Supreme Court of India
Employers In Relation To The … vs Workmen Being Represented By … on 7 September, 2021Author: Hrishikesh Roy

Bench: A.M. Khanwilkar, Hrishikesh Roy, C.T. Ravikumar



(Arising out of SLP (C) No.29873 OF 2016)





Hrishikesh Roy, J.

1. Leave granted. This appeal has been preferred

by the Management against the judgement dated

11.02.2016 in the L.P.A. No.334/2008 whereby, the

Division Bench of the High Court of Jharkhand had

set aside the order passed by the learned Single

Judge and restored the Award dated 28.09.2005

passed by the Central Government Industrial
Signature Not Verified

Digitally signed by
Date: 2021.09.07
Tribunal No.1 Dhanbad whereby, the workmen-
17:26:57 IST

Page 1 of 17
respondents were directed to be reinstated with 50%

back wages.

2. We have heard Mr. Anupam Lal Das, learned Sr.

counsel appearing for the Management. The

respondent-Union who were espousing the interest of

the discharged workmen, is represented by Ms.

Anisha Upadhyay, the learned counsel.

3. The appellants are the Management of Bhalgora

Area of M/s Bharat Coking Coal Limited (‘BCCL’ for

short), a Central Government Undertaking within the

meaning of Section 617 of the Companies Act, 1956.

By virtue of their status, the BCCL is required to

process their recruitment, by notifying the

vacancies and requisitioning names from the

jurisdictional Employment Exchange, under the

provisions of the Employment Exchange (Compulsory

Notification of Vacancies) Act, 1959 (for short,

‘the 1959 Act’)

4. In 1986, the BCCL decided to recruit Scheduled

Castes/Scheduled Tribes candidates in vacancies of

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miners/loaders. Accordingly, the Management of

BCCL made requisition from the Employment Exchange

on the basis whereof, list of eligible SC/ST

candidates for appointment was prepared. As a

matter of fact, such list did not contain the names

of any of the 38 workmen whose case is represented

by the respondent-Trade Union. The allegation is

that those 38 job aspirants, in connivance with a

Dealing Assistant and a Personnel Manager of the

Bhalgora Area of BCCL, dishonestly secured

appointments. When such fraudulent appointments was

detected, disciplinary proceedings were drawn up

against the concerned Dealing Assistant and the

Personnel Manager and eventually both were removed

from service. Parallelly, Charge Memo was issued

against the concerned miners/loaders and following

the adverse finding in the departmental inquiry,

the beneficiaries of the fraudulent appointment

process were terminated from service.

5. The case of the 38 workmen was taken up by the

respondent-Trade Union and in the Reference Case

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No.98 of 1994, the Central Government Industrial

Tribunal No.1 Dhanbad (hereinafter referred to as,

‘the Tribunal’ for short) concluded that the

Management failed to substantiate the charge of

manipulated appointment as the concerned witness

i.e. the dealing clerk Jitendra Kumar Adeshra and

the Personnel Manager PM Prasad, were not examined

to prove the charge of unmerited appointment being

secured by the workmen, in connivance with the said

two employees of the Organization. For the

perceived failure of the Management to justify

their action, the termination orders were

interdicted by the Tribunal and the concerned

workmen were directed to be reinstated with 50%

back wages.

6. Aggrieved by the Tribunal’s Award dated

28.09.2005, the Management filed the W.P.(L)

No.1916 of 2006, challenging the finding and the

direction of the Tribunal. The learned Single

Judge noted that the specific case of some of the

workmen in their reply to the charge-memo was that

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their names figured in the Employment Exchange

sponsored list, sent from Bhowra area to Bhalgora

area and in this way, they tried to show that they

were legally appointed. But in their Written

Statement filed before the Tribunal in a clear

departure from their earlier stand, the workmen on

the second occasion contended that their

appointments were made by the General Manager of

the Bhalgora area independently and this was not

related to the Employment Exchange sponsored

panel, prepared by the Bhalgora area in 1986.

While analyzing such contradictory stand, the Writ

Court found that the lists sent from the Employment

Exchange to the Bhowra area (marked as Exbt.M-3 to

M-3/3) and the list sent from Bhowra area to

Bhalgora area (marked as Exbt.M-4/1 to M-4/4) were

available on record before the Tribunal. The names

in the lists were verified and it was found that

the litigating workmen did not figure in those

lists. The disciplinary action taken against the

Dealing Clerk and the Personnel Manager on the

charge of facilitating fraudulent employment for

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the 38 workmen, was also noted by the learned

Judge. In consequence, having regard to the

materials on record, it was concluded that the

Tribunal erroneously answered the reference against

the Management. It was accordingly held that the

reinstatement order for the workmen, was unmerited.

Adverting to the contradictory stand of the workmen

to lend legitimacy to their appointment, the

Court’s conclusion was that the Tribunal

misdirected itself in allowing the workmen to

depart from the earlier stand on the premises that

the workmen were appointed by the General Manager

independently and without reference to the lists

sent from the Employment Exchange. On this aspect,

it must be observed that the legitimacy of the

appointment cannot be tested on the touchstone of

two contradictory projections. If either one is

accepted, the next one has to be discarded. Thus,

it is reasonable to hold that the appointees failed

to establish that their appointments were

legitimate and should therefore, be immune from


Page 6 of 17
7. It is also relevant to record herein that the

Management witness Ram Janam Sigh (M-1), who was

the Deputy Personnel Manager in Bhowra area at the

relevant time, while proving the Exbt. M-3 series

and M-4 series had pointedly testified that the M-3

series Exbts. were the lists received from the

Employment Exchange from which, few were appointed

in Bhowra area and the remaining persons whose

names find place in M-4 series Exbts, were then

appointed in the Bhalgora area. From the materials

the Court formulated that the main question to be

examined is whether the names of the workmen

figured in the Employment Exchange sponsored lists.

It was then found that they did not. The learned

Judge accordingly held that the Management has

proved that it is a case of unmerited appointment

and the workmen were the beneficiaries of a

fraudulent process.

8. The Court was also of the view that the burden

was on the Union to establish that the workmen were

lawfully appointed but since such onus was not

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discharged by the Union, the Writ Petition was

allowed in favour of the Management, and against

the workmen.

9. Aggrieved by the decision of the learned

Single Judge, the Union filed the LPA No.334 of

2008 before the High Court. The Division Bench, on

the perceived failure of the Management to adduce

material to justify the termination orders, decided

in favour of the appointees. In this way, the

fraudulent process through which the workmen

secured appointment was not given due weightage by

the Division Bench. The fact that the names of the

workmen did not figure in the lists sponsored by

the Employment Exchange and as a corollary, the

appointments would be contrary to the prescription

in the 1959 Act, was also significantly overlooked,

in the LPA proceeding. The names of the workmen

did not as a matter of fact, figure in the Exbt.M-3

series and Exbt.M-4 series and yet, without regard

for this most relevant aspect, the Division Bench

erroneously concluded that the Management failed to

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adduce requisite evidence on un-merited

appointment, secured by the workmen.

10. At this stage it would be relevant to state

that the records of the domestic enquiry leading to

the termination orders were made available by the

Management to the Tribunal. All the exhibits from

page 1 to page 454, including the approval of the

General Manager for the discharge of the workmen on

the recommendation of the Project Officer, the

Exbt.M-2 chargesheets, as also the domestic enquiry

proceedings were all presented to the Tribunal by

the Management. To claim legitimacy for their

appointment, few of the workmen in their response

to the chargesheet as noted earlier, claimed that

their names figured in the lists sponsored by the

Employment Exchange. But in their Written

Statement, the workmen pleaded differently and

claimed that they were appointed by the General

Manager of the Bhalgora area, independently and

without reference to the lists from the Employment

Exchange. Such diametrically opposite stand of the

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workmen on how they secured appointment,

(predicated on two versions which naturally can not

stand together), should have in our view, persuaded

both the Tribunal as also the Division Bench to

answer the reference in favour of the Management.

11. In the present case, the Management’s

consistent stand has been that it was a case of

fraudulent appointment in connivance with the

Dealing Assistant and Personnel Manager, who faced

disciplinary action for facilitating wrongful

appointment. It is also noteworthy that the

appellant as a Government Undertaking, is under a

statutory obligation under the 1959 Act, to make

appointments only through the Employment Exchange.

But this was not done in this case for the 38

litigating workmen. The names of the respondent-

workmen, as earlier noted, did not figure in either

of the two lists relatable to the Employment

Exchange. Moreover, the workmen, as can be seen,

failed to discharge their burden and took the

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contradictory stand in a desperate attempt to

convey legitimacy to their appointment.

12. We must also be conscious of the fact that

departmental action was taken by the appellant

against the errant Personnel Manager and the

Dealing Assistant, for their misconduct in

facilitating unmerited appointment to the 38

workmen through a fraudulent process. In this

regard, usefully it can be noted that the Dealing

Assistant and the Personnel Manager were dismissed

for their misconduct. For the record, the Dealing

Assistant’s dismissal was upheld by the Tribunal on

13.06.2000 in the Reference No.5/97. The dismissal

order against the Personnel Manager was although

interfered by the High Court but on appeal by the

Management, the case was remanded to the High Court

for fresh adjudication. Since then, the Personnel

Manager has reached the age of superannuation.

These would suggest that the appellant pursued the

issue of unmerited appointment, both against the

facilitators and also the beneficiaries.

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13. In the above perspective, the reference in our

opinion, was erroneously answered by the Tribunal,

against the Management. In the process, the steps

taken by the Management to undo the wrong done by

the two delinquent employees to facilitate

unmerited appointment, was undeservedly interdicted

by the Tribunal.

14. The learned Single Judge should not have been

overruled by the impugned judgment by ignoring the

key fact that the appointees did not figure in

either of the lists, sponsored by the

jurisdictional Employment Exchange and that they

were beneficiaries of a fraudulent process. Enough

materials were presented to the Tribunal to justify

the action against the illegally appointed workmen,

and as such the appellants cannot be made to suffer

the consequence of the misconduct of their two

errant employees against whom, disciplinary actions

were taken by the Management. Moreover, the

contradictory stand of the workmen at different

stage would suggest that they were conscious and

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aware of being appointed through a non-bonafide

process. In any case, the appointments were

contrary to the requirements of the 1959 Act.

15. In Union of India Vs. M.Bhaskaran1, on similar

facts of fraudulent appointment, Justice S.B.

Majumdar writing for a Division Bench rightly

expressed the following,

“6. …the concerned railway employees,
respondents herein have admittedly
snatched employment in Railway service,
may be of a casual nature, by relying
upon forged or bogus casual labourer
cards. The unauthenticity of the service
cards on the basis of which they got
employment is clearly established on
record of the departmental enquiry held
against the concerned employees.
Consequently, it has to be held that
respondents were guilty of
misrepresentation and fraud perpetrated
on the appellant employer while getting
employed in Railway service and had
Snatched such employment which would not
have been made available to them if they
were not armed with such bogus and forged
labourer cards. It was clearly a case of
fraud on the appellant-employer. If once
such fraud is detected, the appointment
orders themselves which were found to be
tainted and vitiated by fraud and acts of
1 (1995) Supp. 4 SCC 100

Page 13 of 17
cheating on the part of employees, were
liable to be recalled and were at least
voidable at the option of the employer
concerned. This is precisely what has
happened in the present case. Once the
fraud of the respondents in getting such
employment was detected the respondents
were proceeded against in departmental
enquiries and were called upon to have
their say and thereafter have been
removed from service. Such orders of
removal would amount to recalling of
fraudulently obtained erroneous
appointment orders which were avoided by
the employer- appellant after following
the due procedure of law and complying
with the principles of natural justice.”

16. We also endorse the opinion of Justice D.Y.

Chandrachud, writing for a three judges’ Bench in

Chairman and Managing Director, Food Corporation

of India & Ors. Vs. Jagdish Balram Bahira & Ors. 2,

where the Court has noted the responsibility of

Courts to guard against fraudulent employment,

especially when such appointment is obtained by

perpetuating fraud upon the authorities,

“4. …Public employment is a significant
source of social mobility. Access to
education opens the doors to secure
futures. As a matter of principle, in the
2 (2017) 8 SCC 670

Page 14 of 17
exercise of its constitutional
jurisdiction, the court must weigh
against an interpretation which will
protect unjust claims over the just,
fraud over legality and expediency over
principle. As the nation evolves, the
role of the court must be as an
institution which abides by
constitutional principle, enforces the
rule of law and reaffirms the belief that
claims based upon fraud, expediency and
subterfuge will not be recognised. Once
these parameters are established with a
clear judicial formulation individual
cases should pose no problem. Usurpation
of constitutional benefits by persons who
are not entitled to them must be answered
by the court in the only way permissible
for an institution which has to uphold
the rule of law. Unless the courts were
to do so, it would leave open a path of
incentives for claims based on fraud to
survive legal gambits and the creativity
of the disingenuous.”

17. Fraudulent practice to gain public employment

cannot be countenanced to be permitted by a Court

of law. The workmen here, having hoodwinked the

Government Undertaking in a fraudulent manner, must

be prevented from enjoying the fruits of their ill-

gotten advantage. The sanctity of public

employment, as a measure of social welfare and a

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significant source of social mobility, must be

protected against such fraudulent process which

manipulates and corrupts the selection process.

Employment schemes floated by the State for

targeted groups, can absorb a finite number of

workmen. To abuse the legitimate process therefore

would mean deprivation of employment benefits to

rightful beneficiaries. The Courts as sentinel of

justice must strive to ensure that such employment

programmes are not manipulated by deceitful

middlemen, thereby setting up a parallel mechanism

of Faustian Bargain. Often, desperate job

aspirants’ resort to such measures to compete for

limited vacancies, but this Court cannot condone

false projections so as to circumvent the

statutorily prescribed procedure for appointments.

Such illegal practices must be interdicted by the


18. For the aforesaid reasons, the reversal of the

well-reasoned order of the learned Single Judge is

found to be unjustified. The appeal accordingly

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stands allowed by setting aside the LPA judgment

and restoring the decision of the learned Single

Judge. It is ordered accordingly. The parties to

bear their own cost.


SEPTEMBER 07, 2021

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