Rajib Ranjan and others v R. Vijay Kumar
Supreme Court of India

14 October 2014
Cr.A. No(s). 729-732 of 2010
The Judgment was delivered by : Arjan Kumar Sikri, J.
1. These appeals are filed by four appellants, who were arrayed as accused persons in the complaint case No.183/2007 filed by the respondent herein before the Court of Judicial Magistrate No.II, Tiruchirapalli, Tamil Nadu. The complaint has been filed under Sections 120-B, 468, 420 and 500 of the Indian Penal Code (for short 'the IPC'). The learned Judicial Magistrate took cognizance of the said complaint and summoned the appellants. The appellants (who were arrayed as accused Nos.3, 4, 5 and 6) challenged the said summoning orders and sought quashment of the complaint by filing petition u/s. 482 of the Code of Criminal Procedure (for short 'the Cr.P.C.) inasmuch as according to them the allegations in the complaint did not make out any offence under the aforesaid provisions of the IPC; the complainant had neither any locus standi nor any legal status to prefer any such complaint; the appellants being public servants and Gazetted officers of the State Government of Chhattisgarh, no such criminal proceedings could be initiated against them without prior sanction from the appointing authority as per S. 197 of the Cr.P.C.; and the complaint was blatant misuse and abuse of the process of Court which was filed by the complainant after exhausting the civil remedies in which he had failed. The High Court, after examination of the matter, has not found any merit in any of the aforesaid contentions raised by the appellants and, consequently, dismissed their petitions.
2. Before we advert to the submissions of the appellants, which are mirror image of what was argued before the High Court, it would be appropriate to traverse through the relevant facts and events leading to the filing of the said complaint by the complainant. These are as under:
The Chhattisgarh State Electricity Board (for short 'the CSEB') issued an advertisement inviting tender (NIT) bearing No. T- 136/2004 dated 02.06.2004 for its work at Hasedeo Thermal Power Station (Korba West) towards Designing, Engineering, Testing, Supply, Erection & Commission of HEA Ignition system. The applications received there under were required to be processed in three stages successively namely; Part-I (EMD); Part-II (Techno- Commercial Criteria) and Part III (Price Bid). The respondent herein submitted an application on 26.08.2004 as Chief Executive Officer of M/s Control Electronics India (CEI) requesting for Tender Document. The application was rejected on the ground that it was accompanied by incomplete documents i.e. non-submission of documentary evidence of past performance and experience of the respondent. The respondent made a complaint dated 06.09.2004 against appellant No. 3 herein alleging that the Tender Documents were not issued to the respondent. It was followed by several letters requesting for issuance of Tender Documents. He was informed that rather than pressurising the appellants here or other officials, he should furnish documents as per pre-qualifying condition of the Tender. In response thereto, vide his letter dated 05.11.2004, the respondent filed a copy of purchase order dated 28.01.2002 placed by Jharkhand State Electricity Board (for short 'the JSEB') and assured to supply other documentary evidence (performance report) subsequently. On such assurance, the Tender Documents were issued to the respondent. The respondent vide his letter dated 08.12.2004, mentioned that the Performance Report was enclosed in Part-II. However, the said report was not found enclosed and even after repeated requests from the CSEB to furnish documents, respondent did not fulfill the necessary requirement. As the respondent did not submit the necessary documents, the CSEB sought the information from the Chief Engineer of JSEB (arrayed in the complaint as accused No.2) vide letter dated 10.12.2004 about the performance of the respondent. Appellant No.2 herein was also deputed to get the desired information from JSEB. After meeting the officials of JSEB, appellant No.2 submitted his report stating that the works carried out by the respondent were not satisfactory as many defects were found therein. As per the appellants, even technical expertise was sought from SE (ET & I) KW (CSEB) and found that the respondent was not technically suitable as per the technical vetting and comparative data of SE (ET & I) KW letter dated 04.02.2005. On that basis, tender of the respondent was rejected. The appellants submit that as an outburst, in not getting the Tender in his favour, the respondent made complaints alleging irregularities to various fora including the State Government, which ordered the CSEB to conduct an enquiry. The CSEB submitted its report on 21.02.2006 stating that there were no such irregularities and that the respondent had not furnished the necessary documents despite repeated requests. At this stage, the respondent filed the Civil Suit (26-A/06) before the Civil Judge Class-II, Korba against the CSEB. However, the respondent moved an application seeking to withdraw the said suit. In any case he did not appear on the date fixed and accordingly the suit was dismissed for non-prosecution on 12.09.2006. The respondent herein then filed a Writ Petition No.2951 of 2006 before the Chhattisgarh High Court which was dismissed on 25.06.2007. Even costs of Rs.25,000/- was imposed while dismissing the writ petition with the observations that it was abuse of the process of Court. Thereafter, SLP No.15897 of 2007 was preferred by the respondent which also came to be dismissed vide order dated 14.09.2007. After the exhaustion of these remedies, albeit unsuccessfully, the respondent filed a complaint before K.K. Nagar P.S., Thirucharapalli, Tamil Nadu. The police authorities refused to register the same on the ground that it is a civil dispute. It is, thereafter, that the respondent filed the said Criminal Complaint under Sections 120-B, 468, 420 & 500 IPC before the trial Court, which was registered as C.C. No. 183/07 and the trial Court issued summons to the appellants herein and accused No.1 (Successful Bidder) & accused No. 2 (then Chief Engineer, JSEB). Petitions of the appellants seeking quashing of the said complaint have been dismissed by the order of the High Court, which is impugned before us.
3. A reading of the said complaint reveals the following broad allegations levelled by the respondent:
(a) The respondent/complainant alleges that the appellants and accused No.1 (Successful Bidder) & accused No. 2 (then Chief Engineer, JSEB) had conspired secretly to disentitle the complainant's company by creating a discredit and for the said purpose, they were in constant touch so as to create the said Performance Report Cum Certificate, which was issued by accused No.2.
(b) The respondent/complainant alleges that the said conspiracy started with an agreement entered into by the 1st accused and the appellants herein and they planned to fabricate the said certificate dated 28.12.2004. For this purpose, accused No. 2 was approached so as to tailor the certificate totally discrediting the CEI (Company of the Complainant) with reference to supply and service relationship with Patratu Thermal Power Station (for short 'the PTPS') and JSEB.
(c) The respondent/complainant alleges that the said Certificate cum Report is false, fabricated, motivated and malafide and the same was contrary to the minutes of meeting that the complainant and his officials had with the officials of PTPS and JSEB. He further alleges that for the said reasons, the accused No. 2 was demoted from his post.
(d) The respondent/complainant alleges that on suspicion of such Certificate Cum Report, the complainant visited the CSEB and on verifying about the same, he found that the said tender was being given to Company of the 1st accused against the Complainant's Company and so he wrote a letter to the Chief Secretary and Chairman of JSEB for verifying and cancelling such certificate. He also wrote to many officials of the CSEB.
(e) The respondent/complainant alleges that the said Certificate is perse defamatory as against the complainant's company and is a crude attempt to favour accused No.1 by spoiling the image of the Complainants company. He further alleges that this caused a wrongful loss to the complainant's company by robbing its due chance to get a contract for the Boiler Plant Units at Korba.
4. After recording preliminary evidence, the Magistrate took cognizance of the complaint which order was challenged in the High Court. Before the High Court, the appellants, inter alia, contended that the allegations made by the respondent under Sections 120-B, 468, 420 & 500 of IPC pertained to the award of tender in favour of accused No.1 in which the respondent was also a competing party. It was also pleaded that the said complaint has been lodged as an afterthought, having failed in the civil suit for injunction which was dismissed and likewise, after unsuccessful attempt to challenge the award of contract in favour of accused No.1 as the writ petition of the respondent was dismissed by the High Court. Thus, the lodging of complaint before Judicial Magistrate-II, Tiruchirapalli was nothing but abuse of process of law. The appellants also contended that the respondents herein had no locus standi nor any legal status to prefer the said complaint, as CEI is not a registered company, having a legal entity. The appellants further relied on Naresh Kumar Madan v. State of M.P., (2007) 4 SCC 766 2007 Indlaw SC 333 wherein it has been held that an employee working in the Electricity Board is covered under the definition of 'Public Servant' and State of Maharashtra v. Dr. Budhikota Subbarao, (1993) 2 SCC 567 1993 Indlaw SC 955 for the proposition that the absence of sanction order from the appropriate authority under S. 197 Cr.P.C for prosecuting a public servant, vitiates the proceedings.
5. The respondent refuted the aforesaid submissions by arguing that the appellants herein had deliberately conspired and had committed the offences against the complainant and therefore he has a right to lodge a complaint for the offences committed by the appellants along with accused No. 2 (Chief Engineer, JSEB) in rejecting the tender submitted by the complainant with a view to accept the tender of the 1st accused. It was argued that they conspired and created false document with an idea of rejecting the claim of the complainant. The respondent further submitted that complainant's locus standi as a company was not questioned in the earlier proceedings before the Chhattisgarh High Court and that the Judicial Magistrate had applied his mind and after satisfying himself that the complainant/respondent has got legal status to lodge the said complaint, had taken cognizance of the offences committed by the accused persons. It was also contended that the question of obtaining sanction under S. 197 Cr.P.C. will not arise in so far as the present complaint is concerned, as the accused are charged for conspiracy, cheating, criminal breach of trust and defamation. He further submitted that his allegation in the complaint pertained to the fabrication of the Certificate-cum-Report dated 28.12.2004 which was used against him in rejecting his tender and 1st accused was favoured with the award of work. Therefore, they had committed offences against the complainant and damaged the reputation of the respondent/ complainant.
6. The High Court while dismissing the petition of the appellants recorded that:
(a) As far as mandatory provisions of S. 197 Cr.P.C is concerned, the High Court accepted that the appellants are 'Public Servants'. It also observed that if the accusation against the appellants under Sections 120-B, 468, 420 & 500 IPC are connected with the discharge of their duty viz. if the said acts had reasonable connection with discharge of his duty then applicability of S. 197 cannot be disputed. However, on going through the allegations in the complaint, the High Court held that even though the appellants are 'Public Servant', the alleged offences committed by them are cognizable offences are not in discharge of their normal duties, in which component of criminal breach of trust is found as one of the elements and hence the provisions of S. 197 Cr.P.C. are not attracted.
(b) It has also been observed that the evidence regarding the allegations made in the complaint have to be recorded and gone into by the trial court after the evidence have been adduced by the complainant. It is only thereafter the lower Court, can decide as to whether the allegations about the falsity of the Certificate with conspiracy of accused No. 2 and the appellants herein are correct or not.
7. It is clear from the above that primarily two questions arise for consideration namely:
(a) Whether prior sanction of the competent authority to prosecute the appellants, who are admittedly public servants, is mandatory under S. 197 of the Code?
(b) Whether, on the facts of this case, the complaint filed by the respondent is motivated and afterthought, after losing the battle in civil litigation and amounts to misuse and abuse of law?
We would like to remark that having regard to the facts of this case the two issues are interconnected and narratives would be overlapping, as would become apparent when we proceed with the discussion hereinafter.
8. For this purpose, we would first like to point out that the High Court has itself taken note of the judgment of this Court in the Case of Naresh Kumar Madan 2007 Indlaw SC 333 (supra) to hold that the appellants are covered by the description of public servants within the meaning of S. 21 of IPC. Following observations therefrom have been quoted:
"The officers of the State Electricity Board are required to carry out public functions. They are public authorities. Their action in one way or the other may entail civil or evil consequences to the consumers of electrical energy. They may prosecute a person. They are empowered to enter into the house of the Board's consumers. It is only for proper and effective exercise of those powers, the statute provides that they would be public servants, wherefore a legal fiction has been created in favour of those employees, when acting or purported to act in pursuance of any of the provisions of the Act within the meaning of S. 21 of the Indian Penal Code. Indian Penal Code denotes various persons to the public servants. It is, however, not exhaustive. A person may be public servant in terms of another statute. However we may notice that a person, who, inter alia, is in the service or pay of the Government established by or under a Central, Provincial or State Act, would also come within the purview thereof. S. 2 (1) (c) of the 1988 Act also brings within its embrace a person in the service or pay of a corporation established by or under a Central Act."
9. The question is of the applicability of S. 197 of the Code. Said provision with which we are concerned is reproduced below:
"Prosecution of Judges and public servant. (1) When any person who is or was a Judge or Magistrate or a public servant not removable from his office save by or with the sanction of the Government is accused of any ofence alleged to have been committed by him while acting or purporting to act in the discharge of his official duty, no Court shall take cognizance of such offence except with the previous sanction-
(a) In the case of a person who is employed, or as the case may be, was at the time of commission of the alleged offence employed, in connection with the affairs of the Union, of the Central Government;
(b) in the case of a person who is employed or, as the case may be, was at the time of commission of the alleged offence employed, in connection with the affairs of a State, of the State Government."
10. This provision makes it clear that if any offence is alleged to have been committed by a public servant who cannot be removed from the office except by or with the sanction of the Government, the Court is precluded from taking cognizance of such offence except with the previous sanction of the competent authority specified in this provision.
11. The sanction, however, is necessary if the offence alleged against public servant is committed by him "while acting or purporting to act in the discharge of his official duties". In order to find out as to whether the alleged offence is committed while acting or purporting to act in the discharge of his official duty, following yardstick is provided by this Court in Dr. Budhikota Subbarao 1993 Indlaw SC 955 (supra) in the following words:
"If on facts, therefore, it is prima facie found that the act or omission for which the accused was charged had reasonable connection with discharge of his duty then it must be held to be official to which applicability of S. 197 of the Code cannot be disputed."
12. This principle was explained in some more detail in the case of Raghunath Anant Govilkar v. State of Maharashtra 2008 Indlaw SC 158, which was decided by this Court on 08.02.2008 in SLP (Crl.) No.5453 of 2007, in the following manner:
"On the question of the applicability of S. 197 of the Code of Criminal Procedure, the principle laid down in two cases, namely, Shreekantiah Ramayya Munipalli v. State of Bombay 1954 Indlaw SC 175 and Amrik Singh v. State of Pepsu 1955 Indlaw SC 9 was as follows:
It is not every offence committed, by a public servant that requires sanction for prosecution under S. 197 (1) of Criminal Procedure Cod; nor even every act done by him while he is actually engaged in the performance of his official duties; but if the act complained of is directly concerned with his official duties so that, if questioned, it could be claimed to have been done by virtue of the office, then sanction would be necessary.
The real question therefore, is whether the acts complained of in the present case were directly concerned with the official duties of the three public servants. As far as the offence of criminal conspiracy punishable under Sections 120-B read with S. 409 of the Indian Penal Code is concerned and also S. 5(2) of the Prevention of Corruption Act, are concerned they cannot be said to be of the nature mentioned in S. 197 of the Code of Criminal Procedure. To put it shortly, it is no part of the duty of a public servant, while discharging his official duties, to enter into a criminal conspiracy or to indulge in criminal misconduct. Want of sanction under S. 197 of the Code of Criminal Procedure is, therefore, no bar."
13. Likewise, in Shambhoo Nath Misra v. State of U.P. and others, (1997) 5 SCC 326 1997 Indlaw SC 1818, the Court dealt with the subject in the following manner:
"5. The question is when the public servant is alleged to have committed the offence of fabrication of record or misappropriation of public fund etc. can be said to have acted in discharge of his official duties? It is not the official duty of the public servant to fabricate the false record and misappropriate the public funds etc. in furtherance of or in the discharge of his official duties. The official capacity only enables him to fabricate the record or misappropriate the public fund etc. It does not mean that it is integrally connected or inseparably interlinked with the crime committed in the course of same transaction, as was believed by the learned Judge. Under these circumstances, we are of the opinion that the view expressed by the High Court as well as by the trial Court on the question of sanction is clearly illegal and cannot be sustained."
14. The ratio of the aforesaid cases, which is clearly discernible, is that even while discharging his official duties, if a public servant enters into a criminal conspiracy or indulges in criminal misconduct, such misdemeanor on his part is not to be treated as an act in discharge of his official duties and, therefore, provisions of S. 197 of the Code will not be attracted. In fact, the High Court has dismissed the petitions filed by the appellant precisely with these observations namely the allegations pertain to fabricating the false records which cannot be treated as part of the appellants normal official duties.
The High Court has, thus, correctly spelt out the proposition of law. The only question is as to whether on the facts of the present case, the same has been correctly applied. If one looks into the allegations made in the complaint as stand alone allegations, probably what the High Court has said may seem to be justified. However, a little deeper scrutiny into the circumstances under which the complaint came to be filed would demonstrate that allegation of fabricating the false record is clearly an afterthought and it becomes more than apparent that the respondent has chosen to level such a make belief allegation with sole motive to give a shape of criminality to the entire dispute, which was otherwise civil in nature. As noted above, the respondent had in fact initiated civil action in the form of suit for injunction against the award of the contract in which he failed. Order of civil court was challenged by filing writ petition in the High Court. Plea of the respondent was that the action of the Department in rejecting his tender and awarding the contract to accused No.1 was illegal and motivated. Writ petition was also dismissed with cost. These orders attained finality. It is only thereafter criminal complaint is filed with the allegation that accused No.1 is favoured by creating a false certificate dated 28.12.2004. We would dilate this discussion with some elaboration, hereinafter.
15. As already pointed above, tender was floated by the CSEB and the CEI herein was one of the parties who had submitted its bid through the respondent. However, tender conditions mentioned certain conditions and it was necessary to fulfill those conditions to become eligible to submit the bid and have it considered. As per the appellants, tender of the respondent was rejected on the ground that plant and equipment erected by the respondent at Patratu Thermal Power Station, Patratu, Jharkhand was not functioning well. This information was received by the Tender Committee from JSEB. When the report was sought by CSEB in December, 2004, the Tender Committee took the view that the respondent did not fulfill the pre-qualifying conditions and rejected his tender. Before doing so, the respondent was asked time and again to send the performance report which he had promised but he failed to comply even when he had assured to do the needful. In fact, that itself was sufficient to reject that bid of the respondent as it was non compliant with the tender conditions. Still, in order to verify the claim of the respondent and to consider his bid on merits, though not strictly required, the appellant R.C. Jain was deputed to get the desired information from JSEB. He met the officials of JSEB and submitted his report to the effect that the works carried out by the respondent at Patratu Thermal Power Station was not satisfactory. Even, Shri B.M. Ram, General Manager of the said Power Station furnished his report dated 28.12.2004 wherein it was summed up that due to the defects in the scanning system, supplied by the respondent, generation had been adversely effected and the said Electricity Board was not satisfied with the equipment supplied by the respondent. In spite of the aforesaid material, the tender Committee acted with caution and even the technical expertise was sought. Even the report of the technical experts went against the respondent as it opined that the respondent was not technically suitable on the technical vetting and comparative data. On the basis of the aforesaid material, the respondent's tender document was not opened and returned and he was informed accordingly. All this has clearly happened in furtherance of and in discharge of the official duties by the appellant. In the facts of the present case, we are of the view that allegations of fabricating the records are mischievously made as an afterthought, just to give colour of criminality to a civil case.
16. As pointed out above, the respondent had even filed the civil suit challenging the decision of the Electricity Board in returning his tender documents on the ground that the same were not as per pre- qualifying conditions of the tender. He had thus resorted to the civil remedy. However, he failed therein as for the reasons best known to him, he sought to withdrew the same and accordingly the same was dismissed for non-prosecution. It is trite that once the suit is withdrawn, that acts as constructive res judicata having regard to the provision of Order XXIII Rule 1 of the Code of Civil Procedure. Also, when suit is dismissed under Order IX Rule 8 CPC, fresh suit under Order IX Rule 9 is barred. The legal implication would be of that the attempt of the respondent in challenging the decision of the Tender Committee in not considering his tender remained unfaulted. Even when the respondent himself invited order of dismissal in the civil suit, curiously enough, he filed a writ petition against the order passed in the civil court dismissing his suit for non-prosecution, but the same was also dismissed by the High Court on 25.06.2007 and even a cost of Rs.25,000/- was imposed on the respondent as the said writ petition was perceived by the High Court as 'abuse of process of the court'. SLP preferred by the respondent was also dismissed by this Court on 14.09.2007. It is only thereafter the respondent filed the criminal complaint out of which present proceedings emanate. No doubt, the respondent in his complaint has right to colour his complaint by levelling the allegations that the appellants herein fabricated the records. However, on the facts of this case, it becomes difficult to eschew this allegation of the respondent and we get an uncanny feeling that the contents of FIR with these allegations are a postscript of the respondent after losing the battle in civil proceedings which were taken out by him challenging the action of the Department in rejecting his tender. When he did not succeed in the said attempt, he came out with the allegations of forgery. It is thus becomes clear that the action of the respondent in filing the criminal complaint is not bonafide and amounts to misuse and abuse of the process of law.
17. In State of Haryana v. Bhajan Lal, 1992 Supp (1) SCC 335 1990 Indlaw SC 91, this Court has laid down principles on which Court can quash the criminal proceedings u/s. 482 of Cr.P.C. These are as follows:
"102.(1) Where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence or make out a case against the accused.
(2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers u/s. 156 (1) of the Code except under an order of a Magistrate within the purview of S. 155 (2) of the Code.
(3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused.
(4) Where the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under S. 155 (2) of the Code.
(5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused.
(6) Where there is an express legal bar engrafted in any of the provisions of the Code or the Act concerned (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the Act concerned, providing efficacious redress for the grievance of the aggrieved party.
(7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge."
Principle Nos.6 and 7 are clearly applicable in the present case.
18. Having regard to the circumstances narrated and explained above, we are also of the view that attempt is made by the respondent to convert a case with civil nature into criminal prosecution. In a case like this, High Court would have been justified in quashing the proceedings in exercise of its inherent powers u/s. 482 of the Code. It would be of benefit to refer to the judgment in the case of Indian Oil Corpn. v. NEPC India Ltd. and others, (2006) 6 SCC 736 2006 Indlaw SC 430, wherein the Court adversely commented upon this very tendency of filing criminal complaints even in cases relating to commercial transaction for which civil remedy is available is available or has been availed. The Court held that the following observations of the Court in this behalf are taken note of:
"13. While on this issue, it is necessary to take notice of a growing tendency in business circles to convert purely civil disputes into criminal cases. This is obviously on account of a prevalent impression that civil law remedies are time consuming and do not adequately protect the interests of lenders/creditors. Such a tendency is seen in several family disputes also, leading to irretrievable breakdown of marriages/families. There is also an impression that if a person could somehow be entangled in a criminal prosecution, there is a likelihood of imminent settlement. Any effort to settle civil disputes and claims, which do not involve any criminal offence, by applying pressure through criminal prosecution should be deprecated and discouraged. In G. Sagar Suri v. State of U.P., (2000) 2 SCC 636 2000 Indlaw SC 603, this Court observed:
"It is to be seen if a matter, which is essentially of a civil nature, has been given a cloak of criminal offence. Criminal proceedings are not a short cut of other remedies available in law. Before issuing process a criminal court has to exercise a great deal of caution. For the accused it is a serious matter. This Court has laid certain principles on the basis of which the High Court is to exercise its jurisdiction u/s. 482 of the Code. Jurisdiction under this section has to be exercised to prevent abuse of the process of any court or otherwise to secure the ends of justice."
14. While no one with a legitimate cause or grievance should be prevented from seeking remedies available in criminal law, a complainant who initiates or persists with a prosecution, being fully aware that the criminal proceedings are unwarranted and his remedy lies only in civil law, should himself be made accountable, at the end of such misconceived criminal proceedings, in accordance with law. One positive step that can be taken by the courts, to curb unnecessary prosecutions and harassment of innocent parties, is to exercise their power u/s. 250 CrPC more frequently, where they discern malice or frivolousness or ulterior motives on the part of the complainant. Be that as it may."
19. In Inder Mohan Goswami and another v. State of Uttaranchal and others, (2007) 12 SCC 1 2007 Indlaw SC 1024, the Court reiterated the scope and ambit of power of the High Court u/s. 482 of the Code in the following words:
"23. This Court in a number of cases has laid down the scope and ambit of courts' powers u/s. 482 CrPC. Every High Court has inherent power to act ex debito justitiae to do real and substantial justice, for the administration of which alone it exists, or to prevent abuse of the process of the court. Inherent power u/s. 482 CrPC can be exercised:
(i) to give effect to an order under the Code;
(ii) to prevent abuse of the process of court, and
(iii) to otherwise secure the ends of justice.
24. Inherent powers u/s. 482 CrPC though wide have to be exercised sparingly, carefully and with great caution and only when such exercise is justified by the tests specifically laid down in this section itself. Authority of the court exists for the advancement of justice. If any abuse of the process leading to injustice is brought to the notice of the court, then the could would be justified in preventing injustice by invoking inherent powers in absence of specific provisions in the statute.
Discussion of decided cases
25. Reference to the following cases would reveal that the courts have consistently taken the view that they must use this extraordinary power to prevent injustice and secure the ends of justice. The English courts have also used inherent power to achieve the same objective. It is generally agreed that the Crown Court has inherent power to protect its process from abuse. In Connelly v. DPP : [1964] A.C. 1254  Lord Devlin stated that where particular criminal proceedings constitute an abuse of process, the court is empowered to refuse to allow the indictment to proceed to trial. Lord Salmon in DPP v. Humphrys, [1977] A.C. 1  stressed the importance of the inherent power when he observed that it is only if the prosecution amounts to an abuse of the process of the court and is oppressive and vexatious that the judge has the power to intervene. He further mentioned that the court's power to prevent such abuse is of great constitutional importance and should be jealously preserved.
46. The court must ensure that criminal prosecution is not used as an instrument of harassment or for seeking private vendetta or with an ulterior motive to pressurise the accused. On analysis of the aforementioned cases, we are of the opinion that it is neither possible nor desirable to lay down an inflexible rule that would govern the exercise of inherent jurisdiction. Inherent jurisdiction of the High Courts u/s. 482 CrPC though wide has to be exercised sparingly, carefully and with caution and only when it is justified by the tests specifically laid down in the statute itself and in the aforementioned cases. In view of the settled legal position, the impugned judgment cannot be sustained."
20. As a result, these appeals are allowed. Order of the High Court is set aside. Consequently, cognizance taken by the learned Magistrate and orders summoning the appellants as accused is hereby set aside resulting into the dismissal of the said complaint. There shall however be no order as to costs.
Appeals allowed


Manager, R.B.I., Bangalore v S. Mani and Others
Supreme Court of India

14 March 2005
Appeal (Civil)  6306-6316 of 2003
The Judgment was delivered by : S. B. Sinha, J.
1.  The Respondents herein were Ticca Mazdoors working under the Appellant herein. Ticca Mazdoors are intermittently appointed by the Reserve Bank of India whenever absence of regular Class IV employees takes place. They are not engaged everyday or continuously. Their engagement depends upon the need of the Appellant. They are never regarded as regular Mazdoors. Two waiting lists are maintained by the Appellant. The first waiting list contains the names of such of them who may be appointed as regular Mazdoors whereas the second list is maintained for those who are to be engaged as Ticca Mazdoors. The name of the respondents figured in the second list. They were appointed in the said category as Ticca Mazdoor between the period 14th March, 1980 and 8th August, 1982 for the purpose of their appointment as regular Mazdoors. The Respondents herein, except Respondent No. 6, were interviewed on different dates between January, 1982 and May, 1982. Allegedly, during interview, they produced transfer certificates but their answers to the questions posed in this behalf were not in conformity therewith, whereupon a verification was made and it was found that the said certificates were forged and fabricated. Three first information reports were lodged by the officers of the Appellant herein for furnishing false certifications by the Respondents.
2. In the criminal case, however, they were acquitted by three different judgements passed on 20th April, 1987, 5th August, 1987 and 24th September, 1987. Between October, 1987 and August, 1988, the Respondents submitted fresh school transfer certificates and requested the Appellant herein to reemploy them. As their request for reemployment was not accepted, an industrial dispute was raised resulting in a reference made by the Central Government for adjudication thereof to the Central Government Industrial Tribunal, Bangalore. The Industrial Tribunal by an award dated 18.12.1997 held that the Respondents having completed 240 days of service; and their terminations having been brought about without complying with the provisions of Section 25F of the Industrial Disputes Act, and, thus, being illegal they were entitled to be reinstated in the Bank's services as per the prevailing rules and conditions of the service with full back wages.
3.  The Appellant herein filed a Special Leave Petition against the said award which was dismissed as withdrawn with liberty to it to approach the High Court. The Appellant filed writ petitions before the Karnataka High Court. By an order dated 30th November, 1998, the writ petitions were dismissed by the learned Single Judge whereagainst writ appeals were filed by the Appellant which were marked as WA No. 3700 of 1999 and 5301 to 5310 of 1999. By reason of the impugned judgment dated 25th June, 2002, the Division Bench allowed the said appeal in part modifying the award of the Tribunal as also the learned Single Judge to the effect that the back wages be paid from 23rd July, 1993 instead of their respective dates of retrenchment.
4. The Division Bench, however, gave liberty to the Appellant to hold domestic enquiry against the Respondents for the alleged misconduct committed by them. The Division Bench in issuing the aforesaid direction inter alia held that as the Respondents were not regularized in services for the alleged misconduct of producing false certificates, the same would amount to stigma and loss of confidence of the Appellant in them.
5.  Mr. Mahendra Anand, learned senior counsel appearing on behalf of the Appellant would contend that as the Respondents herein did not report for duty between December, 1982 and March, 1987, they must be held to have abandoned their services.
6.  The learned counsel would contend that the learned Tribunal committed a serious error of law insofar as it failed to take into consideration the fact that the Respondents were not able to prove that they had completed 240 days of service during a period of 12 months preceding the order of termination and in that view of the matter the question of compliance of Section 25F of the Industrial Disputes Act did not arise at all. Our attention was also drawn to the fact that during pendency of aforementioned industrial adjudication the management and the Union had arrived at a settlement pursuant whereto or in furtherance whereof all posts had been filled up. In any event, it was urged, only because the Respondents have allegedly completed 240 days of work, the same by itself would not confer any right on them to be regularized in service. Reliance in this connection has been placed on Maharashtra State Cooperative Cotton Growers' Marketing Federation Ltd. and Another Vs. Employees' Union and Another [1994 Supp. (3) SCC 385] 1994 Indlaw SC 1275
7.  The learned counsel would submit that no adverse inference could have been drawn for non-production of attendance register as sufficient explanation therefor had been furnished. Reliance in this connection has been placed on Municipal Corporation, Faridabad Vs. Siri Niwas [(2004) 8 SCC 195] 2004 Indlaw SC 719.
8.  It was further urged that the burden of proof in that behalf lay upon the Respondents and in support thereof reliance has been placed on M.P. Electricity Board Vs. Hariram [(2004) 8 SCC 246] 2004 Indlaw SC 829.
9.  The Tribunal, according to Mr. Anand, misdirected itself in passing the impugned award insofar as it considered irrelevant factors and failed to take into consideration the relevant facts. The learned counsel has further placed before us some school transfer certificates produced by some of the Respondents in December, 1982 and March, 1987 with a view to show that the action taken by the Appellant herein was not wholly arbitrary so as to justify a direction for reinstatement of the Respondents in service only on the ground that they stood acquitted in the criminal cases. The judgments of the criminal court having been rendered by giving benefit of doubt to the Respondents herein, the learned counsel would submit, the same itself could not have been a ground for grant of relief. Reliance in this connection has been placed on Union of India and Another Vs. Bihari Lal Sidhana [(1997) 4 SCC 385] 1997 Indlaw SC 3017.
10.  Mr. N.G. Phadke, learned counsel appearing on behalf of the Respondents, on the other hand, supported the award of the Tribunal and consequently the judgments of the learned Single Judge and the Division Bench of the Karnataka High Court contending that
(i) . the Respondents' contentions that they continued in service, from March 1980 to August 1982 as disclosed in their pleadings and representations, having not been denied, the same must be held to have been admitted.
(ii) . as the Appellant herein could not prove its case that the Respondents had abandoned their services, the Tribunal rightly placed the onus of proof on it;
(iii) as despite an order made in this behalf the Appellant did not produce attendance registers, the impugned award could have been passed upon drawing an adverse inference.Reliance in this behalf has been placed on H.D. Singh Vs. Reserve Bank of India and Others [(1985) 4 SCC 201] 1985 Indlaw SC 280.
(iv) in any event, the Appellant never raised a contention that the Respondents had not worked for more than 240 days during preceding 12 months.
(v) the order of the Division Bench being a consent order, no appeal lies thereagainst.
(vi) although by reason of the Respondents' being reinstated in service, they would continue to have the status of Ticca Mazdoors, but having regard to the intervening circumstances, viz., the settlement arrived at by and between the Appellant and the Union, they would be entitled to be regularized in services in terms of the decision of this Court in Chief General Manager, Reserve Bank of India Vs. General Secretary, Reserve Bank Workers Organisation [2001 (2) LLJ 487] 2001 Indlaw SC 355; and
(vii) section 25F of the Industrial Disputes Act being mandatory in nature, the provisions thereof are required to be complied with even when the workmen were employed as Badli Workers or Ticca Mazdoors as daily wager. Reliance in this behalf has been placed on The State Bank of India Vs. Shri N. Sundara Money [(1976) 1 SCC 822] 1976 Indlaw SC 4, H.D. Singh 1985 Indlaw SC 280 (supra), Management of M/s. Willcox Buckwell India Ltd. Vs. Jagannath and Others [(1974) 4 SCC 850] 1973 Indlaw SC 462, L. Robert D'Souza Vs. Executive Engineer, Southern Railway and Another [(1982) 1 SCC 645] 1982 Indlaw SC 79, Samishta Dube Vs. City Board, Etawah and another [1999 Lab. I.C. 1125] 1999 Indlaw SC 982 and Moolchand Kharati Ram Hospital K. Union Vs. Labour Commissioner and Others [2000 (2) LLJ 1411] 2000 Indlaw SC 2977.
STATUS OF TICCA MAZDOORS:
11.  As noticed hereinbefore, Ticca Mazdoors are not regarded as regular Mazdoors. Two waiting lists are maintained by the appellant. The first waiting list contains the names of such Mazdoors who may be appointed as regular Mazdoors whereas the second list is maintained for those who are to be engaged as Ticca Mazdoors.
12.  The service of Ticca Mazdoors being not permanent in nature can be dispensed with subject to compliance of the statutory or contractual requirements, if any. Their status is not higher than that of a temporary workman or a probationer. (See Civil Appeal No. 4868 of 1999, Karnataka State Road Transport Corporation & Another Vs. S.G. Kotturapp & Anr. 2005 Indlaw SC 144, disposed of on 3rd March, 2005)
EFFECT OF JUDGMENT OF ACQUITTAL:
13.  The Appellant's contention as regard holding of interview of the Respondents herein in December, 1982 and March, 1987 is not denied or disputed. It is also further not in dispute that their educational qualifications and other details were required to be verified. Institution of three criminal cases stands admitted. Before us a judgment passed in the criminal cases has been produced, from a perusal whereof it would appear that the contention raised by the Respondents herein that they had never produced any transfer certificate at the time of interview was not raised. If the contention of the Appellant as regard production of transfer certificates by the Respondents at the time of their interview finds acceptance, then concededly the said certificates vis-'-vis the certificates produced by the Respondents in the year 1987 are different in several respects, including the name of the father and name of the school, date of birth, etc. It is true that the certificates produced by them in 1987 were found to be genuine but the same by itself would not lead to a conclusion, as suggested by Mr. Phadke, that the Respondents themselves did not produce the said certificates before the interview board or the same were manufactured by the officers of the Reserve Bank of India.
14.  It is trite that a judgment of acquittal passed in favour of the employees by giving benefit of doubt per se would not be binding upon the employer. The employer had no occasion to initiate departmental proceeding against the Respondents. They were not regularly employed. They, according to the Appellant, filed forged and fabricated documents and as such were not found fit to be absorbed in regular service. The effect of a judgment of acquittal vis-'-vis the alleged misconduct on the part of the workmen fell for consideration before this Court in Bihari Lal Sidhana 1997 Indlaw SC 3017 (supra) wherein it was held:
"5. It is true that the respondent was acquitted by the criminal court but acquittal does not automatically give him the right to be reinstated into the service. It would still be open to the competent authority to take decision whether the delinquent government servant can be taken into service or disciplinary action should be taken under the Central Civil Services (Classification, Control & Appeal) Rules or under the Temporary Service Rules. Admittedly, the respondent had been working as a temporary government servant before he was kept under suspension. The termination order indicated the factum that he, by then, was under suspension. It is only a way of describing him as being under suspension when the order came to be passed but that does not constitute any stigma. Mere acquittal of government employee does not automatically entitle the government servant to reinstatement. As stated earlier, it would be open to the appropriate competent authority to take a decision whether the enquiry into the conduct is required to be done before directing reinstatement or appropriate action should be taken as per law, if otherwise, available. Since the respondent is only a temporary government servant, the power being available under Rule 5(1) of the Rules, it is always open to the competent authority to invoke the said power and terminate the services of the employee instead of conducting the enquiry or to continue in service a government servant accused of defalcation of public money. Reinstatement would be a charter for him to indulge with impunity in misappropriation of public money."
15.  Recently in Krishnakali Tea Estate Vs. Akhil Bharatiya Chah Mazdoor Sangh and Another [(2004) 8 SCC 200] 2004 Indlaw SC 890, one of us, Santosh Hegde, J., speaking for a 3-Judge Bench observed:
"25. The next contention addressed on behalf of the respondents is that the Labour Court ought not to have brushed aside the finding of the criminal court which according to the learned Single Judge "honourably" acquitted the accused workmen of the offence before it. We have been taken through the said judgment of the criminal court and we must record that there was such "honourable" acquittal by the criminal court. The acquittal by the criminal court was based on the fact that the prosecution did not produce sufficient material to establish its charge which is clear from the following observations found in the judgment of the criminal court: "Absolutely in the evidence on record of the prosecution witnesses I have found nothing against the accused persons. The prosecution totally fails to prove the charges under Sections 147, 353, 329 IPC."
26. Learned counsel for the respondents in regard to the above contention relied on a judgment of this Court in the case of Capt. M. Paul Anthony. In our opinion, even that case would not support the respondents herein because in the said case the evidence led in the criminal case as well as in the domestic enquiry was one and the same and the criminal case having acquitted the workmen on the very same evidence, this Court came to the conclusion that the finding to the contrary on the very same evidence by the domestic enquiry would be unjust, unfair and rather oppressive. It is to be noted that in that case the finding by the Tribunal was arrived at in an ex parte departmental proceeding. In the case in hand, we have noticed that before the Labour Court the evidence led by the management was different from that led by the prosecution in the criminal case and the materials before the criminal court and the Labour Court were entirely different. Therefore, it was open to the Labour Court to have come to an independent conclusion dehors the finding of the criminal court"
It was observed:
"From the above, it is seen that the approach and the objectives of the criminal proceedings and the disciplinary proceedings are altogether distinct and different. The observations therein indicate that the Labour Court is not bound by the findings of the criminal court."
16.  In Cholan Roadways Limited Vs. G. Thirugnanasambandam [2004 (10) SCALE 578] 2004 Indlaw SC 1069, this Court held:
"It is further trite that the standard of proof required in a domestic enquiry vis-'-vis a criminal trial is absolutely different. Whereas in the former 'preponderance of probability' would suffice; in the latter, 'proof beyond all reasonable doubt' is imperative."
17.  The contention that the Respondents had not produced such certificates or the same have been fabricated at the instance of some officers of the Reserve Bank of India, therefore, does not find our acceptance. It is rejected accordingly.
SECTION 25F OF THE INDUSTIRAL DISPUTES ACT:
18.  The provisions contained in Section 25F of the Industrial Disputes Act are required to be complied with if the workmen concerned had completed 240 days of service in a period of 12 months preceding the order of termination. The Tribunal admittedly based its decision on the following:
(i) The Appellant did not produce the attendance register.
(ii) There was circumstantial evidence to show that the Respondents herein had made several representations between March, 1987 and April, 1990.
(iii) The witness examined on behalf of the Appellant MW3 conceded that the workmen had worked for 240 days.
19.  The workmen raised a contention of rendering a continuous service between April, 1980 to December, 1982 in their pleadings and representations. Admittedly, the Appellant herein in their rejoinder denied and disputed the said facts stating:
"(i) as regards paragraph 1, it is denied that the I Party has worked continuously from April, 1980 to December, 1982. The factual position is that the I party was engaged off and on from August 80 to January 83 depending upon the availability of casual vacancies on various dates and the need for engaging ticcas."
20.  The concerned workmen in their evidence did not specifically state that they had worked for 240 days. They merely contended in their affidavit that they are reiterating their stand in the claim petition.
21.  Pleadings are no substitute for proof. No workman, thus, took an oath to state that they had worked for 240 days. No document in support of the said plea was produced. It is, therefore not correct to contend that the plea raised by the Respondents herein that they have worked continuously for 240 days was deemed to have been admitted by applying the doctrine of non-traverse. It any event the contention of the Respondents having been denied and disputed, it was obligatory on the part of the Respondents to add new evidence. The contents raised in the letters of the Union dated 30th May, 1988 and 11th April, 1990 containing statements to the effect that the workmen had been working continuously for 240 days might not have been replied to, but the same is of no effect as by reason thereof, the allegations made therein cannot be said to have been proved particularly in view of the fact that the contents thereof were not proved by any witness. Only by reason of non-response to such letters, the contents thereof would not stand admitted. Evidence Act does not say so.
22.  The Appellant, therefore, cannot be said to have admitted that the Respondents had worked for more than 240 days.
NON-PRODUCTION OF THE DOCUMENTS:
23.  It is no doubt true that the industrial tribunal by an order dated 12th May, 1993 inter alia directed the Appellant to produce register of workmen for the period between April, 1980 and December, 1982 in respect of the first party workmen and attendance register. The Tribunal, however, in its award noticed the explanation of the Appellant that the attendance registers being old and hence could not be produced holding:
"Of course, it is true that the 2nd party had given an explanation namely those attendance registers are very old and hence could not be produced. But this explanation cannot be acceptable, because as I pointed out earlier, apart from the attendance registers, there may be other relevant records to show that the 1st parties either worked continuously as alleged by the 1st parties or only during the leave vacancy with break of service."
The learned Tribunal further held:
"Therefore, the materials placed before this Tribunal lead to the only conclusion that the 2nd party is not in a position to prove their case namely the concerned 1st parties 1 to 11 had abandoned themselves without any proper reasons."
24.  An adverse inference, therefore, was drawn for non-production of the attendance register alone, and not for non-production of the wage-slips. Reference to 'other relevant documents' must be held to be vague as the Appellant herein had not been called upon to produce any other document for the said purpose.
25.  It appears that the learned Tribunal considered the matter solely from the angle that the Appellant has failed to prove its plea of abandonment of service by the Respondents.
26.  The question came up for consideration before this Court recently in Siri Niwas 2004 Indlaw SC 719 (supra) wherein it was held:
"15A Court of Law even in a case where provisions of the Indian Evidence Act apply, may presume or may not presume that if a party despite possession of the best evidence had not produced the same, it would have gone against his contentions. The matter, however, would be different where despite direction by a court the evidence is withheld. Presumption as to adverse inference for non-production of evidence is always optional and one of the factors which is required to be taken into consideration in the background of facts involved in the lis. The presumption, thus, is not obligatory because notwithstanding the intentional non-production, other circumstances may exist upon which such intentional non-production may be found to be justifiable on some reasonable grounds."
27.  Referring to the decision of this Court in Indira Nehru Gandhi Vs. Raj Narain [1975 Supp SCC 1] 1975 Indlaw SC 473, this Court observed:
"Furthermore a party in order to get benefit of the provisions contained in S. 114(f) of the Indian Evidence Act must place some evidence in support of his case. Here the Respondent failed to do so."
In Hariram 2004 Indlaw SC 829 (supra), this Court observed:
"11. The above burden having not been discharged and the Labour Court having held so, in our opinion, the Industrial Court and the High Court erred in basing an order of reinstatement solely on an adverse inference drawn erroneously."
28.  As noticed hereinbefore, in this case also the Respondents did not adduce any evidence whatsoever. Thus, in the facts and circumstances of the case, the Tribunal erred in drawing an adverse inference.
BURDEN OF PROOF:
29.  The initial burden of proof was on the workmen to show that they had completed 240 days of service. The Tribunal did not consider the question from that angle. It held that the burden of proof was upon the Appellant on the premise that they have failed to prove their plea of abandonment of service stating:
"It is admitted case of the parties that all the 1st parties under the references CR No. 1/92 to 11/92 have been appointed by the 2nd party as ticca mazdoors. As per the 1st parties, they had worked continuously from April, 1980 to December, 1982. But the 2nd party had denied the above said claim of continuous service of the 1st parties on the ground that the 1st parties has not been appointed as regular workmen but they were working only as temporary part time workers as ticca mazdoor and their services were required whenever necessary arose that too on the leave vacancies of regular employees. But as strongly contended by the counsel for the 1st party, since the 2nd party had denied the above said claim of continuous period of service, it is for the 2nd party to prove through the records available with them as the relevant records could be available only with the 2nd party."
30.  The Tribunal, therefore, accepted that the Appellant had denied the Respondents' claim as regard their continuous service.
31.  In Range Forest Officer Vs. S.T. Hadimani [(2002) 3 SCC 25] 2002 Indlaw SC 843, it was stated:
"In our opinion the Tribunal was not right in placing the onus on the management without first determining on the basis of cogent evidence that the respondent had worked for more than 240 days in the year preceding his termination. It was the case of the claimant that he had so worked but this claim was denied by the appellant. It was then for the claimant to lead evidence to show that he had in fact worked for 240 days in the year preceding his termination. Filing of an affidavit is only his own statement in his favour and that cannot be regarded as sufficient evidence for any court or tribunal to come to the conclusion that a workman had, in fact, worked for 240 days in a year. No proof of receipt of salary or wages for 240 days or order or record of appointment or engagement for this period was produced by the workman. On this ground alone, the award is liable to be set aside." [See also Essen Deinki Vs. Rajiv Kumar, (2002) 8 SCC 400] 2002 Indlaw SC 1184"
In Siri Niwas 2004 Indlaw SC 719 (supra), this Court held:
"The provisions of the Indian Evidence Act per se are not applicable in an industrial adjudication. The general principles of it are, however applicable. It is also imperative for the Industrial Tribunal to see that the principles of natural justice are complied with. The burden of proof was on the respondent herein to show that he had worked for 240 days in preceding twelve months prior to his alleged retrenchment. In terms of Section 25-F of the Industrial Disputes Act, 1947, an order retrenching a workman would not be effective unless the conditions precedent therefor are satisfied. Section 25-F postulates the following conditions to be fulfilled by employer for effecting a valid retrenchment :
(i). one month's notice in writing indicating the reasons for retrenchment or wages in lieu thereof;
(ii) payment of compensation equivalent to fifteen days, average pay for every completed year of continuous service or any part thereof in excess of six months."
It was further observed:
"14 As noticed hereinbefore, the burden of proof was on the workman. From the Award it does not appear that the workman adduced any evidence whatsoever in support of his contention that he complied with the requirements of Section 25B of the Industrial Disputes Act. Apart from examining himself in support of his contention he did not produce or call for any document from the office of the Appellant herein including the muster rolls. It is improbable that a person working in a Local Authority would not be in possession of any documentary evidence to support his claim before the Tribunal. Apart from muster rolls he could have shown the terms and conditions of his offer of appointment and the remuneration received by him for working during the aforementioned period. He even did not examine any other witness in support of his case."
Yet again in Hariram 2004 Indlaw SC 829 (supra), it was opined:
"10. We cannot but bear in mind the fact that the initial burden of establishing the factum of their continuous work for 240 days in a year rests with the respondent applicants."
32.  Mr. Phadke placed strong reliance on H.D. Singh 1985 Indlaw SC 280 (supra) to contend that adverse inference was drawn therein for non-production of certain documents. H.D. Singh 1985 Indlaw SC 280 (supra) was rendered on its own fact. In that case, a Special Leave Petition was entertained by this Court directly from the Award passed by the Industrial Tribunal. Before this Court, both the parties filed affidavits and several documents. The workmen therein categorically disclosed the number of days they had worked in each year. In that case the name of the workman was struck off as he had allegedly concealed his educational qualification; purportedly on the basis of a confidential circular issued by the bank on June 27, 1976 to the effect that the matriculates will not be retained in the list. As the workman therein in reply to the letter of the Bank stated that he was not a matriculate in 1974 and he passed the examination only in 1975, he was not given any work even after July, 1976 without issuing any written notice terminating his services. Holding that the workman had been retrenched from service, as noticed hereinbefore, affidavits of the parties were filed and, thus, some evidence had been adduced. The number of actual days worked by the workman therein was also brought on records by the Respondent. The said decision, thus, having been rendered in the fact situation obtaining therein does not constitute a binding precedent.
CIRCUMSTANTIAL EVIDENCE:
33.  The Tribunal also relied upon some purported circumstantial evidence to hold that the workmen had completed 240 days of work in the following terms:
"That apart, the circumstantial evidence also would show that the plea of the abandonment had been taken by the 2nd party only for the sake of defence in this case and it is not a real one. In order to explain the same when we perused the admitted documents Exs. M1 to M7 together with the admitted evidence of MW3 at para 5 of his deposition, we would see that from 3.3.87 till 11.4.90 either almost all the 1st parties before this Tribunal had continuously requested the management for their reinstatement alleging that they served in the 2nd party Bank continuously from April, 1980 to December, 1982. They also pleaded the same in their respective claim petitions before us. But the management as per Exs. M8 dated 8.5.1991 had not denied the alleged claim of continuous service of the 1st parties at their earliest opportunity. But, on the other hand, Ex.M8 would show that for absorption of the 1st parties the 2nd party had put some other conditions and demanded the 1st parties workmen for their signature if they agreed for those conditions. If that be the case, it could be seen that, at the earliest point of time, the 2nd party Bank had not denied the said claim of continue service made by 1st parties. Hence, the documents Exs. M1 to M8 would also disqualify the 2nd party from claiming said plea namely since because the 1st parties had worked temporarily that too only on leave vacancy they are not entitled for any benefits under the provisions of the I.D. Act."
34.  It is difficult to accept the logic behind the said findings.
35.  Only because the Appellant failed to prove their plea of abandonment of service by the Respondents, the same in law cannot be taken to be a circumstance that the Respondents have proved their case.
36.  The circumstances relied upon, in our opinion, are wholly irrelevant for the purpose of considering as to whether the Respondents have completed 240 days of service or not. A party to the lis may or may not succeed in its defence. A party to the lis may be filing representations or raising demands, but filing of such representations or raising of demands cannot be treated as circumstances to prove their case.
ADMISSION BY MW3
37.  We have been taken through the deposition of Shri S. Nagarajan, MW3. He was examined as a witness to prove production of the certificates by the Respondents. He had verified transfer certificates filed subsequently by the Respondents and the same were found to be all genuine. He did not make any admission as regard the continuous working of the Respondents for a period of more than 240 days nor is there even a suggestion to that effect on behalf of the Respondents herein.
38.  The Tribunal's findings are, thus, based on no evidence and must be held to be irrational.
JUDICIAL REVIEW:
39.  The findings of the learned Tribunal, as noticed hereinbefore, are wholly perverse. He apparently posed unto itself wrong questions. He placed onus of proof wrongly upon the Appellant. His decision is based upon irrelevant factors not germane for the purpose of arriving at a correct finding of fact. It has also failed to take into consideration the relevant factors. A case for judicial review, thus, was made out.
In Cholan Roadways Limited 2004 Indlaw SC 1069 (supra), this Court held:
"34. In the instant case the Presiding Officer, Industrial Tribunal as also the learned Single Judge and the Division Bench of the High Court misdirected themselves in law insofar as they failed to pose unto themselves correct questions. It is now well-settled that a quasi-judicial authority must pose unto itself a correct question so as to arrive at a correct finding of fact. A wrong question posed leads to a wrong answer. In this case, further more, the misdirection in law committed by the Industrial Tribunal was apparent insofar as it did not apply the principle of Res ipsa loquitur which was relevant for the purpose of this case and, thus, failed to take into consideration a relevant factor and furthermore took into consideration an irrelevant fact not garmane for determining the issue, namely, the passengers of the bus were mandatorily required to be examined. The Industrial Tribunal further failed to apply the correct standard of proof in relation to a domestic enquiry, which in "preponderance of probability" and applied the standard of proof required for a criminal trial. A case for judicial review was, thus, clearly made out."
The Appellant in para 13.14 of the writ petition contended:
"13.14 For that the Industrial Tribunal erred in holding that all the Ticca Mazdoors are workmen as they have completed 240 days of continuous service during the year 1980-1982, merely because the Petitioner could not produce the attendance registers for the relevant period as the same being old, and destroyed after expiry of its stipulated period of preservation of 5 years were not available with the Petitioner Bank."
40.  Neither the learned Single Judge nor the Division Bench adverted to the said question at all. The learned Single Judge without considering the contentions raised by the Appellant held:
"The Tribunal has extensively dealt with the points of dispute relating to justification of the Bank in terminating the services of the workmen. In paragraphs 16 to 49 the Tribunal has elaborately discussed facts, evidence and the material placed on record with reference to the case laws relating to 'retrenchment'. In this view of the matter, it is wholly unnecessary to refer Mr. Padke, learned counsel for respondents 1 to 11. The Tribunal has recorded a finding that the action of the Bank amounts to retrenchment as defined u/s. 2() of the Act and there is violation of mandatory requirement Section 25-F of the Act. Therefore, this Court should not interfere with the findings of fact recorded by the Tribunal."
41.  The Division Bench unfortunately in its judgment did not take into consideration the relevant questions. It proceeded on a pre-supposition that the Bank intended to reinstate the workmen. The Division Bench without any detailed discussion observed:
"The submission of Mr. Kasturi, learned senior counsel for the Bank has some force in so far as both the order of the Tribunal and the learned Single Judge proceeded on the footings that the termination was contrary to Section 25F of the Industrial Dispute Act."
42.  Laying emphasis on the alleged right of the Respondents to be regularized in their services and denial thereof by the Appellant herein, the Division Bench held that discontinuance of the workmen on the ground that they filed forged certificates cast a stigma and, on that ground, it upheld the award of the learned Industrial Tribunal as also the judgment of the learned Single Judge.
43.  The Division Bench, however, relying on or on the basis of, the decision of this Court in Chief General Manager, Reserve Bank of India 2001 Indlaw SC 355 (supra) directed that the backwages shall be paid only from 23.7.1993.
EFFECT OF THE ORDER OF REINSTATEMENT:
44.  The terms and conditions of settlement by and between the Reserve Bank of India and the Reserve Bank Workers Federation although not produced before us, the same appear in a judgment of this Court in M.G. Datania & Ors. Vs. Reserve Bank of India & Anr. 1995 Indlaw SC 2356 [Civil Appeal No. 7407 of 1994, disposed of on 28th November, 1995]; the relevant portion whereof is as under:
"Terms of Settlement:
(i) The existing arrangement or practice of engaging persons on daily wages purely on temporary and ad hoc basis in Class IV in various cadres shall be discontinued forthwith.
(ii) The leave reserve in the case of mazdoors employed in Cash Department shall be increased from the existing level of 15% to 25%.
(iii) The leave reserve in other categories in Class IV shall be increased from the existing level of 15% to 20%.
(iv) The additional posts that may be created or may arise as a consequence of paragraphs (ii) and (iii) above, together with existing vacancies, if any, shall be utilized for giving (a) full time employment to part-time employees to the extent possible and (b) regular full-time or part-time employment, as the case may be, to the ticcas who have rendered continuous service of three years or more as on 19th November, 1992. However, if the number of available vacancies at a particular centre is less than the number of such ticcas at that centre to be given regular full-time/ part time appointments, the ticcas in excess of the available vacancies at that centre shall have to move at their own cost to another centre where vacancies are available after absorbing eligible ticcas at that centre on a returnable basis as and when vacancies arise in the parent centre. Such repatriation being in the nature of request transfer shall be at their own cost and also subject to usual terms and conditions prescribed in respect of request transfers. Such of the ticcas who are not willing to the above arrangements shall have no claim to be absorbed in the Bank.
(v) The Federation shall not under any circumstances insist on engagement of ticcas on daily wage basis for carrying out Bank's work smoothly and without any hindrance or disturbance in any Section/ Department including Cash Department of the Bank irrespective of number of employees absent for any reason whatsoever. In other words, not withstanding any absenteeism in Class IV cadre (any group), the work of the Bank shall be carried on by and with the assistance of the employees present on any given day. If, however, there is an increase in the Bank's normal work on a long term basis it would review the overall strength in Class IV cadre at the centre concerned in the normal course."
45.  One of the terms, therefore, postulates that regular full time or part time Ticcas whether in regular full time or part time employment who have rendered continuous service of three years or more as on 19th November, 1992 were entitled to be considered for absorption in the additional posts that were required to be created by reason of such settlement. Such settlement had been arrived having regard to the fact that the same Ticca Mazdoors had been working for a long time.
46.  Absorption of the Ticca Mazdoors in the services of the Appellant was not automatic. The concerned workmen were required to fulfill the conditions laid down therefor.
47.  Would by reason of the order of reinstatement, the status of the Respondents change is, the question.
48.  In law, 240 days of continuous service by itself does not give rise to claim of permanence. Section 25F provides for grant of compensation if a workman is sought to be retrenched in violation of the conditions referred to therein. [See Maharashtra State Cooperative Cotton Growers' Marketing Federation Ltd. 1994 Indlaw SC 1275 (supra). See also Madhyamik Siksha Parishad, U.P. Vs. Anil Kumar Mishra and others, etc., AIR 1994 SC 1638] 1992 Indlaw SC 1292
In A. Umarani (supra), this Court held:
"Regularisation, in our considered opinion, is not and cannot be the mode of recruitment by any "State" within the meaning of Art. 12 of the Constitution of India or any body or authority governed by a Statutory Act or the Rules framed thereunder. It is also now well-settled that an appointment made in violation of the mandatory provisions of the Statute and in particular ignoring the minimum educational qualification and other essential qualification would be wholly illegal. Such illegality cannot be cured by taking recourse to regularisation. (See State of H.P. Vs. Suresh Kumar Verma and Another, (1996) 7 SCC 562) 1996 Indlaw SC 3143."
49.  Yet again, in Executive Engineer, ZP Engg. Divn. And Another Vs. Digambara Rao and Others [(2004) 8 SCC 262 2004 Indlaw SC 823] this Court held:
"It may not be out of place to mention that completion of 240 days of continuous service in a year may not by itself be a ground for directing an order of regularization. It is also not the case of the Respondents that they were appointed in accordance with the extant rules. No direction for regularization of their services was, therefore, could be issued."
50.  Furthermore, a direction for reinstatement for non-compliance of the provisions of Section 25F of the Industrial Disputes Act would restore to the workmen the same status which he held when terminated. The Respondents would, thus, continue to be Ticca Mazdoors, meaning thereby their names would continue in the second list. They had worked only from April, 1980 to December, 1982. They did not have any right to get work. The direction of continuity of service per se would not bring them within the purview of terms of settlement. Even in the case of a statutory corporation in S.G. Kotturappa 2005 Indlaw SC 144 (supra), this Court observed:
"It is not a case where the Respondent has completed 240 days of service during the period of 12 months preceding such termination as contemplated under Section 25-F read with Section 25-B of the Industrial Disputes Act, 1947. The Badli workers, thus, did not acquire any legal right to continue in service. They were not even entitled to the protection under the Industrial Disputes Act nor the mandatory requirements of Section 25-F of the Industrial Disputes were required to be complied with before terminating his services, unless they complete 240 days service within a period of twelve months preceding the date of termination."
It was further held:
"The terms and conditions of employment of a Badli worker may have a statutory flavour but the same would not mean that it is not otherwise contractual. So long as a worker remains a Badli worker, he does not enjoy a status. His services are not protected by reason of any provisions of the statute. He does not hold a civil post. A dispute as regard purported wrongful termination of services can be raised only if such termination takes place in violation of the mandatory provisions of the statute governing the services. Services of a temporary employee or a badli worker can be terminated upon compliance of the contractual or statutory requirements."
51.  Mr. Phadke, as noticed hereinbefore, has referred to a large number of decisions for demonstrating that this Court had directed reinstatement even if the workmen concerned were daily wagers or were employed intermittently. No proposition of law was laid down in the aforementioned judgments. The said judgments of this Court, moreover, do not lay down any principle having universal application so that the Tribunals, or for that matter the High Court, or this Court, may feel compelled to direct reinstatement with continuity of service and backwages. The Tribunal has some discretion in this matter. Grant of relief must depend on the fact situation obtaining in a particular case. The industrial adjudicator cannot be held to be bound to grant some relief only because it will be lawful to do so.
52.  In Haryana State Coop. Land Dev. Bank Vs. Neelam [JT 2005 (2) SC 600] 2005 Indlaw SC 175, this Court observed:
"It is trite that the courts and tribunals having plenary jurisdiction have discretionary power to grant an appropriate relief to the parties. The aim and object of the Industrial Disputes Act may be to impart social justice to the workman but the same by itself would not mean that irrespective of his conduct a workman would automatically be entitled to relief. The procedural laws like estoppel, waiver and acquiescence are equally applicable to the industrial proceedings. A person in certain situation may even be held to be bound by the doctrine of Acceptance Sub silentio."
OTHER CONTENTIONS:
53.  We have noticed hereinbefore that the Appellant herein raised a specific plea denying or disputing the claim of the Respondents that they had completed 240 days of work. Such a plea having been raised both before the Industrial Tribunal as also before the High Court, we cannot accept that the Appellant had abandoned such a plea. Even in this Special Leave Petition, it is contended:
"(3) For that the High Court ought to have held that the disengagement of the Ticca Mazdoors (Respondents), who were daily wage casual workers, did not involve any retrenchment and as such there was no question of reinstatement of Respondents will full backwages from 23.7.1993."
54.  The contention of Mr. Phadke that they have abandoned the said plea cannot be accepted. Similarly, the contention of Mr. Phadke raised before us that the order passed by the Division Bench was a consent order is unacceptable. The Division Bench does not say so. Such a contention has been raised only on the basis of a statement made by the Respondents in the Counter-affidavit wherein the reference had been made to one order of the Division Bench asking the parties to make endeavour for settlement. The Respondents contend that the order of the Division Bench is virtually a consent order. No settlement admittedly had been arrived at. A party to the lis, in absence of a statutory interdict, cannot be deprived of his right of appeal. The High Court has passed the judgment upon consideration of the rival contentions raised at the Bar. It arrived at specific findings on the issues framed by it. It has, for the reasons stated in the impugned judgment, affirmed the findings of the Industrial Tribunal as also the learned Single Judge. The impugned order of the Division Bench, in our opinion, by no stretch of imagination, can be said to have been passed with consent of the parties.
However, we agree with the opinion of the Tribunal that the plea of abandonment of service by the Respondents in the facts and circumstances of the case was wholly misconceived.
CONCLUSION:
55.  For the reasons, aforementioned, the impugned judgments cannot be sustained which are accordingly set aside. The appeals are allowed. However, in the facts and circumstances of the case, there shall be no order as to costs.
Appeals allowed.


Municipal Council, Sujanpur v Surinder Kumar
Supreme Court of India

5  May  2006
Appeal (civil) 2474 of 2006 (Arising out of S.L.P.(C ) No. 17977 of 2004)
The Judgment was delivered by: S. B. Sinha, J.
Leave granted.
1.  The appellant herein being aggrieved by and dissatisfied with the judgment and order dated 29.4.2004 passed by a Division Bench of the Punjab and Haryana High Court at Chandigarh in Civil Writ Petition No. 4988 of 2002 affirming the award dated 22.11.2001 of the Labour Court, Gurdaspur is before us. It is not in dispute that the Appellant herein is a statutory body and being a local authority, governed by the Punjab Municipal Act. The terms and conditions of service, including recruitment of its employees, are governed by statutory rules.
2.  The respondent herein was appointed on 1.4.1994. He continued to work up to 31.7.1996. His services were terminated on 16.7.1997 by issuing a notice of termination. Questioning the validity and legality thereof, an industrial dispute was raised which culminated in a reference made by the appropriate governments under Industrial Disputes Act ('the Act') in exercise of its power u/s. 10 (1)(c) thereof the following dispute to the Labour Court, Gurdaspur:
"Whether termination of services of Shri Surinder Kumar, workman is justified and in order? If not, to what/exact amount of compensation is he entitled?"
3.  A plea was raised in the said proceedings on behalf of the appellant herein that the respondent was appointed on a supervisory post and, thus, was not a 'workman' within the meaning of S. 2(S) of the Act.
4.  It is not in dispute that the respondent was appointed on daily wages. Before the Labour Court, the appellant raised a plea that the respondent was appointed on the post of Supervisor, on the recommendation of one Shri R.S. Puri, M.L.A., Sujanpur and then a Minister in the Government of Punjab. The Labour Court by reason of the impugned award, inter alia, held that although the second respondent was appointed with the designation of a Supervisor and was expected to look after the development work being carried out by the appellant and other construction works under the Nehru Rojgar Yojana, he was merely discharging the duties of a workman.
5.  It was held by the Labour Court that the respondent completed 240 days of work within a period of twelve months preceding his termination. The Labour Court proceeded on the basis that the workman having completed 240 days of work in a calendar year, it was the bounden duty of the Appellant to produce the entire relevant records but the same had not been done. It is not in dispute that the attendance records of March 1994 and from April 1994 to February 1996 were produced but the attendance registers from March 1996 onwards were not produced. It, however, does not appear from the impugned award that the respondent had called for the records from the office of the appellant.
6.  The Labour Court upon arriving at a finding that in terminating the services of the respondent, the appellant had not complied with the statutory requirements contained in Section 25F of the Industrial Disputes Act as no compensation had been paid to him in terms thereof, the respondent shall be directed to be reinstated in service with full back wages and allied benefits from the date of termination i.e. July 1997 till actual reinstatement. A writ petition filed before the High Court by the appellant herein against the said award was dismissed.
7.  Before the High Court, a specific plea was raised by the Appellant that the initial appointment of the respondent was contrary to the recruitment rules. The High Court's attention was further drawn to the fact that the respondent was appointed in a Supervisory capacity to look after the construction work of the MC building and other construction works under the Nehru Rojgar Yojana.
8.  The High Court, however, rejected the said contentions of the Appellant relying on or on the basis of the findings of the Labour Court that the work for which the respondent was appointed had been existing. It opined that its jurisdiction in the matter of issuing a writ of certiorari is limited. It further refused to go into the question as regards the payment of entire back wages stating that the appellant herein had neither pleaded nor produced any evidence to show that the respondent was gainfully employed after termination of his service.
9.  The High Court's jurisdiction to issue a writ of certiorari though is limited, a writ of certiorari can be issued if there is an error of law apparent on the face of the record. What would constitute an error of law is well known. In the Judicial Review of Administrative Action, IVth edition p.136, S.A De Smith has summed up the position:
"The concept of error of law includes the giving of reasons that are bad in law or (if there is a duty to give reasons) inconsistent, intelligible or, it would seem, substantially inadequate. It includes also the application of a wrong legal test to the facts found, taking irrelevant considerations into account and failing to take relevant considerations into account, exercising a discretion on the basis of any other incorrect legal principles, misdirection as to the burden of proof, and wrongful admission or exclusion of evidence, as well as arriving at a conclusion without any supporting evidence."
[See also S.N. Chandrashekar and Anr. v. State of Karnataka and Ors. 2006 (2) SCALE 248 2006 Indlaw SC 40 and Bombay Dyeing & Mfg. Co. Ltd. v. Bombay Environmental Action Group & Ors., 2006 (3) SCALE 1 2006 Indlaw SC 1611].
10.  The Labour Court and the High Court also proceeded wrongly on the premise that the burden of proof to establish non-completion of 240 days of work within a period of twelve months preceding the termination, was on the management. The burden was on the workman. [See U.P. State Brassware Corporation & Ors. v. Udit Narain Pandey, JT 2005 (10) SC 344 2005 Indlaw SC 806 and State of M.P. v. Arjan Lal Rajak, (2006) 2 SCC 6102006 Indlaw SC 260].
11.  Equally well settled is the principle that the burden of proof, having regard to the principles analogus to S. 106 of the Evidence Act that he was not gainfully employed, was on the workman. [See Manager, Reserve Bank of India, Bangalore v. S. Mani & Ors., (2005) 5 SCC 100 2005 Indlaw SC 216]
12.  It is also a trite law that only because some documents have not been produced by the management, an adverse inference would be drawn against the management. [See S. Mani 2005 Indlaw SC 216 (supra)]
13.  Apart from the aforementioned error of law, in our considered opinion, the Labour Court and consequently the High Court completely misdirected themselves insofar as they failed to take into consideration that relief to be granted in terms of Section 11A of the said Act being discretionary in nature, a Labour Court was required to consider the facts of each case therefor. Only because relief by way of reinstatement with full back wages would be lawful, it would not mean that the same would be granted automatically.
14.  For the said purpose, the nature of the appointment, the purpose for which such appointment had been made, the duration/tenure of work, the question whether the post was a sanctioned one, being relevant facts, must be taken into consideration.
15.  It is not disputed that the appointment of the respondent was not in a sanctioned post. Being a 'State' within the meaning of Art. 12 of the Constitution of India, the Appellant for the purpose of recruiting its employees was bound to follow the recruitment rules. Any recruitment made in violation of such rules as also in violation of the Constitutional scheme enshrined u/arts. 14 and 16 of the Constitution of India would be void in law. [See M.V. Bijlani v. Union of India & Ors., (2006) 4 SCALE 147 2006 Indlaw SC 122, State of Punjab v. Jagdip Singh & Ors., 1964 (4) SCR 964 1963 Indlaw SC 314 and Secretary, State of Karnataka v. Uma Devi, 2006 (4) SCALE 1972006 Indlaw SC 125].
16.  If a post is not a sanctioned one, again, appointment therein would be illegal. In M.P. Housing Board & Anr. v. Manoj Shrivastava [(2006) 2 SCC 702 2006 Indlaw SC 259], this Court stated the law in the following words:
"A person with a view to obtain the status of a "permanent employee" must be appointed in terms of the statutory rules. It is not the case of the respondent that he was appointed against a vacant post which was duly sanctioned by the statutory authority or his appointment was made upon following the statutory law operating in the field.
The Labour Court unfortunately did not advert to the said question and proceeded to pass its award on the premise that as the respondent had worked for more than six months satisfactorily in terms of cl. 2(vi) of the Standard Standing Orders, he acquired the right of becoming permanent. For arriving at the said conclusion, the Labour Court relief only upon the oral statement made by the respondent.It is one thing to say that a person was appointed on an ad hoc basis or as a daily-wager but it is another thing to say that he is appointed in a sanctioned post which was lying vacant upon following the due procedure prescribed therefor.
It has not been found by the Labour Court that the respondent was appointed by the appellant herein, which is "State" within the meaning of Art. 12 of the Constitution, upon compliance with the Constitutional requirements as also the provisions of the 1972 Act or the Rules and Regulations framed thereunder."
17.  Yet again, in Haryana State Agricultural Marketing Board v. Subhash Chand & Anr. [(2006) 2 SCC 794 2006 Indlaw SC 329], this Court held:
"In P. Ramanatha Aiyar's Advanced Law Lexicon, 3rd Edn., Vol. 4 at p. 4470, the expression "status" has been defined as under:
"Status" is a much discussed term which, according to the best modern expositions, includes the sum total of a man's personal rights and duties (Salmond, Jurisprudence 253, 257), or, to be verbally accurate, of his capacity for rights and duties. (Holland, Jurisprudence 88)
The status of a person means his personal legal condition only so far as his personal rights and burdens are concerned. Duggamma v. Ganeshayya, AIR at p.101 [Evidence Act (1 of 1872), Section 41]
In the language of jurisprudence 'status' is a condition of membership of a group of which powers and duties are exclusively determined by law and not by agreement between the parties concerned. (Roshan Lal Tandon v. Union of India).
The word "privilege" has been defined, at p. 3733, as under:
Privilege is an exemption from some duty, burden, or attendance to which certain persons are entitled; from a supposition of law, that the stations they fill, or the offices they are engaged in, are such as require all their care; that therefore, without this indulgence, it would be impracticable to execute such offices, to that advantage which the public good requires. A right or immunity granted as a peculiar benefit; advantage or favour; a peculiar or personal advantage or right, especially when enjoyed in derogation of a common right.
* * *
Immunity from civil action may be described also as a privilege, because the word 'privilege' is sufficiently wide to include an immunity. The word 'privilege' has been defined as a particular and peculiar benefit or advantage enjoyed by a person .. 'Privileges' are liberties and franchises granted to an offence, place, town or manor, by the King's great charter, letters patent, or Act of Parliament.
In view of the aforementioned definitions of the expressions "status" and "privilege" it must be held that such "status" and "privilege" must emanate from a statute. If legal right has been derived by the respondent herein to continue in service in terms of the provisions of the Act under which he is governed, then only, would the question of depriving him of any status or privilege arise. Furthermore, it is not a case where the respondent had worked for years. He has only worked, on his own showing, for 356 days whereas according to the appellant he has worked only for 208 days.
Therefore, the Fifth Schedule of the Industrial Disputes Act, 1947 has no application in the instant case. In view of the above, the dispensing with of the engagement of the respondent cannot be said to be unwarranted in law."
[See also BHEL v. B.K. Vijay & Ors., (2006) 2 SCC 654 2006 Indlaw SC 1529].
18.  In the instant case, the respondent was appointed in violation of the rules. He was appointed at the instance of a Member of the Legislative Assembly who was a minister at the relevant time. No appointment could have been made at his instance. No authority howsoever high may be cannot direct recruitment of persons of his choice.
19.  Having regard to the factual circumstances of this case, we are of the opinion that grant of monetary compensation would sub-serve the interests of justice.
20.  We, therefore, allow the appeal and set aside the directions of the Labour Court and direct that in place of the respondent being reinstated with back wages, the Appellant would pay monetary compensation to him, quantified at Rs.50,000/-. We make no order as to costs.
Appeal allowed.


Union of India and Others v Jaipal Singh
Supreme Court of India

3 November 2003
Appeal (Civil) 8565 of 2003
The Order of the Court was as follows :
Leave granted.
1.  The above appeal has been filed against the order of the Division Bench of the High Court of Punjab and Haryana and Chandigarh dated 30.10.2001 in CWP No. 12929 of 1999 whereunder the Division Bench has allowed the writ petition filed by the respondents and granted relief, as prayed for, directing re-instalment of the respondent with full back wages and consequential benefits.
2. The respondent was involved in a criminal case and he was charge-sheeted for an offence under Section 302 read with Section 34 of the IPC along with his brother and though he was convicted by the learned Additional Sessions Judge, Rewari for the same by a judgment dated 05.03.1997, on further appeal, before the High Court, the Division Bench of the High Court returned a verdict of acquittal.
3. As a consequence thereof, since, he was not reinstated inspite of the order of acquittal, he moved the High Court and obtained orders, as noticed supra. Aggrieved, the appellants have come before this Court.
4.  Heard Mr. Raju Ramachandran, learned Additional Solicitor General appearing for the appellants, who placed strong reliance upon the decision of this Court in [1996] 11 SCC 603 1996 Indlaw SC 1409: Ranchhodji chaturji thakore v. Superintendent engineer, gujarat electricity board, Himmatnagar (Gujarat) and Anr. 1996 Indlaw SC 1409 wherein this Court, in a case identical to the facts of the present case, has chosen to order only reinstatement but denied back-wages on the ground that the department was in noway concerned with the criminal case and, therefore, cannot be saddled with liability also for back wages for the period when he was out of service during/after conviction suffered by the respondent in the criminal case. Per contra, Mr. Ranbir Singh Yadav, learned counsel for the respondent sought to place reliance upon an order of this judgment of the very same High Court dated 19.07.2001 in CWP No. 10201 of 2000. Learned counsel for the respondent, by inviting our attention to the judgment of the High Court in that case contended that on facts the case on hand was also similar to the case considered therein but this Court dismissed the special leave petition when the relief granted for reinstatement and back wages was contested by the authorities before this Court.
5.  On a careful consideration of the matter and the materials on record, including the judgment and orders brought to our notice, we are of the view that it is well accepted that an order rejecting a special leave petition at the threshold without detailed reasons therefore does not constitute any declaration of law by this Court or constitute a binding precedent.
6. Per contra, the decision relied upon for the appellant is one on merits and for reasons specifically recorded therefore and operates as a binding precedent as well.
7. On going through the same, we are in respectful agreement with the view taken in [1996] 11 SCC 603 1996 Indlaw SC 1409 (supra).
8. If prosecution, which ultimately resulted in acquittal of the person concerned was at the behest or by department itself, perhaps different considerations may arise. On the other hand, if as a citizen the employee or a public servant got involved in a criminal case and it after initial conviction by the trial court, he gets acquittal on appeal subsequently, the department cannot in any manner be found fault with for having kept him out of service, since the law obliges, a person convicted of an offence to be so kept out and not to be retained in service. Consequently, the reasons given in the decision relied upon, for the appellants are not only convincing but are in consonance with reasonableness as well.
9. Though exception taken to that part of the order directing re-instatement cannot be sustained and the respondent has to be re-instated, in service, for the reason that the earlier discharge was on account of those criminal proceedings and conviction only, the appellants are well within their rights to deny back wages to the respondent for the period he was not in service.
10. The appellants cannot be made liable to pay for the period for which they could not avail of the services of the respondent.
11. The High Court, in our view, committed a grave error, in allowing back wages also, without adverting to all such relevant aspects and considerations.
12. Consequently, the order of the High Court in so far as it directed payment of back wages are liable to be and is hereby set aside.
13.  The respondent will be entitled to back wages from the date of acquittal and except for the purpose of denying the respondent actual payment of back wages, that period also will be counted as period of service, without any break.
14. The re-instatement, if not already done, in terms of the order of the High Court will be done within thirty days from today.
The appeal is allowed and disposed of on the above terms.
Appeal allowed