Theft, while on duty, justifies dismissal from service - Supreme Court

In Management of Bharat Heavy Electricals Ltd. vs. M. Mani and Others, it is held that if the departmental enquiry is held to be legal then the Labour Court should not interfere with the punishment awarded by an employer based on the enquiry.

In this case, the appellant Bharat Heavy Electricals Limited is a public sector undertaking which employed the respondent M.Mani and T.A.Mathivanan as Grade II drivers in a Plant in Tamil Nadu. Once, they neglected their duty and misplaced some machinery of the plant and the appellant issued charge sheet to both the respondents. As both the respondents refused their charge, appellant initiated enquiry proceeding. In the report of the enquiry officer, it was seen that the Respondents were involved in committing theft of machinery while on night duty. So, the appellant dismissed the services of the Respondents.

The respondents filed a departmental appeal against the dismissal. At the same time, the appellant also filed a criminal case before the Court of Magistrate for the prosecution of the Respondent under section 379 of the Indian Penal Code, 1860 wherein the Respondents were acquitted for the offence of theft.  The Respondent filed a case against the Appellant employer before the Labour Court challenging the legality of their dismissal orders. The Labour Court gave its judgment in favour of the Respondents holding that the Appellant should have stayed the departmental enquiry until the judgment of criminal case filed by the employer.

Aggrieved by the said order, the Appellant filed a writ petition before the Single Judge of the High Court and it was held that since the departmental enquiry was held to be legal and proper, the only question that remained for the Labour Court to adjudicate was whether the dismissal was just, legal and proper or whether it required any interference. Accordingly, the Single Judge set aside the order of the Labour Court and returned the case back to the Labour Court for fresh adjudication of the matter on merits.

The Respondent aggrieved by the said order filed an appeal before the Division Bench of the Madras High Court. The Division Bench set aside the order of Single Judge and directed reinstatement of the Respondents without payment of back wage.

The Appellant subsequently filed a special leave petition before the Supreme Court. Here, the Supreme Court held that the once the departmental enquiry is held to be legal and proper, then the only question for consideration before the Labour Court is whether the punishment of “dismissal” imposed by the employer was legal and proper. The Court further held that even if an employee has been acquitted in the criminal proceedings, an independent enquiry can still be held by the employer for ascertaining whether the employee was liable for the misconduct or not. It was further held that since the departmental enquiry was conducted by the Appellant in accordance with law and the Enquiry Officer had given a report after appreciating all the evidence on record, a charge of theft against the Respondents was proved. So, the Supreme Court validated the dismissal of the respondents.

Theft, while on duty, justifies dismissal from service - Supreme Court Link