law that it would be idle for any party to suggest that industrial adjudication can or should ignore the claims of social justice in dealing with industrial disputes. The concept of social justice is not narrow, or one-sided, or pedantic and is not confined to industrial adjudication alone. Its sweep is comprehensive. It is founded on the basic ideal of socio economic equality and its aim is to assist the removal of socio-economic disparities and inequalities; nevertheless, in dealing with industrial matters, it does not adopt a doctrinaire approach and refuses to yield blindly to abstract notions, but adopts a realistic and pragmatic approach. It, therefore, endeavours to resolve the competing claims of employers and employees by finding a solution which is just and fair to both parties with the object of establishing harmony between capital and labour, and good relationship. The ultimate object of industrial adjudication is to help the growth and progress of national economy and it is with that ultimate object in view that industrial disputes are settled by industrial adjudication on principles of fair- play and justice. That is the reason why on several occasions, industrial adjudication has thought it fit to make reasonable provision for leave in respect of the workmen who may not strictly fall within the purview of the Factories Act or the Shops and Commercial Establishments Act. We are, therefore, satisfied that there is no substance in the grievance made by Mr.Pathak that the labour Appellate Tribunal should not have granted the demand of the respondents for leave on grounds of fair play and social justice."
25 Therefore, on spacious grounds of equity and justice, the Labour Court cannot be empowered to grant any subsistence allowance or financial assistance of the nature claimed by the respondent in this case. The request made by the respondent could not have been granted and the order of the Labour Court in that behalf is totally unsustainable in law.
26 Mr.Pathak submits that if the orders of the present nature are set aside, then, employers may delay the enquiry or prolong or protract it endlessly. In such a situation, a employee who is already dismissed from services will be seriously prejudiced as grave hardship and irreparable loss will be caused to him. Therefore, the Court should extend the principle laid down in the Supreme Court's decisions referred to above and read into the same an implied power of the Labour Court to grant such a relief. In this behalf he has relied upon the decision of the Division Bench of this Court in the case of Air India Limited (supra). Far from assisting Mr.Pathak, this decision is re-enforcing the conclusion arrived at by me. The question which arose for determination of the Division Bench is whether dismissed employee against whom an application is filed by the employer under section 33(2)(b) of Industrial Disputes Act, 1947 seeking approval to the imposition of the penalty from dismissal of services, is entitled to subsistence allowance pending the final disposal of the application. The Division Bench had before it a case arising out of an application for approval made by the employer post termination of the services of the employee. The Division Bench was considering the ambit and scope of section 33(2)(b) which appears in Chapter VII of the Industrial Disputes Act, 1947. After referring to the object of the said provision in para 5, the Division Bench noted distinction between section 33(1) and section 33(2). The Division Bench was dealing with the ambit and scope of section 33(2)(b) and after referring to the Supreme Court decisions in the field, it concluded that there is a distinction between section 33(1) and section 33(2) and section 33(3). In the former cases previous permission of the authority concerned has to be obtained before any action is taken against the workman whereas under section 33(2)(b) only approval to an action already taken is required to be sought. It is in that context it referred to the case of Fakirbhai Fulabhai Solanki (supra) and made the observations made in paragraphs 16 and 17 which are relied upon by Mr.Pathak. But what Mr.Pathak failed to note is the conclusion in paragraph 20 of the decision in the case of Air India Ltd (supra) which reads thus: "20. Broadly the cases in the Tribunal could be categorised in three categories. As far as the first category of cases is concerned, they are cases in which a workman is dismissed for misconduct after due inquiry and on scrutiny by the Labour Court or the Tribunal, as the case may be, also the inquiry is found to be valid. In such cases, there would be no justification for providing payment of subsistence allowance to the workmen concerned. The mandate of the statute is to
complete the proceedings within a period of three months. If in every case application for interim order is filed and on that application considerable amount of time is spent both before the Tribunal and Labour Court and before the High Court, the legislative mandate of early hearing of the application would be completely defeated. In such cases, the Tribunal would be justified in taking up the main application for approval for hearing. But there are cases in which either the domestic inquiry held by the management is set aside on the ground that it was defective or there was only a facade of an inquiry or there was no inquiry at all. But for the procedure evolved by the decisions of the Court in the interest of speedy finalisation of the cases in which the workmen were dismissed from service, by requiring the Labour Court or the Tribunal itself to hold a de novo inquiry, the position would have been, the moment it is established that the domestic inquiry is invalid or there was no domestic inquiry at all, the penalty imposed would have had to be set aside, but without prejudice to the right of the management to hold a de novo inquiry. In that situation, during the period of de novo inquiry, the management may be asked to give subsistence allowance to the workmen concerned in accordance with the Standing Orders or the rules regulating the condition of service. It is because of the procedure, namely, the holding of domestic inquiry by the Labour Court/Tribunal itself, evolved by the decision of the Court, it has resulted in this situation viz., even as the order of dismissal remains undisturbed, a de novo inquiry is held to find out as to whether dismissal was justified or not. We are of the opinion that if de novo inquiry is ordered to justify the order of dismissal and the matter has been unduly protracted for no fault of the workmen, the Tribunal would be justified in awarding subsistence allowance to the workman in appropriate cases. We, however, hasten to add that the grant of interim relief is not a matter of course and the exercise of such power should be used sparingly and only in deserving cases."
27 These observations of the Division bench must be read in their entirety. So read, they must be held to be confined to cases covered by section 33 of the Industrial Disputes Act, 1947 and particularly in the light of the controversy before the Bench. They cannot be extended to cases of dismissal in which Reference is made under section 10 of the Industrial Disputes Act, 1947 to the Labour Court. The observations cannot be read out of context and applied to cases of the present nature. This decision, therefore, cannot be of any assistance to Mr.Pathak and particularly because of the clarification of the Division Bench itself, namely, that there will be no justification for providing payment of subsistence allowance to the workman where he is dismissed for misconduct after due enquiry and on scrutiny by the Labour Court/Tribunal enquiry is found to be valid. 28 In the light of the observations of the Hon'ble Supreme Court in three Judges Bench decision referred by me above and particularly the observations in paragraph 15, it is clear that the Labour Court has ample powers, if it finds that the employee is dragged into endless or futile litigation. If the employer is unable to prove the charges of misconduct even if of serious nature, by adducing additional evidence before the Court, then, in conclusive and final order the Labour Court while granting appropriate relief to the workman it may also direct payment of backwages and take care of the victimisation of the employee by the employer as held by the Hon'ble Supreme Court. 29 Therefore, it is not as if the hardship to the employee has not been taken note of by the Hon'ble Supreme Court or has gone completely unnoticed till date.
30 Therefore, the apprehension of Mr.Phatak cannot be said to be well founded. In the view that I have taken, it is not necessary to go into any wider question and particularly as to whether this Court in its jurisdiction under Article 226 of the Constitution of India can direct payment of subsistence allowance as has been done by the learned single Judge of the Madras High Court. While declining to enter into this controversy, I may observe that while exercising jurisdiction under Article 226 of the Constitution of India this Court cannot issue any direction contrary to law or pass any orders for which there is no basis or foundation in law. Ultimately, equity and justice require that legal principles are adhered to and not given a go-by completely. 31 In the result, writ petition succeeds. The order of the Labour Court is set aside. The application of the respondent praying for subsistence allowance or financial assistance from the petitioner is dismissed. Rule is made absolute in terms of prayer clause (b). However, in the circumstances, there will be no order as to costs. 32 Bearing in mind that the reference is made in 2004, the Labour Court should endeavour to dispose off the same by 31st May 2011. Order accordingly.