Emphasising that contractual jurisdiction clause cannot oust statutory jurisdiction of Industrial Tribunal, the Calcutta High Court has held that situs of employment and substantial nexus with West Bengal justified the 7th Industrial Tribunal’s assumption of jurisdiction over the dispute. The Court explained that contractual jurisdiction clauses designating a particular forum cannot oust the statutory jurisdiction of an Industrial Tribunal, which is a creature of statute under the Industrial Disputes Act, 1947, and whose jurisdiction flows from the order of reference and not from private agreement between the parties.
The Court pointed out that the situs of employment and the place where the industrial dispute substantially arose are material considerations for determining territorial jurisdiction. Further, the mere fact that the employer’s registered office is located elsewhere does not erase the substantial territorial nexus which the dispute bears with the State where the employee was posted and working. Also, the Court observed that participation in a domestic enquiry does not amount to waiver of every procedural objection, particularly where the employee has contemporaneously protested against the manner, venue and procedure adopted.
Going further, the Court held that reinstatement with full back wages is not an automatic or mechanical consequence in every case of illegal termination, but equally, a mere assertion of loss of confidence by the employer is not sufficient to defeat reinstatement where the very disciplinary process through which the alleged misconduct was sought to be established has been found to be procedurally defective.
The Court also held that where an employee attains the age of superannuation during the pendency of proceedings, the relief of physical reinstatement is no longer possible. The appropriate relief in such cases is to treat the employee as having continued in service up to the date of superannuation and grant consequential monetary and retiral benefits, after due adjustment of amounts already paid under the Award or under Section 17B of the Industrial Disputes Act, 1947.
A Single Judge Bench of Justice Rai Chattopadhyay observed that the appointment letter’s jurisdiction clause designating Mumbai as the exclusive forum could not override the statutory jurisdiction of an Industrial Tribunal, which is a creature of statute under the Industrial Disputes Act, 1947. The Court noted that the situs of the employee’s employment was in West Bengal, where he was posted and working at the relevant time, and that the industrial dispute substantially arose within West Bengal. The mere fact that the company’s registered office was in Mumbai, or that the appointment letter emanated from Mumbai, could not erase the substantial territorial nexus which the dispute bore with West Bengal.
The Court further observed that the Government Notification dated February 2, 2012, delineating territorial jurisdiction of Industrial Tribunals, did not by itself render the 7th Industrial Tribunal’s assumption of jurisdiction a nullity, since the Tribunal had considered the jurisdictional objection and returned a positive finding based on the actual nexus of the dispute.
On the question of the domestic enquiry, the Court observed that the employee had specifically requested that the enquiry be held in West Bengal, where his witnesses were available, but the request was rejected. The employee had also sought representation and raised objections regarding the procedure adopted, including the non-supply of material complaints and reports relied upon against him. The Court noted that the enquiry report was submitted on January 12, 2011, and although the employee sought time till April 5, 2011, to submit his explanation to the second show-cause notice issued on March 4, 2011, the order of dismissal was passed on the very next day, March 24, 2011.
The Court observed that participation in a proceeding did not amount to waiver of every procedural objection, particularly where the employee had contemporaneously protested against the manner and venue of the enquiry. The Tribunal, as the primary fact-finding authority, had found the domestic enquiry improper, and no material had been demonstrated to show that such finding was based on no evidence or upon an irrelevant consideration.
On the question of relief, the Court observed that reinstatement with full back wages is not an automatic or mechanical consequence in every case where termination is found illegal, and that the adjudicatory authority must exercise judicial discretion having regard to the facts and circumstances of each case.
However, the Court equally observed that where termination is found to be illegal and the employee has been kept out of service by an act attributable to the employer, reinstatement with appropriate monetary consequences may be necessary to restore the employee substantially to the position in which he would have stood but for the illegal action. The Court noted that the respondent had specifically pleaded and deposed that he remained unemployed and was not gainfully employed after his dismissal, and the petitioner had not demonstrated any material showing gainful employment so as to warrant interference with the Tribunal’s exercise of discretion.
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Briefly, ICPA Health Products Limited, a pharmaceutical company with its registered office in Mumbai, appointed Tapan Chatterjee as a Medical Representative on February 1, 1990, with his initial headquarters at Imphal. The appointment letter, issued from Mumbai, contained a clause stipulating that Bombay/Mumbai courts would have jurisdiction over any dispute arising from the contract of service. The employee’s service was confirmed on June 1, 1991, and he was subsequently posted in West Bengal.
Following allegations of irregularities, a preliminary enquiry was held on April 9, 2010, and a formal chargesheet containing eight charges was issued on April 16, 2010. The employee denied the charges and objected to the venue of the domestic enquiry being fixed at Mumbai despite his request to hold it in West Bengal, where his witnesses were located. The enquiry officer rejected the request to shift the venue. The employee was dismissed from service on March 24, 2011, even though he had sought time till April 5, 2011, to submit his explanation to the second show-cause notice.
The employee then raised an industrial dispute before the Labour Commissioner, West Bengal, on April 21, 2011, and after conciliation failed, the matter was referred to the 7th Industrial Tribunal, West Bengal. The Tribunal passed an Award on March 31, 2016, holding that it had territorial jurisdiction, that the domestic enquiry was illegal, and directing reinstatement with full back wages.
