Punitive Retrenchment In absence of Departmental Regular Enquiry Violate Provision of Industrial Dispute Act
Punitive Retrenchment Without Regular Departmental Inquiry Violates Industrial Disputes Act: HP HC
Labour Court's finding that termination based on alleged misconduct without conducting a proper departmental inquiry was illegal.
Firstly, the court noted that the retrenchment notice dated February 26, 1999, mentioned that Ramesh Chand had been found guilty of tampering official records with malafide intention. It observed that this finding was based only on the preliminary inquiry and his own admission of guilt. Thus, the court ruled that the termination was entirely rooted in the preliminary inquiry itself.
Secondly, the court referred to Section 25-F and Section 2(oo) of the Industrial Disputes Act. It noted that the provisions define “retrenchment” as termination for any reason whatsoever, “otherwise than as a punishment inflicted by way of disciplinary action.” The court also observed that an FIR had been registered against Ramesh Chand regarding the same allegations, but he was acquitted in the trial. Thus, noting that Chand's termination was clearly a punishment inflicted on the basis of a preliminary inquiry, the court ruled that it was not simple retrenchment.
Finally, relying on Nar Singh Pal v. Union of India (2000 INSC 169), the court held that where an order of termination is passed by way of punishment, it cannot be treated as a simple order of retrenchment. It observed that an order of dismissal passed without holding a regular departmental inquiry is not sustainable in law. The court emphasized that the preliminary inquiry and Ramesh Chand's alleged admission of guilt were inconsequential; since, no proper inquiry was conducted after issuing a charge sheet and no due opportunity was afforded to him to defend himself.
Thus, the High Court upheld the Labour court's order, and dismissed the petition.
2025:HHC:3754 | State of HP v. Ramesh Chand Decided On 24-02-2025*
With Regards
*Suresh Kumawat, Advocate*
*Rajasthan High Court, Jaipur*
*(M) 9166435211*
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