CASE: COOPER ENGINEERING LIMITED Vs.SHRI P. P.

MUNDHE- 20/08/1975

CITATION: 1975 AIR 1900, 1976 SCR (1)361, 1975 SCC (2)661

ACT: Industrial Dispute-Domestic enquiry- Violative of principles of natural justice.

ISSUE: If labour court should give opportunity to adduce evidence afresh-Failure to do so if vitiates
the award.

JUDGEMENT: When a case of dismissal or discharge of an employee is referred for industrial

adjudication the labour court should first decide as a preliminary issue whether the domestic
enquiry has violated the principles of natural justice. When there was no domestic enquiry or
defective enquiry is admitted by the employer, there will be no difficulty. But when the matter is in
controversy between the parties that question must be decided as a preliminary issue. On that
decision being pronounced it will be for the management to decide whether it will adduce any
evidence before the labour court. If it chooses not to adduce any evidence, it will not be there after
permissible in any proceeding to raise the issue. There will be no justification for any party to stall
the final adjudication of the dispute by the labour court by questioning it, decision with regard to the
preliminary issue when the matter, if worthy, can be agitated even after the final award. It will be
legitimate for the High Court to refuse to intervene at this stage.

ISSUE: The important question which has been pinpointed by this appeal is whether when a
domestic inquiry held by an employer is found by the labour court as violative of the principles of
natural justice there is any duty cast upon that court to give an opportunity to the employer to
adduce evidence afresh before it and whether to do so would vitiate its award.

FACTS:
Charge: The workman was charged under the standing orders of the company for soliciting or
collecting from the employees as contributions for some purpose (allegedly purchase of microphone
and loud-speaker arrangements) within the factory premises.
Workman’s Denial of charge: The workman denied the charge of soliciting or collecting contribution
within the factory premises (for purchase of microphone and loudspeaker) and admitted collecting
the said contribution outside the gate of the Company.
Domestic Enquiry: Some witnesses were examined by the employer and cross-examined by the
workman and questioning the workman at the outset as well as at the end of the inquiry.
Enquiry Officer’s report: The Enquiry Officer submitted very brief report to the Works Manager
(hereinafter the Manager) holding that the charges were established. However, he did not give any
detailed reasons for preferring the evidence of the six witnesses examined on behalf of the
employer in the inquiry to the version of the workman.
Dismissal Order: The Manager after perusal of the report of the Enquiry officer passed the order of
dismissal without adverting to the evidence in the inquiry. This was particularly necessary since the
Enquiry Officer had not given his reasons for his finding. Also, during inquiry, the workman after
answering the first question of the Manager abruptly left the inquiry without paying any heed to the
orders of the Manager and to persuasion of other officer resent asking him to wait. The dismissal
order was passed the same afternoon.
Appeal in Labour Court: In this appeal we will proceed on the assumption that the domestic inquiry
was rightly found by the labour court to be defective. The labour court is aware of the legal position
that it was competent in this case to take evidence of the parties and come to its own conclusion on
the merits of the case and to decide whether the order of dismissal was justified or not to enable it
to consider about the relief, if any, to be awarded to the workman. The labour court, however,
observed that no evidence regarding merits is led by the opponent before this Court. It is open to
the Labour Court to hold an enquiry itself. But the opponent has chosen not to lead any evidence
regarding the merits of the alleged misconduct. The natural result of vitiating the enquiry would
therefore be to set aside the order of dismissal and to direct the reinstatement in service of the
dismissed employee with all back wages.

Question posed: Whether after the labour court comes to a decision about the inquiry being
defective it has any duty to announce its decision in that behalf to enable the employer an
opportunity to adduce evidence before it to justify the order on the charge levelled against a
workman.

Observation:
 The Labour Court is aware of the legal position that it was competent in this case to take
evidence of the parties and come to its own conclusion on the merits of the case and to
decide whether the order of dismissal was justified or not to enable it to consider about the
relief, if any, to be awarded to the workman.
 If in such cases the employer is given an opportunity to justify the impugned dismissal on the
merits of his case being considered by the tribunal for itself and that clearly would be to the
benefit of the employee.
 That is why the Court has consistently held that if the domestic enquiry is irregular, invalid or
improper, the tribunal may give an opportunity to the employer to prove his case and in
doing so the tribunal tries the merits itself.
 In enquiries of this kind, the first question which the Tribunal has to consider is whether a
proper enquiry has been held or not.
 The Court in the case took into account management's consistent stand throughout before
the Tribunal as also that it made no grievance on the score of non-availability of opportunity
to adduce evidence even in the special leave petition.

Opinion: We are clearly of opinion that when a case of dismissal or discharge of an employee is
referred for industrial adjudication the Labour Court should first decide as a preliminary issue
whether the domestic enquiry has violated the principles of natural justice.