National Gandhi Museum vs Sudhir Sharma on 24 September, 2021


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Supreme Court of India

National Gandhi Museum vs Sudhir Sharma on 24 September, 2021

Author: Ajay Rastogi

Bench: Ajay Rastogi, Abhay S. Oka

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                                                                      NON-REPORTABLE

                                    IN THE SUPREME COURT OF INDIA
                                     CIVIL APPELLATE JURISDICTION

                                  CIVIL APPEAL NOS. 8215-8216 OF 2011


         NATIONAL GANDHI MUSEUM                                      …… APPELLANT

                                                v.

         SUDHIR SHARMA                                               ……     RESPONDENT

                                            J U D G M E N T

ABHAY S. OKA, J.

1. National Gandhi Museum is the appellant in these appeals. The

appellant has taken an exception to the Judgment and Order dated 30 th

November 2009 delivered by a Division Bench of the High Court in

Letters Patent Appeal No. 602/2009 and the Order dated 12 th March

2010 by which the application made by the appellant for review of the

Judgment and Order dated 30th November 2009 has been rejected.

FACTUAL CONTROVERSY

2. With a view to appreciate the controversy, a brief reference to the

facts of the case will be necessary:

Signature Not Verified

Digitally signed by
NEETU KHAJURIA

(a) In the year 1949, the Working Committee of the Indian National
Date: 2021.09.24
17:43:21 IST
Reason:

Congress executed a Deed of Declaration of a Trust in the name of
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Gandhi Smarak Nidhi with the main object of maintaining a Museum for

preserving relics, books, articles and things associated with the Father of

the Nation. Another object of the Trust was to propagate his messages

and teachings of truth and non-violence.

(b) Gandhi Smarak Sangrhalaya Samiti was incorporated and

registered under the Societies Registration Act, 1860. The Museum

(National Gandhi Museum) is being managed by Gandhi Smarak

Sangrhalaya Samiti (for short “the said Society”).

(c) On 24th December 1996, the respondent was appointed as a

Museum Assistant by the appellant. In the year 2002, the appellant

issued an Office Order cancelling the option of compensatory leave

against the extra attendance and provided for extra emoluments for

extra attendance. The respondent objected to the said Circular. It is

alleged by the appellant that on 27 th December 2003, the respondent

assaulted its Assistant Director and thus committed misconduct.

Accordingly, a charge sheet was served upon the respondent. A writ

petition was filed by the appellant for challenging the charge sheet.

(d) During the pendency of the said petition, on the basis of the dispute

raised by the respondent and another employee, the appropriate

Government referred the dispute regarding cancellation of compensatory

leave for adjudication to the Industrial Tribunal.
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(e) The Writ Petition filed by the respondent for challenging the charge

sheet was heard on 12th July 2004 and was disposed of by granting a

liberty to the respondent to challenge the Inquiry Report in the event the

same be adverse to him. Inquiry Report was submitted by the Inquiry

Officer holding that the respondent was guilty of acts of subordination,

creating a scene, causing disturbance to others in performance of their

duty and causing violence in the office. By the Office Order dated 16 th

September 2004, the appellant imposed penalty of compulsory

retirement on the respondent. On 8th December 2004, the appellant filed

an application before the Industrial Tribunal at Delhi in accordance with

sub-section 2(b) of Section 33 of the Industrial Tribunal Act, 1947 (for

short “I.D. Act”). The application was filed for seeking approval for

imposing the penalty. However, the appellant applied for withdrawal of

the said application to which an objection was raised by the respondent.

The application for withdrawal was made on the ground that since it was

a case of compulsory retirement, it was not necessary to obtain approval

in terms of sub-section 2(b) of the Section 33 of the I.D. Act. By the order

dated 8th December 2004, the application made by the appellant for

grant of approval was dismissed as withdrawn.

(f) The respondent filed Writ Petition No. 10211/2005 before the

Delhi High Court for a declaration that the Office Order dated 16 th
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September 2004 by which the penalty of compulsory retirement was

imposed, was null and void on account of the failure to obtain approval

under sub-section 2(b) of Section 33 of the I.D. Act. In the meanwhile, on

9th September 2005, the Industrial Tribunal disposed of the reference

made earlier at the instance of the respondent on the basis of a

statement made by the appellant that the workmen shall not be assigned

any duty on second Sundays, Gazetted Holidays, and National Holidays.

(g) By the Judgment and Order dated 31st August 2009, the learned

Single Judge of the Delhi High Court allowed Writ Petition No.

10211/2005 and directed the appellant to reinstate the respondent in

service with back wages. Being aggrieved by the said Judgment and

Order, an appeal was preferred by the appellant. In the meanwhile, the

appellant applied for a clarification of the Judgment and Order dated 31 st

August 2009 which application was rejected. By the impugned

Judgment and Order dated 30 th November 2009, a Division Bench of

Delhi High Court dismissed the appeal. Even a review petition seeking a

review of the Judgment and Order of the Division Bench was rejected.

SUBMISSIONS

3. The submissions made by Shri Sunil Gupta, the learned senior

counsel appearing for the appellant are summarized as under:
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(a) The learned senior counsel appearing for the appellant submitted

that the first question to be decided in these appeals is whether the

appellant is an industry within the meaning of I.D. Act. He placed

reliance on a decision of this Court in the case of Bangalore Water

Supply and Sewerage Board v. A. Rajappa and Ors.1 The learned

counsel urged that the appellant has no income and it only depends on

the Government grants and donations for its activities. He submitted that

by no stretch of imagination, the appellant is an industry. Moreover,

considering the conduct of the respondent of assaulting a senior official

of the appellant, as well as the acts of violence, indiscipline and in-

subordination and considering the fact that for a period of 17 years, the

respondent is not working with the appellant, the order of reinstatement

is not at all justified. It is a case of loss of confidence and therefore, his

continuation in service would result in encouraging gross indiscipline.

(b) The learned senior counsel appearing for the appellant further

submitted that the appellant is not a profit making entity or a business

concern. Moreover, it is not even charitable or philanthropic arm of a

company or a business entity. He submitted that appellant is a part of the

said society dedicated to propagation of Gandhian teachings and

philosophy.

1 (1978) 2 SCC 213
6

(c) The learned senior counsel appearing for the appellant submitted

that the appellant did not exercise the option provided by the learned

Single Judge of the Delhi High Court by initiating fresh proceedings

against the respondent as the appellant wanted to test the issue whether

it is an industry.

(d) He submitted that the onus was on the respondent to plead and

prove that he was not gainfully employed from the date of the order of

compulsory retirement. The learned senior counsel further submitted that

as the respondent has not discharged the burden on him, he is

disentitled to claim back wages. He pointed that in terms of the interim

Order dated 10th May 2010 of this Court, entire amount of back wages

payable as on that date amounting to Rs. 4,43,380/- was deposited by

the appellant and the said amount has been withdrawn by the

respondent. He submitted that as the appellant depends on Government

grants and donations from the members of the public, any amount

ordered to be paid to the respondent would be at the cost of the public

interest. He submitted that the payment of any amount to the respondent

will amount to his unjust enrichment.

(e) The learned senior counsel appearing for the appellant relied upon

a decision of the Apex Court in the case of Indian Railway
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Construction Co. Ltd. v. Ajay Kumar2. By relying on this decision, he

submitted that considering the misconduct proved against the

respondent, it will be unjust to allow his reinstatement. Without prejudice

to earlier contentions raised by him, the learned senior counsel urged

that a reasonable compensation can be granted to the respondent in lieu

of reinstatement. He pointed out that the respondent has withdrawn the

sum of Rs. 4,43,380/- deposited by the appellant in this Court in the year

2010. He submitted that the respondent has enjoyed interest on the said

amount and therefore, no further amount should be directed to be paid.

(f) The learned senior counsel appearing for the appellant relied upon

another decision of this Court in the case of Talwara Cooperative

Credit and Service Society Ltd. v. Sushil Kumar3. He submitted that

as laid down by this Court, the respondent ought to have discharged the

burden on him by showing that he was not gainfully employed after the

order of compulsory retirement.

(g) Lastly, he relied upon another decision of this Court in the case of

Reetu Marbles v. Prabhakant Shukla4. He submitted that order of

payment of back wages cannot be mechanically passed after the order

of termination is declared to be illegal.

2 (2003) 4 SCC 579
3 (2008) 9 SCC 486
4 (2010) 2 SCC 70
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4. Shri Mukti Bodh, the learned counsel appearing for the respondent

made following submissions:

(a) He pointed out that not only that the appellant did not raise a

contention that it is not an industry within the meaning of I.D. Act, but

filed an application for approval under sub-section 2(b) of Section 33 of

the I.D. Act. Though the respondent objected to the withdrawal of the

same, at its own risk, the appellant withdrew the said application. He

submitted that before the learned Single Judge, no such contention was

raised. Even in the appeal before the Division Bench, such contention

was not raised and that the same was belatedly raised for the first time

in Review Petition. He would, therefore, submit that the appellant cannot

be allowed to agitate the said contention.

(b) He relied upon a decision of this Court in the case of Jaipur Zila

Sahakari Bhoomi Vikas Bank Ltd. v. Ram Gopal Sharma and Ors.5

He submitted that the order of compulsory retirement of the respondent

by way of punishment amounts to discharge or dismissal by way of

punishment and therefore, in absence of approval under sub-section

2(b) of Section 33 of the I.D. Act, the respondent shall be deemed to

have been continued in the employment. He submitted that the appellant

was aware of the fact that the approval was required and therefore, an

5 (2002) 2 SCC 244
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application for grant of approval was made which was unconditionally

withdrawn. He would submit that there is absolutely no error in the order

of reinstatement passed by the learned Single Judge, which is confirmed

by the Division Bench.

(c) About the back wages, he urged that it was never the case made

out by the appellant that the respondent was gainfully employed. The

learned counsel for the respondent, therefore, submitted that no

interference is called for with the impugned Judgment and Order.

CONSIDERATION OF SUBMISSIONS

5. We have given careful consideration to the submissions. The first

question to be answered is whether the appellant can be allowed to

raise a contention that it is not an Industry within the meaning of I.D. Act.

For more than one reason, we are not inclined to consider the contention

raised by the appellant that it is not an industry within the meaning of I.D.

Act. The first reason is that the appellant at all material times proceeded

on the footing that it is an industry within the meaning of the provisions

of the I.D. Act. In fact, an application was made by the appellant for grant

of prior approval as provided in sub-section 2(b) of Section 33 of the I.D.

Act before the Industrial Tribunal. The appellant applied for withdrawal of

the said application on the ground that prior approval for compulsory

retirement was not required. Notwithstanding the opposition by the
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respondent, the said application was allowed to be withdrawn.

Secondly, an industrial dispute was raised at the instance of the

respondent on the demand for compensatory leave in lieu of the work

done by the employees on holidays. An award was made in the said

industrial dispute by the Industrial Tribunal. The contention that the

appellant was not an industry was not raised in the said proceedings and

in fact, a settlement award was passed in the dispute. Thirdly, in the Writ

Petition filed by the respondent for challenging the order of compulsory

retirement, the said contention was not raised though the Writ Petition

remained pending for four years. Even in the appeal before the Division

Bench of Delhi High Court against the decision in the writ petition, the

said contention was not raised. It was raised for the first time by making

an application for review of the impugned Judgment and Order of the

Division Bench. Whether the appellant is an industry or not is not a pure

question of law. In a given case, it may require adjudication on factual

issues. Considering the aforesaid facts, the appellant cannot be allowed

to agitate the same in the present appeals. However, we make it clear

that the issue is not concluded and the said issue will remain open which

can be agitated by the appellant in the event any proceedings are taken

by any other employee. As the issue that the appellant is not an industry

cannot be allowed to be agitated, there is no reason to interfere with the
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finding that the Order of compulsory retirement by way of penalty was

illegal due to non-compliance with the requirement of obtaining approval.

6. The order of compulsory retirement passed against the appellant

was set aside on the ground that an approval under sub-section 2(b) of

Section 33 of the I.D. Act was not obtained by the appellant. The

respondent did not raise any industrial dispute for challenging the

outcome of the inquiry. The Inquiry Officer concluded that the charge of

assaulting the Assistant Director of the appellant was proved against the

respondent. The impugned order of compulsory retirement was passed

on 16th September 2004. Therefore, here is a case where a serious

misconduct was established against the respondent and the said finding

of the Inquiry Officer has not been disturbed on merits by the High Court.

7. As mentioned earlier, the object of the appellant is to propagate the

philosophy of the Father of the Nation and to preserve the personal

relics, manuscripts, books and other material regarding the Father of the

Nation. Now the question is whether the respondent should be

reinstated. It is necessary to refer to a decision of this court in the case

of Indian Railway Construction Co. Ltd. (supra). In paragraph 29 of

the said decision, this Court held thus:

“29. Here, the alleged acts have not been
disbelieved by the High Court. They are prima
facie acts of misconduct. Therefore, the employer
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can legitimately raise a plea of losing confidence
in the employee, warranting his non-continuance
in the employment. The time-gap is another
significant factor.”

After considering the fact of loss of confidence in the employee and a

long time gap, this Court granted compensation of Rs. 15 lakhs in full

and final settlement to the employee without granting reinstatement. In

the said case before this Court, there was no inquiry held for establishing

misconduct. A finding was recorded that the acts of employee prima

facie constitute misconduct. In our view, considering the aims and object

of the appellant and the serious nature of misconduct proved against the

respondent, instead of granting reinstatement, by balancing the

conflicting interests, appropriate compensation needs to be awarded.

Moreover, considering the nature of the misconduct proved against the

respondent, the grant of reinstatement will not be in the interest of

justice. The long gap of 17 years will be also one of the considerations

for not granting reinstatement especially considering the nature of the

activities of the appellant and the conduct of the respondent. All these

relevant factors borne out by the record were glossed over by the High

Court.

8. In the case of Talwara Cooperative Credit and Service Society

Ltd. (supra), this Court has held that the fact whether an employee after
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dismissal was gainfully employed is within his special knowledge and

therefore, considering the principles laid down in Section 106 of the

Indian Evidence Act, 1872, the burden is on the employee to come out

with a case that he was not gainfully employed during the relevant

period. We must note that whether such burden is discharged or not is

an issue to be decided in the facts of each case. The issue has to be

decided by taking into consideration the entire material on record.

9. In the present case, at no stage, even such a plea has been made

by the respondent. Even in the counter filed to these appeals, no such

statement has been made. The amount of back wages payable up to

June, 2010 was deposited in this Court. The said amount of Rs.

4,43,380/- has been withdrawn by the respondent in the year 2010.

From the year 2004, when order of compulsory retirement was passed,

the respondent has not worked with the appellant. Moreover, he has not

even pleaded that from the date of the compulsory retirement till date, he

was not gainfully employed.

10. We may note here that in the Writ Petition filed by the

respondent, he himself has pleaded the nature of activities conducted

by the appellant. In fact, he has relied upon a brochure published by

the appellant giving all the details. In the second paragraph of the Writ

Petition filed by the respondent, he has stated thus:
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“That the respondent management is managed by the
Gandhi Smarak Sangrahalaya Samiti which is a registered
society under the Societies Registration Act, 1860. The
respondent management keep and preserve personal
relics, Manuscripts, books, journals, documents relating
to the life, philosophy and work of Gandhiji. It also sell
books and literature (over 1400 titles, audio and video
cassettes, CDs, films, picture cards, posters, framed
photographs, and presentation items such as key rings,
pens and figurines – related to Mahatma Gandhi, India’s
freedom movement and allied subjects and
philosophies. Government of India has provided land
where it is situated. Its main financial support is a
corpus fund of Rs.50 million provided by the
Government of India and interest on the said corpus
fund is utilized for management of the respondent
Museum. Besides it there is income from sale of books,
literature etc., and donations and contributions received
from public and other institutions. A copy of the pamphlet
containing its purpose and activities is enclosed as Annexure
P-19.”

(emphasis added)

11. The object for which the said society was established and the

activities admittedly carried out by the appellant will have to be borne in

mind as one of the factors for deciding the quantum of compensation

which can be granted to the respondent in lieu of reinstatement. The

appellant is carrying on noble activities of propagating the thoughts of

the Father of Nation by using the corpus given by the Government and

by utilizing donations and sale proceeds of small articles.

12. The respondent has used the amount of Rs. 4,43,380/- for the last

11 years. His gross salary in the year 2004 was Rs. 5788/- per month.

Taking overall view of the various factual aspects which we have
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discussed above, we find that compensation in the range of Rs.

6,50,000/- to Rs.7,00,000/- in lieu of reinstatement will be just and proper

in the facts of the case. Thus, after taking into consideration the sum of

Rs. 4,43,380/- already received by the respondent, a sum of Rs.

2,50,000/- will be payable by the appellant to the respondent.

13. Hence, we partly allow the appeals by setting aside the order of

reinstatement of the respondent and the order of payment of back

wages to the respondent. We further direct the appellant to pay total

compensation of Rs. 6,50,000/- to the respondent inclusive of the sum of

Rs. 4,43,380/- already paid to the respondent. We direct the appellant to

pay the amount of Rs. 2,50,000/- to the respondent by a demand

draft/Account Payee cheque within a period of six weeks from today.

On the failure to pay the amount within six weeks from today, the amount

will carry interest at the rate of 12% p.a. from the date of this Judgment.

There will be no order as to costs.

…………..…………………J
(AJAY RASTOGI)

…………..…………………J
(ABHAY S. OKA)
New Delhi;

September 24, 2021.



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