Rajendra Jha v Presiding Officer, Labour Court, Bokaro Steel City (1984)

When an enquiry is found defective, the employer gets a second chance: it may lead evidence before the Labour Court to prove the misconduct itself. The earlier cases, Delhi Cloth and General Mills v Ludh Budh Singh and Shankar Chakravarti v Britannia Biscuit Co, put a condition on that chance. The employer must ask for it, by a pleading or a specific request, and must ask before the proceedings close.

Rajendra Jha applies those rules to a messy real case. The employer never asked in writing, yet the Labour Court let it lead evidence. The Supreme Court held that the order stood. The case also carries a clear statement on when a party can reopen a question already decided against it: a wrong decision on a point of law does not escape res judicata unless the court had no jurisdiction at all.

Other benches have treated the case as significant. When a later bench doubted the line of authority on the employer's right to lead evidence, it referred the matter to a larger bench, naming Rajendra Jha vs. Labour Court, (1985 (1) SCR 544) among the decisions to be reconsidered.

The appellant was a Dresser in the Medical Department of the Bokaro Steel Plant, later the Steel Authority of India. On 1 March 1975 he was dismissed after a domestic enquiry on charges of absence from duty, falsification of entries in registers and destruction of records.

An industrial dispute was pending in the Labour Court, so the management applied under s. 33(2)(b) for approval of the dismissal. By a judgment of 16 November 1976 the Labour Court held (i) that the enquiry was invalid because the Chief Medical Officer was not competent to issue the charge-sheet or constitute the Enquiry Committee, but (ii) that the management should be given an opportunity to lead evidence to justify the dismissal.

Both sides went to the Patna High Court: the workman against part (ii), the management against part (i). The High Court dismissed both writ petitions on 26 April 1978. The management appealed to the Supreme Court and lost on 23 July 1980; the finding that the enquiry was vitiated stood. The workman did not appeal against the dismissal of his writ petition.

The Labour Court then called on the management to lead evidence. The workman himself had applied on 4 May 1978 asking that the employers be called upon to adduce evidence; he filed a list of his own witnesses and cross-examined the employer's witnesses. Only after that did he object that the employer should not be allowed to lead evidence at all. The Labour Court rejected the objection, the High Court dismissed his second writ petition on 5 February 1981, and he appealed by special leave.

1. In proceedings under s. 33(2)(b), was the Labour Court right to let the employer lead evidence when its application did not ask for that opportunity?
2. Could the workman reopen that question in the Supreme Court, relying on the rule that there is no estoppel against law, when his earlier challenge to the same order had been dismissed and had become final?
3. Does an erroneous decision on a question of law operate as res judicata between the same parties?

The appeal was dismissed. The employers could lead evidence to justify the dismissal.

The employer's right to lead evidence

The Court began from the settled position: "It is well-known that in such a proceeding, it is open to the employer to lead evidence to justify the order passed against the employee." That right is "governed by certain conditions", which the Court took from Delhi Cloth and General Mills v Ludh Budh Singh and Shankar Chakravarti v Britannia Biscuit Co. From the second of these it restated that "It is for the employer to avail of an opportunity to lead evidence by a specific pleading or by specific request."

The Court admitted that "It is doubtful whether the norms prescribed by these two decisions were followed strictly in this case." The application under s. 33(2)(b) did not ask, even in the alternative, for leave to lead evidence. But the Labour Court's judgment showed that, in all probability, an oral request was made when the hearing was coming to a close. The workman's claim that the Labour Court acted on its own was rejected: "That contention is far-fetched and cannot be accepted in teeth of the facts, both contemporaneous and supervening."

The later conduct settled it. The workman had himself asked the Labour Court to call on the employers to lead evidence, filed his own list of witnesses and cross-examined theirs. So "the order passed by the Labour Court allowing the employers to lead evidence has been accepted and acted upon by the appellant." It would be wrong at this stage to undo what had been done under that order.

Raising a question of law late

The workman relied on Chitturi Subbanna v Kudapapa Subbanna (pure questions of law may be raised for the first time at a later stage) and Mathura Prasad Bajoo Jaiswal v Dossibai N.B. Jeejeebhoy (an erroneous decision on jurisdiction does not operate as res judicata). Neither helped him. The Court stated the limit: "A question of law which does not require fresh investigation into facts may be allowed to be raised at a later stage of a proceeding but, that is subject to the qualification that the question is not concluded by a decision between the same parties." Here the same question had been raised in his writ petition in the Patna High Court and dismissed.

Irregular exercise of jurisdiction is not lack of jurisdiction

On res judicata, the Court held that "the Labour Court had the jurisdiction to decide whether to allow the employers to lead evidence or not. It may have acted irregularly in the exercise of that jurisdiction but that is to be distinguished from cases in which the Court inherently lacks the jurisdiction to entertain a proceeding or to pass a particular order."

On timing, the request came "When the hearing of that application was nearing completion, but before the final orders were passed therein". So it was not a request made after the proceedings had ended, which is what defeated the employers in the two earlier cases. The conclusion: "in passing the order allowing the employers to lead evidence, the Labour Court cannot be said to have acted without jurisdiction."

The closing words

The Court noted that "Nine years is frightful delay", much of it caused by the workman's own objections and stay orders, and directed the Labour Court to finish the matter as quickly as possible. It then asked the employer to consider leniency: "The employers are a public sector undertaking and they could lead the way in ensuring industrial peace and harmony."

In s. 33(2)(b) proceedings the employer may lead evidence before the Labour Court to justify a dismissal when the domestic enquiry fails, provided it asks for that opportunity before the proceedings close. An oral request made while the hearing is nearing completion, before final orders, is enough. A Labour Court that grants the opportunity acts, at worst, irregularly within its jurisdiction, not without it; so its order, once upheld between the same parties, cannot be reopened later on the ground that there is no estoppel against law.

• Direct question: What are the rights of an employer to lead evidence before a Labour Court when the domestic enquiry is found defective? Set out the conditions from Delhi Cloth Mills and Shankar Chakravarti (specific pleading or request, made before the proceedings close), then use Rajendra Jha to show how the rule applies when the request is oral and late in the hearing but before final orders.
• Problem question: a workman accepts a Labour Court order, takes part in the evidence, and later challenges the order as void. Use the Court's distinction between irregular exercise of jurisdiction and inherent lack of jurisdiction, and the rule that a question of law already decided between the same parties cannot be raised again.
• Procedure point: Does res judicata apply to industrial adjudication? The case applies it, with the Mathura Prasad exception for decisions given without jurisdiction.
• Link: read with Unit 7 material on s. 33 and on domestic enquiries. Note that a later bench referred the correctness of this line of cases to a larger bench.