IN THE HIGH COURT OF JUDICATURE AT MADRAS
R.SUBRAMANIAN, K.GOVINDARAJAN THILAKAVADI, JJ.
R.Govindarajan - Appellant
Versus
Indian Overseas Bank – Respondent
W.A.No.361 of 2020
Decided on : 16-02-2023
Back Wages - Employment Termination - Hindustan Tin Works Pvt. Ltd., Vs. The Employees of M/s.Hindustan Tin Works Pvt. Ltd and Others, Jayantibhai Raojibhai Patel Vs. Municipal Council, Narkhed and Others - Summary of Acts and Sections: The court discussed the principles of awarding back wages in cases of wrongful termination of service, emphasizing the normal rule of full back wages and the discretion of the tribunal to consider relevant circumstances. The court also highlighted the burden of proof on the employer to establish that the employee was gainfully employed and the factors to be considered in deciding the entitlement to full back wages. The judgment emphasized the need for sound reasoning to deny back wages and the consequences of illegal termination of service.
Fact of the Case:
The appellant, a Clerk with the respondent Bank, was charged with various delinquencies related to discounting of cheques and non-sending of cheques for realization. The Bank imposed dismissal from service for the appellant and two others, while the Chief Manager was given a lesser punishment. The Writ Court set aside the dismissal but denied back wages to the appellant.
Finding of the Court:
The Writ Court's direction denying back wages to the appellant was held to be without sound reasoning, as the termination was found to be illegal. The appellant was entitled to full back wages during the period of his service, and the punishment of reduction in back wages was upheld.
Issues: The issues revolved around the disparity in punishments imposed by the Bank, the denial of back wages by the Writ Court, and the legality of the termination of service.
Ratio Decidendi: The court emphasized the normal rule of full back wages in cases of wrongful termination of service and the need for sound reasoning to deny back wages. It also highlighted the burden of proof on the employer to establish that the employee was gainfully employed and the factors to be considered in deciding the entitlement to full back wages.
Final Decision: The Writ Appeal was allowed, upholding the punishment of reduction in back wages but setting aside the direction denying back wages to the appellant. The appellant was entitled to full back wages during the period of his service, and the Bank was directed to pay the back wages within twelve weeks.
JUDGMENT :
R.SUBRAMANIAN, J.
The appellant is aggrieved by the direction of the Writ Court that he would not be entitled to back wages while setting aside the order of the dismissal and imposing a penalty/punishment of reduction of basic pay in five stages with cumulative effect.
2. The appellant, who was working as a Clerk with the respondent Bank was charged with various delinquencies. All the charges related to discounting of cheques of a particular group of Companies and non-sending of the cheques for realization in time. While the appellant was also charged for destruction of the some of the cheques that were purchased by the Bank, the other Officers viz., The Chief Manager, The Assistant Manager and another Clerk were charged with dereliction of duty. The Chief Manager Mr.V.Sankar was charged with even granting facilities over and above the permitted levels. He was also accused of having discounted cheques despite there being delay in payment of the dues by the persons, who had discounted the cheques. The Management saw it as a scheme by these four individuals to help the borrowers to gain undue advantage to the detriment of the Bank. All the four were charge sheeted. The Bank initially proposed to impose punishment of reduction in pay uniformly for all the four employees. When the Bank sought the opinion of the Central Vigilance Commission on the proposed punishments, the Bank was advised that, for the proved delinquencies, the appropriate punishment for all the four of them would be dismissal from service. The Bank, however imposed the punishment of dismissal from service for three of them viz., The Assistant Manager and the clerical staff including the appellant. The Chief Manager, however was dealt with very soft gloves and imposed a punishment of reduction in pay alone. All the three persons, who were imposed a punishment of dismissal from service challenged the same in WP.Nos.12475, 12571 of 2004 and WP.No.30829 of 2005. The writ petitions filed by the clerical staffs M.Eganathan and the appellant herein came to be disposed of by a common order dated 05.03.2019. The other writ petition filed by S.Yuvaraja Bhoopathy, Assistant Manger viz., WP.No.30829 of 2005 was disposed of on the basis of the order in W.P.Nos.12475 & 12571 of 2004, which is impugned in this Writ Appeal on 01.07.2021. The other two employees viz., M.Eganathan and S.Yuvaraja Bhoobathy have not challenged the direction for withholding back wages.
3. We have heard Mr.R.Viduthalai, learned Senior counsel appearing for the appellant, Mr.K.Srinivasamurthy, learned counsel appearing for Mr.N.G.R.Prasad for the respondents.
4. Mr.R.Viduthalai, learned Senior counsel appearing for the appellant would vehemently contend that having held that the punishment is disproportionate and having setting aside the dismissal from service, the Writ Court was not right in denying back wages without assigning any reason. Drawing out attention to the nature of the proved charges, learned Senior counsel would contend that the Management was not right in treating the Chief Manager in very soft gloves and while the Writ Court took note of such partiality or inequality in the quantum of punishment, it however chose to deny back wages for no reason. The learned Senior counsel would also compare the charges that were laid against the Chief Manager and the appellant, who is a clerical staff to contend that the charges against the Chief Manager were more serious than the charges against the appellant. Last but not least, the learned Senior counsel would contend that there was no financial loss for the Bank, since the entire amount stood recovered, of course, after some delay. He would also draw our attention to judgments of the Hon'ble Supreme Court in Hindustan Tin Works Pvt. Ltd., Vs. The Employees of M/s.Hindustan Tin Works Pvt. Ltd and Others reported in (1979) 2 SCC 80 and Jayantibhai Raojibhai Patel Vs. Municipal Council, Narkhed and Others reported in (2019) 17 SCC 184 in suppor
The central legal point established in the judgment is the entitlement to full back wages in cases of wrongful termination of service, emphasizing the normal rule of full back wages and the need for ....
Reinstatement after wrongful termination entitles an employee to back wages unless the employer proves otherwise, even if a minor penalty like censure is imposed.
Point of law; Suspension of service - workman herein also contributed the events led to his dismissal. Further it could be gathered that the workman herein remained out of service and contributed not....
The denial of back wages based on 'Dies-non' for a period of dismissal was ruled arbitrary, necessitating payment of 50% back wages under Rule 19(ii).
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