Non-Filing Of Police Complaint Cannot Discredit Findings Of Service Misconduct Recorded In Domestic Enquiry: Bombay High Court

The High Court observed that an employer may legitimately choose to address an employee's misconduct through departmental action rather than initiate criminal prosecution and that non-registration of a police complaint cannot be treated as a factor negating the commission of service-related misconduct.

The Court was hearing a writ petition filed by a cooperative society challenging an order of the Industrial Court, which had set aside the termination of a driver accused of misconduct and awarded him compensation of ₹5 lakh.

A Bench of Justice Sandeep V. Marne observed: “The third factor considered by the Industrial Court for the disciplinary incident of 14 October 2006 is non-lodging of a police complaint in respect of that incident. The Industrial Court has, however, failed to appreciate that lodging of a police complaint is not a sine qua non for holding a disciplinary inquiry.

The Bench further added: “The employer in a given case may think it appropriate not to lodge criminal prosecution and give importance to enforcing discipline amongst the staff members by conducting a domestic inquiry. In my view, therefore, non-lodging of police complaint is an altogether irrelevant factor for deciding the issue of commission of service-related misconduct by the Respondent.”

Advocate Prashant Mohite appeared for the petitioners, Advocate Rajendra Jain for the respondent.

Background

The respondent was employed as a driver with the petitioner cooperative society, which was engaged in providing transportation and related services for the benefit of fishermen. The dispute arose from disciplinary proceedings initiated against him in relation to allegations of disobedience, misconduct and use of abusive and derogatory language towards office-bearers of the society and women belonging to the fishermen community.

Since the disciplinary enquiry could not be completed, the employer led evidence before the Labour Court to establish the misconduct. Upon evaluating the evidence, the Labour Court held that the most serious charge relating to the respondent's conduct during an incident in October 2006 was proved and concluded that the misconduct warranted dismissal from service. The complaint challenging the termination was accordingly dismissed.

In revision, however, the Industrial Court reversed the findings of the Labour Court. It held that the evidence was insufficient to establish the misconduct and awarded compensation to the employee while declining reinstatement and back wages. The employer challenged that decision before the High Court.

Court's Observations

The Court first examined the basis on which the Industrial Court had reversed the findings of the Labour Court in relation to the principal charge against the employee. The Bench found that the Industrial Court had attached undue importance to minor discrepancies in the testimony of witnesses while ignoring the substance of their evidence regarding the employee's conduct.

Referring to the approach adopted by the Industrial Court, the Court observed:

“The Industrial Court has committed a grave error in giving important to one small inconsistency between depositions of the two witnesses (about presence of managing committee member) What ought to have been appreciated by the Industrial Court is the fact that both the witnesses ... have deposed about use of abusive and derogatory language by the Respondent and that there is no inconsistency in the same.”

The Court further emphasised that disciplinary proceedings are not governed by the same evidentiary standards applicable to criminal trials.

The Bench observed: “It must be borne in mind that this is a domestic enquiry and the test to prove the charges in a domestic enquiry is preponderance of probability. Charges need not be proved beyond reasonable doubt.”

According to the Court, minor discrepancies in witness depositions could not justify rejection of otherwise credible evidence, nor was corroboration by every witness a legal requirement in departmental proceedings.

The Court also disagreed with the Industrial Court's decision to discard the testimony of a witness merely because she was related to a former office-bearer of the society. The Bench held that the relevant consideration was the capacity in which the witness was present at the scene rather than her relationship with any member of the management.

The Court observed: “What needs to be emphasized is the capacity of the witness as a fisherwoman and not her relationship as sister of the ex-office bearer. She was present at the spot in her capacity as a fisherwoman and not in capacity as sister of ex-chairman.”

The Court then dealt with the Industrial Court's reliance on an earlier memo issued to the employee. Rejecting the reasoning that the absence of a detailed narration of misconduct in the memo weakened the employer's case, the Bench observed: “The Memo dated 16 October 2006 was issued to the Respondent essentially to ensure that the Respondent did not attend duties. It was not for conducting disciplinary inquiry against him.”

The Court further held: “Therefore, mere absence of allegation of use of indecent or unparliamentary language in the Memo dated 16 October 2006 cannot be a ground for concluding that the incident may not have occurred.”

Turning to the question of non-filing of a police complaint, the Court held that the Industrial Court had applied an entirely irrelevant consideration while assessing whether the misconduct stood proved. Explaining the legal position underlying the lead observation, the Bench held that disciplinary proceedings and criminal prosecution operate in separate domains and that an employer may choose to enforce discipline through departmental action rather than criminal law.

The Court next considered the limits of interference with findings recorded in disciplinary proceedings. The Bench reiterated: “In a domestic inquiry, the findings can be treated as perverse only if there is total absence of evidence.”

Referring to the settled law governing judicial review of disciplinary findings, the Court held that adequacy or sufficiency of evidence cannot ordinarily be examined so long as there exists some material supporting the conclusion reached by the disciplinary authority or tribunal.

Applying these principles, the Court concluded that the Industrial Court had exceeded the scope of its revisional jurisdiction under Section 44 of the MRTU and PULP Act.

The Bench observed: “The Industrial Court has exercised revisional jurisdiction under Section 44 of the MRTU and PULP Act with material irregularity. It has virtually reappreciated the evidence and has gone into the issue of quality and quantity of evidence, which was beyond its jurisdiction.”

The Court also disagreed with the Industrial Court's conclusion that the punishment was disproportionate. Referring to the nature of the misconduct established before the Labour Court, the Bench observed: “Looking at the utterances made by the Respondent on 14 October 2006 towards women of Koli community, it cannot be concluded that the misconduct is not serious.”

The Court further held: “Such tendency on behalf of employees needs to be dealt with iron hands so as to maintain discipline in the organization.”

Finding no justification for the award of compensation, the Bench concluded: “Such a person cannot be rewarded with compensation.”

Conclusion

Allowing the writ petition, the Bombay High Court set aside the order of the Industrial Court and restored the judgment of the Labour Court upholding the employee's termination.

The Court held that the Industrial Court had improperly interfered with findings supported by evidence and was not justified in awarding compensation to the respondent despite the gravity of the misconduct established against him.

Cause Title: Uttan Machimar and Vahatuk Sahakari Society Ltd. and Anr. v. Nitin Jaywant Mhatre (Neutral Citation: 2026:BHC-AS:24292)

Appearances

Petitioners: Advocates Prashant Mohite, Kishor G. Pashte

Respondent: Advocates Rajendra Jain, Pranil Lahigade

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