ID Act When Charges Of Serious Nature Are Not Proved And Punishment Is Disproportionate, Labour Court Has Right To Invoke Section 11A: Gujarat High Court

Section 11A of the Industrial Disputes Act, 1947 pertains to the authority of the Labour Court, Tribunal, or National Tribunal to modify the punishment imposed by the employer on an employee in certain cases. This section empowers the adjudicating body to interfere with the punishment if it finds it disproportionate to the misconduct committed by the employee. It lays down specific conditions under which such interference is permissible, including cases where the principles of natural justice have not been followed during the disciplinary proceedings or where the punishment is found to be excessive considering the gravity of the offense.

Brief Facts:

The Respondent (“Workman”) began working as an Apprentice Lineman with the Uttar Gujarat Vij Company Ltd on January 4, 1990. Over the years, he was transferred to various locations. On July 15, 2008, the Workman was served with a show-cause notice, which led to a departmental inquiry being initiated. Following the inquiry, during which certain charges were proved, the Workman's service was terminated on September 2, 2008. Subsequent appeals by the Workman were unsuccessful. A mercy petition led to a directive for a fresh inquiry, resulting in another termination order on November 11, 2011. Dissatisfied with this, the Workman raised a dispute before the Labour Court, Himmatnagar, resulting in an order for the Workman's reinstatement with continuity of service but without back wages. Feeling aggrieved, the Management approached the Gujarat High Court (“High Court”) to challenge the award.

The Management argued that the Labour Court's award was flawed. It contended that the invocation of Section 11A of the Industrial Disputes Act was unwarranted as the principles of natural justice were followed during the inquiry. It further argued that the punishment was proportionate, all charges were proved, and the Workman's past record was considered.

In contrast, the Workman argued that the Labour Court's decision was appropriate. He maintained that the reinstatement with continuity was justified, stating the disproportionate nature of the punishment and the lack of complaints from consumers regarding the alleged misconduct. He underscored that only one charge related to irregular record-keeping was proven, and the alleged loss to the company was unsubstantiated.

Observations by the High Court:

The High Court held that the Labour Court justified its intervention in the punishment quantum by invoking the powers conferred under Section 11A of the ID Act. It noted that the Labour Court's order held the dismissal of the Workman as excessively severe considering the proven charges, which primarily involved leaving the workplace without prior permission, causing damage to company property, and negligence resulting in potential loss. Notably, it held that there were no complaints from customers regarding any losses due to the Workman's actions, and the inquiry officer's report lacked specifics on the extent of damage or loss suffered by the company. Specifically, while one charge of delayed depositing of customer payments was proven, the refunded amount indicated no actual loss to the company.

The High Court rejected the Management's argument that Section 11A is applicable only under certain conditions. It held that the Labour Court rightly held that the punishment was disproportionate, particularly when no tangible loss was incurred by the company.

The High Court held that when serious charges are not substantiated, the punishment meted out by the company is rightfully considered disproportionate. It held that this warrants the Labour Court's intervention under Section 11A. Therefore, the High Court upheld the decision of the Labour Court and dismissed the petition.

Case Title: Executive Engineer - Uttar Gujarat Vij Company Ltd Versus Patel Rasikbhai Rangabhai & Anr.

LL Citation: 2024 LiveLaw (Guj) 60

Case Number: R/SPECIAL CIVIL APPLICATION NO. 12366 of 2014

Advocate for the Petitioner: SP Hasurkar

Advocate for the Respondent: Manish Shah

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