Supreme Court overturns High Court order on reinstatement of employee after departmental enquiry: APSRTC vs. G. Kondal Rao (2018)

Date of the Judgment: 07 December 2018

Citation: (2018) INSC 1038

Judges: Dr. Dhananjaya Y. Chandrachud, J. and M.R. Shah, J.

Can a High Court order the reinstatement of an employee with continuity of service, when that employee was terminated after a full departmental enquiry found them guilty of misconduct? The Supreme Court of India recently addressed this question, clarifying the circumstances under which such reinstatement can be granted. This judgment clarifies that reinstatement with continuity of service is not automatic, especially when an employee has been terminated after a proper departmental enquiry. The bench consisted of Justice Dr. Dhananjaya Y. Chandrachud and Justice M.R. Shah, with the judgment authored by Justice M.R. Shah.

Case Background

The respondent, G. Kondal Rao, was employed as a contract conductor with the Andhra Pradesh State Road Transport Corporation (APSRTC). Following a departmental enquiry, his services were terminated due to proven misconduct. His departmental appeal and review petition were rejected. Instead of seeking remedies under the Industrial Disputes Act, he directly approached the High Court of Judicature at Andhra Pradesh at Hyderabad under Article 226 of the Constitution of India.

The High Court, relying on a previous judgment in a similar case, ordered the reinstatement of the respondent with continuity of service, though without monetary benefits for the period he was out of service. The High Court did not consider the fact that in the present case, a full-fledged departmental enquiry was conducted, unlike the previous case. The High Court’s order was upheld by the Division Bench.

Timeline

Course of Proceedings

The respondent was terminated following a departmental enquiry. The departmental appeal and review petition were rejected. The respondent then filed a writ petition before the High Court of Judicature at Andhra Pradesh at Hyderabad. The learned Single Judge allowed the petition, relying on an earlier judgment in Writ Petition No. 2786 of 2012, without considering the specific facts of the case. The Division Bench upheld the Single Judge’s order. The APSRTC then appealed to the Supreme Court.

Legal Framework

The judgment primarily revolves around the interpretation of the principles of natural justice, the Industrial Disputes Act, and the exercise of writ jurisdiction under Article 226 of the Constitution of India. While the specific sections of the Industrial Disputes Act are not mentioned, the Court notes that the respondent did not pursue remedies under the Act. The Court also considered the principles of natural justice in the context of departmental enquiries. The High Court’s power under Article 226 of the Constitution was invoked by the respondent.

Arguments

Appellant (APSRTC) Arguments:

• The High Court erred in affirming the Single Judge’s order without considering the specific facts of the case.
• The Single Judge mechanically relied on an earlier judgment (Writ Petition No. 2786 of 2012) which was not applicable to the present case.
• In the present case, the respondent was dismissed after a full departmental enquiry where the charges of misconduct were proven.
• The High Court failed to appreciate that the earlier judgment was in a batch of cases where termination orders were issued without enquiry or with violation of natural justice.
• Granting continuity of service to an employee found guilty of misconduct would place him on the same footing as employees with unblemished records.
• The High Court could not have granted continuity of service without setting aside the termination order.

Respondent (G. Kondal Rao) Arguments:

• The respondent’s arguments are not explicitly detailed in the judgment. However, it can be inferred that the respondent argued for reinstatement based on the earlier judgment of the High Court in Writ Petition No. 2786 of 2012, which had directed reinstatement of employees in similar situations.
• The respondent argued that the High Court was correct in directing reinstatement with continuity of service.

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame issues in a separate section. However, the core issue before the Supreme Court was whether the High Court was justified in ordering the reinstatement of the respondent with continuity of service, despite the fact that the respondent’s services were terminated after a full departmental enquiry where he was found guilty of misconduct.

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues

Authorities

The Supreme Court considered the following authorities:

• Writ Petition No. 2786 of 2012 of the High Court of Judicature at Andhra Pradesh at Hyderabad: This was the primary authority relied upon by the High Court to order reinstatement. The Supreme Court distinguished this case, noting that it involved cases where either no enquiry was conducted or the enquiry violated the principles of natural justice, unlike the present case where a full enquiry was held.

Judgment

How each submission made by the Parties was treated by the Court?

How each authority was viewed by the Court?

• Writ Petition No. 2786 of 2012: The court distinguished this case and observed that the High Court had erred in relying upon this authority as the facts were different.

The Supreme Court allowed the appeal and set aside the High Court’s order. The court reasoned that the High Court had erred in mechanically relying on the earlier judgment without considering the facts of the present case, where a full departmental enquiry had been conducted. The court also emphasized that continuity of service cannot be granted unless the termination order is set aside.

The Court observed, “Even otherwise such a direction cannot be issued by the learned Single Judge without the termination being set aside. The ground of continuity was not sustainable for the simple reason that unless the order of termination is set aside, as a matter of first principle, continuity cannot be granted.”

The court further noted, “Granting continuity of service to a person such as the respondent, who was found to have committed misconduct, would place him on the same footing as other contractual employees who have a record without blemish.”

The court also stated, “We find a considerable degree of merit in the submission of learned senior counsel appearing on behalf of the Corporation that in deciding the entire batch of cases by a common order, the learned Single Judge as well as the Division Bench unfortunately lost sight of the facts of each individual case.”

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the fact that the respondent’s termination followed a full departmental enquiry where the charges of misconduct were proven. The Court emphasized that the High Court should have considered the facts of the individual case and not mechanically relied on a previous judgment that dealt with different circumstances. The Court was also concerned that granting continuity of service to an employee found guilty of misconduct would be unfair to other employees with clean records.

Key Takeaways

• Reinstatement with continuity of service is not automatic and depends on the specific facts of each case.
• High Courts must consider the facts of individual cases and not rely mechanically on earlier judgments.
• Continuity of service cannot be granted unless the termination order is set aside.
• Employees found guilty of misconduct after a proper departmental enquiry cannot be placed on the same footing as employees with clean records.

Directions

The Supreme Court set aside the impugned judgment and order dated 26.04.2013 in Writ Appeal No. 246 of 2013, as well as the judgment and order passed by the learned Single Judge in Writ Petition No. 25970 of 2012.

Development of Law

The ratio decidendi of this case is that reinstatement with continuity of service is not automatic and depends on the specific facts of each case, especially when a full departmental enquiry has been conducted. This clarifies the position that High Courts must consider the facts of each individual case and not mechanically rely on earlier judgments. This case reinforces the principle that continuity of service cannot be granted unless the termination order is set aside, and that employees found guilty of misconduct cannot be treated the same as those with clean records. There was no change in the previous position of law, but it clarified the application of existing principles.

Conclusion

The Supreme Court’s judgment in APSRTC vs. G. Kondal Rao overturned the High Court’s order, emphasizing the importance of considering the facts of each individual case. The Court clarified that reinstatement with continuity of service is not automatic, especially when an employee has been terminated after a proper departmental enquiry. The judgment reinforces the principle that continuity of service cannot be granted unless the termination order is set aside, and that employees found guilty of misconduct cannot be treated the same as those with clean records. This case serves as a reminder to High Courts to avoid mechanical application of precedents and to consider the unique facts of each case.