WA/559/1999 of Vs on 11 December 2003

:JUDGMENT

V.S. SIRPURKAR, J.

The judgment of the learned single Judge, allowing the writpetition filed by the second respondent bank (in short 'the bank'),challenging the award passed by the Industrial Tribunal and upholding theorder of dismissal by the bank, is in challenge before us.

2. The appellant herein was employed as a clerk inPurasawalkam branch of the bank. On 15-12-1977, a demand draft dated12-11-1977 issued by the National Bank of Omen, drawn in favour of one K.C.Appukuttan was brought to the bank by one V.T. Lazar, who had account in thatbank, for being deposited in his account. That draft was endorsed by the saidpayee. The draft was presented along with the usual pay-in slip at the counter of the bank, which was manned by the appellant. It later on turnedout that the amount covered in the said demand draft was not credited to theaccount of V.T. Lazar and, therefore, he complained to the bank. He alsoproduced the counterfoil which disclosed that the demand draft, which was madepayable at the Bank of America was received from the V.T. Lazar for beingcredited to his account.

2.1. On the complaint being received, it was found that the amount was deposited in the name of the appellant , who had received the said draftalong with the pay-in slip duly filled in. The amount covered by the saiddraft was credited to the account of the appellant on 16 -12-1977 and on thevery next day, he also drew the money from his bank account. The appellantkept on working in the bank till 26-12-197 7 and thereafter, gave a leaveletter and went on leave on account of his alleged illness. He did not turnup for the work for more than two months. He produced a medical certificate.2.2. The bank, on the basis of the complaint given by Lazar,instituted an enquiry and an explanation was called on the basis of the saidcomplaint dated 9-1-1978. The appellant wrote a letter on 20-1-1978 whereinhe owned up the two charges levelled against him and urged that the chargeswere true and that he had committed the said acts by mistake and withoutthinking about the seriousness of his action and he sought apologies. He alsowrote that he prepared to accept the disciplinary action without anyreservation.

2.3. The departmental enquiry proceeded in respect of the fraud

2.3. The departmental enquiry proceeded in respect of the fraud played by the appellant because in the investigation it came to light that theappellant had fraudulently written his name in the main foil of the pay-inslip while on the counterfoil meant for the customer, the name of Lazar waswritten. The counterfoil also bore a portion of the rubber-stamp of the bank,suggesting that the draft mentioned therein was deposited in the bank.2.4. The appellant took part in the enquiry. He cross-examinedwitnesses also. He also examined himself. The said Lazar was also thoroughlyexamined and he supported his case to the hilt. He gave out a statement thatafter depositing the draft, he left the bank in a hurry and the appellant hadgave him the counter-foil of the pay-in slip in the evening at his residence.He also asserted that he enquired with the appellant as to whether the amounthad been collected and he was told by him that it will take some time as itwas the year-end closing time. He also further asserted that he had gone toenquire from the appellant but he was not in the bank and, therefore, made acomplaint to the Branch Manager of the bank, who after making enquiries, foundthat the amount covered by the said demand draft had in fact been collectedand credited to the account of the appellant instead of Lazar. Though he wascross-examined, nothing really came out of the corss-examination in respect ofthe material allegations. The bank Manager was also examined and he pointedout that the draft had been sent for collection and was also realised on16-12-1977 and the amount was credited on 16-12-1977 to the account of theappellant and was withdrawn by him also.

2.5. The defence raised by the appellant was slightly unusual. He said that he accepted that the draft was given to him by Lazar for collectionbut, he claimed that on the following day he found that there was no signatureof Lazar on the reverse side of the draft and, therefore, he thought of savingtime and put his own signature on the reverse and got the draft credited tohis own account. According to him, he had drawn the money only with an intention to give it back to Lazar but he could not do so as later on he fell

ill.

2.6. The appellant was found guilty on all the counts. In reply to the second notice before proposing the punishment, the appellant asserted thathe had already paid the amount to the customer without furnishing any detailsabout the date and place of payment. Ultimately, he came to be dismissed fromservice on 10-6-1978.

2.7. The dismissal order was challenged before the Industrial Tribunal vide I.D. No.85 of . No oral evidence was let in by either party.Ex.M-1 to M-28 were marked by consent of the Management. The appellant alsodid not challenge the enquiry.

2.8. The Tribunal endorsed the finding of misconduct perhaps becausethose findings were never challenged before it. The finding of the Tribunalis to be found in paragraph 6. The Tribunal had went on to observe that thebank had paid the amount to Lazar on 9-1-1978 and that since the appellant hadlearnt about the said payment having been made by the bank, he paid the sameto the bank. The Tribunal noted that since the bank could not confirm thisclaim by the appellant due to the non-availability of the records, theTribunal held that the money was returned by the appellant was correct .Ultimately, the Tribunal held that though the misconduct was proved, which wasthe subject-matter of the first charge, the third charge of unauthorisedabsence was only a minor misconduct. The Tribunal dubbed the whole affair asa 'temporary misappropriation made in a momentary fit of indiscretion'. TheTribunal, therefore, came to the conclusion that the appellant was entitled tothe sympathetic treatment and, therefore, came to the conclusion that thepunishment was more harsh than necessary and thus set aside the dismissal anddirected the reinstatement with continuity in service as also 50% of thebackwages.

3. The order of the Tribunal was challenged by the bank

3. The order of the Tribunal was challenged by the bank before the learned single Judge and it was contended that the discretion shownby the Tribunal was perverse. It was pointed out that in the wake of provedmisconduct, that too of a very serious nature, the Tribunal could not havedubbed it as an 'act of momentary indiscretion'. It was pointed out that themisconduct of misappropriation was complete and could not be said to betemporary because it is nowhere proved that the appellant had in any mannerreturned the money to the bank. It was also pointed out to the learned singleJudge that it was a case of absolute fraud involving more than one offencesunder the Indian Penal Code that the appellant had in fact prepared falsedocuments and had misappropriated the money and had further falsely claimedthat the misappropriated amount was returned to the bank for which there wasabsolutely no basis. The Tribunal, therefore, could not have merely dubbed itas an 'act of momentary indiscretion' without analysing the grave nature ofthe fraud played by the appellant.

3.1. The learned single Judge allowed the writ petition and that is how the matter is before us.

4. Shri N.G.R. Prasad, learned counsel for the appellant very vociferously argued before us that once the Tribunal had used its discretion under Sec.11-A of the Industrial Disputes Act and had awarded thepunishment of the cut of 50% of the backwages, the learned single Judge, inhis jurisdiction under Art.226 of the Constitution, could not have found faultwith the discretion. Learned counsel argues that to begin with, this was nomisappropriation at all and it was a honest misunderstanding on the part ofLazar, who had also at subsequent stages favoured the exoneration of theappellant. He further points out that the appellant had deposited the draftin his own account solely with an idea to help Lazar, who was in a hurry andcould not collect the amount then and there. He points out that the theory ofthe bank that the appellant wrote his own name on the main foil of the pay-inslip while writing the name of Lazar on the counter-foil was itself notcorrect and once that theory falls down, there was no scope for holding thatthe appellant had committed any misappropriation. This the learned counseltried to suggest from producing the xerox copies of the counterfoil which beara portion of the bank stamp. Learned counsel says that if that was the casethen, the remaining part of the bank-stamp should have been there found on thecounterfoil in which the name of the appellant was written, obviously in thehandwriting of the appellant. That not being there, according to the learnedcounsel, the first charge had to fail necessarily.

4.1. Learned counsel then goes on to point out that even if it was accepted that the appellant had deposited the money in his own account, thatshould not be held against the appellant as that was with the honest intentionto return the money to Lazar. Ultimately, the learned counsel went on tosuggest that even if all the findings of facts had been endorsed by theTribunal, the Tribunal, in its' wisdom, had used its discretion consideringthe unblemished record of the appellant, which was bound to be considered andwhich was not considered by the bank while inflicting the punishment, and,therefore, the discretion shown by the Tribunal could never have beeninterfered with by the learned single Judge. According to him, the learnedsingle Judge had committed jurisdictional error.

5. Shri Sampathkumar, learned counsel for the bank,

Conclusion

reiterated that in fact it was a grave crime committed by the appellant whichwas not only admitted by him but, later on proved in the departmentalproceedings to the hilt. Learned counsel points out that the Tribunal hadalso endorsed that misconduct and gave a clear-cut finding in support thereof.Under such circumstances, if the Tribunal showed undue sympathy, it wasnothing but perversity on the part of the Tribunal. Learned counsel suggeststhat the learned single Judge was perfectly correct in holding that thediscretion shown by the Tribunal under Sec.11-A in respect of quantum ofpunishment was perverse. Learned counsel also took up the position that wherethe enquiry was found to be in keeping with the principles of natural justiceand where the findings were also endorsed then, the Tribunal should not haveused its' discretion in perverse and, therefore, the learned single Judge wascorrect in interfering with the order of the Tribunal and restoring thepunishment of dismissal.

6. The learned single Judge has painstakingly examined the decisions cited on behalf of the appellant before him which pertained to theprinciples of awarding punishment and also regarding the discretion to be usedby the Tribunal. We need not go into all those decisions since they were not pressed into service before us and rightly so as the law is settled on thequestion of jurisd iction of the High Court under Art.226 of the Constitutionwhile examining the award of the Labour Court. From the facts, the learnedsingle Judge found that the appellant had played worst kind of fraud byfirstly making false documents, depositing the draft in his own name; bykeeping this information from Lazar and by lying to him regarding the truestate of affairs regarding the draft and lastly by avoiding to pay the saidamount to Lazar. In paragraph 17 of the judgment, the learned Judge has notedthat at every point of time, the appellant was taking recourse to thefalsehoods.

7. Shri Prasad tried to urge before us that this was nothing

but a honest help tried to be given by the appellant to Lazar as Lazar was ina hurry and had left the draft without signing the same on the reverse and itwas therefore got deposited by the appellant in his own account with the soleidea to return the money. It is clear from the evidence and from thedocuments that on 15th, when the bank draft was deposited, the appellant metLazar in the evening and also gave the counterfoil to him which bore the bankstamp, suggesting that the draft mentioned on the counterfoil was in factdeposited in the bank in the name of Lazar. If the said counterfoil was givenin the evening by the appellant to Lazar and if at that time, he did notdisclose anything about the draft and kept quiet about the draft not havingbeen deposited, it was obviously with an intention to cheat the customer. Hehad made a false representation to Lazar that the draft was duly deposited asper the counterfoil. The countefoil was also a false document made by theappellant who had put the stamp on the said counterfoil. If the appellantknew that the bank draft was not deposited much less in the name of Lazar tohis account then, there was no necessity on the part of him to give Lazar thecounterfoil, which was duly stamped. In fact, this evening-meet is admittedby the appellant himself. It is also obvious from the cross-examination ofLazar that the facts deposed by him in examination-in-chief were not at allcontroverted. Thereafter also, the appellant on the very next day depositedthe said draft in his own account and as if that was not sufficient, the verynext day, he withdrew the amount also from his account. He did not bother toinform anything about the depositing of the draft in his own name to Lazar andthen made himself scarce after 26-1 2-1977. The appellant had ampleopportunity to meet Lazar between 17 th and 25th December. He did not do soand instead claimed that he was suffering from conjunctivitis . Learned Judgehas analysed all these and has recorded a finding that the fraud played by theappellant was not an ordinary one. It was a deliberate attempt to cheat thebank as also the customer and had the effect of bringing the bank intodisrepute.

8. Indeed, it is not necessary for us to go into all that because in the very first blush, the appellant had admitted his guilt thoughhe resiled from it later on and as if that was not sufficient, even theTribunal has endorsed the finding of guilt. We cannot, therefore, entertainthe argument of Mr. Prasad that this was not a fraud or misconduct in thereal sense of the term. Mr. Prasad, however, tried to describe the wholeaffair as a minor petty youthful indiscretion on the part of the appellant.He pointed out that even the Tribunal had taken the same view that it was an

'act of momentary indiscretion' and, therefore, not viewed seriously by theTribunal. The main thrust of the argument is that once the discretion hasbeen shown by the Tribunal under Sec.11-A of the Act, there was no scope forthe learned single Judge to interfere. We find ourselves unable to agree onthis principle. Learned single Judge has given very cogent reasonshighlighting the peculiar position of the appellant where the evidence of thecustomer was the most material aspect. The learned Judge very rightly foundthat here was a bank-employee who patently duped the customer and also harmedthe bank's reputation.

9. The learned counsel also noted that the misconduct wasadmitted though the appellant later on tried to wriggle out of his admissionby suggesting that it was taken under coercion. Mr. Prasad also wanted us tohold that it was merely because of the representation made by the Manager thatthe appellant had owned up his mistake. We agree with the learned Judge whenthe learned Judge discards the theory of the so-called coercion. In ouropinion, there was nothing but a very bare attempt on the part of theappellant to escape from the inevitable departmental enquiry. We also agreewith the learned single Judge where it is held by him that it is only when theTribunal discharges its functions judicially, a value can be attached to thediscretion exercised by it and it is only if that discretion is properlyexercised, the same would not be interfered with by the High Court. LearnedJudge has also quoted the law laid down by Justice M. Srinivasan in SouthIndia Sugars Limited case (1989 II MLJ 1044) and Justice A.M. Ahmadi (as HisLordship then was) in Municipal Corporation of City of Ahmedabad (1987 I LLJ152). The learned Judge has then come to the conclusion that if the LabourCourt has come to the conclusion on the basis of the cases that the labourcourt had not exercised its jurisdiction in a judicious manner then, the orderis liable to be reviewed by this Court. The law laid down by the SupremeCourt in Hindustan Steels Case (AIR 1970 SC 1401) was also relied upon by thelearned single Judge to hold that it becomes the duty of the court tointerfere with the order which has not been made in proper exercise of thediscretionary power after examining all the relevant circumstances and thematerials.

10. At the instance of Shri Prasad, we also went through the order of the Tribunal to see whether the Tribunal has properly exercised itsdiscretion. A glance at the order suggests that the Tribunal has merelytreated this to be a temporary misappropriation. Mr. Prasad also heavilyrelied on the finding to that effect. In our opinion, this could not be acase of mere temporary misappropriation. In this, the appellant, a bankclerk, had firstly made a false document, on that basis made a falserepresentation to the bank customer, cheated the customer and in the processmade unlawful gain of Rs.500/- himself and on the top of it had claimed thathe had returned the whole money even before the enquiry begun. It has comeout clearly that that claim was clearly false. All that the Tribunal hasmentioned is that the appellant had unblemished past service record and thatwas not taken into consideration by the punishing authority along with theextenuating circumstances existing in the case before the punishment ofdismissal was awarded to him and that this was in contravention of clause19.12(c) of the bi-partite settlement. According to the Tribunal, there was

no evidence let in on behalf of the bank to controvert the statement putforward that the appellant had unblemished record of service and that thismisconduct was in his youthful indiscretion. All this was clearly perversethinking. Here was a man who had made false vouchers, dubed the bankcustomer, misappropriated the whole amount and on the top of it, neverbothered to return the money. It could not therefore be, by any stretch ofimagination, called and brushed aside as 'temporary misappropriation'.Therefore, in reality, the Tribunal had not taken into account the graveconsequences of the act on the part of the appellant and had merely dubbed thewhole affair as 'youth indiscretion'. After all, till that time the appellanthad put in four years of service. Therefore, this could not be a case of longunblemished service. That apart, a mere continuation of the service by itselfdoes not add any credit to the employee and cannot be compared with the gravemisconduct that the appellant had committed. In our opinion, the Tribunal hadgravely erred in awarding the service back along with the 50% of thebackwages. That was indeed a unique piece of thinking and, in our opinion,the learned single Judge was absolutely correct in interfering.

11. Mr. Prasad very heavily relied on two decisions. The first such case is SHANKAR DASS v. UNION OF INDIA AND ANOTHER (1985 (2) LLJ 184 ) That was a case where the Supreme Court had allowed the appeal of anemployee, who had failed to deposit Rs.500/- though he had collected the sameon behalf of the bank being its collecting agent. He was let off by thecriminal court on the probation considering the typical circumstances that hehad lost his son in February 1962, his wife had suffered a serious injuryimmediately thereafter and his daughter fell seriously ill and remained so fareight months. The Supreme Court found fault with the bank in choosing todismiss the appellant in a huff without applying its mind to the penalty whichcould properly be imposed upon him in so far as his service career wasconcerned.

12. We do not find any parallel though Mr. Prasad very heavily relied on this case. According to Mr. Prasad this was also a case ofmisappropriation or criminal breach of trust only for Rs.500/-. That by foris the only similarity that we find. However, it is obvious that was not acase of a deliberate plan of cheating and perpetrating fraud. This is apartfrom the fact that the Supreme Court has shown mercy in the light of the factsof that case. We do not find any parallel.

13. Mr. Prasad also relied on the Division Bench judgment of the Gujarat High Court in PARMAR (R.M.) v. GUJARAT ELECTRICITY BOARD, BARODA(1983 (1) LLJ 261) , determining the scope of Sec.11A of the IndustrialDisputes Act. There is nothing in this judgment which would persuade us totake a different view than the one which we propose to take. The principleswhich the learned Judges have discussed in this case which are to be found inparagraph 6 of the judgment do not apply as that was a case of taking of apetty article by a worker in a moment of weakness. There, the worker did nothold the sensitive post of 'trust'. It is also liable to be seen in thatbehalf that the Division Bench has observed:

"Taking of a petty article by a worker in a moment of weakness when he yieldsto a temptation does not call for an extreme penalty of dismissal from service. More particularly when he does not hold a sensitive post of trust(pilferage by a cashier or by a storekeeper from the stores in his charge, forinstance, may be viewed with seriousness)" (emphasis ours')We need not say more than observing that here the appellant was working as abank clerk and was in reality holding the position of 'trust'. He not onlyabused that position but went on to drive nails to his coffin by making falserepresentations one after the other.

14. We do not find anything wrong in the order passed by thelearned single Judge. In short, the appeal has no merits. It is dismissed.There shall be no order as to the costs.

To:

1. The Presiding OfficerIndustrial TribunalMadras-104