Court’s Decision
The Bombay High Court (Division Bench: Justice G.S. Kulkarni and Justice Aarti Sathe) quashed the dismissal of a Welfare Commissioner from the Maharashtra Labour Welfare Board, holding that the State Government had no authority in law to remove an employee of the Board. The Court ruled that only the appointing authority — the Labour Welfare Board — could exercise such powers, and that the Government’s order of dismissal dated 31 January 2012 was wholly without jurisdiction.
“Section 15 of the Bombay Labour Welfare Fund Act, 1953 does not empower the State to terminate an employee of the Board. The power of appointment carries with it the power of removal.”
The Court thus allowed the writ petition, set aside the dismissal order, and granted liberty to the petitioner to seek consequential benefits from the Board.
Facts
The petitioner, appointed as Senior Deputy Welfare Commissioner in 1992, was promoted to Welfare Commissioner in 1999 with prior approval of the State Government as mandated under Section 11 of the Bombay Labour Welfare Fund Act, 1953.
In 2002, a female clerk at the Board, referred to as X, lodged a complaint of sexual harassment against the petitioner under Sections 354, 504, and 509 of the Indian Penal Code. However, internal and departmental enquiries found no substance in the allegations, and X subsequently filed an affidavit in January 2004 withdrawing her complaint and admitting that she had filed it under a misunderstanding and union pressure.
The petitioner was acquitted by the Metropolitan Magistrate, Bhoiwada in January 2004, and his suspension was withdrawn by the Board in June 2004.
Despite these findings, nearly eight years later, the State Government, citing “moral turpitude,” dismissed the petitioner from service under Section 15 of the Act and Rule 5(9) of the Maharashtra Civil Services (Discipline and Appeal) Rules, 1979.
Aggrieved, the petitioner approached the High Court under Article 226 of the Constitution, challenging the State’s jurisdiction and the legality of the dismissal order.
Issues
- Whether the State Government had jurisdiction under Section 15 of the Bombay Labour Welfare Fund Act, 1953, to dismiss an employee of the Labour Welfare Board.
- Whether the dismissal order was valid when the complainant had withdrawn her allegations and the petitioner had been acquitted.
- Whether “unsuitability” under Section 15 can be equated to a ground for termination in disciplinary proceedings.
Petitioner’s Arguments
The petitioner contended that he was an employee of the Maharashtra Labour Welfare Board, not the State Government, and therefore the latter had no authority to remove him from service. His appointment was made by the Board under Section 11(1) of the Act, subject only to the State’s prior approval, and his salary was debited to the Board’s fund.
He further argued that the complaint of sexual harassment had been conclusively found false, as the complainant had withdrawn all allegations and acknowledged filing the complaint under depression and union instigation. The criminal proceedings ended in acquittal, and subsequent enquiries also exonerated him.
Hence, the State’s reliance on a non-existent finding of moral turpitude was contrary to the record. He emphasized that Section 15 only allows the State to act where an employee is “unsuitable,” not to punish or terminate an officer after disciplinary proceedings.
Respondent’s Arguments
The State, in its affidavit, claimed that it exercised overall control over the Board under Sections 11, 14, and 15 of the Act, and therefore possessed power to remove any “unsuitable” person from service. It asserted that the disciplinary proceedings were validly conducted and that the petitioner’s acts amounted to grave misconduct justifying dismissal to “uphold the dignity of women in offices.”
It relied on the Maharashtra Civil Services Rules, which, according to the State, were made applicable to the Board’s employees under Rule 51-A of the Maharashtra Labour Welfare Board Employees (Conditions of Service) Rules, 1961.
The Board, however, supported the petitioner, confirming that the State had no role beyond initial approval of appointment and that all administrative powers, including dismissal, vested solely in the Board.
Analysis of the Law
The Bench analyzed the interplay between Sections 11 and 15 of the Bombay Labour Welfare Fund Act, 1953.
Section 11 vests the power of appointment in the Board with prior Government approval. Section 15 gives the State limited power to “remove any person whom it may deem unsuitable”, along with the power to “make an appointment in respect of whom more than one-third of the members of the Board have not agreed.”
The Court observed that this section cannot be interpreted to authorize disciplinary termination of employees. The phrase “unsuitable” must be confined to cases where the State deems a candidate unfit at the time of appointment, not as a punitive measure.
“Reading Section 15 as conferring power of termination would amount to doing violence to its plain language and legislative intent.”
The Bench emphasized that the power to appoint includes the power to remove, as per Section 16 of the General Clauses Act, and since the petitioner was appointed by the Board, only the Board could remove him.
Precedent Analysis
- Parvez Qadir v. Union of India (AIR 1975 SC 446) — The term “suitable” must be understood contextually and cannot equate to “fit for dismissal.”
- Valsala Kumari Devi M. v. Director, Higher Secondary Education (2007) 8 SCC 533 — “Suitability” means legal eligibility and fitness to be chosen, not grounds for disciplinary removal.
- Municipal Board, Kannauj v. State of Uttar Pradesh (1972) 3 SCC 345 — The State cannot interfere with or cancel decisions of autonomous local bodies under the guise of supervision; it can only prohibit execution in limited circumstances.
By applying these precedents, the Court concluded that the State Government’s dismissal order exceeded its statutory limits and that Section 15 could not override Section 11.
Court’s Reasoning
The Bench found multiple fatal flaws in the State’s action:
- Jurisdictional Defect: The State was not the petitioner’s employer; only the Labour Welfare Board was competent to discipline or dismiss him.
- Misinterpretation of “Unsuitability”: The term could not justify termination; it applied only to initial appointments, not punitive actions.
- Absence of Factual Basis: The entire dismissal rested on a complaint that had been withdrawn and disproved in enquiry and court proceedings.
- Failure of Natural Justice: The State disregarded the Board’s own findings and the petitioner’s exoneration.
- Autonomy of the Board: The Board is a statutory body with perpetual succession, and the State has limited supervisory powers, not direct administrative control.
“Section 15 is not a disciplinary provision. To attribute such meaning would enlarge the State’s powers contrary to legislative intent.”
Conclusion
The Court held that the dismissal order dated 31 January 2012 was void ab initio as it was passed without jurisdiction and in violation of the statutory framework.
“The impugned order miserably fails not only in appreciating the facts but also stands passed without authority. The State cannot assume powers exclusively vested in the Board.”
The Court accordingly:
- Quashed and set aside the dismissal order;
- Declared that the petitioner’s removal was illegal;
- Granted liberty to the petitioner to seek consequential benefits from the Board; and
- Directed the Board to decide his representation within four weeks.
Implications
This judgment reinforces the autonomy of statutory boards and limits executive overreach by the State. It clarifies that Section 15 of the Bombay Labour Welfare Fund Act cannot be used as a disciplinary provision and that the State’s supervisory role cannot extend to terminating employees of independent boards.
The ruling sets a precedent safeguarding officers of autonomous bodies from unlawful executive interference, ensuring adherence to statutory separation of powers between the State and autonomous institutions.
