Bombay High Court Upholds MSRTC's Right To Dismiss Conductor For Repeated Misconduct; Domestic Inquiries Do Not Require The Same Standard Of Proof As Judicial Proceedings

Background

Raghu Deu Mongal, employed as a conductor by MSRTC, was involved in an incident on May 7, 2000, where a passenger was found without a ticket during a routine inspection. The passenger claimed to have paid Rs. 3 to Mongal but was not issued a ticket. Additionally, a shortfall of Rs. 65.25 was found in Mongal's cash bag. MSRTC initiated a disciplinary inquiry, and after finding Mongal guilty of misconduct, issued a show-cause notice on January 29, 2001, proposing dismissal from service. Mongal challenged this notice before the Labour Court, which dismissed his complaint on December 4, 2002. However, Mongal succeeded in a revision before the Industrial Court, which reversed the Labour Court's decision and restrained MSRTC from dismissing him. MSRTC, dissatisfied with this outcome, filed the present writ petition.

Arguments of the Petitioner

MSRTC, represented by Ms. Pinky M. Bhansali, contended that the decision to dismiss Mongal was based on clear and sufficient evidence gathered during the departmental inquiry. The primary argument centered on the checker's testimony, which established that a passenger was traveling without a ticket, and Mongal's cash bag had a shortfall. While the evidence of the Rs. 3 fare paid to Mongal was hearsay, MSRTC argued that hearsay evidence is admissible in domestic inquiries, provided it is credible and logically relevant.

The petitioner further emphasized that Mongal had a history of similar misconduct, having been involved in 11 prior instances of cash discrepancies and ticketless travel. MSRTC asserted that the penalty of dismissal was proportionate, given the repeated nature of the offenses. The petitioner also argued that the Industrial Court erred in its decision by demanding corroborative evidence and placing undue weight on the absence of testimony from the passenger.

Arguments of the Respondent

Mr. Vaibhav Jagdale, appearing for Mongal, argued that the Industrial Court had rightly found fault with the domestic inquiry. He emphasized that the inquiry had relied on hearsay evidence, as the passenger in question was not called to testify, thus undermining the fairness of the proceedings. Mongal argued that without direct testimony from the passenger, the case against him was weakened, as the checker's statement regarding the passenger's payment of Rs. 3 to Mongal was not corroborated.

Additionally, Mongal contended that the shortfall of Rs. 65.25 in his cash bag was the result of an innocent dealing mistake, and that the amount had been immediately rectified. He argued that this minor discrepancy, when seen in isolation, did not justify the extreme penalty of dismissal. Mongal also maintained that the Industrial Court had correctly considered the procedural shortcomings of the inquiry and acted within its rights by restraining MSRTC from proceeding with the dismissal.

Judgment

The court reaffirmed State of Haryana v. Rattan Singh (1977 (2) SCC 492), which held that strict rules of evidence applicable to judicial proceedings do not govern domestic inquiries. In such proceedings, hearsay evidence is admissible as long as it is logically probative and has a reasonable nexus to the issue. The judge noted that while the testimony of the checker regarding the Rs. 3 fare paid by the passenger was hearsay, it was not inadmissible, especially since the checker had recorded the passenger's statement, which formed part of the inquiry record. The court concluded that the Industrial Court had erred by dismissing this evidence solely because the passenger did not testify in person.

Next, the court scrutinized Mongal's defense that the Rs. 65.25 shortfall in his cash bag was a minor dealing mistake. While acknowledging that the shortfall might not have justified dismissal in isolation, Justice Marne emphasized that Mongal had engaged in similar offenses 11 times prior, which revealed a pattern of behavior that merited serious disciplinary action. In light of this repeated misconduct, the court held that MSRTC's decision to impose dismissal was proportionate and not “shockingly disproportionate” as argued by Mongal. The Industrial Court's failure to consider the cumulative effect of these past offenses was a critical flaw in its reasoning.

Additionally, Justice Marne addressed Mongal's claim that the Industrial Court had correctly demanded corroborative evidence from the passenger. The court rejected this argument, holding that domestic inquiries do not require the same standard of proof as judicial proceedings. The standard in such cases is based on a preponderance of probability, not proof beyond reasonable doubt. The court found that the checker's testimony and the documented evidence, including the recorded passenger statement, provided sufficient grounds to sustain the charges. The court also noted that the checker was not an “interested witness” with any motive to falsely implicate Mongal, further reinforcing the validity of the inquiry's findings.

The court further addressed Mongal's argument that he was denied the opportunity to cross-examine the passenger. Justice Marne held that this procedural shortcoming did not vitiate the inquiry, as the essential facts had already been established through the checker's inspection and the recorded statement. The absence of the passenger's direct testimony did not weaken the inquiry's overall fairness or the conclusions drawn from it.

Finally, Justice Marne took issue with the Industrial Court's overreach in restraining MSRTC from imposing the proposed penalty. The judge reiterated that employers have an inherent right to discipline employees, provided the disciplinary process adheres to the principles of natural justice. In this case, the inquiry was found to be fair, and the Industrial Court had no basis to substitute its own judgment for that of the employer. By restraining MSRTC from enforcing the dismissal, the Industrial Court had overstepped its authority. Thus, the High Court concluded that MSRTC had conducted a fair and reasonable inquiry, and the penalty of dismissal was appropriate given the gravity of Mongal's repeated misconduct. The Industrial Court's order restraining MSRTC from dismissing Mongal was set aside, and the Labour Court's original order was restored. However, the court directed that Mongal be paid gratuity for his years of service.

Maharashtra State Road Transport Corporation V/SMr. Raghu Deu Mongal

Counsel for the Petitioner: Ms. Pinky M. Bhansali with Ms. Dharini Jain

Counsel for the Respondent: Mr. Vaibhav Jagd