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2025 Supreme(Online)(Mad) 11595

IN THE HIGH COURT OF JUDICATURE AT MADRAS
A.D. Maria Clete, J
Cognizant Technology Solutions Pvt. Ltd – Appellant
Versus
Sivakumar Krishnamurthy – Respondent
W.P.No. 682 of 2020|W.M.P.Nos. 810, 812, 2417, 5302 of 2020|W.M.P.No. 25633 of 2023



Advocates:
For the Appellants/Petitioners: Srinath Sridevan, P.M.N.Bhagavath Krishnan
For the Respondents: R.Kumaravel, N.L.Rajah, Rohini Ravikumar, S.Mahesh Kumar

An employer cannot pass an innocent-looking 'termination simpliciter' to avoid the requirements of a fair domestic inquiry for misconduct. Appellate authorities under the Shops and Establishments Act have wide powers to examine the true substance of the termination and order reinstatement if the action lacks reasonable cause.

Headnote:(A) Tamil Nadu Shops and Establishments Act, 1947 - Section 41(1) and 41(2) - Termination of services - Employer has dual courses under Section 41(1): termination for reasonable cause with notice pay, or dismissal for misconduct following a domestic inquiry - Appellate Authority holds power under Section 41(2) to review the validity and justification of the employer's action - Once an employer opts for termination for 'reasonable cause', it cannot supplement this with grounds for misconduct determined in a prior, rescinded disciplinary proceeding. (Paras 37, 38, 54, 56)

(B) Appellate Jurisdiction - Scope of interference - Appellate authority is empowered to record additional evidence if a domestic inquiry is found defective, missing, or to reach its own conclusion on the guilt of the employee - Findings of fact by the appellate authority, unless perverse or based on no evidence, are not to be interfered with under writ jurisdiction. (Paras 43, 44, 60)

(C) Judicial Conduct - Allegations of misconduct against quasi-judicial authorities - Courts must not encourage or entertain unsubstantiated allegations against officers unless supported by material and impleaded in personal capacity - Such conduct undermines the independence of quasi-judicial bodies. (Paras 25, 30, 31)

Facts of the case:
An employee challenged their termination from service before the appellate authority under the state legislation. The employer had initially initiated a domestic inquiry for misconduct, rescinded that termination order, and subsequently issued a fresh termination order citing 'reasonable cause' with notice pay. The appellate authority directed reinstatement, finding the termination punitive in nature, lacking reasonable cause, and improperly executed without a fair inquiry. The employer challenged this order in the High Court.

Findings of Court:
The court held that the employer cannot claim 'termination simpliciter' while concealing a punitive motive behind a prior failed disciplinary attempt. The appellate authority acted within its jurisdiction in conducting a summary inquiry and allowing evidence. The court rejected the allegations of mala fides against the authority as baseless and unsubstantiated.

Issues: Whether the appellate authority exceeded its jurisdiction, whether the termination order was a 'termination simpliciter' or a punitive dismissal in disguise, and whether the appellate authority properly evaluated the evidence to order reinstatement.

Ratio Decidendi: When an employer abandons a disciplinary inquiry and issues an order of 'termination simpliciter', the court may pierce the veil to uncover the true intent; if the termination is found to be punitive or lacking reasonable cause, the order is set aside as non-est, effectively restoring the employee to their original position.

Result: Writ petition dismissed.

Table of Content
1. procedural history and interim orders regarding the dispute. (Para 2 , 3 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17)
2. allegations against quasi-judicial authorities and scrutiny of conduct. (Para 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32)
3. distinction between termination simpliciter and punitive dismissal under the shops act. (Para 34 , 35 , 36 , 37 , 38 , 39 , 54)
4. the court's power to pierce the veil of a termination order. (Para 40 , 41 , 57 , 58)
5. appellate authority's power to record evidence and review findings of fact. (Para 42 , 43 , 44 , 45 , 46 , 47 , 48 , 49 , 50 , 51 , 52)
6. limits of loss of confidence doctrine and powers concerning reinstatement. (Para 61 , 62 , 63 , 64 , 65 , 66 , 67)
7. disposal of writ petition and imposition of costs. (Para 68 , 69 , 70)

J U D G M E N T

Heard.

2.The Petitioner is a software company a a subsidiary of Cognizant Technology Solutions Inc., based in New Jersey, United ates of America. In the present writ petition, the Petitioner challenges the order dated 18.10.2019 passed by the 1 Respoent, the Appellate Authority uer the Tamil Nadu Shops a Eablishments Act, 1947, in proceedings bearing TSE-1/1 of 2016.

3.The Appellate Authority (1 Respoent), by her well-considered order dated 18.10.2019, finally passed the following order:—

Issue No.6 : To what remedy the appellant is entitled to.

153. In fine, in view of extensive discussions on various issues, the Authority holds that the dispensing with the services of the appellant by the respoent-management is that i) the termination of services of the appellant was not for reasonable cause, ii) that the respoent has not satisfied the Appellate Authority as to the subjective satisfaction based on which the appellant was terminated from service based on documents a evidence, iii) that the termination of service of the appellant is not “termination simpliciter” but one of “punitive” in nature, iv) since the termination of service ca igma, the respoent-management, before dispensing with the services of the appellant has not coucted any domeic enquiry as maated uer Section 41 of Tamil Nadu Shops & Eablishments act, 1947 a v) that the evidences let in by the respoent during the course of enquiry in the appeal before the Appellant Authority was held not supported the contention of the respoent – management.

154. Therefore, the Authority directs that the order dt. 21.12.2015 terminating the services of Thiru.Sivakumar Krishnamurthy, the appellant herein, is set aside a the appellant be reinated into service with continuity of service, full back wages a all consequent a atteant benefits as prayed for by the appellant.”

4.The sole queion that arises for consideration in the present writ petition is whether the order passed by the Appellate Authority on 18.10.2019 is fair, proper, a legally suainable, or whether it as vitiated by any error, including the allegation of mala fides attributed to the officer concerned. Although the issue lies within a narrow compass, it is unfortunate that both parties have been embroiled in protracted litigation, approaching this Court on multiple occasions over the same subject matter. For what is essentially a raightforward dispute, the course of action adopted by the parties has resulted in uue consumption of judicial time a avoidable expeiture of public resources.

5.It becomes necessary to set out the prior litigation initiated by the parties, not only again each other but also involving the atutory Appellate Authority, who was unfortunately drawn into the public domain, with her couct being subjected to scrutiny in the course of the proceedings. The actions of both parties, in this regard, warrant rong disapproval. Merely because the Petitioner is a multinational software company a the 2 Respoent a software professional, neither is entitled to initute multiple rous of litigation over a singular issue, namely, the legality a juification of the 2 Respoent’s termination.

6.The 2 Respoent, who was

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