Labour Court Must First Decide Fairness Of Domestic Inquiry Before Examining Merits Of Charges: Allahabad High Court

The Allahabad High Court has reiterated that where the termination of a workman on the basis of a domestic inquiry is referred to a Labour Court, the Labour Court must first decide whether the domestic inquiry was fair, and may take up the merits of the charges only after deciding that issue.It held that where the inquiry is found to be unfair, the employer must be granted an opportunity to lead evidence to prove the charges, and the Labour Court must then decide whether the charges are made out on the evidence led before it. Taking up both exercises together, the Court held, vitiates the award.Relying on Supreme Court's decision in Workmen of M/s Firestone Tyre & Rubber Co. of India (P) Ltd. vs. Firestone Tyre & Rubber Company, Justice Saurabh Shyam Shamshery observed,“..even a Workman is dismissed or any adverse action is taken against a Workman even without conducting an inquiry, in such case the Labour Court after making a declaration that no inquiry was conducted, an opportunity should be granted to Employer to prove, whether charge can be proved or not and that further proceeding will be initiated only after the Labour Court has taken a decision, whether domestic inquiry was fair or not.”A domestic inquiry was initiated by the petitioner, M/s Shahi Export House (now known as Shahi Export Pvt. Ltd.), against the respondent-workman. On the basis of the inquiry report, the workman was terminated in October 2001. The workman raised an industrial dispute before the Labour Court, Noida.The question whether the domestic inquiry conducted by the employer was fair was framed as an additional issue. Before that issue was adjudicated, the employer's evidence was also taken on record.By the impugned award, the Labour Court not only decided the additional issue but, on the evidence so recorded, returned a finding that the charges levelled against the workman were not proved. It held that the inquiry was unfair for want of sufficient opportunity to the workman. It held that the termination order was illegal.Counsel for the employer relied on a decision of the Allahabad High Court in M/s Dwarikesh Sugar Industries Ltd. v. Presiding Officer, Labour Court, Rampur and others. He submitted that the Labour Court must at the first instance decide whether the domestic inquiry was fair; if it was, the dispute proceeds no further, and if it was not, the employer must be given an opportunity to present evidence to prove the charge, on the basis of which the Labour Court decides the matter on merits. He also relied on the Supreme Court's decision in State of Uttarakhand and others v. Sureshwati which stated the above. Counsel for the workman relied on a Coordinate Bench decision of the Allahabad High Court in Shashi Export Private Limited v. State of U.P. and others, where a similar issue arose and the Labour Court concerned had adopted a similar procedure, and the employer's writ petition was dismissed. It was informed during argument that the Special Leave to Appeal against that decision was dismissed by the Supreme Court.The Court held that it could still follow M/s Dwarikesh Sugar Industries Ltd., notwithstanding the different order passed by the Coordinate Bench, because the Supreme Court judgments considered in that decision were neither placed before nor considered by the Coordinate Bench.Restating the principle laid down by the Supreme Court in Workmen of M/s Firestone Tyre & Rubber Co. of India (P) Ltd., the Court held that even where a workman is dismissed or visited with adverse action without any inquiry at all, the Labour Court must first declare that no inquiry was conducted, then grant the employer an opportunity to prove the charge, and only thereafter carry the proceedings forward."…when law on issue is very clear and reiterated by Supreme Court time and again, the procedure undertaken by Labour Court concerned, being contrary and in the teeth of judgments passed by Supreme Court, cannot be sustainable,” Court said.Accordingly, the award was set aside only to the extent that the employer had not been granted an opportunity to prove whether the charge was made out. The Court did not interfere with the Labour Court's finding that the domestic inquiry was unfair.Remitting the matter, the Court directed the Labour Court to grant the employer an opportunity to produce evidence, including fresh evidence, with a further opportunity to the workman to cross-examine, and to conclude the entire proceedings within three months. Case Title: M/s Shahi Export House (Now Known As Shahi Export Pvt. Ltd.) v. Presiding Officer, Labour Court And AnotherCounsel for Petitioners(s) :Shakti Swarup Nigam, Sr. Advocate assisted by Karshit NigamCounsel for Respondent(s) : Bushra Mariyam, Sr. Advocate assisted by Baqer MehdiClick Here To Read/Download Order

Labour Court Must First Decide Fairness Of Domestic Inquiry Before Examining Merits Of Charges: Allahabad High Court

Upasna Agrawal

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Labour Court Must First Decide Fairness Of Domestic Inquiry Before Examining Merits Of Charges: Allahabad High Court

Upasna Agrawal

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