Holding

The Industrial Tribunal had jurisdiction to interfere with the quantum of punishment, and the Life Insurance Corporation Act, 1956 does not oust that jurisdiction; a Development Officer is a workman within the meaning of the Industrial Disputes Act.

Summary

R. Suresh, a Development Officer of the Life Insurance Corporation of India (LIC), was dismissed after a departmental enquiry found him guilty of negligence, though he was cleared of breach of trust and forgery. He raised an industrial dispute before an Industrial Tribunal under s.11A of the Industrial Disputes Act, 1947, which held that dismissal was too harsh and ordered his reinstatement without back‑wages. LIC contended that the Life Insurance Corporation Act, 1956 ousted the jurisdiction of the Industrial Courts and that a Development Officer was not a "workman". The Supreme Court held that the 1956 Act contains no provision ousting the jurisdiction of civil or industrial courts, that a Development Officer falls within the definition of a workman, and that the Tribunal was entitled to examine the quantum of punishment. Consequently, the appeal was dismissed.

Issues considered

The Industrial Tribunal under s.11A, 1947 Act has jurisdiction to interfere with the quantum of punishment in a dismissal of a LIC employee.
Whether the Life Insurance Corporation Act, 1956 ousts the jurisdiction of the Industrial Courts.
Whether a Development Officer of LIC qualifies as a "workman" under the Industrial Disputes Act, 1947.

Legislation cited

Code of Civil Procedure, 1908s. 9
Industrial Disputes Act, 1947s. 11A, s. 2(s)
Life Insurance Corporation Act, 1956s. 3, s. 4, s. 48(2C), s. 48(2)(cc), s. 6

Subjects

Industrial Disputes ActLife Insurance Corporation Actjurisdictionworkman definitiondismissalindustrial tribunalproportionalitynegligencedisciplinary proceedingsconstitutional law

Judgment

[2008] 5 S.C.R. 208

A LIC OF INDIA
v.
R. SURESH
(Civil Appeal No. 2004 of 2008)

MARCH 14, 2008
B
[S.B. SINHA AND V.S. SIRPURKAR, JJ.]

Industrial Disputes Act, 1947 - s.11A - Respondent,
Development Officer in Appellant, a Corporation constituted
c and incorporated under the 1956 Act - Departmental
proceedings against him -· Enquiry Officer finding him guilty
of negligence in duty but exonerating him from charges of
breach of trust and forgery - Respondent dismissed - He
raised industrial dispute - Industrial Tribunal holding that the
D punishment of dismissal was too harsh and ordering re-
instatement of Respondent, albeit without grant of back-wages
,....
- Dispute as to whether the Industrial Tribunal had any
;urisdiction in the matter and whether it was justified in
interfering with the quantum of punishment - Held: The 1956
Act does not contain any provision in terms whereof the
E
;urisdiction of Civil Court and/or Industrial Court is taken away
- Hence, presumption arises against ouster of jurisdiction -
Industrial Court in terms of s.11A exercises a discretionary
;urisdiction - In exercising such jurisdiction, nature of the
misconduct alleged, conduct of the parties, manner in which
F
the enquiry proceeding h~d been conducted may be held to
be relevant factors - In given cases, even the doctrine of ,(

proportionality may be invoked - Jurisdiction of the lndustria·I
Court being wide and it having been conferred with the power
to interfere with the quantum of punishment, it could go into
G
the nature of charges, so as to conclude as to whether
Respondent had misused his position or his acts were in ..
breach of trust conferred upon him by his employer - Life ~..- _.,
Insurance Corporation Act, 1956.

H 208
LIC OF INDIA v. R. SURESH 209

Respondent was employed as a Development Officer A
in Appellant, a Corporation constituted and incorporated
under the Life Insurance Corporation Act, 1956.
Departmental proceedings were initiated against
Respondent. The Enquiry Officer found him guilty of the
charges of negligence in duty but exonerated him from s
the charges of breach of trust and forgery. Respondent
was dismissed from service. He raised industrial dispute
against the Appellant-Corporation. The Industrial Tribunal
held that the punishment of dismissal was too harsh and
ordered re-instatement of Respondent, albeit without c
grant of back-wages.
Dispute arose as to whether the Industrial Tribunal
had any jurisdiction in the matter and that whether it was
justified in interfering with the quantum of punishment.
D
The contention of the Appellant is that in view of the
provisions of the 1956 Act, as amended in the year 1981,
the provisions of the Industrial Disputes Act, 1947 would
have no application and that Respondent, in any event,
being a Development Officer, was not a workman and,
thus, the Tribunal could not have interfered with the E
quantum of punishment awarded by the management.
Respondent, on the other hand, urged that the
jurisdiction of the Tribunal would be ousted only in regard
to the terms and conditions of service and not in a case F
of this nature; that in various decisions of this Court, an
industrial dispute against LIC has been entertained and
that the charges of breach of trust and forgery being the
main charge and the Respondent having been
exonerated therefrom, the Tribunal cannot be said to have G
committed any illegality in interfering with the quantum
of punishment in exercise of its jurisdiction under Section
11A of the 1947 Act.
Dismissing the appeal, the Court
H
210 SUPREME COURT REPORTS [2008) 5 S.C.R.

,..
A HELD:1.1. LIC is a "State" within the meaning of
Article 12 of the Constitution. Its duties and functions are
provided for under the Life Insurance Corporation Act,
1956. A decision taken by the Disciplinary Authority under
the 1956 Act ordinarily could have been a subject matter
B of suit. The Civil Court, however, exercises a limited
jurisdiction. If however, the concerned employee is a
'workman' within thE! meaning of the provisions of the
Industrial Disputes Act, 1947, his remedy apart from the
common law remediEis may also lie before an industrial
court. When a right accrues under two statutes vis-a-vis
c the common law right, the concerned employee will have
an option to chose his forum. (Paras 11, 12) (217-G & H;
218-C, D & E]
1.2. The 1956 Act does not contain any provision in
D terms whereof the jurisdiction of the Civil Court and/or
Industrial Court is taken away. It is now a well settled
principle of law that any provision taking away the
jurisdiction of a Court shall be strictly construed. A
presumption arises against the ouster of jurisdiction.
Having regard to the provisions contained in s.9, CPC ahd
E
as also the provisions of the 1947 Act, an endeavour
should be made to construe the provisions in such a
manner so as to retain the jurisdiction subject, however,
to the ouster of jurisdiction either expressly or by
necessary implication . (Para 12 & 13) (218-F, G, H; 219-D]
F
1.3. The jurisdiction of the Industrial Court must be
A.
held to be ousted only when the remedy sought for by
the workman is premised on a right under the industrial
laws which is in conflict with the right granted to an
employee, an agent or LIC. [Para 13) [219-H; 220-A]
G
1.4. If the Rules made under the 1956 Act are not in
conflict: with the jurisdiction of an Industrial Tribunal to
go into the question of validity or legality of an order of +-~

termination of service, one fails to see how the jurisdiction
H of the Industrial Court stood ousted. [Para 14) (220-E & F]
LIC OF INDIA v. R. SURESH 211

1.5. An Industrial Court in terms of s.11 A of the 1947 A
Act exercises a discretionary jurisdiction. Discretion must
be exercised judiciously. It cannot be based on whims or
caprice. [Para 16] [221-D]
1.6. Again, the jurisdiction must be exercised having
regard to all relevant factors in mind. In exercising such 8
jurisdiction, the nature of the misconducts alleged, the
conduct of the parties, the manner in which the enquiry
proceeding had been conducted may be held to be a
relevant factor. A misconduct committed with an intention
deserves the maximum punishment. Each case must be C
decided on its own facts. In given cases, even the doctrine
of proportionality may be invoked. [Para 16] [221-E & F]
1.7. The jurisdiction of the Industrial Court being wide
and it having been conferred with the power to interfere
0
with the quantum of punishment, it could go into the nature
of charges, so as to arrive at a conclusion as to whether
the respondent had misused his position or his acts are
in breach of trust conferred upon him by his employer.
[Para 17] [222-H; 223-A]
E
1.8. Furthermore, however, Respondent is out of
service since 1987. He has already suffered a lot being
out of service for more than 20 years. All the Courts have
held in his favour. Thus it would not be a fit case for
exercise of discretionary jurisdiction under Article 136 of F
the Constitution. [Para 19] [223-C & D]
M. Venugopal Vs. Divisional Manager, Life Insurance
Corporation of India, Machilipatnam, A.P and Another [(1994)
2 SCC 323]; S.K. Verma Vs. Mahesh Chandra and another
[AIR 1984 SC 1462]; Dwarka Prasad Agarwal v. Ramesh G
Chandra Agarwal (2003) 6 SCC 220; A. V Nachane and Anr.
v. Union of India and Anr. (1982) 1 SCC 205; Life Insurance
-~ Corporation of India and Anr. v. Raghavendra Seshagiri Rao
Kulkarni (1997 8 SCC 461; Bhavnagar University v. Palitana
Sugar Miff (P) Ltd. and Ors. (2003) 2 SCC 111; Dipak Chandra H
212 SUPREME COURT REPORTS [2008] 5 S.C.R.

A Ruhidas v. Chandan Kumar Sarkar (2003) 7 SCC 66; Mukesh
K. Tripathi v. Senior Divisional Manager, LIC and Ors. (2004)
SCC 387; Haryana Urban Development Authority v. Saurabh
Aggarwal (2005) 9 SCC S48; Union of India and Others Vs. J.
Ahmed [(AIR 1979 SC 1022]; ITC Ltd., Monghyr, Bihar v.
B Presiding Officer, Labour Court, Patna (Bihar)(1978) 3 SCC
504 and Suresh Pathrnlla v. Oriental Bank of Commerce
(2006) 10 sec572 - referred to.

GP Singh, Principles of Statutory Interpretation, 11th Ed., >

pg. 707-·referred to.
c
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
2004 of 2008.

From the fin~ Judgment and Order dated 03.02.2006 of
the High Court of Kerala at Ernakulam in W.A. No. 3360 of2001.
D
K. Ramamurthy, S. l~ajappa and Sri ram for the Appellant.
G. F)rakash for the F~espondent.

The Judgment of th1e Court was delivered by
E S.R SINHA, J. Leave granted.
1. Whether jurisdiction of the Industrial Courts are ousted
in regard to an order of dismissal passed by the Life Insurance
Corporation of India, a Corporation constituted and incorporated
under the Life Insurance Corporation Act, 1956, is the question
F involved in this appeal which arises out of a judgment and order
dated 3.2.2006 passed by a Division Bench of the Kerala High
Court at Ernakulam.
2. Respondent herein was appointed as a Development
G Officer of the appellant. Departmental proceeding were initiated
against him. Articles of Charges were framed; fifth of it being,
forgery of a signature on a proposal. According to the Enquiry
Officer,.the respondent was negligent in the performance of his I-"
duties as he did not personally verify the details of the person
H concerned and relied wholly upon the representation of the
\.
LIC OF INDIA v. R. SURESH 213
[S.B. SINHA, J.]
~
agent. The Enquiry Officer found him guilty of the first four A
charges, but exonerated him on the fifth one. He was dismissed
from service by the disciplinary authority by an order dated
19.4.1989.
3. An industrial dispute was raised by him. The appropriate
.,, Government referred the following dispute for adjudication of B
·~
;
the Industrial Tribunal:
"Whether the action of the Management of the Life
Insurance Corporation of India, Thiruvananthapuram in
removing. from service of Sh. R. Suresh, Development c
officer with effect from 19.04.1989 is justified? If not what
relief is the workman entitled to."

.!
4. By an Award dated 6.2.1993, while holding that the
principles of natural justice have been followed in the matter of
holding the domestic enquiry against the respondent, in respect ['
~;
of charges 1 to 4, but having regard to the nature of charges
vis-a-vis the admission of the respondent, it was held:
"IV. Admittedly there was no monetary loss to the
management and no monetary gain to the workman by
the issuance of a policy in the name of a dead person. It E
is pertinent to note that senior branch manager of the
Punalur Branch office of the management has deposed
before Enquiry Officer "that the workman has not
deliberately secured the proposal knowing that the party
as dead. But he has been careless in not verifying the F
... correct facts that is why it is said his work habit is
unsatisfactory". The above statement makes it clear that
the workman deliberately not secured the policy but
everything happened due to his carelessness. As per
Regulation Nos. 21 and 24 mentioned above every G
employee of the management corporation shall serve the
corporation honestly and faithfully and shall maintain
absolute, integrity and devotion to duty etc., and as per
Regulation 39(1) the management is empowered to
impose punishment for committing breach of the H
214 SUPREME COURT REPORTS (2008] 5 S.C.R.

>-
A Regulations of the Corporation and the punishment
included dismissal as well. But as deposed by the senior
Branch Manager the workman was careless in securing
the proposal which resulted in the issuance of the policy
in the name of a dead person. It may be recalled that he
B had only two years service with the management and there
was no other complaint against him during that period " r
except the othe!r complaint against him during that period
except the present charge. But the misconduct happened
due to his carelessness on as admitted by the senior
c Branch Manager. On an anxious consideration of all these
aspects I am of the view that the punishment of dismissal
is too harsh to be sustained. The management failed to
consider these~ aspects and failed to award a lesser
,....
punishment. However, the workman cannot be let off
without any punishment for the misconducts proved
D
against him. The anguish and pain suffered by him due to
the loss of his job and denial of backwages and all other .,.--
monetary benefits would be adequate punishment
according to me for the misconducts now proved against
him. Subject to that he is ordered to be reinstated in
E service."
5. A Writ Petition was filed by the appellant before the High
Court. A contention inter alia was raised therein that the Industrial
Tribunal had no jurisdiction in the matter. Before the High Court,
F a decision of this Court in M. Venugopal Vs. Divisional
Manager, Life Insurance Corporation of India, Machilipatnam,
..I,
A.P and Another ((1994) 2 SCC 323], was cited.
The High Court opined that the said decision has no
application in the fact of.the present case, stating:
G
" ..... It was also held that once Section 2(cc) is not attracted,
there is no question of application of Section 25-F on the
basis of which the termination of the service of the
probationer can be held to be invalid. It was therefore that
the Court found that the proceedings before the Tribunal
H
LIC OF INDIA v. R. SURESH 215
[S.S. SINHA, J.]

were not justified. There again the reasoning is that in the A
case of conflict between the provisions in the Staff
Regulation and the provisions of the Industrial Disputes
Act, the former would prevail."
Relying on a decision of this Court in S.K. Verma Vs.
Mahesh Chandra and another[AIR 1984 SC 1462], it was held; B

" .... After considering the terms and conditions relating to
appointment of Development Officers, it was found that
the Development Officer, a whole time employee of the
L.l.C. with liability for transfer is expected to assist and c
inspire the agents while exercising no administrative control
over them. The agents are not his subordinates. In the
circumstances, he is not a person in administrative or
managerial cadre and as such was held to be a workman
within the meaning of Section 2(s) of the Industrial Disputes
D
Act.. ... "
In regard to the question as to whether the Industrial Tribunal
-~
was justified in interfering with the quantum of punishment, it
was opined;
"19. The above findings were made in a case where the E
Management alleged that four of its employees committed
breach of trust and misappropriated, two amounts of Rs.
24,239.97 and Rs. 19,884.06 during the period 1977-78.
The charges were established based on shortage of goods
notices on stock verification. When there is a charge of F
misappropriation proved, there is certainly no justification
for interfering with the punishment of dismissal imposed
by the Management. But, in the instant case, there is no
allegation of misappropriation. As already mentioned, there
was no wrongful loss to the Corporation nor any wrongful G
f
gain to the 2nd Respondent. All that was proved was
l negligence. The case of breach of trust and forgery alleged
in Charge No. 5 was already found against and only the
,_--.. minor charges arising from carelessness stood proved. In
such a case, the observations of the Apex Court made in H
216 SUPREME COURT REPORTS (2008] 5 S.C.R.

A the aforesaid case cannot be justly applied."
6. On an intra-court appeal, having been preferred
thereagainst, a Division Bench of the High Court affirmed the
said view.

s 7. Mr. K. Rarnamurthy, the learned senior counsel
appearing on behalf of the appellant would submit:-

(i) In view of the provisions of the 1956 Act, as amended
in the year 1981, the provisions of the Industrial
Disputes Act, 1947 (for short "194 7 Act") would have
C no application.

(ii) The respondent, in any event, being a Development
Officer, was not a workman and, thus, the Tribunal
could not have interfered with the quantum of
punishment awarded by the management.
D
8. Mr. G. Prakash, learned counsel appearing on behalf of
the respondent, on the other hand, urged:-
(i) The jurisdiction of the Tribunal would be ousted only
in regard to the terms and conditions of service and
E
not in a case of this nature.

(ii) There are various decisions of this Court, where an
industrial dispute against LIC has been entertained.

(iii) Charge No. 5 being the main charge and the
F respondent having been exonerated therefrom, the
Tribunal cannot be said to have committed any
illegality in interfering with the quantum of punishment ,...
in exercise of its jurisdiction under Section 11A of
the 194 7' Act.
G
9. The 195Ei Act was enacted to provide for the
nationalization of life insurance businesses in India by transferring
all such businesses to a Corporation established for the purpose
and to provide for the regulation and control of the business of
H the Corporation and for matters connected therewith or incidental
LIC OF INDIA v. R. SURESH 217
[S.8. SINHA, J.]

thereto. A
....
Section 3 provides for the establishment and incorporation
of the Life Insurance Corporation of India. Section 4 provides
for the constitution of the Corporation. Section 6 occurring in
Chapter 111 of the Act enumerates the functions of the Corporation
inter alia to carry on business in insurance and to carry on any B
other business which may seem to the Corporation to be
capable of being conveniently carried on.

Section 48 of the Act empowers the Central Government
to make rules. Sub-Section (2) of Section 48 enumerates the c
power in respect whereof the Central Government can make
rules in particular and without prejudice to the generality of the
power conferred upon it under Section 1 thereof. Clause (cc) of
sub-Section (2) of Section 48 reads as under:-
"(cc) the terms and conditions of service of the employees D
and agents of the Corporation, including those who
became employees and agents of the Corporation on the
-~
appointed day under this Act;"
Sub-section (28) of Section 48 of the Act elucidates as to
E
what would be the matters which would be covered by clause
(cc) of sub-Section (2) in the following terms;

"(i) the power to give retrospective effect to such rules;
and
..... (ii) the power to amend by way of addition, variation or F
repeal, the regulations and other provisions referred to in
sub-section (2A), with retrospective effect, "
l
10. By way of a validating statute, sub-section (2C) was
also enacted, giving retrospective effect to any Rule which have
G
been made in terms of sub-Section (28) of Section 48 of the
Act.
11. LIC is a "State" within the meaning of Article 12 of the
,.. ~ Constitution of India. Its duties and functions are provided for
under the 1956 Act. The same by itself, however, having regard H
218 SUPREME COURT REPORTS [2008] 5 S.C.R.

A to the definition of "Industry" as contained in Section 20) of the
~
Industrial Disputes Act, 1947 cannot take within its umbrage
the functions of the Life Insurance Corporation outside its
purview.

12. Under the industrial law, and in particular the 1947 Act,
B the authorities specified therein, the appropriate governments
and the industrial courts have various functions to perform. Terms
and conditions can be laid down thereunder. Violations of the
terms and conditions of service are also justiciable. Safeguards
have been provided under the Act to see that services of a
c workman are not unjustly terminated. The 1947 Act provides for
a wider definition of termination of service. Conditions precedent
for termination of service have been provided for thereunder. A
decision taken by the Disciplinary Authority under the 1956 Act
J
ordinarily could have been a subject matter of suit. The Civil
D Court, however, exercises a limited jurisdiction. If however, the
concerned employee is a 'workman' within the meaning of the
provisions of the 1947 Act, his remedy apart from the common ..,._
law remedies may also lie before an industrial court. When a
right accrues under two statutes vis-a-vis the common law right,
E the concerned employee will have an option to chose his forum.
Section 48 provides for a rule making power. Clause (cc)
of sub-Section (2) whereof only empowers the Central
Government to lay down the terms and conditions of service of
the employees and agents of the Corporation. The Act does
F not contain any provision in terms whereof the jurisdiction of the ...
Civil Court and/or Industrial Court is taken away. It is now a well
settled principle of law that any provision taking away the .).

jurisdiction of a Court shall be strictly construed. A presumption
arises against the ouster of jurisdiction. Having regard to the
G provisions contained in Section 9 of the Code of Civil Procedure
and .as also the provisions of the 1947 Act, an endeavour should
be made to construe the provisions in such a manner so as to
retain the jurisdiction subject, however, to the ouster of jurisdiction
either expressly or by necessary implication. ,._ ....
H
UC OF INDIA v. R. SURESH 219
[S.S. SINHA, J.]

In Dwarka Prasad Agarwal Vs. Ramesh C~andra Agarwal A
[(2003) 6 sec 220], it was stated:-

"22. The dispute between the parties was eminently a civil
dispute and not a dispute under the provisions of the
Companies Act. Section 9 of the Code of Civil Procedure
confers jurisdiction upon the civil courts to determine all B
dispute of civil nature unless the same is barred under a
statute either expressly or by.. necessary implication. Bar
of jurisdiction of a civil court is not to be readily inferred.
A provision seeking to bar jurisdiction of civil court requires
strict interpretation. The court, it is well-settled, would c
normally lean in favour of construction, which would uphold
retention of jurisdiction of the civil court ... "

13. We have noticed hereinbefore that the 1956 Act does
not contain any provision ousting the jurisdiction of the Civil Court
D
or the Industrial Court. The question, therefore, would be as to
whether the jurisdiction is ousted by necessary implication. For
-~ the said purpose, construction of clause (cc) of sub-Section (2)
of Section 48 of the Act is necessary. It is one thing to say that
rules may provide for the terms and conditions of service of the
employees but it is another thing to say that a person is entitled E
to avail his human right of access to justice to get his grievances
adjudicated before an independent fora. Access to justice as is
well known is a valuable right.

,,
Construing the text of G.P. Singh, Principles of Statutory F
Interpretation, 11 1h Ed., pg. 707;

"There is a strong presumption that civil courts have
jurisdiction to decide all questions of civil nature. The
exclusion of jurisdiction of civil courts is therefore not to be
' readily inferred and such exclusion must either be "explicitly G
J expressed or clearly implied."
'
So construed, and applying the aforementioned principle
of interpretation to a case of this nature, the jurisdiction of the
~-..J
Industrial Court must be held to be ousted only when the remedy
H
220 SUPREME COURT REPORTS [2008] 5 S. C.R.

A sought for by the workman is premised on a right under the
industrial laws which is in conflict with the right granted to an
employee, an agent or LIC.
Reliance has been placed by Mr. K. Ramamurthy on A.\/.
Nachane and Anr. Vs. Union of India and Anr. [(1982) 1 SCC
B 205]. This Court therein was concerned with the validity of
Section 48(2C) of the Ac:t. It was held that the appellant therein
had not been able to bring on records sufficient materials to
attract the wrath of Article 14 of the Constitution of India.

c 14. The question came up for consideration in M.
Venugopal (supra), wheffein again the issue was as to whether
retrenchment of an employee must precede compliance of the
statutory requirements under Section 25 F of the Act, although
there exists a statutory power on the authorities under the Act to
effect such termination. It was held that 1956 Act shall prevail
0
over the 1947 Act stating;
"·14. The amendments introduced in Section 48 of the "f--
Corporation Act have clearly excluded the provisions of
the Industrial Disputes Act so far as they are in conflict
E with the rules framed under Section 48(2)(cc) ... " ·

If, therefore, the Hules made under the 1956 Act are not in
conflict with the jurisdiction of an Industrial Tribunal to go into
the question of validity or legality of an order of termination of
service, we fail to see how the jurisdiction of the Industrial Court
F stood ousted. ReliancB has also been placed on Life Insurance
Corporation of India and Another Vs. Raghavendra Seshagiri
Rao Kulkarni [(1997 :B SCC 461], Bhavnagar University Vs.
Palitana Sugar Mill (P) Ltd. and Others [(2003) 2 SCC 111]
and Dipak Chandra Ruhidas Vs. Chandan Kumar Sarkar
G [(2003) 1 sec 66].
Each of the aforementioned decisions reiterate the
aforementioned principles only and in the fact situation obtaining
therein, the Rules made under the 1956 Act were held to be
H applicable.
UC OF INDIA v. R. SURESH 221
[S.B. SINHA, J.]

15. A Development Officer has been held to be a A
"workman" in S.K. Verma (supra).

We, however, are not unmindful of a decision of a three
Judges Bench of this Court in Mukesh K. Tripathi Vs. Senior
Divisional Manager, UC and Others [(2004) 8 SCC 387),
wherein one of us (Sinha, J.) was a member, where the question 8
was as to whether an apprentice would be a workman within
the meaning of the provisions of Section 2(s) of the 1947 Act. It
is not a case where case of an apprentice is involved.

16. In !:faryana Urban Development Authority Vs. c
Saurabh Aggarwal [(2005) 9 SCC 548), also this Court was
dealing with a case of an employee whose services had been
wrongly terminated and he prayed for a reference under·section
1Oof the Act.

An Industrial Court in terms of Section 11A of the Act D
exercises a discretionary jurisdiction. Indisputably, discretion
--< must be exercised judiciously. It cannot be based on whims or
caprice.

Indisputably again, the jurisdiction must be exercised
E
having regard to all relevant factors in mind. In exercising such
jurisdiction, the nature of the misconducts alleged, the conduct
of the parties, the manner in which the enquiry proceeding had
been conducted may be held to be a relevant factor. A
misconduct committed with an intention deserves the maximum
punishment. Each case must be decided on its own facts. In F
given cases, even the doctrine of proportionality may be invoked.

17. In fact this Court in Union of India and Others Vs. J.
Ahmed [(AIR 1979 SC 1022] opined that negligence by itself
may not be held to be a misconduct. The Court stated;
G
"11 ... It is however, difficult to believe that lack of efficiency
or attainment of highest standards in discharge of duty
attached to public office would ipso facto constitute
... ~
misconduct. There may be negligence in performance of
duty and a lapse in performance of duty or error of judgment H
222 SUPREME COURT REPORTS [2008] 5 S.C.R.

A in evaluating the developing situation may be negligence
in discharge of duty but would not constitute misconduct
unless the consequences directly attributable to negligence
would be such as to be irreparable or the resultant damage
would be so heavy that the degree of culpability would be
B very high. An error can be indicative of negligence and the
degree of culpability may indicate the grossness of the
negligence. Carelessness can often be productive of more
harm than deliberate wickedness or malevolence ... "
This Court in ITC Ltc:f., Monghyr, Biharv. Presiding Officer,
C Labour Court, Patna (Bihar), (1978) 3 SCC 504, opined that
negligence by itself cannot be held to constitute misconduct
stating:-
"Mr. Pai submitted that even neglect of work simpliciter
can be a misconduct within the meaning of Sub-clause (1)
D
of Clause (ii) of Standing Order 20 apart from its being a
fault within the meaning of Sub-clause (b) of Clause (i) of
the said Standing Order as the word 'habitual' in the former
merely qualifies the word 'negligence' and not the
expression 'neglect of work'. This argument has to be
E stated merely to be rejected. Mere neglect of work cannot
bH both. If it is so, it is a fault. If it is habitual that is, if it is
repeated several times then only it is misconduct. It may
well be that fault of one kind or the other as enumerated
in Sub-clauses (a) to (g) of Standing Order 20(i) if repeated
F more than once may be habituai within the meaning of
Standing Order 20(ii)(1), and especially in the light of the
fourth fault being a misconduct within the meaning of
Standing Order 20(a), but on the facts of this case, there
was no charge against respondent No. 3 that he was guilty
G of habitual neglect of work. Moreover the Labour Court
found that the negligence of the workman was not of a
serious kind. Some others in the factory also contributed
to it. We, therefore, reject point No. 2."
The jurisdiction of the Industrial Court being wide and it
LIC OF INDIA v. R. SURESH 223
[S.B. SINHA, J.]
~ having been conferred with the power to interfere with the A
quantum of punishment, it could go into the nature of charges,
so as to arrive at a conclusion as to whether the respondent
had misused his position or his acts are in breach of trust
conferred upon him by his employer.
..,, 18. It may be true that quantum of loss may not be of much B
relevance as has been held in Suresh Pathre!la Vs. Oriental
Bank of Commerce [(2006) 10 SCC 572], but there a~ain a
question arose as to whether he was in the position of a trust or
not.
c
19. Furthermore, however, the respondent is out of service
since 1987. He has already suffered a lot being out of service
for more than 20 years. All the courts have held in his favour.
We, thus, do not think that it would be a fit case where we should
exercise our discretionary jurisdiction under Article 136 of the
D
Constitution of India. This appeal is dismissed. No costs.
- -\'
B.B.B. Appeal dismissed.