A Seesaw Ride Between Adjudication and Judicial Restraint: Decoding the Adjudicatory Role of a Tribunal under Section 33 of the Industrial Disputes Act, 1947

Ensuring a balance between the standing of the employer and the employee/workmen has been the central objective behind the enactment of the Industrial Disputes Act, 1947 (“IDA”). To achieve this, Section 33 of IDA protects the employee from the wrath and materialistic vengeance of the employer during the pendency of an industrial dispute. Under Section 33 of IDA, an order of dismissal can be passed by the employer after conducting a fair and bona fide domestic inquiry, and such an order becomes enforceable only after the approval of the Labour Court/Tribunal. A question of law arises while determining the extent of adjudication that such a tribunal may exercise while granting the approval. There has been a divergence of jurisprudence in this regard, which was ultimately resolved in  John D’Souza v. Karnataka State Road Transport Corporation (“John D’Souza”). This article seeks to trace the legal developments preceding the John D’Souza case and determine the contemporary relevance of this judgment.

Judicial Interpretation Prior to the John D’Souza Case 

Prior to the judgment in the John D’Souza case, the issue regarding the adjudicatory role of a tribunal under Section 33A arose in a catena of cases, leading to parallel jurisprudence. This issue first arose in Martin Burn Limited v. R.N. Bangerjee, (“Martin Burn”) where a three-judge bench of the Apex Court determined the purview of judicial inquiry under Section 33 of IDA. The Court held that for the purpose of adjudication under Section 33, the tribunal has to rely solely on the doctrine of prima facie case, which means that there is no need to prove the case to the hilt. The tribunal only needs to establish whether the order of dismissal is valid based on the evidence led in its support.

Further, in Punjab National Bank v. Workmen (“Punjab National Bank”), the Court clarified that for proceedings under Section 33, instead of examining the validity, fairness or adequacy of the order passed by the employer, the Tribunal has to merely determine the existence of a prima facie case and either grant permission or refuse it. This view was also followed in judgments preceding the Punjab National Bank case, including Automobile Products of India Ltd. v. Rukmaji Bala and Lakshmi Devi Sugar Mills Ltd. v. Pt. Ram Sarup.

Subsequently, in Mysore Steel Works Pvt. Ltd. v. Jitendra Chandra Kar (“Mysore Steel”), the Court traversed an extra mile to envisage a situation where the domestic inquiry was found to be violative of principles of natural justice. Here, the Court held that if the tribunal finds the inquiry defective by virtue of the evidence adduced by the parties, it may delve into determining the justification for such dismissal. Based on such determination, if the tribunal finds that the order of dismissal is justified, it may grant the approval. This view was reiterated in Lalla Ram v. D.C.M. Works Ltd. (“Lalla Ram”), highlighting the stage at which concerned parties may produce evidence outside the scope of domestic inquiry.

However, Cholan Railways Ltd. v. G. Thirugnanasambandam (“Cholan Railways”) did not deal with the question surrounding the production of evidence by the parties before the Tribunal. The Court established that the Tribunal is solely required to decide whether there has been a prima facie case made regarding the validity or otherwise of the local inquiry carried out against the workmen.

Observations Of The Supreme Court in John D’Souza Case 

The instant case involves facts related to the absenteeism of a bus conductor (“appellant”) employed by the Karnataka Road State Transport Corporation (“KSRTC”). He remained absent from duty without prior intimation or permission from the employer, prompting an inquiry. The appellant was given the opportunity to be heard and present evidence. However, he failed to do so, leading the management to pass an order of dismissal against him. Thereby, KSRTC sought approval of the Labour Court under Section 33(2)(b) of IDA and received approval for the same. Interestingly, the High Court quashed this approval and directed the Tribunal to reconsider its decision. Upon reconsideration, the Tribunal reaffirmed its earlier stance and subsequently, a division bench of the High Court overruled the order on the grounds of the limited adjudicatory role of a tribunal under Section 33(2)(b). Eventually, the matter went before the Supreme Court.

At this juncture, it becomes pertinent to note that judicial precedents preceding the John D’Souza case exhibited considerable variance regarding the extent of a tribunal’s adjudicatory role under Section 33 of IDA. These precedents can be classified into two streams- First consisting of Punjab National Bank, Mysore Steel Works and Lalla Ram, which illustrates a wider adjudicatory role of a tribunal in situation where domestic inquiry is found defective, and the second consisting of Martin Burn and Cholan Railways, which provides a narrow scope of a tribunal’s adjudicatory role. Eventually, these two streams met a harmonious confluence in the instant John D’Souza’s judgement.

To harmonise these two diverse sets of judicial views, the Court observed that while the tribunal’s role is limited under Section 33, there are instances where further inquiry is essential. Especially if the domestic inquiry is found to be violative of principles of natural justice, the tribunal may ask parties to adduce new evidence. Further, the Court highlighted that the legislature did not envisage parallel or even overlapping adjudicatory mechanisms under Section 33(2)(b) and Section 10(1)(c) & (d) of IDA. While Section 33 does not aim to grant finality to an order of dismissal, its purpose is limited to whether punitive action should be lifted or not to prevent further victimisation of the workmen.

Further, the Court held that adjudicatory role of a tribunal under Section 33 can be delineated into two prongs: Firstly, to determine prima facie whether domestic inquiry was conducted with due process and adherence to principles of natural justice for which it only needs to peruse the records of inquiry. Secondly, if the domestic inquiry is found defective, then it may consider new evidence. Further, the concerned forum shall not exercise powers available to it under Section 10(1)(c) of IDA in proceedings under Section 33(2)(b) of IDA.

Contemporary Relevance and Authors’ Observations

In recent times, the adjudicatory role of a Tribunal under Section 33 of IDA has been under scrutiny of various High Courts across the country. Recently, the Delhi High Court observed that the Regional Labour Commissioner has limited powers in proceedings under Section 33C(1) of the Act, and the Kerala High Court has also affirmed the limited role of inquiry and adjudication under Section 33(2)(b). Further, amidst such a situation, harmonisation of varied principles expressed in past judicial precedents surrounding the tribunal’s adjudicatory role under Section 33 of IDA makes the instant case unique. By delineating the stage of production of evidence and settling the uncertainty over the nature of enquiry under Section 33 of IDA, the instant case has brought finality and certainty over the application of Section 33 of IDA. Amidst such a situation, the judgment of the Supreme Court in the John D’Souza case bridges the gap in India’s evolving jurisprudence of labour law.

While the limiting role of the tribunal under Section 33 is not in the black letter of the law, it stems from judicial precedents and the notion of tribunals with limited roles. However, when looked at from the perspective of the very purpose behind Section 33 of IDA, which is to prevent further victimisation of the employee, such an approach becomes problematic. This is because it circumscribes the powers of the tribunal within the limits of the prima facie principle and prevents the application of the judicial mind to the issue.

Here, the authors argue that Section 33 should not become the sole reason for limiting the powers of the Tribunal. While Section 33(2)(b) does not lead to the finality of a dismissal order, it should not boil down to mere mechanical action with no application of the judicial mind. The authors propose that the doctrine of proportionality should be imported into the proceedings under Section 33(2)(b) without giving the forum extensive powers of going into merits before engaging in prima facie consideration of domestic inquiry.

To sum up, the Supreme Court’s ruling in the John D’Souza case has clarified the adjudicatory role of a Tribunal under Section 33(2)(b) of IDA. The judgment effectively strikes a fine balance between protecting employees and ensuring that tribunals do not exceed their adjudicatory role. It tackles the issue of divergent principles laid down by the judiciary and strengthens industrial harmony while upholding social and economic justice. This judgment acts as a guiding force towards a more consistent approach in the adjudication of labour disputes.

Author:– Vishnu Sharma, in case of any queries please contact/write back to us at support@ipandlegalfilings.com or   IP & Legal Filing.