Management Of Reserve Bank Of India, New Delhi vs Bhopal Singh Panchal

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

1993 Supreme(SC) 1050

SUPREME COURT OF INDIA
P. B. SAWANT, S. MOHAN AND S. P. BHARUCHA, JJ.
The Management of Reserve Bank of India, New Delhi, Appellant
Versus
Bhopal Singh Panchal, Respondent.
Civil Appeal No. 554 of 1986,
D/- 3-11-1993.
Advocates Appeared
Mr. Harish Salve, Sr. Advocate and Mr. H. S. Parihar, Advocate with him, for Appellant; Mr. K. T. Anantaraman, Advocate for M/s. Khaitan & Co., Advocates, for Respondent.

Advocates:
H.S.PARIHAR, HARISH N.SLAVE, K.N.SINGH, K.T.ANANTHARAMAN

Headnote:
Indian Penal Code,1860 - Section 302 and 304 - Reserve Bank of India (Staff) Regulations, 1948 - Regulation 46(l), 46(3), 47 and 39 - Industrial Disputes Act - Section 33-C(2) – Offence of murder – Acquitted - Benefit of doubt - Bank relied on Regulation 46(4) of Regulations and refused to reinstate employee in service on ground that he had not earned an honourable acquittal of offence - Respondent-employee, therefore, raised an industrial dispute which was decided by the Central Government Industrial Tribunal - By said award, Industrial Tribunal held that Regn. 46(4) was invalid and improper and militated against industrial jurisprudence as developed and applied by courts in country - Thereafter, employee filed present application before Central Government Labour Court claiming difference in amount paid to him as subsistence allowance during period of suspension from till date of his dismissal, viz., and full pay and allowances which, according to him, were payable for said period - He further claimed that he was entitled to increments during period he was under suspension and prayed for arrears of salary on that account also – Held, said regulations read together, leave no manner of doubt that in case of an employee who is arrested for an offence, as in present case, his period of absence from duty is to be treated as not being beyond circumstances under his control - In such circumstances, when he is treated as being under suspension during the said period, he is entitled to subsistence allowance - In other words, Regulations vest power exclusively in Bank to treat period of such suspension on duty or on leave or otherwise - Power thus vested cannot be validly challenged - During this period, employee renders no work - He is absent for reasons of his own involvement in misconduct and Bank is in no way responsible for keeping him away from his duties - Bank, therefore, cannot be saddled with liability to pay him his salary and allowances for the period - That will be against principle of no work, no pay and positively inequitable to those who have to work and earn their pay - As it is, even during such period, employee earns subsistence allowance by virtue of Regulations - In circumstances, Banks power in that behalf is unassailable - Labour Court while acting !under Section 33-C(2) of Act had no jurisdiction to decide said question - Since Labour Court in present case took upon itself task of deciding said question, it clearly exceeded its jurisdiction - Order of Labour Court is, therefore, liable to be set aside - Appeal allowed.

Judgement Key Points

The court upheld the following key points:

The regulations governing suspension and employment conditions vest exclusive authority in the bank to determine whether a period of absence due to arrest or detention should be treated as on duty, on leave, or on extraordinary leave, and this authority cannot be challenged (!) .
During a period of suspension, an employee who is arrested or detained is not automatically entitled to full pay and allowances unless the competent authority explicitly treats the period as on duty and the employee is acquitted of all blame or satisfies the authority that he was not guilty of improper conduct resulting in detention (!) .
The period of absence due to arrest or detention, when not followed by discharge or termination, is to be treated as extraordinary leave, and the employee is not entitled to salary or allowances for that period unless the authority specifically rules otherwise (!) .
The power to decide how the period of suspension is to be treated and whether full pay and allowances are payable rests solely with the employer (the bank), and this power cannot be challenged (!) .
The Labour Court exceeded its jurisdiction by attempting to decide whether the employee was entitled to full pay and allowances during the suspension period; such questions are within the domain of the employer’s authority (!) .
The appeal was allowed, and the order of the Labour Court was set aside, affirming the bank’s right to treat the period of suspension as it deemed fit under the regulations (!) (!) .

In summary, the court upheld the principle that the employer has the sole authority to determine the treatment of suspension periods, and employees are not automatically entitled to full pay during suspension unless explicitly granted by the employer’s decision.

Judgment

SAWANT, J.:- The respondent-employee was employed with the appellant-Bank in its New Delhi office as Coin/Note Examiner, Grade-II having joined service on 5th March, 1969. On 7th September, 1974 a criminal case was registered against him under Sec. 302, Indian Penal Code (IPC) and he was arrested for the offence on l8th September, 1974. On his arrest, the Bank placed him under suspension under Regulation 46(l) of the Reserve Bank of India (Staff) Regulations, 1948 (hereinafter referred to as the Regulations). On 13th December, 1976, the employee was convicted by the Sessions Court for the offence under, Section 304, Part 1 of the IPC and sentenced to 8 years rigorous imprisonment. On receipt of the courts judgment, the Bank dismissed the employee from service w.e.f. 28th April, 1977 in terms of Regulation 46(3) of the Regulations. In appeal filed by the employee against his conviction, the High Court on 21 st November, 1977 acquitted him of the offence, giving him the benefit of doubt.

2. The Bank relied on Regulation 46(4) of the Regulations and refused to reinstate the employee in service on the ground that he had not earned an honourable acquittal of the offence. The respondent-employee, therefore, raised an industrial dispute which was decided on 19th May, 1983, by the Central Government Industrial Tribunal. By the said award, the Industrial Tribunal held that Regn. 46(4) was invalid and improper and militated against industrial jurisprudence as developed and applied by the courts in the country. The Tribunal further held that the dismissal was unjustified and quashed the same and ordered the Bank to reinstate the employee with full back-wages and to allow him continuity in service as if he was never dismissed from service.

3. After the award of the Tribunal, the Bank reinstated him in service by its order of 24th August, 1983 and treated him as on duty during the period from 28th April, 1977 to 23rd August, 1983 and paid him admissible back-wages for that period. The employee received Rs. 1,00,421.74 towards back-wages for the said period.

4. Thereafter, the employee filed the present application before the Central Government Labour Court under S. 33-C(2) of the Industrial Disputes Act (hereinafter referred to as the Act) claiming difference in the amount paid to him as subsistence allowance during the period of suspension from 18th September, 1974 till the date of his dismissal, viz., 28th April, 1977 and full pay and allowances which, according to him, were payable for the said period. He further claimed that he was entitled to increments during the period he was under suspension and prayed for arrears of salary on that account also. He also claimed that his pay on reinstatement had to be fixed taking into account the increments earned by him between the date of his suspension and dismissal. Thus the employee claimed Rs. 34,742.75 in all as shown by him in his application. The bank contested the claim and asserted that the suspension had followed the employees arrest and it was effective from 18th September, 1974 till 27th April, 1977 during which period he was paid his subsistence allowance. The Bank also contended that the Tribunals award had not allowed him full payment for the period of suspension and that the period of suspension continued to be governed by the Office Order dated 28th April, 1977 which reads as follows:

"The order of suspension passed in respect of Shri Bhopal Singh Panchal, Coin/Note Examiner Grade-II, placing him under suspension with effect from the afternoon of 18th September, 1974 pursuant to Regulation 46(1) of the Reserve Bank of India (Staff) Regulations, 1948 vide this office order No. 593/74-75 dated October 11, 1974, is revoked with effect from the forenoon of 28th April, 1977. The period of suspension has been regularised in the following manner, namely,

(a) 18th September to 5th October 1974 : by grant of ordinary leave

(b) 6th October 1974 to 27th April 1977 : by grant of extraordi

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