SC’s Ruling on Disciplinary Proceedings and Non-Supply of Inquiry Report

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November 15, 2017

Uttarakhand Transport v. Sukhveer Singh

Date of judgment: November 10, 2017

In this recent case, the Supreme Court has primarily ruled on the legal principle of Non-Supply of Inquiry Report to the delinquent employee in disciplinary proceedings and the consequences that follow when the delinquent employee has not been prejudiced by non-supply of inquiry report prior to the issuance of show cause notice.

Factual Matrix in the case: Disciplinary proceedings had been initiated against the Respondent Driver by the Appellant on account of an incident and later on it was discovered that 61 passengers were travelling without a ticket. Thereafter, Respondent was suspended and disciplinary proceedings were initiated against him. The inquiry officer found that the charges against the Respondent were proved and thereafter the disciplinary authority issued a show cause notice along with which the inquiry report was supplied to the Respondent. Not satisfied with the explanation submitted by the Respondent to the show cause notice, the disciplinary authority dismissed him from service in 1997 and later on in series of proceedings the Appellate authority as well as the Labour Court dismissed the Respondent’s appeal against order of dismissal.

The Respondent then challenged the award in the High Court, wherein the Court allowed the writ petition and set aside the dismissal order in view of the Supreme Court’s judgment in the case of Managing Director ECIL Hyderabad & ors. v. B. Karunakar & ors.[1], wherein it was held that a delinquent employee has a right to receive the report of the inquiry officer before the disciplinary authority takes a decision regarding his guilt or innocence.

Appellant’s contention before the Supreme Court- That the impugned judgment of High Court was contrary to the law laid down in Managing Director case as a copy of the inquiry report had been supplied to the Respondent and that the Respondent did not even plead that any prejudice was caused to him by the non-supply of the inquiry report prior to the issuance of show cause notice.

Respondent’s submission- The Respondent relied on Managing Director case to contend that injustice was meted out to him and hence he should be reinstated. The Respondent also contended that the punishment of dismissal from service was disproportionate to the delinquency i.e. wrong alleged to be committed by him.

Bench’s Verdict

The Supreme Court allowed the appeal and set aside High Court’s order. It made the following observations in the case:

Non-supply of Inquiry Report does not automatically results in Re-instatement of Delinquent Employee– That the High Court committed an error in its interpretation of the judgment in Managing Director case. Though, it was necessary for the Appellants to have supplied the inquiry report before issuance of the show cause notice proposing penalty, there exists no reason to hold that the Respondent was prejudiced by supply of the inquiry officer’s report along with the show cause notice and that this was not a case where the delinquent employee was handicapped due to the inquiry officer’s report not being furnished to him at all. The Court in the case quoted Supreme Court’s observation in Managing Director case:

When the employee is dismissed or removed from service and the inquiry is set aside because the report is not furnished to him, in some cases the non-furnishing of the report may have prejudiced him gravely while in other cases it may have made no difference to the ultimate punishment awarded to him. Hence to direct reinstatement of the employee with back-wages in all cases is to reduce the rules of justice to a mechanical ritual. The theory of reasonable opportunity and the principles of natural justice have been evolved to uphold the rule of law and to assist the individual to vindicate his just rights. They are not incantations to be invoked nor rites to be performed on all and sundry occasions. Whether in fact, prejudice has been caused to the employee or not on account of the denial to him of the report, has to be considered on the facts and circumstances of each case. Where, therefore, even after the furnishing of the report, no different consequence would have followed, it would be a perversion of justice to permit the employee to resume duty and to get all the consequential benefits. It amounts to rewarding the dishonest and the guilty and thus to stretching the concept of justice to illogical and exasperating limits. It amounts to an “unnatural expansion of natural justice” which in itself is antithetical to justice.

Other precedent quoted by the Supreme Court is the case of Haryana Financial Corporation v. Kailash Chandra Ahuja[2] in which it was held that failure to supply a report of the inquiry officer to the delinquent employee would not ipso facto result in the proceedings being declared null and void. It is for the delinquent employee to plead and prove that non-supply of such report had caused prejudice and resulted in miscarriage of justice. If he is unable to satisfy the court on that point, the order of punishment cannot automatically be set aside.

In view of the aforesaid, Two-Judge Bench of the Supreme Court comprising of Justice Arun Kumar Mishra and Justice L. Nageswara Rao held that supply of inquiry report is part and parcel of natural justice and must be furnished to the delinquent employee, failure to do so would not automatically result in quashing or setting aside of the order or the order being declared null and void. For that, the delinquent employee has to show “prejudice”.

Acts of corruption and disappropriate punishment- In reponse to this contention of the Respondent, the Supreme Court in the case made a noteworthy observation that acts of corruption/misappropriation cannot be condoned, even in cases where the amount involved is meagre.

 

[1] (1993) 4 SCC 727

[2] (2008) 9 SCC 31