The Bombay High Court has set aside the Industrial Tribunal’s refusal to approve the dismissal of a municipal employee found guilty of corruption in an octroi refund fraud, holding that a hyper-technical interpretation of Section 33(2)(b) of the Industrial Disputes Act, 1947 cannot result in the reinstatement of an employee whose misconduct has been conclusively established.
Justice Sandeep V. Marne allowed a writ petition filed by the Municipal Corporation of Greater Mumbai (MCGM), observing that the Tribunal had committed a grave error by treating the employee’s salary for the month of November 2006 as the statutory one month’s wages required under Section 33(2)(b). The Court clarified that the provision contemplates payment of an additional month’s wages at the time of dismissal and not the salary earned during the month in which the employee remained in service.
The respondent, a clerk in the Octroi Department, was found guilty in a departmental enquiry of conspiring with others to fraudulently divert an octroi refund of ₹4,10,885 to a third-party bank account, from which ₹1,50,000 was allegedly withdrawn and paid to him. The Industrial Tribunal had upheld the findings of guilt and the fairness of the departmental enquiry but refused to approve the dismissal solely on the ground that deductions had been made from the employee’s salary while computing one month’s wages under Section 33(2)(b).
The High Court found that the Tribunal had completely overlooked the Corporation’s specific case that it had separately offered ₹14,468 towards one month’s wages through a money order after the employee refused to accept the dismissal order and payment at the workplace. The Court noted that this fact had been pleaded, supported by documentary evidence and oral testimony, and was not specifically denied by the employee. The Tribunal’s failure to consider this material rendered its findings perverse.
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The Court further held that even assuming there had been a minor shortfall in the amount paid, such a deficiency would not automatically invalidate the dismissal. Referring to Supreme Court precedent, it observed that where any deficit in one month’s wages is identified, the Tribunal may direct the employer to make good the shortfall instead of refusing approval altogether. It emphasised that Section 33(2)(b) is intended to soften the rigours of dismissal during the pendency of industrial proceedings and should not be stretched to produce the anomalous result of reinstating an employee found guilty of grave misconduct.
Criticising the Tribunal’s approach, the Court observed that it had ignored the seriousness of the misconduct and adopted a hyper-technical view that would effectively permit a municipal employee found guilty of corruption and forgery to claim reinstatement with back wages. The Court held that the statutory protection under Section 33(2)(b) is not meant to create technical grounds for defeating disciplinary action where the misconduct stands proved.
Accordingly, the High Court set aside the Tribunal’s orders rejecting the approval application and the subsequent review application, and granted approval to the Municipal Corporation’s decision to remove the employee from service.
