Employee's Termination Without Departmental Inquiry Based On Incomplete & Non-Specific Show Cause Notice Violative Of S.25g Of Id Act

By - Shailija Singh on September 18, 2022

Central Bank of India v Karunamoy Banerjee

A show cause notice was issued to a worker, a tanker driver, after being absent from work. After receiving the notice, his services were terminated because the contractual employer did not accept the worker's justification. The employers' attorneys jointly argued that the impugned award must be overturned because the respondent was given a chance to explain his absence from work, and in his response to the show-cause notice, he made general statements about his parent's health issues. children's health issues. and subsequent family deaths, which had prevented him from performing his duties.

Furthermore, the worker stated in the reply that he had been absent without permission. Therefore, there was no need for any further action to be taken in the presence of a departmental inquiry because doing so would be meaningless. The contractual employer deemed his response to the notice unacceptable, and his services were thus terminated. Further, the workman's justifications seem insincere since, while he claimed that family members were ill in his response to the show cause notice, he took a different stance in his statement of claim, claiming that he was medically unfit. 

Justice AY Kogje ruled that when the show cause notice/charge was insufficiently specific for the worker to respond, termination without a proper departmental inquiry violated Section 25(G) of the Industrial Disputes Act, which states that:

"Where any workman in an industrial establishment, who is a citizen of India, is to be retrenched and he belongs to a particular category of workmen in that establishment, in the absence of any agreement between the employer and the workman on this behalf, the employer shall ordinarily retrench the workman who was the last person to be employed in that category, unless for reasons to be recorded the employer retrenches any other workman." 

The Judge was hearing three petitions from a contractual employer, the principal employer, and a workman challenging a Labour Court order. Central Bank of India v Karunamoy Banerjee[1] was referred to contend that where the guilt by the employee has been admitted, there is no need for a departmental inquiry. The Bench observed that the workman was absent on several occasions between July 2003 and June 2004 and was negligent towards his duty. Given that the worker had been employed by the employer as a tanker driver since 1994 until the order of termination, the High Court determined that the Labour Court was justified in finding a violation of Section 25(G) of the ID Act. 

Concerning a secondary issue, that the workman was an employee of the primary employer, Justice Kogie explained that the cause of action was based on the show cause notice issued by the contractual employer, who also issued the order of dismissal. As a result, there was insufficient evidence to establish a master-servant relationship between the workman and the principal employer.It is argued that once the worker has provided his explanation, and if that explanation is not acceptable, it is the employer's responsibility to conduct a departmental inquiry because the worker may have compelling reasons for not reporting to work, such as hospitalisation.

For this purpose, learned counsel for the respondent relied on the Supreme Court's decision in Krushnakant B.Parmar vs Union of India & Anr.[2]. In terms of back wages, the Labour Court has delegated proper reasons by applying the principle of "no work, no pay" and has thus refused back wages. The Court sees no reason to overturn the Labour Court's decision in this case.


[1] 1968 AIR 266, 1968 SCR (1) 251

[2] (2012) 3 SCC, 178


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