Scooters India Limited v. Labour Court

FACTS

• The respondent (workman) was charged on three separate occasions in 1981 for major misconduct. Separate inquiries were conducted for each charge, and all charges were ultimately proven.

• The management subsequently dismissed the workman.

• The Labour Court, acting under Section 4(k) of the U.P. Industrial Disputes Act, 1947 (which is analogous to the central Industrial Disputes Act, 1947), found that the domestic inquiries were fair and proper.

• However, the Labour Court decided to interfere with the penalty of dismissal, opting for reinstatement but awarding only 75% back wages instead of full back wages.

• Both the petitioner (Management) and the respondent (Workman) filed separate Writ Petitions in the High Court challenging the Labour Court's award, which were both dismissed. The Management then filed a Special Leave Petition (SLP) before the Supreme Court.

ISSUES

• The primary issue underlying the challenge was the Labour Court's power to interfere with the punishment of dismissal and substitute it with reinstatement while simultaneously limiting back wages to 75%.

JUDGEMENT

• The apex court dismissed the special leave petition filed by the Management.

• The Court held that the order of the High Court declining to quash the award passed by the Labour Court did not call for any interference.

• The Court affirmed the Labour Court's power to modify the punishment.

OBSERVATION & APPLICATION OF SECTION 11A

The judgment implicitly deals with the Adjudicatory Authorities' Power in cases of Discharge/Dismissal under Section 11A (or the analogous State provision):

1. Power to Interfere with Punishment (Section 11A)

• Section 11A grants the Labour Court/Tribunal the specific power to interfere with the punishment imposed by the employer, even if the misconduct is proven and the inquiry is fair.

• The power is exercised when the Tribunal determines that the punishment is unduly harsh or disproportionate to the offense committed.

2. Application of Doctrine of Proportionality

• The Labour Court invoked the Doctrine of Proportionality by noting the workman's conduct was "far from satisfactory" and characterized by an "exaggerated sense of his duties," which led to "bad blood" with the management.

• The Labour Court found: "In these circumstances it will meet the ends of justice if back wages to the extent of 75 per cent are allowed to the workman."

This substitution of punishment (reinstatement with limited back wages instead of dismissal) demonstrates the application of proportionality: the Court balanced the gravity of the misconduct and the worker's unsatisfactory conduct with the severity of the dismissal.

The Supreme Court, by dismissing the SLP, affirmed that the High Court was correct in considering the nature of powers conferred on the Labour Court by Section 11A (or its equivalent) for setting aside an order of discharge or dismissal and substituting it with an order of lesser punishment.