DECISION ' This appeal arises from the decision of Sindh Labour Court No, I, Karachi, whereby a grievance application of respondent Muhammad Akram under section 25-A of the I.R.O., 1969, for reinstatement in service of the Bank was allowed with full back benefits.
2. Muhammad Akram was a parmanent workman in the Bank of America as a Messenger or Qasid.
Allegedly, in cousultation with the Bank's Assistant Manager Dilshad Raza, the respondent filed an application with Bank for House Purchasing Loan, amounting to Rs,2,87,100. The actual cost of the house that he wanted to purchase was shown by him as Rs,3,19,000. 10% of the equity was required to be spent by the employee purchaser himself, and this loan amount was shown as the remaining 90% of the value of the real estate. After the usual formalities the loan was sanctioned. The sale was registered. The Bank issued two cheques in the sum of Rs,2,85,000 and 2,100 in favour of the respondent Muhammad Akram, but at the request of the respondent the amount was paid to him in cash. Thereafter for three days the respondent remained absent from duty and on enquiry it was found that the actual value of the house sold to the respondent was Rs,2,34,000 and an amount of Rs,56,000 had been received over and above the sale amount by the respondent. The respondent then submitted a written apology to the bank and explained that Rs,2,34,000 was the actual price which he paid to the vendor, Rs,25,500 was spent on purchase of stamps, Rs,2,970 was paid as registration charges, Rs,1,000 was fees of Advocate, Rs,3,207 was house insurance premium. That only Rs,12,432 was taken by him as personal loan for repayment of an earlier loan from the Bank.
That the total amount thus came to Rs,2,80,109 and there remained a petty balance of Rs,6,991. The respondent had mortgaged the house purchased by him with the Bank. He had also paid a premium for insurance of the house for an amount of Rs,3,00,000 and given personal security for payment of the loan. The Bank, however, regarded the written apology as a confession and considered the enhanced amount of loan difference of Rs,56,000 as misapproriation and the service of the respondent were terminated by an order in writing, dated 28-5-1991, stating that since he admittedly lied to the Bank they had lost confidence in him as an employee of the Bank.
3. Mr. Mahmood Abdul Ghani, Representative for the Bank has argued that although the respondent was found to be guilty of misconduct under Standing Order 15(3)(b) for fraud and dishonesty in connection with employer's business or property, action was not taken against him under Standing Order 15, but his services were terminated simpliciter under Standing Order 12(3) by an order in writing stating the reasons for the action taken. Admittedly no charge-sheet nor any notice was served on the respondent nor was any domestic enquiry held against him, and in spite of misconduct being the actual reason for the termination, it was comouflaged as termination due to loss of confidence. Mr. Ahsanul Haq, Vice-President of the Bank in his cross-examination has admitted that respondent had committed misappropriation of Rs, 56,000 and his services were terminated on the basis of his confession. The respondent has explained that he submitted a written apology at the suggestion of Assistant Manager Mr. Dilshad Raza, who was himself responsible for the whole transaction of house loan.
4. The learned Advocate for the appellants has, however, admitted the misconduct but stated that the termination was under Standing Order 12(3) due to loss of confidence on account of that misconduct. It has, however, to be seen whether the termination was due to misconduct or due to loss of confidence and if the cause of termination was misconduct under sub-clause (b) of clause
(3) of Standing Order 15, the services of the workman could not be terminated simpliciter under Standing Order 12. Standing Order 12(1) clearly mentions the procedure for terminating the employment of a permanent workman for any reason other than misconduct so that for misconduct the procedure to be followed is that described under Standing Order 15. Standing Order 15 provides punishment for misconduct. The major punishment provided under sub-clause
(iv) is dismissal and not termination. Under sub-clause (iv) no order of dismissal shall be made unless the workman concerned is informed in writing of the alleged misconduct within one month of the date of such misconduct and is given an opportunity to explain the circumstances alleged against him. The procedure for dismissal in such cases under Standing Order 15(4) is to be strictly followed. The written Notice of alleged misconduct is to be given and an opportunity to the workman to explain the charges against him is necessary. It has also been generally stated as a principle of natural justice that the workman be supplied a copy of the enquiry report and also given a second show-cause notice why he should not be dismissed from service. This provision under Standing Order 15(4) for giving a charge-sheet is mandatory and its non-observance vitiate the proceedings. Termination of service being not a punishment for misconduct cannot be substituted for dismissal, to avoid following the mandatory provision of law.
5. It has been argued by the learned counsel for the appellants that it is open to the employer to terminate the services of a workman simpliciter under Standing Order 12 or to proceed under Standing Order 15 and in this case the termination is due to loss of confidence. Standing Order 12(1) however only permits termination for any reason other than misconduct and no option has been provided for not following the procedure laid down under Standing Order 15 by just passing order of termination simpliciter.
6. A similar case was decided as far back as the year 1962 by Full Bench of the Supreme Court of Pakistan consisting of A.R. Cornelius, J, SA. Rahman, C.J., Fazle-Akbar, B.Z. Kaikaus and Hamoodur Rahman, JJ. The Glaxo Laboratories (Pakistan) Ltd. v. Glaxo Laboratories Workers' Union and others 1962 PLC 362. In that case also the termination of service of worker was specifically for misconduct but the employer paid him one month's salary in lieu of notice and terminated his services simpliciter. It was held that such payment does not change the original reason for termination of service. Misconduct not being lawfully established, reinstatement of worker was held to be proper.
A proper enquiry for misconduct is, therefore, necessary, The mode provided by the law is to be strictly followed under the mandatory provisions contained in Standing Order 15 of the West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance, 1968.
7. Where this procedure is not adopted termination will be bad in law and will amount to a contravention of the provision of the Ordinance. A wrongfully dismissed workman has then to be reinstated in service and paid the back benefits.
8. The order of the Labour Court is, therefore, maintained and the appeal is dismissed.