PETITIONER:
J. D. JAIN
Vs.
RESPONDENT:
THE MANAGEMENT OF STATE BANK OF INDIA & ANR.
DATE OF JUDGMENT17/12/1981
BENCH:
ISLAM, BAHARUL (J)
BENCH:
ISLAM, BAHARUL (J)
TULZAPURKAR, V.D.
VARADARAJAN, A. (J)
CITATION:
1982 AIR 673 1982 SCR (2) 227
1982 SCC (1) 143 1981 SCALE (3)1884
ACT:
Constitution of India 1950 Art. 226-Award of Industrial
Tribunal-Jurisdiction of High Court-interference-When
arises.
Industrial Disputes Act 1947 S. 11 A-Complaint-
Depositor against bank employee-Debit authority alteration
of-Withdrawal of excess money-Confession by employee to
officer of alteration and withdrawal-Holding of domestic
enquiry-Non examination of depositor-Charge of fraud and
misappropriation proved-Employee discharged from service-
Dispute raised-Issue referred to Tribunal-Tribunal holding
depositor (complainant) not examined-Evidence against
employee ‘hearsay’-Directing reinstatement-High Court in
writ petition setting aside of tribunal-High Court Whether
correct in interfering with award-Award whether vitiated by
misconception of law.
Labour Law-Domestic enquiry-Guilt whether to be
established beyond reasonable doubt-Proof of misconduct
alone-Whether sufficient,
Words & Phrases ‘hearsay’-Meaning of
HEADNOTE:
The Appellant was working as a Cashier in a Bank. A
depositor who had a Savings Bank Account with the Bank came
to the Bank to receive his Pass Book. On receipt of his Pass
Book from the Counter Clerk he complained to the ledger
keeper that, on a certain date he had withdrawn only Rs. 500
but a debit entry of Rs, 1,500 had been shown in the Pass
Book. The Ledger keeper took the depositor to the Supervisor
and The Agent and his complaint was recorded. When the
documents pertaining to the withdrawal were examined it was
found that the depositor had given a letter of authority to
the appellant authorising withdrawal from his account. The
letter of authority showed that it was for withdrawal of Rs.
1500 though there appeared to be some interpolation
suggesting that the figure of Rs. 500 had been altered lo
the figure of Rs. 1500.
A memorandum of charge was served on the appellant by
the Management respondent No. I and a disciplinary enquiry
was held. The Enquiry Officer submitted his report and his
findings were that the appellant had fraudulently altered
the amount in the letter of authority given by the
depositor, withdrew Rs. 1500 from the depositor’s account
and paid Rs. 500 only to the depositor and
228
misappropriated Rs. 1500. In pursuance of the enquiry the
appellant was discharged from service.
The appellant having raised an industrial dispute the
matter was referred to the Industrial Tribunal. Before the
Tribunal the appellant denied the charges and pleaded that
as the depositor was not examined in the disciplinary
enquiry there was no legal evidence before the Enquiry
officer for finding that he was guilty. Before the Tribunal
the Management examined no witnesses but produced documents
and relied on them. The Tribunal held that on the evidence
before it the appellant could not be held guilty as in the
absence of the evidence of the depositor, the evidence
recorded was ‘hearsay’ and directed reinstatement to the
appellant with full back wages.
The respondent moved the High Court under Article 226
and 227 which held that the charge against the appellant had
been established and quashed the award of the Tribunal.
In the appeal to this Court it was contended on behalf
of the appellant: (1) that the Tribunal exercised its powers
under Section 11 A of the Industrial Disputes Act and the
High Court exercising powers under Article 226/227 had no
jurisdiction to interfere with the award; (2) the Tribunal
rightly refused to rely on the evidence which was hearsay;
the depositor not having been examined, and (3) the High
Court committed an error in not considering the receipt
executed by the depositor showing payment of Rs. 1000 to the
depositor.
Dismissing the appeal,
^
HELD: The award of the Tribunal is vitiated by
misconception of the law involved. It erred in holding that
as Kansal (depositor) was not examined, fraud and
misappropriation on the part of appellant cannot be held to
be proved and in failing to appreciate the confession made
by the appellant to the higher officer that he had altered
the amount in figures and words in his own hand. [236 G]
1. In an application for a writ of certiorari under
Article 226 for quashing the award of an Industrial Tribunal
the jurisdiction of the High Court is limited. It can quash
the award when the Tribunal has committed an error of law
apparent on the face of the record or when the finding of
facts of the Tribunal is perverse. [233 B]
In the instant case, three kinds of proceedings against
the delinquent were possible: (i) departmental proceedings
and action, (ii) Criminal prosecution for the alleged
misappropriation of the amount, and (iii) civil proceedings
for recovery of the amount alleged to be misappropriated.
The respondent adopted the first course and instituted the
domestic enquiry. In such an enquiry guilt need not be
established beyond reasonable doubt; proof of misconduct may
be sufficient. [234 G-235 A]
State of Haryana & Anr. v. Rattan Singh A.I.R. 1977
S.C. 1512, referred to
229
2. The word ‘hearsay’ is used in various senses.
Sometimes it means whatever a person declares on information
given by someone else. [235 E]
In the instant case, the Tribunal after having made a
detailed reference to the evidence of the witnesses found
that a complaint was made by Kansal and that the appellant
confessed that he had altered the debit authority, but held
That as Kansal was not examined, this was not direct
evidence but was of the nature of ‘hearsay’ evidence, with
regard to the fact whether the appellant manipulated the
documents, withdrew the excess amount and misappropriated
it, there is no direct evidence of any of the witnesses
except the appellant’s confession. The evidence on which
reliance has been taken by the respondent is the confession
and circumstantial evidence. The evidence of Kansal would
have been primary and material. if the fact in issue were
whether Kansal authorised the appellant to make the
alterations in the authority letter. But Kansal’s complaint
was to the contrary. No rule of law enjoins that a complaint
has to be in writing as insisted by the Tribunal. For the
purpose of a departmental enquiry, complaint substantiated
by circumstantial evidence is enough. What the respondent
sought to establish in the domestic enquiry was that Kansal
had made a verbal complaint with regard to the withdrawal of
excess money by the appellant. On the factum of complaint of
Kansal the evidence of these four witnessess is direct as
the complaint is said to have been made by Kansal in their
presence and hearing. It is not therefore ‘hearsay’. The
respondent has succeeded in proving that a complaint was
made by Kansal on the evidence of these four witnesses. [236
A-E]
Subramaniam v Public Prosecutor [1956]1 W.L.R. 965,
referred to
3. The receipt executed by Kansal showing payment by
the appellant of Rs. 1000 to the former is destructive of
the appellant’s defence and on the contrary proves the
respondent’s case. [236 H-237A]
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 495 of
1979.
Appeal by special leave from the judgment and order
dated the 18th October, 1978 of the Delhi High Court in
Civil Writ Petition No. 1292 of 1975.
R.R. Garg, U.R. Lalit and Randhir Jain for the
Appellant.
M.C. Bhandare, S.A. Shroff, S.S. Shroff and Miss C.K
Sachurita for Respondent No. 1.
The Judgment of the Court was delivered by
BAHARUL ISLAM J. This appeal by special leave is by the
appellant, J.D. Jain. who was a workman and whose services
have been terminated by the management of the State Bank of
India (hereinafter called the respondent).
230
2. The material facts are these.
The appellant was working as a cashier in the Meerut
City Branch of the State Bank of India. On June 21, 1971,
one Dishan Prakash Kansal (‘Kansal’ for short) who had a
Savings Bank account with the said branch of the State Bank
came to the Bank to receive 3 his Pass Book. On receipt of
the Pass Book from the counter clerk, Kansal complained to
Wadhera who was the Ledger-keeper, that on February 8, 1971,
he had withdrawn only Rs. 500 but a debit entry of Rs. 1,500
had been shown in the Pass Book. Wadhera thereupon took
Kansal to the the Supervisor, R.P. Gupta, before whom Kansal
repeated his complaint. Necessary documents pertaining to
the said withdrawal were then examined and it was found that
Kansal had given a ‘letter of authority’ (which expression
means, we are told, the withdrawal application form) to the
appellant on February 8, 1971 authorising him to withdraw
the amount from his account. The letter of authority showed
that it was for withdrawal of Rs. 1,500 though there
appeared to be some interpolation suggesting that the figure
of Rs. 500 had been altered to the figure of Rs. 1,500. The
matter was then brought to the notice of M. Ramzan, the
Agent of the State Bank, before whom also Kansal is said to
have repeated his complaint.
3. Eventually on September 18, 1972, a memorandum of
charges was served on the appellant by the respondent
stating, inter alia that in the letter of authority, the
appellant altered in his own handwriting with different ink
the amount of Rs. 500 to Rs. 1,500 and thus received Rs.
1,000 in excess, passing only Rs. 500 to the pass-book
holder, and that he subsequently, on June 24, 1971,
deposited Rs 250 in the account of Kansal to liquidate a
part or the amount misappropriated by him. The appellant
replied to the charges. He denied the allegations. Thereupon
the respondent appointed one Rajendra Prasad as an Enquiry
officer and a formal disciplinary enquiry was held against
the appellant. The Enquiry Officer submitted his report to
the respondent on February 13, 1973. The findings of the
Enquiry officer were that The appellant had fraudulently
altered the amount in the letter of authority given to him
by Kansal, withdrew Rs. 1,500 from Kansal’s account and paid
Rs. 500 only to Kansal and misappropriated Rs. 1000. The
disciplinary authority on receipt of the report of the
Enquiry officer passed the following order (material portion
only):-
231
“2. Although, the charges against you are of a
serious nature which would, in normal course, warrant
your dismissal from the service of the Bank, yet
keeping in view your past record, I am inclined to take
a lenient view in the matter. Upon consideration of the
matter, I have tentatively come to the decision that
your misconduct be condoned and you be merely
discharged of in terms of paragraphs 521 (5) (e) of the
Sastry Award read with para graph 18.28 of the Desai
Award and paragraph 1.1 of the Agreement dated the 31st
March 1967 entered into between the Bank and the State
Bank of India Staff Federation. Before, however, I take
a final decision in the matter I would like to give you
a hearing as to why the proposed punishment should not
be imposed upon you. To enable you to do so, I enclose
copies of the proceedings of the enquiry and findings
of the Enquiry officer.
3. You may ask for a hearing or if you so prefer
show cause in writing within one week of receipt by you
thereof. If you fail therein, I will conclude that you
have no cause to show in this behalf.”
The appellant then submitted a representation to Shri
V.B. Chadha, the Regional Manager of the State Bank of India
on June 15, 1973. Shri Chadha after perusing the
representation of the appellant and hearing him in person,
recommended that the proposed punishment should not be
imposed upon the appellant, on the grounds that Kansal had
not been examined as a witness and that there had been no
written complaint against the appellant. The respondent,
however, did not accept the recommendation, and, by its
memorandum of December 7, 1973, discharged the appellant
from service with effect from the close of the business on
December 22, 1973.
4. The appellant then having raised an industrial
dispute, the Central Government, by its order dated January
17, 1975, referred the following issue to the Central
Government Industrial Tribunal at Delhi for adjudication:
“Is the management of State Bank of India
justified in discharging from service Shri J.D. Jain,
Cashier of Meerut Branch, with effect from 22nd
December, 1973? If not to what relief is he entitled ?”
232
5. Before the Tribunal, the appellant denied the
charges, He inter alia, pleaded that as Kansal was not
examined in the enquiry, there was no legal evidence before
the inquiry officer for a finding that he was guilty.
The Tribunal framed the following two issues:-
“1. Whether a proper and valid domestic enquiry was
held by the Bank and its effect ?
2. Is the management of State Bank of India justified
in discharging from service Shri J.D. Jain,
Cashier of Meerut Branch with effect from 22nd
December, 1973 ? If not to what relief is he
entitled ?”
Before the Tribunal, the Management examined no
witnesses but produced certain documents and relied on them.
The appellant also did not adduce any evidence.
On a perusal of the evidence recorded by the Enquiry
officer, the Tribunal held that on the evidence before it,
the appellant could not be held guilty as, according to it,
in the absence of the evidence of Kansal, the evidence
recorded was hearsay, with the result that it directed
reinstatement of the appellant with full back wages from
22nd December, 1973. The respondent moved the High Court
under Article 226 and 227 of the Constitution of India for
quashing the award of the Tribunal. The High Court held that
the charges against the appellant had been established and
quashed the award of the Tribunal. It is against this
judgment of the High Court that the present appeal by
special leave is directed.
6. Mr. R.K. Garg, learned counsel appearing for the
appellant makes three submissions before us:-
(1) That the Tribunal exercised its powers under
Section 11 A of the Industrial Disputes Act and
the High , Court, exercising powers under Article
2261227 of the Constitution, had no jurisdiction
to interfere with the award of the Tribunal;
(2) The Tribunal in the perspective of the broad
contours of the case rightly refused to rely on
the evidence which was hearsay? Kansal not having
been examined;
233
(3) Assuming the evidence could be relied on, the High
Court committed error in not considering the
receipt executed by Kansal showing payment of Rs.
1000 to Kansal and its judgment is vitiated.
7. In an application for a Writ of Certiorari under
Article 226 of the Constitution for quashing an award of an
Industrial Tribunal, the jurisdiction of the High Court is
limited. It can quash the award, inter alia, when the
Tribunal has committed an error of law apparent on the face
of the record or when the finding of facts of the Tribunal
is perverse. In the case before us, according to the
Tribunal, as Kansal was not examined, the evidence before it
was hearsay and as such on the basis thereof the appellant
could not be legally found guilty.
8. Before the Enquiry officer, the respondent
examined the following witnesses:
Gupta (Witness 1), Wadhera, the Ledger Keeper
(Witness 2), Mahesh Chander who was incharge of Savings
Bank account on 8.2.1971 (Witness 3), M. Ramzan, Agent
of the Bank (Witness 4), Sarkar (Witness 5), and
Bhardwaj (Witness 6).
Bhardwaj was a leader of the employees’ union of the
respondent. He did not support the case of the respondent.
The other witnesses supported the case of the respondent.
Witnesses Nos. 1, 2, 4 and 5 depose that a verbal complaint
was made by Kansal in their presence to the effect that he
had authorised the appellant to withdraw Rs. 500 which sum
was paid to him, but the entries showed that Kansal had
withdrawn Rs. 1,500. Witnesses Vadhera, Ramzan and Sarkar
also deposed that the appellant had confessed before them
that he had made the alterations in the figure and in words
of the sum. The Tribunal after having made detailed
references to the evidence of the above witnesses in fact
found, “All that this evidence thus, proves is that a
complaint was made by Shri Kansal and that the workmen
confessed that he had altered the debit authority. (emphasis
added). Curiously, however, it held, “This evidence, by no
means prove that the workman altered the debit authority to
defraud or that he actually defrauded or that he mis.
appropriated the amount of Rs. 1,000 after paying Rs. 500
only to Mr. Kansal from the amount of Rs. 1,500 withdrawn
from the bank by him as it was not direct evidence but was
in the nature of
234
hearsay evidence since it was learnt through the medium of a
third person and that person was not available.” It further
held, “There can be no hesitation, therefore, that the
enquiry officer relied on hearsay evidence in arriving at
his findings and it vitiated the enquiry.” It went on, “All
this could be enough for raising a suspicion only. In order
to be called ‘proved’ it needed evidence which was not
there.” It further observed, “But the question was whether
it was done without the consent or knowledge of Mr. Kansal.
There was no evidence on the record to prove it. The only
person who could speak about it was Mr. Kansal. He did not
appear before the inquiry officer, therefore, there was no
direct evidence that the change that was admittedly made by
the workman in the debit authority was without Mr. Kansal’s
consent or knowledge or that it was designed to defraud ”
(emphasis added)
The positive findings of the Tribunal are:
(i) Kansal made the complaint as alleged by the
management.
(ii) The appellant confessed that he had made the
alterations charged with, as alleged by the
management,
(iii) By implication it has also found that Rs. 1,000 in
excess of the original amount of Rs. 500 was
received by the appellant as a result of the
alternations. But it has held that as Kansal was
not examined, fraud and misappropriation on the
part of the appellant cannot be held to be proved,
as the evidence was ‘hearsay’.
9. The learned Tribunal, it appears, was obvious of
the fact that it was examining the evidence in a domestic
enquiry, and not the evidence in a criminal prosecution
entailing conviction and sentence.
In a case like the one before us, three kinds of
proceedings against the delinquent are possible .
(i) departmental proceedings and action,
(ii) original prosecution for forgery and
misappropriation,
(iii) civil proceedings for, recovery of the amount
alleged to be misappropriated.
235
The respondent herein adopted course (i) and instituted
the domestic enquiry in which the principle applied by the
Tribunal is not applicable; in such an enquiry guilt need
not be established beyond reasonable doubt, proof of
misconduct may be sufficient.
The learned Tribunal has committed another error in
holding that the finding of the domestic enquiry was based
on “hearsay” evidence. The law is well-settled that the
strict rules of evidence are not applicable in a domestic
enquiry.
This Court in the case of State of Haryana & Anr. v.
Rattan Singh held:
“It is well-settled that in a domestic enquiry the
strict and sophisticated rules of evidence under
the Indian Evidence Act may not apply. All
materials which are logically probative for a
prudent mind are permissible. There is no allergy
to hearsay evidence provided it has reasonable
nexus and credibility.”
10. The next question is, is the evidence in the
domestic enquiry really hearsay, as held by the Tribunal ?
The word ‘hearsay’ is used in various senses. Some
times it means whatever a person is heard to say; some times
it means whatever a person declares on information given by
someone else. (See Stephen on Law of Evidence).
The Privy Council it the case of Subramaniam v/s.
Public Prosecutor, observed: “Evidence of a statement made
to a witness who is not himself called as a witness may or
may not be hearsay. It is hearsay and inadmissible when the
object of the evidence is to establish the truth of that is
contained in the statement. lt is not hearsay and is
admissible when it is proposed to establish by the evidence,
not the truth of the statement but the fact that it was
made. The fact that it was made quite apart from its truth,
is frequently relevant in considering the mental state and
conduct thereafter of the witness or some other persons in
whose presence these statements are made.”
236
11. In the instant case, the alleged misconduct of the
appellant was that he forged documents, withdrew Rs. 1,500.
1,000 in excess of the amount he was authorised to do and
misappropriated the excess amount of Rs. 1,000. With regard
to the fact whether the appellant manipulated the documents,
withdrew excess amount and misappropriated it, there is, of
course, no direct evidence of any eye witness except the
appellant’s ‘confession’ referred to above. The evidence on
which reliance has been taken by the respondent is the
confession and circumstantial evidence, namely, the
authority letter containing the admitted interpolations by
the appellant in his own handwriting in different ink, and
the addition of the digit “I” before 500. The evidence of
Kansal would have been primary and material, if the fact in
issue were whether Kansal authorised the appellant to make
the alterations in the authority letter. But Kansal’s
complaint was to the contrary. For the purpose of a
departmental enquiry complaint certainly not frivolous, but
substantiated by circumstantial evidence, is enough. What
the respondent sought to establish in the domestic enquiry
was that Kansal had made a verbal complaint with regard to
1) the withdrawal of excess money by the appellant in
presence of the four witnesses, namely, Wadhera, Gupta,
Ramzan and Sarkar, aforesaid, against his advice. On the
complaint of Kansal, the evidence of these four witnesses is
direct as the complaint is said to have been made by Kansal
in their presence and hearing; it is therefore, not hearsay.
As the respondent has succeeded in proving that a come
plaint was made by Kansal on the evidence of the above-named
four witnesses, the respondent has succeeded. No rule of law
enjoins that complaint has to be in writing as insisted by
the Tribunal.
12. The learned Tribunal has committed yet another
grevious error, in failing to appreciate the confessions
made by the appellant ”in the presence of witnesses and to
the higher officer who appeared as witness” (as found by
itself) namely, Wadhera, Ramzan, Gupta and Sarkar,
aforesaid. The confessions of the appellant before the said
witnesses were to the effect that he had altered the amount
in figure and words in his own hand.
The award of the Tribunal, therefore, has been vitiated
by misconception of the law involved in the case.
13. The last submission of Mr. Garg that the judgment
of the High Court had been vitiated as it had not taken into
consideration the receipt executed by Kansal showing payment
by the appellant of Rs. 1000 to the former is destructive of
the appellant’s defence. In
237
Our opinion, this payment on the contrary, proves the
respondent’s case and destroys the appellant’s defence which
was that he had withdrawn Rs. 1,500 as advised by Kansal and
paid the full amount to Kansal.
14. In our opinion the High Court was fully in its
jurisdiction in quashing the award of the Tribunal. This
appeal has no merit and is dismissed. We, however, leave the
parties to bear their own costs.
N.V.K. Appeal dismissed.
238