Holding

The workmen are not Union of India employees, Article 311 does not apply, and the principles of natural justice require proof of prejudice; therefore the High Court and Labour Court orders are set aside and the matter remitted for fresh consideration.

Summary

The Division Manager, Plantation Division, Andaman & Nicobar Islands (the appellant) dismissed eight workmen for alleged misconduct after an ex‑parte domestic enquiry, as the workmen failed to attend the enquiry. The workmen raised an industrial dispute before the Labour Court, which ordered their reinstatement, holding that the removal violated Article 311(2) of the Constitution because a second show‑cause notice and a copy of the enquiry report were not served. The appellant challenged this award in the Calcutta High Court; the High Court dismissed the writ petition and later rejected a Letters Patent appeal filed 103 days late, also dismissing a review. On appeal, the Supreme Court held that the workmen are not employees of the Union of India, their service conditions are not governed by rules under Article 309, and therefore Article 311 does not apply; the principles of natural justice require proof of prejudice before setting aside an order. The Court also observed that, given the serious questions of law, the High Court should have condoned the delay in filing the appeal. Consequently, the Supreme Court set aside the High Court and Labour Court orders and remitted the matter to the Labour Court for fresh consideration, directing the appellant to pay costs.

Issues considered

Whether the workmen are employees of the Union of India and thus protected by Article 311 of the Constitution.
Whether the domestic enquiry complied with the applicable rules and the principles of natural justice, including service of a second show‑cause notice and the enquiry report.
Whether the non‑service of the enquiry report and lack of a second show‑cause notice vitiates the removal order absent proof of prejudice.
Whether the delay of 103 days in filing the Letters Patent appeal should be condoned in view of the serious questions of law raised.
Whether the Labour Court erred in invoking Article 311 in its award.

Legislation cited

Constitution of Indias. 309, s. 311
Industrial Disputes Act, 1947s. 11-A

Subjects

industrial disputedomestic enquirynatural justiceArticle 311Section 11-ALetters Patent appealdelay condonationreinstatementdisciplinary proceedings

Judgment

A DIVISIONAL MANAGER, PLANTATION DIVISION,
ANDAMAN & NICOBAR ISLANDS
v.
MUNNU BARRICK AND ORS.

DECEMBER 17, 2004
B
J
[N. SANTOSH HEGDE AND S.B. SINHA, JJ.]

Labour Law :

C Industrial Disputes Act, 1947 : Section 11-A.

Industrial dispute-Workmen removed fi'om service on charges of
commission of misconduct-Despite notice the said workmen did not
participate in domestic enquily-Thereafter, the said 1:•orkmen removed
from service on the basis of ex parte enquiry-Labour Court directed
D reinstatement of the said workmen since procedun prescribed in Art. 311
was not followed-Letters Patent Appeal filed after a delay of 103 days
dismissed as barred by limitation-Review application also dismissed-
Correctness of-Held : The workmen are not employees of the Union of
india and their conditions of service are not governed by any rule made
E under Art. 309-Hence, they are not protected under Art. 311-Where
serious questions of law are raised delay should have been condoned-
High Court's Judgment set aside-Matter remitted to Labour Court for fresh
consideration-Constitution of India, 1950, Art. 311.

The respondent-workmen were removed· from service on charges
F of commission of misconduct of giving less outturn and instigating other
workmen to slow down work. Despite notice the responde0;ts did not
participate in the domestic enquiry and, therefore, the Disciplinary
Authority directed removal of the respondents on the basis of an ex parte
enquiry.
G The respondents raised an industrial dispute and the Labour Court
directed reinstatement of the respondent holding that the procedure
prescribed in Article 311(2) of the Constitution of India was not fol-
lowed. ,..- ,
H The appellant filed a writ petition before the High Court, which
1162
D.M., PLANTATION DIVN. ANDAMAN & NICOBAR ISLANDS v. M. BARRICK 1163

was dismissed. The Letters Patent Appeal filed after a delay of 103 days A
was dismissed as barred by limitation. The review application was also
dismissed. Hence the appeal.

Allowing the appeal, the Court
B
HELD : 1. Domestic enquiry in an industrial establishment is
governed by the Standing Orders applicable thereto. The employer, if
it is a government company, or a society registered, under the Societies
Registration Act can also frame is rules and regulations governing the
conditions of service of its employees. Domestic enquiry is required to
be conducted in terms of such rules and regulations. [1167-C] C
2. From a perusal of the award passed by the Labour Court it does
not appear that the workmen had raised any contention as regards
violation of any mandatory provision of such rules laying down the
procedure for conducting departmental proceedings. Indisputably, D
however, the principles of natural justice in such a proceeding are
required to be complied with. ;1167-D-E]

3. In law, the concerned workmen to do enjoy any status as they
are not the employees of the Union of India and furthermore their
conditions of service were not governed by any rule made under Article E
309 of the Constitution. Services of the workmen were also not protected
under Article 311 thereof. [1167-F]

4. The principles of natural justice cannot be put in a straitiacket
formula. It must be viewed with flexibility. In a given case, where a
F
deviation takes place as regards compliance of the principles of natural
justice, the Court may insist upon proofofprejudice before setting aside
the order impugned before it. (1168-B-C]

Bar Council of India v. High Court of Kerala, [2004) 6 SCC 311,
Managing Director ECIL v. B. Karunakar, (1994) SC 1074 and Canara
Bank v. Debasis Das, [2003) 4 SCC 557, relied on.

5. In a case of this nature were serious questions ofJaw were raised
by the appellant, the Division Bench of the High Court should h;;ve
taken a liberal view on the application for condonation of delay filed by H
1164 SUPREME COURT REPORTS [2004] SUPP. 6 S.C.R.

A the appellant wherefor the respondent-workmen could have been ad-
equately compensated on monetary terms. [1169-E]

6. With a view to doing complete justice to the parties the impugned
judgments and orders are set aside and the matt-er remitted to the Presiding
B Officer. Labour Court for consideration of the matter afresh. [1170-B]

CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 7312~7313
of 2002.

From the Judgment and Order dated 4.7.2001 of the Calcutta High
C Court: (Circuit Bench at Port Blair) in CAN No. 28/2001-MAT No. 12 of
2001.

Jaideep Gupta, Dipak Kumar Jeri~ and Ghanshyam Joshi for the
Appellant.
D
The Judgment of the Court was delivered by

S.B. SINHA, J. : The Management of Andaman Nicobar Islands
Forest and Plantation Development Corporation situate in the Union Ter-
ritory of Andaman and Nicobar Islands i:,, in appeal before us from a
E judgment and order dated 4.7.2001 passed by a Division Bench of the
Calcutta High Court in CAN No. 28 of 2001 (M.A.T. No. 12 of 2001)
whereby and whereunder an application for condonation of 103 days' delay
in filing an appeal under Clause 15 of the Letters Patent of the Calcutta High
Court was not condoned as also an order dated 10 .10.2001 passed by another
p Bench of the said High Court refusing to review the said order.

Respondent No. 1 to 8 herein (Respondent Workmen) were workmen
working with the Appellant in their establishment. On an allegation of
commission of mis-conduct of giving foss outturn and instigating other
workmen to slow down work and give less daily outturn, they were placed
G under suspension by orders dated 10.l 0.1994 and 24.10.1994. Charge-
Sheets containing the articles of misbehaviour and in support thereof list of
documents as well as the list of witnesses which were to be brought on
records for sustaining the same were supplied to the workmen. It appears ,......,
that the conditions of services of the workmen are governed by the Rules
H framed by the Appellant known as IES Rules.
D.M. PLANTATION DIVN. ANDAMAN & NICOBAR ISLANDS''· M BARRICK [SINHA, J) 1J65
,,..
The workmen despite notice did not participate in the domestic enquiry A
whereupon an ex-parte enquiry was conducted by the Inquiry Officer. He
upon completion of the enquiry sent his report to the disciplinary authority.
The disciplinary authority by an order dated I 2.6. I 995 directed removal of
the workmen from services. Along with the orders of removal, a copy of
the enquiry report was also enclosed.
B
j •

An industrial dispute was raised by the workmen culminating in a
reference made by the Administrator, Andaman and Nicobar Islands to the
Labour Court, Andaman and Nicobar Islands by a notification dated
13.3.1997.
c
Before the Labour Court, both the parties filed their respective plead-
ings and adduced evidences. By reason of an award dated 10.11.1998, the
learned Presiding Officer, Labour Court, Andaman and Nicobar Islands in
I.D. Case No. l of I 994 arrived at a finding that the said orders of removal
passed against the workmen were bad in law as a copy of the enquiry report D
was not served upon the workmen with a second show-cause notice and
consequently directed reinstatement of workmen in service with all back
wages and service benefits attached thereto.

The learned Presiding Officer in his award dated 10. I 1.1998 held:
E
"Here in this case apart from change over of the position in I.D.
Act by introduction of Section I I-A, there is glaring violation of
natural justice as pointed out earlier, that is to say non compliance
with the mandate of Article 31 I (2) of the Constitution, to be
specific, no second show-cause notice was served upon any of the p
eight workmen as named before, giving each of them opportunity
to present their defence, if any, before imposition of punishment
or penalty. The principle of natural justice, Audi Alterm Partem
was clearly violated and contravened. The rudimentary and fun-
damental principles have been clearly infringed. It is also a clear
case of discrimination. The delinquent workmen were denied of G
their right to receive the copy of inquiry report as well as the right
of hearing before final order imposing major penalty."

The said order came to be questioned by the Appellant herein in a writ
petition filed before the Calcutta High Court. Before a learned Single Judge H
1166 SUPREME COURT REPORTS [2004] SUPP. 6 S.C.R.

A of the said court a contention was raised by the Appellant herein that the
it should be permitted to proceed with the disciplinary proceeding against
the Respondent Workmen from the stage of service of the report of the .
Inquiry Officer on them. The said contention was rejected by the learned
Single Judge by an order dated 20.12.2000 on the premise that the Appellant
B had not filed any application for adduction ofadditional evidence before the
Labour Court. It was opined: . l.

"Accordingly, I am not in a position to sustain the contention of
the petitioner authority that except for the service of notice of the
enquiry report upon the respondent-workmen all the charges framed
c against the respondent-workmen were proved beyond doubts. I,
therefore, do not incline to interfere with the impugned award
passed by the Tribunal. I, accordingly, dismiss this writ petition."

A Letters Patent Appeal thereagainst was preferred before the Division
D Bench which was barred by limitation, as a delay of I 03 days occurred in
filing the same. As indicated hereinbefore, the delay in filing the said appeal
was not condoned. Consequently, the appeal was dismissed; whereafter a
review application was filed before the said court and the same also came
to be dismissed.

E Mr. Jaideep Gupta, learned senior counsel appearing on behalf of the
Appellant would submit that the Division Bench of the High Court in the
peculiar facts and circumstances of the case and particularly having regard
to the question of law involved therein should have disposed of the appeal
on merit upon condoning the delay in filing the same.
F
The learned counsel would urge that the Presiding Officer, Labour
Court and consequently the learned Single Judge of the High Court clearly .,...
erred in invoking the principles governing conditions of services of the
employees of the Union of India in the instant case as Article 311 of the
Constitution of India is clearly inapplicable. In any event, the learned
G counsel would contend that non-supply of the enquiry report to the delin-
quent workmen in order to enable them to raise contentions as regard the
quantum of punishment would not vitiate the entire enquiry proceedings
inasmuch as the Disciplinary Authority could have considered the matter
afresh on the question of punishment upon service of a copy of the said
H enquiry report.
D.M .. PLANTATION D!VN. ANDAMAN & NICOBAR ISLANDS 1·. M. BARRICK [SINHA, J J ] 167

Mr. Gupta would submit that even in Managing Director, ECIL, A
Hyderabad, Etc. Etc. v. B. Karunakar, Etc. Etc., AIR (1994) SC 1074 the
Court has laid stress on the 'prejudice doctrine', in terms whereof it was
obligatory on the part of the workmen to show that they had been prejudiced
by reason of non-supply of the enquiry report. Reliance in this connection
has also been placed on Canara Bank and Others v. Debasis Das and B
I • Others, (2003] 4 sec 557.

Nobody has appearP,d for the Respondents despite service of notice.

Domestic enquiry in an industrial establishment is governed by the
Standing Orders applicable thereto. The employer, if it is a government c
company, or a society registered under the Societies Registration Act can
also frame its rules and regulations governing the conditions of service of
its employees. A domestic enquiry is required to be conducted in terms of
such rules and regulations.
D
From a perusal of the award passed by the Presiding Officer, Labour
Court, it does not appear that the workmen had raised any contention as
regards violation of any mandatory provision of such rules laying down the
procedure for conducing departmental proceedings. Indisputably, however,
the principles of natural justice in such a proceeding are required to be
complied with. E

In law, the concerned workmen do not enjoy any status as they are not
the employees of Union of India and furthermore, their conditions of serv-
ice, were not governed by any rule made under Article 309 of the Consti-
tution. Services of the workmen were also not protected under Article 311 F
thereof. It has been contended before us that in terms of the extant rules
governing the conditions of service of the workmen, a departmental appeal
was maintainable against an order of the Disciplinary Authority. Presum-
ably, such a remedy was provided with a view to enable the workmen to
prefer an effective departmental appeal and only in that view of the matter,
a copy of the enquiry report was supplied by the Appellant along with the G
order of the dismissal.

·- The workmen evidently did not avail the benefit of filing any depart-
mental appeal. In such an appeal they could have shown as to how and in
what manner and to what extent they were prejudiced by non-supply of a H
1168 SUPREME COURT REPORTS [2004] SUPP. 6 S.C.R.

A copy of the enquiry report. Had the workmen filed such an appeal, they
could have furthermore demonstrated before the Appellate Authority that
in terms of the rules and regulations governing their conditions of service,
they were, as a matter ofright, entitled to a copy of the enquiry report before
an order of punishment is imposed upon them.
B
The princi pies of natural justice cannot be put in a strait-jacket formula. • t
It must be viewed with flexibility. In a given case, where a deviation takes
place as regard compliance of the principles of natural justice, the Court may
insist upon proof of prejudice before setting aside the order impugned before
it. [See Bar Council of India v. High Court of Kerala, [2004] 6 SCC 311].
c
The Presiding Officer, Labour Court, as noticed hereinbefore, commit-
ted a manifest error in invoking Article 311 of the Constitution of India in
the instant case.

D In Karunakar (supra), this Court has clearly held that the employee
must show sufferance of prejudice by non-obtaining a copy of the enquiry
report.

This Court in Canara Bank (supra) while following Karunakar (supra)
held:
E
"19. Concept of natural justice has undergone a great deal of change
in recent years. Rules of natural justice are not rules embodied
always expressly in a statute or in rules framed thereunder. They
may be implied from the nature of the duty to be performed under
F a statute. What particular rule of natural justice should be implied
and what its context should be in a given case must depend to a r-
great extent on the fact and circumstances of that case, the frame-
work of the statute under which the enquiry is held. The old
distinction between a judicial act and an administrative act has
G withered away. Even an administrative order which involves civil
consequences must be consistent with the rules of natural justice.
The expression "civil consequences" encompasses infraction of not
merely property or personal rights but of civil liberties, material
deprivations, and non-pecuniary damages. In its wide umbrella
comes everything that affects a citizen in his civil life."
H
D.M., PLANTATION DlVN. ANDAMAN & NICOBAR ISLANDS" M. BARRICK [SIN! !A, J ] 1169
~
Referring to a large number of decisions, it was observed that a court A
will refrain from interfering with an order, having regard to 'useless for-
mality theory', in a given case. It was opined:

"27. It is to be noted that at no stage the employee pleaded preju-
dice. Both learned Single Judge and the Division Bench proceeded
B
on the basis that there was no compliance of the requirement of
\ >
Regulation 6(18) and, therefore, prejudice was caused. In view of
the finding recorded supra that Regulation 6( 18) has not been
correctly interpreted, the conclusions regarding prejudice are inde-
fensible."
c
The learned Single Judge of the High Court, therefore, in our opinion,
seriously erred in not considering the matter from the aforementioned angle.
Furthermore, in view of the submissions made on behalf of the Appellant
herein, the court should have given an opportunity to complete the disci-
pl inary proceeding from the stage of supplying a copy of the enquiry report D
to the workmen so as to enable them to raise a contention as regard cor-
rectness of the findings of the Inquiry Officer contained in the report as also
on the quantum of punishment proposed to be imposed by the Appellant
while issuing a second show-cause notice.

In a case of this nature where serious questions of law were raised E
by the Appellant, in our opinion, the Division Bench of the High Court
should have taken a liberal view on the application for condonation of delay
filed by the Appellant wherefor the Respondents workmen could have been
adequately compensated on monetary terms.
F
Ordinarily, we have remitted the matter back to the Division Bench
for consideration of the matter on merit but as we are satisfied that the
learned Single Judge of the High Court as well as the Presiding Officer,
Labour Court have seriously erred in passing the impugned award and
judgments, with a view to do complete justice to the parties we are of the
view that all the impugned judgments and orders should be set aside and G
the matter remitted to the Presiding Officer, Labour Court for consideration
of the m1!tter afresh. However, as the matter is pending for a long time, we
direct the Appellant to pay a sum of Rs. I 0,000 to the workmen by way of
~~
costs. Such costs should be deposited before the Labour Court within six
weeks from date. H
1170 SUPREME COURT REPORTS [2004] SUPP. 6 S.C.R.

A The impugned order dated 4.7.2001 passed by the D~vision Bench
of the High Court, dated 20.12.2000 passed by the Single Judge of the High
Court as also the award dated l 0.11.1998 passed by the Presiding Officer,
Labour Court, Andaman and Nicobar Islands are accordingly set aside.

B This Appeal is allowed and the matter is remitted to the Court of the
Presiding Officer, Labour Court, Andaman and Nicobar Islands with the <I
aforementioned directions. As the Respondents have not appeared, there
shall be no order as to costs.

v.s.s. Appeal allowed.

r