Whether the accused are entitled for discharge due to noncompliance of Section 20­A(1) of the Terrorist and Disruptive Activities (Prevention) Act, 1987 (hereinafter referred to as ‘TADA Act”) ?. As pointed out by us above, the situation may be different where, to give an example, the police official finds a dead body, sees that a murder has taken place, apprehends a person, who is running away after committing the murder and from that person a prohibited arm is recovered in a notified area. In such a situation, the main offence is the offence of murder and the offence of carrying a prohibited weapon in a notified area is the secondary offence under TADA Act. Here, the police official can record the information and arrest the person for committing an offence under Indian Penal Code,1860 but before proceeding under TADA Act he will have to take sanction under Section 20­ A(1) of TADA Act. In view of the above, the appeal is allowed, the order of the Designated TADA Court is set aside and the appellants are discharged from the offences under TADA Act but they may be proceeded against under other provisions of law.

 Whether  the accused are entitled for  discharge due to noncompliance of Section 20­A(1) of the Terrorist and Disruptive Activities (Prevention) Act, 1987 (hereinafter referred to as ‘TADA Act”) ?. 

As pointed out by us above, the situation may be different where, to give an example, the police official finds a dead body, sees that a murder has taken place, apprehends a person, who is
running away after committing the murder and from that person a prohibited arm is recovered in a notified area.   In such a situation, the  main  offence  is the offence of murder and the
offence of carrying a prohibited weapon in a notified area is the secondary offence under TADA Act.  Here, the police official can record the information and arrest the person for committing an offence   under   Indian   Penal   Code,1860   but   before   proceeding under TADA Act he will have to take sanction under Section 20­ A(1) of TADA Act.
In view of the above, the appeal is allowed, the order of the Designated   TADA   Court   is   set  aside   and   the   appellants   are discharged from the offences under TADA Act but they may be proceeded   against   under   other   provisions   of   law.


REPORTABLE
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO(S). 1692 OF 2009
EBHA ARJUN JADEJA & ORS.    …APPELLANT(S)
Versus
THE STATE OF GUJARAT        …RESPONDENT(S)
J U D G M E N T
Deepak Gupta, J.
1. This appeal by the accused is directed against the order
passed by the Designated TADA Court whereby the application
filed by the accused that they should be discharged due to noncompliance of Section 20­A(1) of the Terrorist and Disruptive
Activities (Prevention) Act, 1987 (hereinafter referred to as ‘TADA
Act”) was dismissed. 
2.  Briefly stated the facts of the case are that appellant no.
1/accused no. 1, Ebha Arjun Jadeja, was wanted in Crime No. II1
3/1994 registered against him under Section 25(1B)(a) and 27 of
the Arms Act, 1959 and under Section 3 and 5 of TADA Act etc. 
3. The prosecution version is that on 10.04.1995, when Police
Inspector C.J. Singh along with some other police personnel was
doing night round in Kutiyana and was trying to keep a secret
watch   over   bootleggers,   he   received   some   information   that
appellant no. 1, who was absconding in Crime No. II­3/1994, was
coming to his village in a motor vehicle.   The police inspector
arranged   two   witnesses   and   after   preparing   preliminary
panchnama, left Kutiyana in a Government jeep at about 1.00­
1.15 a.m.  They set up a naka and at about 2.45 a.m., one motor
vehicle came from the side of village Garej.   The vehicle was
asked to stop and it stopped.  Accused no. 1 was found sitting on
the driver’s seat.  The police cordoned the motor vehicle in which
two other persons (appellant nos.2 and 3) were also sitting.  All
these three persons were asked to get down and disclose their
identities.   On making personal search of these three persons,
following recoveries were made:
2
S.
No.
Name of the accused Recoveries
1. Ebha Arjun Jadeja 1. One   foreign   made   9mm
beretta pistol and three live
cartridges   and   one   fired
cartridge,   valued   at
Rs.1,50,150/­.
2. One   32   bore   foreign   made
revolver   and   5   live
cartridges,   valued   at   Rs.
50,250/­.
3. One fired cartridge
2. Bachchu Bhikha Mer One   315   bore   country   made
tamancha, valued at Rs. 3,000/­.
3. Keshu Chana Mer One   12   bore   country   made
tamancha, valued at Rs. 2,000/­.
4. The three accused persons could not produce any licence
and the aforesaid arms were seized.  Though the first information
report (FIR) was recorded under the Arms Act, in the very same
FIR, the officer also recorded as follows:
“One 9 MM semi automatic prohibited foreign made pistol
and its cartridges loaded in it and Japan made revolver
and its cartridges in a loaded condition were found from
Mer Ebha Arjan.  Out of which, it becomes from the smell
coming from the barrel of the pistol and box that the
same is used before some time for firing.  From the two
persons   with   Jadeja   Ebha   Arjan,   namely,   Mer   Bachu
Bhima and Mer Keshu Chana also, two country made
tamanchas   are   found   and   Mer   Ebha   Arjan   is   a   gang
3
leader   of   gundas   in   Porbandar   area   and   in   that
circumstances, the persons as above are found in an
Ambassador car no.GJ­M­8905 and it appears that they
are going to commit any terrorist activity and so all the
three persons were legally arrested for the offence under
Sections 25(1)(Ba), 27 of the Arms Act and Section 135 of
the   Bombay   Police   Act   and   motor   car   Ambassador
no.GJM­8905 valuing at Rs.100000/­ was also seized in
this case. 
Hence, it is my complaint against them for the offence
under Sections 25(1)(BA), 27 of the Arms Act and Section
135 of the Bombay Police Act.  My witnesses are panchas
with me and the police personnel and others who are
found during the investigation.
The above persons were found in possession of weapons
and cartridges from out of the weapons and explosives
mentioned in Arms Rules 1962 Schedule­1 Class­1 and
Class­3(A) Column no.2 and 3 in public area and hence,
as the offence under Section 5 of TADA Act is also made
out   and   so,   arrangement   is   made   for   obtaining   the
sanction   of   the   District   Superintendent   of   Police,
Porbandar under Section 20(A)(1) of the Act, by making a
report along with copies of the panchnama and F.I.R. and
identification sheets of the accused.”
5. Thereafter on the same day i.e. 10.04.1995, the District
Superintendent of Police granted sanction to add Section 5 of
TADA Act to the offences already registered.  The grievance of the
appellants is that in terms of Section 20­A(1) of TADA Act, no
information about commission of offence under the Act could
have   been   recorded   without   approval   of   the   District
Superintendent of Police.   Therefore, it is contended that the
entire initiation of the action wherein the Crime No.II.28/1995
4
was recorded without sanction of the District Superintendent of
Police, vitiates the entire proceedings in so far as they have been
initiated under TADA Act. 
6. Section 20­A of TADA Act reads as under:
“20­A.  Cognizance   of   offence.—(1)   Notwithstanding
anything contained in the Code, no information about the
commission of an offence under this Act shall be recorded
by the police without the prior approval of the District
Superintendent of Police.
(2) No court shall take cognizance of any offence under
this Act without the previous sanction of the InspectorGeneral   of   Police,   or   as   the   case   may   be,   the
Commissioner of Police.”
The language of the Section is mandatory in nature.   It starts
with   a   non­obstante   clause.     It   forbids   the   recording   of
information about the commission of offence under TADA Act by
the police without prior approval of the District Superintendent of
Police.
7. The provisions of Section 20­A(1) are mandatory.  This issue
is no longer  res integra.   In  Rangku  Dutta  @  Ranjan  Kumar
Dutta  v.  State  of  Assam1
, this Court held that the provision,
which was couched in negative terms is mandatory in nature.
Relevant portion of the judgment reads as under:
1 (2011) 6 SCC 358
5
“18.  It is obvious that Section 20­A(1) is a mandatory
requirement   of  law.  First,  it   starts   with  an  overriding
clause   and,   thereafter,   to   emphasise   its   mandatory
nature, it uses the expression “No” after the overriding
clause. Whenever the intent of a statute is mandatory, it
is clothed with a negative command. Reference in this
connection   can   be   made   to  G.P.   Singh’s Principles   of
Statutory Interpretation, 12th Edn.…”
8. Learned counsel for the appellants also placed reliance on
the   judgment   of   this   Court   in  Anirudhsinhji   Karansinhji
Jadeja & Anr. v. State of Gujarat2
.  In this case, the case was
registered against the accused initially under the Arms Act.  The
District Superintendent of Police, instead of giving approval for
recording   information,   made   a   report   to   the   Additional   Chief
Secretary,   seeking   permission   to   proceed   under   TADA   Act.
Thereafter,   the   Additional   Chief   Secretary,   Home   Department,
gave sanction to proceed under TADA Act.  Dealing with the issue
whether   Section   20­A(1)   was   violated   and   whether   the
prosecution was, therefore, vitiated, this Court has observed as
under:
“11.  The   case   against   the   appellants   originally   was
registered on 19­3­1995 under the Arms Act. The DSP
did not give any prior approval on his own to record any
information about the commission of an offence under
TADA.   On   the   contrary,   he   made   a   report   to   the
Additional Chief Secretary and asked for permission to
proceed   under   TADA.   Why?   Was   it   because   he   was
reluctant to exercise jurisdiction vested in him by the
2 (1995) 5 SCC 302
6
provision   of   Section   20­A(1)?  This   is   a   case   of   power
conferred upon one authority being really exercised by
another. If a statutory authority has been vested with
jurisdiction, he has to exercise it according to its own
discretion.   If   the   discretion   is   exercised   under   the
direction or in compliance with some higher authority’s
instruction, then it will be a case of failure to exercise
discretion   altogether.   In   other   words,   the   discretion
vested in the DSP in this case by Section 20­A(1) was not
exercised by the DSP at all.”
9. Similar matter came up before this Court in Ashrafkhan &
Anr. v.  State   of   Gujarat3
.     Dealing   with   the   issue   of   the
consequences of non­compliance of Section 20­A(1) of TADA Act,
this Court held as follows:
27. It is worth mentioning here that TADA, as originally
enacted, did not contain this provision and it has been
inserted   by   Section   9   of   the   Terrorist   and   Disruptive
Activities (Prevention) Amendment Act, 1993 (43 of 1993).
From   a   plain   reading   of   the   aforesaid   provision   it   is
evident that no information about the commission of an
offence shall be recorded by the police without the prior
approval   of   the   District   Superintendent   of   Police.   The
legislature, by using the negative word in Section 20­A(1)
of TADA, had made its intention clear. The scheme of
TADA is different than that of ordinary criminal statutes
and,   therefore,   its   provisions   have   to   be   strictly
construed. Negative words can rarely be held directory.
The plain, ordinary grammatical meaning affords the best
guide to ascertain the intention of the legislature. Other
methods to  understand the meaning of  the statute  is
resorted   to   if   the   language   is   ambiguous   or   leads   to
absurd result. No such situation exists here. In the face
of it, the requirement of prior approval by the District
Superintendent of Police, on principle, cannot be said to
be directory in nature.”
3 (2012) 11 SCC 606
7
Thereafter, reference was made to the various judgments of this
Court and it was held as under:
“37.  The plea of the State is that the Commissioner of
Police having granted the sanction under Section 20­A(2)
of TADA, the conviction of the accused cannot be held to
be bad only on the ground of absence of approval under
Section   20­A(1)   by   the   Deputy   Commissioner.   As
observed earlier, the provisions of TADA are stringent and
consequences   are   serious   and   in   order   to   prevent
persecution,   the   legislature   in   its   wisdom   had   given
various safeguards at different stages. It has mandated
that no information about the commission of an offence
under TADA shall be recorded by the police without the
prior approval of the District Superintendent of Police.
Not only this, further safeguard has been provided and
restriction   has   been   put   on   the   court   not   to   take
cognizance of any offence without the previous sanction
of the Inspector General of Police or as the case may be,
the Commissioner of Police. Both operate in different and
distinct stages and, therefore, for successful prosecution
both the requirements have to be complied with. We have
not come across any principle nor are we inclined to lay
down that in a case in which different safeguards have
been provided at different stages, the adherence to the
last safeguard would only be relevant and breach of other
safeguards shall have no bearing on the trial. Therefore,
we reject the contention of the State that the accused
cannot assail their conviction on the ground of absence of
approval under Section 20­A(1) of TADA by the Deputy
Commissioner,   when   the   Commissioner   of   Police   had
granted sanction under Section 20­A(2) of TADA.”
The Court further held that non­compliance of Section 20­A was
not a curable defect and could not be cured in terms of Section
465 of Code of Criminal Procedure, 1973 (CrPC).
8
10. Thereafter   in  Hussein   Ghadially   &   Ors.  v.  State   of
Gujarat4
, this Court dealing with Section 20­A of TADA Act held
as follows:
“21. A careful reading of the above leaves no manner of
doubt   that   the   provision   starts   with   a   non   obstante
clause and is couched in negative phraseology. It forbids
recording   of   information   about   the   commission   of
offences   under   TADA   by   the   police   without   the   prior
approval of the District Superintendent of Police…….”
Thereafter, reference was made to the various judgments of this
Court and it was held as under:
“29.  The upshot of the above discussion, therefore, is
that the requirement of a mandatory statutory provision
having   been   violated,   the   trial   and   conviction   of   the
petitioners for offences under TADA must be held to have
been vitiated on that account…..”
11. The law is therefore, clear that if Section 20­A(1) of TADA
Act is not complied with, then it vitiates the entire proceedings.
12. On behalf of the respondents, it is urged that in terms of
Section   154(1)   of   CrPC,   an   FIR   has   to   be   lodged   whenever
information of commission of a cognizable offence is received.  It
is also urged that Section 20­A(1) of TADA Act bars the recording
of information but it does not specifically bar registration of the
FIR   under   the   Arms   Act.     It   is   also   urged   that   the   District
4 (2014) 8 SCC 425
9
Superintendent of Police has to take a decision and, therefore,
some information has to be placed before him and then only he
can decide whether the sanction should be granted or not.  As far
as the last submission is concerned, there can be no quarrel with
respect to the same.  Obviously, information will have to be given
to the District Superintendent of Police but this information can
be in the nature of a communication specifically addressed to the
District   Superintendent   of   Police   and   not   in   the   nature   of
information being recorded in the Register or Book meant for
recording of information under Section 154 of CrPC.   We may
refer to the opening portion of Section 154 of CrPC, which reads
as under:
“154.   Information   in   cognizable   cases.­(1)   Every
information relating to the commission of a cognizable
offence, if given orally to an officer in charge of a police
station, shall be reduced to writing by him or under his
direction, and be read over to the informant; and every
such information, whether given in writing or reduced to
writing as aforesaid, shall be signed by the person giving
it, and the substance thereof shall be entered in a book to
be   kept   by   such   officer   in   such   form   as   the   State
Government may prescribe in this behalf:
xxx xxx xxx”
13. The word ‘FIR’ is not used in Section 154 of CrPC, though it
is now commonly used with regard to information recorded under
10
Section   154.     Therefore,   whenever   information   relating   to
commission of a cognizable offence is given orally then the officerin­charge of the police station is bound to record that information
in a book to be kept for such offences in such form as the State
Government may prescribe in this behalf.   What is prohibited
under   Section   20­A(1)   of   TADA   Act   is   the   recording   of
information.     We   can   presume   that   the   Legislature   while
introducing Section 20­A(1) in TADA Act was also aware of the
provisions   of   Section   154   of   CrPC.     Therefore,   the   clear­cut
intention was that no information of commission of an offence
under TADA Act would be recorded by the police under Section
154 of CrPC without sanction of the competent authority.   The
reason why Section 20­A(1) was introduced into TADA Act in the
year 1993 by amendment was that because the provisions of
TADA Act were very stringent, the Legislature felt that a senior
official should look into the matter to ensure that an offence
under TADA is made out and then grant sanction.
14. The   bar   under   Section   20­A(1)   of   TADA   Act   applies   to
information recorded under Section 154 of CrPC.  This bar will
not apply to a  rukka  or a communication sent by the police
11
official   to   the   District   Superintendent   of   Police   seeking   his
sanction.  Otherwise, there could be no communication seeking
sanction, which could not have been the purpose of TADA Act. 
15. Each case is to be decided on its own facts.   The police
official,   not   being   the   District   Superintendent   of   Police,   may
receive information of commission of an offence and may reach
the scene of a crime.  He can record the information on the spot
and then send a rukka to the police station for recording of FIR.
There   may   be   cases   of   serious   offences   like   murder,   rape,
offences under Narcotic Drugs and Psychotropic Substances Act,
1985, Protection of Children from Sexual Offences (POCSO) Act,
2012 etc. where any delay in investigation is fatal.   In these
cases, the police officer is entitled to record the information some
of which may indicate an offence under TADA Act, also because
non­recording of the information with regard to the main offence
may delay the investigation and hamper proper investigation in
the matter.  In such cases, while recording the information and
recording the FIR, for the offences falling under TADA Act, the
police   officials   concerned   can   approach   the   District
Superintendent of Police for sanction under Section 20­A(1) of
12
TADA Act.   The investigation in serious cases of murder, rape,
smuggling, narcotics, POCSO Act etc. cannot be delayed only
because TADA Act is also involved.
16. At the same time, where the information basically discloses
an offence under TADA Act and the other offence is more in the
nature of an ancillary offence then the information cannot be
recorded without complying with the provisions of Section 20­A(1)
of TADA Act.   This will have to be decided in the facts of each
case.  In the case in hand, the only information recorded which
constitutes an offence is the recovery of the arms.   The police
officials must have known that the area is a notified area under
TADA Act and, therefore, carrying such arms in a notified area is
itself an offence under TADA Act.  It is true that this may be an
offence   under   the   Arms   Act   also   but   the   basic   material   for
constituting an offence both under the Arms Act and TADA Act is
identical i.e. recovery of prohibited arms in a notified area under
TADA Act.  The evidence to convict the accused for crimes under
the Arms Act and TADA Act is also the same.  There are no other
offences of rape, murder etc. in this case.  Therefore, as far as the
present case is concerned, non­compliance of Section 20­A(1) of
13
TADA Act is fatal and we have no other option but to discharge
the   appellants   in   so   far   as   the   offence   under   TADA   Act   is
concerned.  We make it clear that they can be proceeded against
under the provisions of the Arms Act.
17. As pointed out by us above, the situation may be different
where, to give an example, the police official finds a dead body,
sees that a murder has taken place, apprehends a person, who is
running away after committing the murder and from that person
a prohibited arm is recovered in a notified area.   In such a
situation, the  main  offence  is the offence of murder and the
offence of carrying a prohibited weapon in a notified area is the
secondary offence under TADA Act.  Here, the police official can
record the information and arrest the person for committing an
offence   under   Indian   Penal   Code,1860   but   before   proceeding
under TADA Act he will have to take sanction under Section 20­
A(1) of TADA Act.
18. In view of the above, the appeal is allowed, the order of the
Designated   TADA   Court   is   set   aside   and   the   appellants   are
discharged from the offences under TADA Act but they may be
14
proceeded   against   under   other   provisions   of   law,   if   required.
Pending application(s), if any, stand(s) disposed of. 
…………………………….J.
(Deepak Gupta)
……………………………..J.
(Aniruddha Bose)
New Delhi
October 16, 2019
15

Whether the Labour Court or the Tribunal while exercising their jurisdiction under Section 33(2)(b) are empowered to permit the parties to lead evidence in respect of the legality and propriety of the domestic enquiry held into the misconduct of a workman, such evidence would be taken into consideration by the Labour Court or the Tribunal only if it is found that the domestic enquiry conducted by the Management on the scale that the standard of proof required therein can be `preponderance of probability’ and not a `proof beyond all reasonable doubts’ suffers from inherent defects or is violative of principles of natural justice. In other words, the Labour Court or the Tribunal cannot without first examining the material led in the domestic enquiry jump to a conclusion and mechanically permit the parties to lead evidence as if it is an essential procedural part of the enquiry to be held under Section 33(2)(b) of the Act.- = Consequently, the Labour Court shall in the instant case re-visit the matter afresh within the limit and scope of Section 33(2)(b), as explained above and keeping in mind that the exercise in hand is not adjudication of an `industrial dispute’ under Section 10(1)(c) or (d) read with Section 11A of the Act. However, if the Labour Court finds that the domestic inquiry held against the appellant is suffering from one of the incurable defects as illustrated by this Court in Mysore Steel Works Pvt. Ltd. or Lalla Ram’s cases, then it may look into the evidence adduced by the parties for the purpose of formation of its prima facie opinion.

 Whether the Labour Court or the Tribunal while exercising their jurisdiction under Section 33(2)(b) are empowered to permit the parties to lead evidence in respect of the legality and propriety of the domestic enquiry held into the misconduct of a workman, such evidence would be taken into consideration by the Labour Court or the Tribunal only if it is found that the domestic enquiry conducted by the Management on the scale that the standard of proof required therein can be `preponderance of probability’ and not a `proof beyond all reasonable doubts’ suffers from inherent defects or is violative of principles of natural justice.
In other words, the Labour Court or the Tribunal cannot without first examining the material led in the domestic enquiry jump to a conclusion and mechanically permit the parties to lead evidence as if it is an essential procedural part of the enquiry to be held under Section 33(2)(b) of the Act.- 

= Consequently, the Labour Court shall in the instant case re-visit the matter afresh within the limit and scope of Section 33(2)(b), as explained above and keeping in mind that the exercise in hand is not adjudication of an `industrial dispute’ under Section 10(1)(c) or (d) read with Section 11A of the Act. However, if the Labour Court finds that the domestic inquiry held against the appellant is suffering from one of the incurable defects as illustrated by this Court in Mysore Steel Works Pvt. Ltd. or Lalla Ram’s cases, then it may look into the evidence adduced by the parties for the purpose of formation of its prima facie opinion. 

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 8042 OF 2019
[Arising out of Special Leave Petition(C)No. 6371 OF
2019]
John D’Souza ..... Appellants(s)
 VERSUS
Karnataka State Road Transport
Corporation
.....Respondents(s)
JUDGMENT
SURYA KANT, J.
Leave granted.
2. The instant appeal, by special leave, is directed against
the judgment and order dated 30th November, 2018 passed
by the Division Bench of High Court of Karnataka at
Bangalore whereby the intra-Court appeal preferred by the
1
Karnataka State Road Transport Corporation (in short, `the
Corporation’) against the order dated 20th September, 2017
of the Learned Single Judge has been allowed and after
setting aside the order dated 28th October, 2016 of the First
Additional Labour Court, Bangalore, the said Court has been
directed to decide afresh application of the Corporation
under Section 33(2)(b) of the Industrial Disputes Act, 1947
(in short, `the Act’) in accordance with the observations
made by the Division Bench of the High Court in an earlier
order dated 14th July, 2016 passed in W.A. No. 30 of 2015.
3. The question which falls for consideration revolves
around the scope and ambit of the enquiry to be held by a
Labour Court or Industrial Tribunal while granting or refusing
approval for the discharge or dismissal of a workman under
Section 33(2)(b) of the Act.
4. The facts giving rise to the present controversy may be
briefly noted. The appellant-workman joined the Corporation
as a bus conductor on 28th November, 1984. He had been a
Union activist and also the General Secretary of the KSRTC
and BMTC United Employees Union. The appellant reportedly
remained absent from duty since 18th August, 2005 onwards
2
without prior permission of his superiors or getting his leave
sanctioned. The Depot Manager reported the appellant’s
absence on 25th August, 2005. A notice was sent to him on
5
th September, 2005 to resume the duties. The appellant
statedly absented himself from duty w.e.f. 18th August, 2005
to 29th October, 2005 for which he was served an article of
charges on 23rd June, 2006. He did not submit any reply to
the charge sheet, hence the disciplinary authority decided to
hold an enquiry. A retired Joint Law Officer of the Corporation
was appointed as the Enquiry Officer. The enquiry was held
on various dates commencing from 5th September, 1998 till
its conclusion on 12th August, 2010. The appellant
participated in the enquiry during the time the
Management’s witnesses were examined and after closure of
the evidence of Management he was given an opportunity to
produce his witnesses and also the documents for which the
enquiry proceedings were adjourned to 28th January, 2010.
The appellant, however, sought adjournments on 28th
January, 2010; 18th February, 2010; 11th March, 2010; 15th
April, 2010; 13th May, 2010; 4th June, 2010; 15th July, 2010;
and 12th August, 2010, but still failed to produce any
3
evidence. The enquiry was eventually closed and report was
submitted holding that the charges had been proved.
Thereafter a show cause notice dated 21st August, 2010
along with the enquiry findings was served upon the
appellant to which he submitted his reply. The disciplinary
authority was not satisfied with the explanation furnished by
the appellant, hence it passed the order of dismissal from
service on 11.10.2010.
5. The past service record of the appellant appears to
have weighed in the mind of the disciplinary authority as
there were 30 other default charges of one or the other
nature and on two previous occasions also, the appellant was
dismissed from service though both those orders had been
set aside and/or withdrawn.
6. Since an `industrial dispute’ in Reference No. 243/2006
in which the appellant was also a concerned workman was
pending before the Labour Court-cum-Industrial Tribunal, the
Corporation moved an application under Section 33(2)(b) of
the Act seeking permission of the Labour Court to effectuate
the order of dismissal. It further appears that the appellant
meanwhile attained the age of superannuation.
4
7. The Labour Court formulated the following four issues
for its consideration:-
“1. Whether domestic enquiry held against first party
is fair and proper?
2. Whether the Enquiry Officer is justified in holding
that the charges are proved?
3. Whether the disciplinary authority is justified in
dismissing the first party?
4. To what award or order the parties entitled.”
8. The Labour Court after perusing the evidence adduced
on Issue No.1 passed an order dated 16th March, 2012
answering Issue No. 1 in `affirmative’ and held that the
domestic enquiry was conducted in a fair and proper manner.
The appellant unsuccessfully challenged that order before
the High Court. He thereafter filed SLP(C) Nos. 34485-
34486/2013 in this Court, but the matter was rendered
infructuous as meanwhile the Labour Court vide its final
order/Award dated 6th November, 2013 decided Issue Nos. 2,
3 and 4 in favour of the appellant. The application of the
Management under Section 33(2)(b) was consequently
rejected. The Corporation challenged the final order of the
Labour Court, but a Learned Single Judge of the High Court
dismissed its Writ Petition on 21st November, 2014. Still
5
aggrieved, the Corporation filed Writ Appeal No. 30 of 2015
which was allowed by a Division Bench of the High Court vide
order dated 14th July, 2016 laying down that the Labour Court
while exercising jurisdiction under Section 33(2)(b) could not
have permitted the parties to adduce evidence as the scope
of enquiry thereunder is very limited. The High Court, thus,
viewed:-
“A prima facie case does not mean a case proved to the
hilt, but a case which, can be said to be established, if
the evidence, which is led in support of the same, were
believed. While determining whether a prima facie
case has been made out, the relevant consideraiton is,
whether on the evidence led, it was possible to arrive
at the conclusion in question, and not whether that was
the only conclusion which could be arrived at on that
evidence. It may be that the Tribunal considering this
question may itself, could arrive at a different
conclusion. It has, however, not to substitute its own
judgment for the judgment in question. It has, only,
got to consider whether the view taken is a possible
view on the evidence on the record.”
9. The Division Bench further observed that since the
Labour Court had exceeded its jurisdiction the award passed
by it as well as the order of the Learned Single Judge were
liable to be set aside. The matter was, thus, remitted back
to the Labour Court for reconsideration.
10. The First Additional Labour Court at Bangalore again
6
ventured into the controversy and reiterating its view, it
passed the award dated 28th October, 2016 turning down the
Corporation’s application under Section 33(2)(b) on the
ground that though issue No. 1 was decided against the
workman holding that the enquiry held against him was just
and proper, but on consideration of the plethora of
documents Exts. R-1 to R-104 produced by the appellant it
could be safely inferred that he had, in fact, applied for leave
vide application Ext. A-3 and had also reported for duty on
29th August, 2005 but he was not allowed to join and instead
the departmental enquiry was initiated. The Labour Court,
thus, held that the appellant cannot be treated as an
absentee from 29th August, 2005 onwards. The absence
period was not from 18th August, 2005 to 29th October, 2005
it could rather at best be from 18th August, 2005 till 29th
August, 2005. The Labour Court also relied upon certain
decisions to hold that it was within its jurisdiction under
Section 33(2)(b) of the Act to find out that “there was
victimisation or unfair labour practices” adopted by the
Management.
11. The aggrieved Corporation assailed the order of the
7
Labour Court before a Learned Single Judge who vide
judgment dated 20.09.2017 took more or less the same view
and declined to interfere with the order. The Corporation,
therefore, once again questioned the order of the Learned
Single Judge in Writ Appeal No. 6609 of 2017 which has been
allowed by the Division Bench of the High Court vide
impugned judgment dated 30th November, 2018, essentially
on the premise that the jurisdiction under Section 33(2)(b)
could not be stretched and expanded to permit the parties to
lead their evidence which was never produced in the
domestic enquiry. Such new evidence could not be relied
upon to hold that the charges were not proved or that the
punishment of dismissal was disproportionate. The Division
Bench, thus, held:-
“...From close scrutiny of the order passed by the
Labour Court particularly paragraphs 25 to 45, it is
evident that the findings by the Labour Court with
regard to perversity of the findings recorded by the
Enquiry Officer and victimization is based on additional
material on record, which did not form a part of the
enquiry proceeding. The Labour Court, while passing
the impugned order has not only traveled beyond the
order of remand, but has acted like an Appellate
Authority.
The learned Single Judge has failed to appreciate that
the respondent only cross-examined the witnesses of
appellant in the departmental enquiry and did not
adduce any evidence. The respondent for the first
8
time before the Labour Court produced the documents
viz., Exs. R1 to R104, which, have been considered by
the Labour Court. The learned Single Judge has also
failed to appreciate that the Labour Court was required
to decide the application under Section 33(2)(b) of the
Act in the light of observations made by the Division
Bench of this Court in order dated 14.07.2016 passed
in W.A. No. 30/2015, which had attained finality and
was binding on the Labour Court. The learned Single
Judge has also not appreciated that the finding with
regard to victimization of respondent is based on
additional material, which was not part of the enquiry
conducted against the respondent.”
12. The Division Bench further held that the Labour Court
was duty-bound to decide application under Section 33(2)(b)
within the restricted parameters evolved by a Co-ordinating
Bench in Writ Appeal No. 30 of 2015 decided on 14th July,
2016 in the 2nd round of litigation.
13. We have heard the appellant in person and Shri R.S.
Hegde, Learned Advocate for the Corporation. The
orders/Judgments passed by different forums in multiple
rounds have also been compendiously perused.
14. Before determining the width and length of the
jurisdiction exercisable by a Labour Court or Tribunal under
Section 33(2)(b), it is beneficial to discuss the Legislative
scheme of the Act and some of its relevant provisions having
bearing on the issue to be resolved.
9
15. The 1947 Act was enacted to remove the defects
experienced in the working of Trade Disputes Act, 1929 and
to provide, inter alia,
a) Statutory mechanism for the settlement of
industrial dispute which is conclusive and binding
on the parties to the dispute;
b)to check the industrial unrest;
c) for creation of two new Institutions of Works
Committees and Industrial Tribunal;
d) to provide an explicit procedure for reference of
an Industrial dispute by the appropriate
Government and enforcement of the Award which
may be passed;
e) to re-orient the administration of the conciliation
machinery provided under the old Act; and
f) also prohibition on strikes and lock-outs during
the pendency of conciliation and adjudication
proceedings, etc., etc. The Act, therefore,
unambiguously aims at harmonising the
Management-Workmen relationship and to
prevent labour-unrest or industrial peace – both
being detrimental to the industrial growth of the
nation.
16. Chapter-III of the Act relates to “REFERENCE OF
DISPUTES TO BOARDS, COURTS OR TRIBUNALS.” Section 10
thereof provides that where the appropriate government is of
the opinion that an industrial dispute exists or is
apprehended, it may refer the same either to a Board for
promoting a settlement or to a Court for enquiry or it may
10
refer such dispute, if it relates to any matter specified in the
Second Schedule, to a Labour Court for adjudication or if the
said dispute relates to any matter specified in the Second or
Third Schedule, to a Tribunal for adjudication. Section 10(1)
of the Act reads as follows:-
“10. Reference of disputes to Boards, Courts or
Tribunals.- (1) [Where the appropriate Government is
of opinion that any industrial dispute exists or is
apprehended, it may at any time], by order in writing,-
(a) refer the dispute to a Board for promoting a
settlement thereof; or
(b) refer any matter appearing to be connected with or
relevant to the dispute, to a Court for enquiry; or
(c) refer the dispute or any matter appearing to be
connected with, or relevant to, the dispute, if it relates
to any matter specified in the Second Schedule, to a
Labour Court for adjudication; or
(d) refer the dispute or any matter appearing to be
connected with, or relevant to, the dispute, whether it
relates to any matter specified in the Second Schedule
or the Third Schedule, to a Tribunal for adjudication:
Provided that where the dispute relates to any matter
specified in the Third Schedule and is not likely to
affect more than one hundred workmen, the
appropriate Government may, if it so thinks fit, make
the reference to a Labour Court under Clause (c);
Provided further that where the dispute relates to a
public utility service and a notice under Section 22 has
been given, the appropriate Government shall, unless
it considers that the notice has been frivolously or
vexatiously given or that it would be inexpedient so to
do, make reference under this sub-section
notwithstanding that any other proceedings under this
Act in respect of the dispute may have commenced:
Provided also that where the dispute in relation to
11
which the Central Government is the appropriate
Government, it shall be competent for the
Government to refer the dispute to a Labour Court or
an Industrial Tribunal, as the case may be, constituted
by the State Government.”
(Emphasis applied]
17. The Second Schedule of the Act lists the matters which
fall within the jurisdiction of Labour Court, including the one
at Sr. No. 3, “3. Discharge or dismissal of workmen
including re-instatement of, or grant of relief to,
workmen wrongfully dismissed.”
Similarly, the Third Schedule of the Act enlists elven
types of matters, any of it if constitute an `industrial
dispute’, the same shall be referred for adjudication to the
Industrial Tribunal under Section 10(1)(d) of the Act.
18. Chapter-IV lays down the procedure, powers and duties
of different authorities for adjudication of the industrial
disputes under Section 10 of Chapter-III, referred to above.
In this regard, Section 11(3) of the Act vests the Board,
Labour Court and Tribunal the powers of a Civil Court under
the Code of Civil Procedure, 1908 when trying a suit, for the
purpose of securing evidence. Section 11(3) of the Act says
that:-
12
“11. Procedure and power of conciliation
officers, Boards, Courts and Tribunals.-
xxx xxx xxx
(3) Every Board, Court, [Labour Court, Tribunal and
National Tribunal] shall have the same powers as are
vested in a Civil Court under the Code of Civil
Procedure, 1908 (5 of 1908), when trying a suit, in
respect of the following matters, namely:-
(a) enforcing the attendance of any person and
examining him on oath;
(b) compelling the production of documents and
material objects;
(c) issuing commissions for the examination of
witnesses;
(d) in respect of such other matters as may be
prescribed,
and every inquiry or investigation by a Board, Court,
[Labour Court, Tribunal or National Tribunal] shall be
deemed to be a judicial proceeding within the meaning
of Sections 193 and 228 of the Indian Penal Code (45
of 1860).”
19. Section 11A of the Act unequivocally empowers the
Labour Court, Tribunals and National Tribunals to set aside
the order of discharge or dismissal of a workman and direct
his reinstatement on such terms and conditions, as it thinks
fit, or to award any lesser punishment in lieu of such
discharge or dismissal, provided that the Labour Court or the
Tribunal, as the case may be, is satisfied that the order of
discharge or dismissal, was not justified.
20. Chapter-VII of the Act comprises `MISCELLANEOUS’
13
provisions and its Section 33 provides that conditions of
service, etc. of the workmen shall remain unchanged in
certain circumstances during the pendency of proceedings.
Section 33(2) with which we are concerned here reads as
follows:-
“33. Conditions of service, etc. to remain
unchanged under certain circumstances during
pendency of proceedings.-
(1) …..
(2) During the pendency of any such proceeding in
respect of an industrial dispute, the employer may, in
accordance with the standing orders applicable to a
workman concerned in such dispute [or, where there
are no such standing orders, in accordance with the
terms of the contract, whether express or implied
between him and the workman]-
(a) alter, in regard to any matter not connected with the
dispute, the conditions of service applicable to that
workman immediately before the commencement of
such proceeding; or
(b) for any misconduct not connected with the dispute,
discharge or punish whether by dismissal or otherwise,
that workman:
Provided that no such workman shall be discharged or
dismissed, unless he has been paid wages for one
month and an application has been made by the
employer to the authority before which the proceeding
is pending for approval of the action taken by the
employer.”
21. The composite Scheme of the Statute bears out that
when an `industrial dispute’ pertaining to “Discharge or
`dismissal’ of workmen including reinstatement of or `grant
14
of relief’ to workmen wrongfully dismissed” arises (See Sr.No.
3 of Second Schedule), such dispute is referable for
adjudication to the Labour Court in exercise of the
jurisdiction vested in it under Section 10(1)(c) of the Act.
The Labour Court shall have the powers of Civil Court to
secure evidence for deciding such dispute. Most importantly,
the doctrine of proportionality is statutorily embedded in
Section 11A of the Act, which further empowers the Labour
Court, subject to its satisfaction, to set aside the order of
discharge or dismissal and reinstate a workman on such
terms and conditions as it thinks fit or to award a lesser
punishment in lieu thereof. All such awards or orders are
enforceable under the Act.
22. The Legislature has, thus, provided a self-contained
mechanism through Section 10 read with Sections 11(3) and
11A of the Act, for adjudication of an `industrial dispute’
stemming out of an order of discharge or dismissal of a
workman. Having done so, it can be safely inferred that
neither the Legislature intended nor was there any legal
necessity to set-up a parallel remedy under the same Statute
for adjudication of the same `industrial dispute’ by the same
15
Forum of Labour Court or Tribunal via Section 33(2)(b) of the
Act. To say it differently, Section 33(2)(b) has been inserted
for a purpose other than that for which Section 10(1)(c) and
(d) have been enacted. Section 33(2)(b), thus, is neither
meant for nor does it engender an overlapping procedure to
adjudicate the legality, propriety, justifiability or otherwise
sustainability of a punitive action taken against a workman.
23. Having held so, it should not take long to trace out the
legislative object behind incorporation of Section 33,
including sub-section (2) thereof. The caption of Section 33
itself sufficiently hints out that the primary object behind this
provision is to prevent adverse alteration in the conditions of
service of a workman when `conciliation’ or any other
proceedings in respect of an `industrial dispute’ to which
such workman is also concerned, are pending before a
Conciliation Officer, Board, Arbitrator, Labour Court or
Tribunal. The Legislature, through Section 33(1)(a) and (b)
has purposefully prevented the discharge, dismissal or any
other punitive action against the workman concerned during
pendency of proceedings before the Arbitrator, Labour Court
or a Tribunal, even on the basis of proven misconduct, save
16
with the express permission or approval of the Authority
before which the proceedings is pending. Sub-section (2) of
Section 33 draws its colour from sub-Section(1) and has to be
read in conjunction thereto. Sub-section (2), in fact, dilutes
the rigours of sub-section (1) to the extent that it enables an
employer to discharge, dismiss or otherwise punish a
workman for a proved misconduct not connected with the
pending dispute; in accordance with Standing Orders
applicable to the workman or in absence thereof, as per the
terms of contract; provided that such workman has been
paid one month wages while passing such order and before
moving application before the Authority concerned `for
approval of the action’. In other words, the Authority
concerned (Board, Labour Court or Tribunal, etc.) has to
satisfy itself while considering the employer’s application
that the `misconduct’ on the basis of which punitive action
has been taken is not the matter sub-judice before it and
that the action has been taken in accordance with the
standing orders in force or as per terms of the contract. The
laudable object behind such preventive measures is to
ensure that when some proceedings emanating from the
17
subjects enlisted in Second or Third Schedule of the Act are
pending adjudication, the employer should not act with
vengeance in a manner which may trigger the situation and
lead to further industrial unrest.
24. Section 33(2)(b) of the Act, thus, in the very nature of
things contemplates an enquiry by way of summary
proceedings as to whether a proper domestic enquiry has
been held to prove the misconduct so attributed to the
workmen and whether he has been afforded reasonable
opportunity to defend himself in consonance with the
principles of natural justice. As a natural corollary thereto,
the Labour Court or the Forum concerned will lift the veil to
find out that there is no hidden motive to punish the
workman or an abortive attempt to punish him for a nonexistent misconduct.
25. The Labour Court/Tribunal, nevertheless, while holding
enquiry under Section 33(2)(b), would remember that such
like summary proceedings are not akin and at par with its
jurisdiction to adjudicate an `industrial dispute’ under
Section 10(1)(c) and (d) of the Act, nor the former provision
clothe it with the power to peep into the quantum of
18
punishment for which it has to revert back to Section 11A of
the Act. Where the Labour Court/Tribunal, thus, do not find
the domestic enquiry defective and the principles of fair and
just play have been adhered to, they will accord the
necessary approval to the action taken by the employer,
albeit without prejudice to the right of the workman to raise
an `industrial dispute’ referrable for adjudication under
Section 10(1)(c) or (d), as the case may be. It needs
pertinent mention that an order of approval granted under
Section 33(2)(b) has no binding effect in the proceedings
under Section 10(1)(c) and (d) which shall be decided
independently while weighing the material adduced by the
parties before the Labour Court/Tribunal.
26. The scope of enquiry vested in a Labour Court or
Tribunal under Section 33(2)(b) has been the subject matter
of a catena of decisions by this Court. In Martin Burn Ltd.
v. R.N.Bangerjee
1
, a Three-Judge Bench of this Court
considered the scope of enquiry under Section 22 of the
Industrial Disputes (Appellate Tribunal) Act, 1950 whereunder
also permission to discharge a workman was required to be
obtained in the manner which was somewhat similar to
1. 1958 SCR 514
19
Section 33 (2)(b) of the 1947 Act. This Court, thus, held:-
“27. The Labour Appellate Tribunal had to determine on
these materials whether a prima facie case had been
made out by the appellant for the termination of the
respondent’s service. A prima facie case does not
mean a case proved to the hilt but a case which can be
said to be established if the evidence which is led in
support of the same were believed. While determining
whether a prima facie case had been made out the
relevant consideration is whether on the evidence led it
was possible to arrive at the conclusion in question and
not whether that was the only conclusion which could
be arrived at on that evidence. It may be that the
Tribunal considering this question may itself have
arrived at a different conclusion. It has, however, not
to substitute its own judgment for the judgment in
question. It has only got to consider whether the view
taken is a possible view on the evidence on the
record.”
[Emphasis by us]
27. A Three-Judge Bench of this Court in Punjab National
Bank Ltd. v. Workmen
2
, considered and interpreted the
scope of Section 33 to lay down that the jurisdiction of the
Tribunal in dealing with such applications is limited. It was
held that:-
“24. Where an application is made by the employer for
the requisite permission under Section 33 the
jurisdiction of the tribunal in dealing with such an
application is limited. It has to consider whether a
prima facie case has been made out by the employer
for the dismissal of the employee in question. If the
employer has held a proper enquiry into the alleged
misconduct of the employee, and if it does not appear
that the proposed dismissal of the employee amounts
2. (1960) 1 SCR 806
20
to victimisation or an unfair labour practice, the
tribunal has to limit its enquiry only to the question as
to whether a prima facie case has been made out or
not. In these proceedings it is not open to the tribunal
to consider whether the order proposed to be passed
by the employer is proper or adequate or whether it
errs on the side of excessive severity; nor can the
tribunal grant permission, subject to certain
conditions, which it may deem to be fair. It has merely
to consider the prima facie aspect of the matter and
either grant the permission or refuse it according as it
holds that a prima facie case is or is not made out by
the employer.
25. But it is significant that even if the requisite
permission is granted to the employer under Section
33 that would not be the end of the matter. It is not as
if the permission granted under Section 33 validates
the order of dismissal. It merely removes the ban; and
so the validity of the order of dismissal still can be,
and often is, challenged by the union by raising an
industrial dispute in that behalf. The effect of
compliance with the provisions of Section 33 is thus
substantially different from the effect of compliance
with Section 240 of the Government of India Act, 1935,
or Article 311(2) of the Constitution. In the latter
classes of cases, an order of dismissal passed after
duly complying with the relevant statutory provisions
is final and its validity or propriety is no longer open to
dispute; but in the case of Section 33 the removal of
the ban merely enables the employer to make an
order of dismissal and thus avoid incurring the penalty
imposed by Section 31(1). But if an industrial dispute
is raised on such a dismissal, the order of dismissal
passed even with the requiste permission obtained
under Section 33 has to face the scrutiny of the
tribunal.”
[Emphasis applied]
28. In Punjab National Bank (supra), this Court relied
upon Automobile Products of India Ltd. v. Rukmaji
21
Bala, and further opined that:-
“In Automobile Products of India Ltd. v. Rukmaji Bala,
this Court was dealing with a similar problem posed by
the provisions of Section 22 of Act 48 of 1950, and
Section 33 of the Act. Dealing with the effect of these
sections this Court held that the object of Section 33
was to protect the workmen against the victimisation
by the employer and to ensure the termination of the
proceedings in connection with the industrial disputes
in a peaceful atmosphere. That being so, all that the
tribunal, exercising its jurisdiction under Section 33, is
required to do is to grant or withhold the permission,
that is to say, either to lift or to maintain the ban. This
section does not confer any power on the tribunal to
adjudicate upon any other dispute or to impose
conditions as a prerequisite for granting the permission
asked for by the employer. The same view has been
expressed in Lakshmi Devi Sugar Mills Ltd. v. Pt. Ram
Sarup.”
29. Another Three-Judge Bench of this Court in Mysore
Steel Works Pvt. Ltd. v. Jitendra Chandra Kar and
Others
3
, held an indepth scrutiny in the scope of jurisdiction
vested in an Industrial Tribunal under Section 33(2) (b) of the
Act and ruled as follows:-
“10.The question as to the scope of the power of an
Industrial Tribunal in an enquiry under Section 33(2) of
the Industrial Disputes Act has by now been considered
by this Court in a number of decisions and is no longer
in dispute. If the Tribunal comes to the conclusion that
the domestic enquiry was not defective, that is, it was
not in violation of the principles of natural justice, it has
only to see if there was a prima facie case for
dismissal, and whether the employer had come to a
bona fide conclusion that the employee was guilty of
misconduct. In other words, there was no unfair labour
3. (1971) 1 LLJ 543
22
practice and no victimisation. It will then grant its
approval. If the Tribunal, on the other hand, finds that
the enquiry is defective for any reason, it would have to
consider for itself on the evidence adduced before it
whether the dismissal was justified. If it comes to the
conclusion on its own appraisal of evidence adduced
before it that the dismissal was justified it would give
its approval to the order of dismissal made by the
employer in a domestic enquiry. (See P.H. Kalyani v. Air
France [1964 (2) SCR 104 at 112] ) where, therefore
the domestic enquiry is conducted in violation of the
principles of natural justice evidence must be adduced
before the Tribunal by the employer to obtain its
approval. Such evidence must be adduced in the
manner evidence is normally adduced before the
Tribunal, that is, witnesses must be examined and not
by merely tendering the evidence laid before the
domestic enquiry, unless the parties agree and the
tribunal given its assent to such a procedure. (See K.N.
Barmab v. Management of Badla Beta Tea Estate [ CA
No. 1017 of 1968, decided on 9th March, 1967] ). It is
clear, therefore, that the jurisdiction of a tribunal under
Section 33(2) is of a limited character. Where the
domestic enquiry is not defective by reason of violation
of principles of natural justice or its findings being
perverse or by reason of any unfair labour practice, the
tribunal has only to be satisfied that there is a prima
facie case for dismissal. The tribunal in such cases does
not sit as an appellate Court and come to its own
finding of fact.”
[Emphasis is ours]
30. The view taken in Mysore Steel Works Pvt. Ltd.
(supra) was reiterated in Lalla Ram v. D.C.M. Works Ltd.
4
,
where this Court analysed Section 33(2)(b) of the Act and
held as follows:-
“12. The position that emerges from the
abovequoted decisions of this Court may be stated
thus: In proceedings under Section 33(2)( b) of the
4. (1978) 3 SCC 1
23
Act, the jurisdiction of the Industrial Tribunal is
 confined to the enquiry as to (i) whether a proper
domestic enquiry in accordance with the relevant
rules/Standing Orders and principles of natural
 justice has been held; ( ii) whether a prima facie case
for dismissal based on legal evidence adduced
 before the domestic tribunal is made out; ( iii)
whether the employer had come to a bona fide
conclusion that the employee was guilty and the
dismissal did not amount to unfair labour practice
and was not intended to victimise the employee
regard being had to the position settled by the
decisions of this Court in Bengal Bhatdee Coal Co. v.
Ram Prabesh Singh[AIR 1964 SC 486 : (1964) 1 SCR
709 : (1963) 1 LLJ 291 : 24 FJR 406] , Titaghur Paper
Mills Co. Ltd. v. Ram Naresh Kumar [(1961) 1 LLJ
511 : (1960-61) 19 FJR 15] , Hind Construction &
Engineering Co. Ltd. v. Their Workmen [AIR 1965 SC
917 : (1965) 2 SCR 85 : (1965) 1 LLJ 462 : 27 FJR
232] , Workmen of Messrs Firestone Tyre & Rubber
Company of India (P) Ltd. v. Management [(1973) 1
SCC 813 : 1973 SCC (L&S) 341 : AIR 1973 SC 1227 :
(1973) 3 SCR 587] and Eastern Electric & Trading Co.
v. Baldev Lal[(1975) 4 SCC 684 : 1975 SCC (L&S) 382
: 1975 Lab IC 1435] that though generally speaking
the award of punishment for misconduct under the
Standing Orders is a matter for the management to
decide and the Tribunal is not required to consider
the propriety or adequacy of the punishment or
whether it is excessive or too severe yet an
inference of mala fides may in certain cases be
drawn from the imposition of unduly harsh, severe,
unconscionable or shockingly disproportionate
punishment; (iv) whether the employer has paid or
offered to pay wages for one month to the employee
and (v) whether the employer has simultaneously or
within such reasonably short time as to form part of
the same transaction applied to the authority before
which the main industrial dispute is pending for
approval of the action taken by him. If these
conditions are satisfied, the Industrial Tribunal would
grant the approval which would relate back to the
date from which the employer had ordered the
dismissal. If however, the domestic enquiry suffers
from any defect or infirmity, the labour authority will
have to find out on its own assessment of the
24
evidence adduced before it whether there was
justification for dismissal and if it so finds it will grant
approval of the order of dismissal which would also
relate back to the date when the order was passed
provided the employer had paid or offered to pay
wages for one month to the employee and the
employer had within the time indicated above
applied to the authority before which the main
industrial dispute is pending for approval of the
action taken by him.”
[Emphasis supplied]
31. This Court in the above cited decisions has, in no
uncertain terms, divided the scope of enquiry by the Labour
Court/Tribunal while exercising jurisdiction under Section
33(2)(b) in two phases. Firstly, the Labour Court/Tribunal will
consider as to whether or not a prima facie case for
discharge or dismissal is made out on the basis of the
domestic enquiry if such enquiry does not suffer from any
defect, namely, it has not been held in violation of principles
of natural justice and the conclusion arrived at by the
employer is bona fide or that there was no unfair labour
practice or victimisation of the workman. This entire
exercise has to be undertaken by the Labour Court/Tribunal
on examination of the record of enquiry and nothing more.
In the event where no defect is detected, the approval must
follow. The second stage comes when the Labour
25
Court/Tribunal finds that the domestic enquiry suffers from
one or the other legal ailment. In that case, the Labour
Court/Tribunal shall permit the parties to adduce their
respective evidence and on appraisal thereof the Labour
Court/Tribunal shall conclude its enquiry whether the
discharge or any other punishment including dismissal was
justified. That is the precise ratio – decendi of the decisions
of this Court in (i) Punjab National Bank, (ii) Mysore
Steel Works Pvt. Ltd. and (iii) Lalla Ram’s cases (supra).
32. A Division Bench of this Court in Cholan Roadways
Ltd. v. G. Thirugnanasambandam5
, also went into the
issue of jurisdiction exercisable under Section 33(2)(b) of the
Act and relying upon the Martin Burn Ltd. (supra), it has
opined as follows:-
“18. The jurisdiction of the Tribunal while considering
an application for grant of approval has succinctly
been stated by this Court in Martin Burn Ltd. v. R.N.
Banerjee [AIR 1958 SC 79 : 1958 SCR 514]. While
 exercising jurisdiction under Section 33(2)( b) of the
Act, the Industrial Tribunal is required to see as to
whether a prima facie case has been made out as
regards the validity or otherwise of the domestic
enquiry held against the delinquent, keeping in view
the fact that if the permission or approval is granted,
the order of discharge or dismissal which may be
passed against the delinquent employee would be
liable to be challenged in an appropriate proceeding
5. (2005) 3 SCC 241
26
before the Industrial Tribunal in terms of the provision
of the Industrial Disputes Act.”
[Emphasis applied]
The Court then observed that:
“19. It is further trite that the standard of proof
required in a domestic enquiry vis-a-vis a criminal trial
is absolutely different. Whereas in the former
“preponderance of probability” would suffice; in the
latter, “proof beyond all reasonable doubt” is
imperative.
20. The Tribunal while exercising its jurisdiction under
Section 33(2)(b) of the Industrial Disputes Act was
required to bear in mind the aforementioned legal
principles. Furthermore, in a case of this nature the
probative value of the evidence showing the extensive
damages caused to the entire left side of the bus; the
fact that the bus first hit the branches of a tamarind
tree and then stopped at a distance of 81 ft therefrom
even after colliding with another bus coming from the
front deserved serious consideration at the hands of
the Tribunal. The nature of impact clearly
demonstrates that the vehicle was being driven rashly
or negligently.”
33. The Three-Judge bench decisions of this Court in
Punjab National Bank and Mysore Steel Works Pvt.
Ltd. (supra), as well as the Division Bench judgment in Lalla
Ram (supra) were unfortunately not cited before this Court
in Cholan Roadways Ltd. There is yet no conflict of
opinion as in Cholan Roadways Ltd. (supra) also this Court
reiterated the past consistent view that while exercising
jurisdiction under Section 33(2)(b) of the Act, the Industrial
27
Tribunal is required to see only whether a prima facie case
has been made out as regard to the requirement of domestic
enquiry. Cholan Roadways nonetheless deals with only 1st
phase of the jurisdiction exercisable under Section 33(2)(b)
and it falls short to elucidate as to whether, in the event of a
defective domestic enquiry, the Labour Court/Tribunal can
also the parties to adduce evidence. The 2nd phase of
Jurisdiction exercisable under Section 33(2)(b) was not
debated in Cholan Roadways (supra) apparently for the
reason that on facts this Court was satisfied that the
delinquent workman was guilty of the misconduct attributed
and proved against him in the domestic enquiry. On the
other hand, Mysore Steel Works Pvt. Ltd. and Lalla Ram
have gone a step ahead to hold that the Tribunal can permit
the parties to adduce evidence if it finds that the domestic
enquiry suffers from any defect or was violative of the
principles of natural justice or was marred by unfair labour
practice, it may then independently examine the evidence
led before it to embark upon the question whether or not the
punitive action deserves to be accorded approval.
28
34. It, thus, stands out that though the Labour Court or the
Tribunal while exercising their jurisdiction under Section
33(2)(b) are empowered to permit the parties to lead
evidence in respect of the legality and propriety of the
domestic enquiry held into the misconduct of a workman,
such evidence would be taken into consideration by the
Labour Court or the Tribunal only if it is found that the
domestic enquiry conducted by the Management on the
scale that the standard of proof required therein can be
`preponderance of probability’ and not a `proof beyond all
reasonable doubts’ suffers from inherent defects or is
violative of principles of natural justice. In other words, the
Labour Court or the Tribunal cannot without first examining
the material led in the domestic enquiry jump to a conclusion
and mechanically permit the parties to lead evidence as if it
is an essential procedural part of the enquiry to be held
under Section 33(2)(b) of the Act.
35. If the awards/orders of the Labour Court or the
judgments passed by Learned Single Judge(s) and the
Division Benches of the High Court are evaluated on these
principles, it appears to us that all of them went partly wrong
29
and their respective orders suffer from one or the other legal
infirmity. While the Labour Court and the Learned Single
Judge(s) have erroneously presumed that no enquiry can be
held under Section 33(2)(b) without asking the parties to
lead their evidence, the Learned Division Benches of the
High Court have proceeded on the premise that in a prima
facie fact finding enquiry under Section 33(2)(b) no evidence
can be adduced or considered by the Labour Court except
what is on the record of domestic enquiry. Both the views do
not go hand in hand with the law laid down by this Court in
Punjab National Bank, Mysore Steel Works Pvt. Ltd.
and Lalla Ram’s cases (supra). The Division Bench of the
High Court solely depended upon Martin Burn Ltd. and
Cholan Roadways Ltd. (supra) to hold that the scope of
enquiry under Section 33(2)(b) being limited to see that
prima facie the enquiry is just and proper, the Labour Court
is precluded from asking the parties to lead any other
evidence. Such a view is not in confirmity with the
exposition of law in Punjab National Bank, Mysore Steel
Works Pvt. Ltd. and Lalla Ram’s cases, cited above. The
Labour Court did not exceed its jurisdiction in permitting the
30
parties to adduce the evidence before it though it erred in
relying upon the same without holding that the enquiry was
defective or the punitive action was vitiated for want of bona
fides. The finding on issue No. 1 that the domestic enquiry
was held in a proper and fair manner also acquires
significance here. Still further, the scope and object of
Section 33(2)(b) cannot be expanded to an extent that the
very scheme of adjudication of an `industrial dispute’ under
Sections 10(1)(c) and (d) read with Section 11A of the Act
becomes superfluous.
36. It is for this precise reason that the Three-Judge Bench
in Punjab National Bank (supra), after limiting the scope of
enquiry under Section 33(2)(b) of the Act, has categorically
held that the order of dismissal even if approved under
Section 33(2)(b), would not attain finality and that .... “if an
industrial dispute is raised on such a dismissal, the order of
dismissal passed even with the requisite permission obtained
under Section 33 has to face the scrutiny of Tribunal.”
37. In Cholan Roadways Ltd. (supra) also, this Court
gave opportunity to the workman to take recourse to such
31
remedy as was available to under the laws for questioning
the order of dismissal.
38. The Labour Court or Tribunal, therefore, while holding
enquiry under Section 33(2)(b) cannot invoke the
adjudicatory powers vested in them under Section 10(i)(c)
and (d) of the Act nor can they in the process of formation of
their prima facie view under Section 33(2)(b), dwell upon the
proportionality of punishment, as erroneously done in the
instant case, for such a power can be exercised by the
Labour Court or Tribunal only under Section 11A of the Act.
39. Consequently, the Labour Court shall in the instant case
re-visit the matter afresh within the limit and scope of
Section 33(2)(b), as explained above and keeping in mind
that the exercise in hand is not adjudication of an `industrial
dispute’ under Section 10(1)(c) or (d) read with Section 11A
of the Act. However, if the Labour Court finds that the
domestic inquiry held against the appellant is suffering from
one of the incurable defects as illustrated by this Court in
Mysore Steel Works Pvt. Ltd. or Lalla Ram’s cases, then
it may look into the evidence adduced by the parties for the
purpose of formation of its prima facie opinion.
32
40. This is, however, not the end of the matter. We are not
oblivious to the fact that the appellant attained the age of
superannuation in the year 2010. There might be some
substance in the allegation that he used to indulge in the
acts of indiscipline, insubordination or may have absented
himself from duties for a few days, there are, however, no
allegations of financial irregularity or embezzlement of funds.
It has come on record that when the proceedings were
pending before the High Court, the parties were directed to
mediate and submit their settlement proposals. The
appellant also submitted his proposal which is on record, in
which he demanded 75% of back wages whereas the
Corporation agreed to pay 50% back wages to him. The
settlement could not take place due to the difference in
demand and offer to the extent of 25% back wages. Though
the appellant seems to be in no mood to settle the dispute,
we have not lost the hope and are sanguine that better
sense will prevail upon both the parties and they will make
an earnest and renewed effort through the Mediation Centre
of High Court of Karnataka at Bangalore for amicable
settlement of the dispute. This can only happen by adopting
33
the give and take approach, especially to avoid prolonged
litigation. The appellant may agree to take less than 75%
back wages and the Corporation may incline to offer more
than 50% back wages. Mediators will surely make efforts to
bridge the gap and see that the dispute comes to an end.
Both the parties, must also bear in mind that the recourse to
`mediation’ suggested by us is one of the statutory mode
prescribed for resolving an `industrial dispute’ under the Act.
We, therefore, direct both the parties to appear before the
Mediation Centre of the High Court of Karnataka at Bangalore
on 4th November, 2019 at 11.00 A.M. and let such
proceedings be concluded by 3rd December, 2019. Till such
time, the stay of proceedings before the Labour Court
granted by this Court shall continue to operate. If the parties
are able to resolve their dispute amicably, the Mediation
Centre of the High Court of Karnataka at Bangalore shall
send its report to this Court. Registry is directed to list the
matter before the Court within two weeks from the date of
receipt of the mediation report for further directions, if need
be. However, if the mediation fails, the parties are directed
to appear before the Labour Court at Bangalore on 5th
34
December, 2019. In that event, the Labour Court shall
decide the matter on merits without taking any lead from
what we have suggested for the purpose of amicable
settlement. It is made clear that we have not expressed any
views on merits of the case.
41. In the light of above discussion, the appeal is allowed in
part and the impugned judgment dated 30.11.2018 passed
by the Division Bench of the High Court is modified to the
extent mentioned above.
………………………………..J.
(SANJAY KISHAN KAUL)
…………………………… J.
(SURYA KANT)
NEW DELHI
DATED : 16.10.2019

35

Whether the Black Money Act retrospectively applicable from 01.07.2015 ? =Apex court held that we find that the High Court was not right in holding that, by the notification/order impugned before it, the penal provisions were made retrospectively applicable. The Black Money Act has been passed by the Parliament on 11.05.2015 and it has received Presidential assent on 26.05.2015. Sub­section (3) of Section 1 provides, that save as otherwise provided in the said Act, it shall come into force on the 1st day of April, 2016. However, by the notification/ order notified on 01.07.2015, which have been impugned before the High Court, it has been provided, that the Black Money Act shall come into force on 01.07.2015, i.e., the date on which the order is issued under the provisions of sub­section (1) of Section 86 of the Black Money Act. However, the scheme of the Black Money Act also provided one time opportunity to make a declaration in respect of any undisclosed asset located outside India and acquired from income chargeable to tax under the Income­tax Act. Section 59 of the Black Money Act provided that such a declaration was to be made on or after the date of commencement of the Black Money Act, but on or before a date notified by the Central Government in the Official Gazette. The date so notified for making a declaration is 30.09.2015 whereas, the date for payment of tax and penalty was notified to be 31.12.2015. As such, an anomalous situation was arising if the date under sub­section (3) of Section 1 of the Black Money Act was to be retained as 01.04.2016, then the period for making a declaration would have been lapsed by 30.09.2015 and the date for payment of tax and penalty would have also been lapsed by 31.12.2015. However, in view of the date originally prescribed by sub­section (3) of Section 1 of the Black Money Act, such a declaration could have been made only after 01.04.2016. Therefore, in order to give the benefit to the assessee(s) and to remove the anomalies the date 01.07.2015 has been substituted in sub­section (3) of Section 1 of the Black Money Act, in place of 01.04.2016. This is done, so as to enable the assessee desiring to take benefit of Section 59 of the Black Money Act. By doing so, the assessees, who desired to take the benefit of one time opportunity, could have made declaration prior to 30th September, 2015 and paid the tax and penalty prior to 31st December, 2015. The date has been changed only for the purpose of enabling the assessee(s) to take benefit of Section 59 of the Black Money Act. The power has been exercised only in order to remove difficulties. The penal provisions under Sections 50 and 51 of the Black Money Act would come into play only when an assessee has failed to take benefit of Section 59 and neither disclosed assets covered by the Black Money Act nor paid the tax and penalty thereon. As such, we find that the High Court was not right in holding that, by the notification/order impugned before it, the penal provisions were made retrospectively applicable.

1

REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL No.1563 OF 2019

(Arising out of S.L.P.(Crl.) No. 4911 of 2019)

UNION OF INDIA AND ORS.                        .... APPELLANT(S)

                         

             

                              VERSUS

GAUTAM KHAITAN                                 .... RESPONDENT(S)

J U D G M E N T

B.R. GAVAI, J.

     Leave granted.

2. The present appeal challenges the interim order passed

by the Division Bench of the Delhi High Court in Writ Petition

(Crl.) No. 618 of 2019 dated 16.05.2019 thereby, restraining the

appellants   herein   from   taking   and/or   continuing   any   action

against the writ petitioner (respondent herein) pursuant to the

Order dated 22.01.2019  under Section 55 of the Black Money

(Undisclosed Foreign Income and Assets) and Imposition of Tax

2

Act, 2015 (hereinafter referred to as the “Black Money Act”)

passed by Appellant No. 2 herein.

3. We have heard Mr. Tushar Mehta, learned Solicitor

General appearing on behalf of the appellants, and Mr. P.V.

Kapur, learned senior counsel appearing on behalf of the sole

respondent.

4. The short question that falls for consideration is, as to

whether   the   High   Court   was   right   in   observing   that   while

exercise of the powers under the provisions of Sections 85 and

86 of the Black Money Act, the Central Government has made

the   said   Act   retrospectively   applicable   from   01.07.2015   and

passed a restraint order.

 5. From the Statement of Objects and Reasons, it could be

seen   that   the   Black   Money   Act   has   been   enacted   for   the

following purposes :

(a) To   unearth   the   black   money   stashed   in   foreign

countries; and

(b) To prevent unaccounted money going abroad.

(c) To   punish   the   persons   indulging   in   illegitimate

means   of   generating   money   causing   loss   to   the

revenue

(d) To   prevent   illegitimate   income   and   assets   kept

outside   the   country   from   being   utilised   in   ways

which   are   detrimental   to   India’s   social,   economic

and strategic interest and its national security.

3

6. The Black Money Act has been passed by the Parliament

on  11.05.2015  and   it   has   received   Presidential   assent   on

26.05.2015. Sub­section (3) of Section 1 provides, that save as

otherwise provided in the said Act, it shall come into force on

the 1st day of April, 2016.  However, by the notification/ order

notified  on 01.07.2015, which have been impugned before the

High Court, it has been provided, that the Black Money Act

shall come into force on 01.07.2015, i.e., the date on which the

order is issued under the provisions of sub­section (1) of Section

86 of the Black Money Act.

7. It will be relevant to refer to Section 3 of the Black Money

Act, which is a charging section.

“3. Charge of Tax ­ (1) There shall be charged on every

assessee for every assessment year commencing on or

after the 1st day of April, 2016, subject to the provisions

of   this   Act,   a   tax   in   respect   of   his   total   undisclosed

foreign income and asset of the previous year at the rate

of thirty per cent of such undisclosed income and asset:

Provided   that   an   undisclosed   asset   located   outside

India shall be charged to tax on its value in the previous

year   in   which   such   asset   comes   to   the   notice   of   the

Assessing Officer.

(2)   For   the   purposes   of   this   section,   “value   of   an

undisclosed asset” means the fair market value of an

asset   (including   financial   interest   in   any   entity)

determined in such manner as may be prescribed.”

4

8. It could thus be seen, that Section 3 provides that tax

shall be charged on every assessee for every assessment year

commencing on or after the 1st day of April, 2016 in respect of

his total undisclosed foreign income and assets of the previous

year. The rate of the said tax has been quantified at thirty per

cent.  The proviso to sub­section (1) of Section 3 of the Black

Money  Act  provides,   that  undisclosed   assets   located   outside

India shall be charged to tax on its value in the previous year in

which such asset comes to the notice of the Assessing Officer.

9. It   could   thus   clearly   be   seen,   that   the   proviso   to

sub­section (1) of Section 3 of the Black Money Act, makes it

clear that the undisclosed asset located outside India shall be

charged to tax on its value in previous year in which, such an

asset comes to the notice of Assessing Officer.   Clause (9) of

Section 2 of the Black Money Act defines “previous year”. Four

different definitions have been given in sub­clauses (a), (b), (c)

and (d). For the present matter, sub­clause (d) of clause (9) of

Section 2 would be relevant, which reads thus:

“(9)  “previous year” means—

(a)  …

(b)  …

5

(c)  …

(d)  the period of twelve months commencing on the 1st

day of April of the relevant year in any other case,

and which immediately precedes the assessment year.”

10. It   could   thus   be   seen,   that   the   previous   year   in   the

present   case   would   mean   a   period   of   twelve   months

commencing on the 1st  day of April of the relevant year and

which immediately precedes the assessment year.

11. A bare reading of the provisions of Section 3  read with

Section 2(9)(d)  of the Black Money Act would unambiguously

show, that the legislative intent insofar as the charging tax on

undisclosed   asset   located   outside   India   is   concerned,   is   to

charge the tax on its value in the previous year in which such

asset comes to the notice of the Assessing Officer. The previous

year in the present case would be a period of twelve months

commencing on the 1st  day of April of the relevant year and

which immediately precedes the assessment year.

12. It could thus be seen, that Section 3 read with Section 2

(9)(d)   of   the   Black   Money   Act   would   permit   the   Assessing

Officer, while assessing the case of an assessee for assessment

year commencing after 01.04.2016, to bring the undisclosed

asset located outside India under the tax net on the value of the

6

said property within a period of twelve months, prior to the date

on   which   such   asset   comes   to   the   notice   of   the   Assessing

Officer. By virtue of these provisions, if such asset comes to the

notice of Assessing Officer on 01.04.2016, he could charge such

asset(s) on the basis of its value as would be ascertained in a

previous year ending on 31.03.2016.  A perusal of Section 3 of

the Black Money Act would further reveal, that what is relevant

is   the   date   on   which   the   Assessing   Officer   notices   the

acquisition by an assessee of undisclosed asset located outside

India. However, for the purposes of taxation, the value of such

asset has to be ascertained as is in the immediate previous year.

13. A perusal of Section 59 of the Black Money Act would

further reveal, that an opportunity is given to the assessee to

make a declaration in respect of any undisclosed asset located

outside India and acquired from income chargeable to tax under

the   Income­tax   Act,   for   any   assessment   year   prior   to   the

assessment year beginning on 01.04.2016.  Section 59 further

provides, that such a declaration has to be made on or after the

date of commencement of the Black Money Act, however, before

the date to be notified by the Central Government.  The Central

Government, in exercise of the powers under Section 59 of the

Black   Money   Act,   published   a   Notification   on  01.07.2015,

7

notifying 30.09.2015 as the date on or before which a person is

required to make a declaration in respect of an undisclosed

asset located outside India.  It also notifies 31.12.2015 as the

date on or before which the person shall pay the tax and penalty

in respect of such undisclosed asset located outside India.

14. It could thus be seen, that Section 59 of the Black Money

Act gives an opportunity to the assessees who have acquired an

asset   located   outside   India,   which   is   acquired   from   income

chargeable to tax under the Income­tax Act.  The assessee has

been given an opportunity to declare such asset and pay the tax

and penalty thereon. The consequences of the non­declaration

have been provided under Section 72(c) of the Black Money Act,

which reads thus:

“Section  72  Removal  of  doubts.   –  For the removal of

doubts, it is hereby declared that­

(a) …

(b) …

(c)  where any asset has been acquired or made prior to

commencement of this Act, and no declaration in

respect of such asset is made under this Chapter,

such asset shall be deemed to have been acquired

or made in the year in which a notice under section

10   is   issued   by   the   Assessing   Officer   and   the

provisions of this Act shall apply accordingly.”

15. It could therefore be seen, that where no declaration in

respect of the asset covered under the Black Money Act is made,

8

such asset would be deemed to have been acquired or made in

the year in which a notice under Section 10 is issued by the

Assessing   Officer   and   the   provisions   of   the   Act   shall   apply

accordingly.

16. The   offences   in   respect   of   which   sanction   has   been

granted are under Sections 50 and 51 of the Black Money Act,

which read thus :

“50.     Punishment for failure to furnish in return of

income,   any   information   about   an   asset   (including

financial   interest   in   any   entity)   located   outside

India.­    If any person, being a resident other than not

ordinarily resident in India within the meaning of clause

(6) of section 6 of the Income­tax Act, who has furnished

the return of income for any previous year under subsection (1) or sub­section (4) or sub­section (5) of section 139 of that Act, wilfully fails to furnish in such return

any information relating to an asset (including financial

interest in any entity) located outside India, held by him,

as a beneficial owner or otherwise or in which he was a

beneficiary, at any time during such previous year, or

disclose any income from a source outside India, he shall

be   punishable   with   rigorous   imprisonment   for   a   term

which shall not be less than six months but which may

extend to seven years and with fine.

51. Punishment for wilful attempt to evade tax –

(1)  If   a   person,   being   a   resident   other   than   not

ordinarily resident in India within the meaning of

clause (6) of section 6 of the Income­tax Act, wilfully

attempts in any manner whatsoever to evade any

tax,   penalty   or   interest   chargeable   or   imposable

under this Act, he shall be punishable with rigorous

imprisonment  for  a term which shall not  be  less

than three years but which may extend to ten years

and with fine.

9

(2)   If   a   person   wilfully   attempts   in   any   manner

whatsoever to evade the payment of any tax, penalty

or   interest   under   this   Act,   he   shall,   without

prejudice to any penalty that may be imposable on

him   under   any   other   provision   of   this   Act,   be

punishable with rigorous imprisonment for a term

which shall not be less than three months but which

may   extend   to   three   years   and   shall,   in   the

discretion of the court, also be liable to fine.

(3) For the purposes of this section, a wilful attempt to

evade   any   tax,   penalty   or   interest   chargeable   or

imposable under this  Act   or the  payment  thereof

shall include a case where any person—

(i)   has in his possession or control any books of

account   or   other   documents   (being   books   of

account   or   other   documents   relevant   to   any

proceeding under this Act) containing a false

entry or statement;

(ii)  makes or causes to be made any false entry or

statement in such books of account or other

documents; or

(iii)   wilfully   omits   or   causes   to   be   omitted   any

relevant entry or statement in such books of

account or other documents; or

(iv) causes any other circumstance to exist which

will have the effect of enabling such person to

evade any tax, penalty or interest chargeable or

imposable   under   this   Act   or   the   payment

thereof.”

17. Section 50 provides that if any person, being a resident

other than not ordinarily resident in India, who has furnished

the return of income for any previous year under sub­section (1)

or   sub­section   (4)   or   sub­section   (5)   of   Section   139   of   the

Income­tax   Act,   wilfully   fails   to   furnish   in   such   return   any

information relating to an asset (including financial interest in

any entity) located outside India, held by a beneficial owner or

10

otherwise or in which he was a beneficiary, at any time during

such   previous   year,   or   disclose   any   income   from   a   source

outside   India,   he   shall   be   punishable   with   rigorous

imprisonment   for   a   term   which   shall   not   be   less   than   six

months but which may extend to seven years and with fine.

18. The penalty of the offences under Section 51 is for wilful

attempt in any manner whatsoever to evade the payment of any

tax,   penalty   or   interest   chargeable   or   imposable   under   the

Income­tax Act.   The punishment provided under sub­section

(1) is for rigorous imprisonment for a term which shall not be

less than three years but which may extend to ten years and

with fine. In respect to any other person not covered by subsection (1) of Section 51, the punishment provided is rigorous

imprisonment for a term which shall not be less than three

months but which may extend to three years and shall, in the

discretion of the court, also be liable to fine.

19. It could therefore be seen, that the scheme of the Black

Money Act is  to  provide  stringent measures for curbing the

menace of black money. Various offences have been defined and

stringent punishments have also been provided. However, the

scheme   of   the   Black   Money   Act   also   provided   one   time

opportunity to make a declaration in respect of any undisclosed

11

asset   located   outside   India   and   acquired   from   income

chargeable to tax under the Income­tax Act. Section 59 of the

Black Money Act provided that such a declaration was to be

made on or after the date of commencement of the Black Money

Act, but on or before a date notified by the Central Government

in   the   Official   Gazette.   The   date   so   notified   for   making   a

declaration is 30.09.2015 whereas, the date for payment of tax

and   penalty   was   notified   to   be   31.12.2015.     As   such,   an

anomalous situation was arising if the date under sub­section

(3) of Section 1 of the Black Money Act was to be retained as

01.04.2016, then the period for making a declaration would

have been lapsed by 30.09.2015 and the date for payment of tax

and   penalty   would   have   also   been   lapsed   by   31.12.2015.

However, in view of the date originally prescribed by sub­section

(3) of Section 1 of the Black Money Act, such a declaration could

have been made only after 01.04.2016. Therefore, in order to

give the benefit to the assessee(s) and to remove the anomalies

the date 01.07.2015 has been substituted in sub­section (3) of

Section 1 of the Black Money Act, in place of 01.04.2016.  This

is done, so as to enable the assessee desiring to take benefit of

Section 59 of the Black Money Act. By doing so, the assessees,

who desired to take the benefit of one time opportunity, could

12

have made declaration  prior to 30th September, 2015 and paid

the tax and penalty prior to 31st December, 2015.

20. It would further be relevant to note that sub­section (3) of

Section 1 of the Black Money Act, itself provides that save as

otherwise provided in this Act, it shall come into force on 1st day

of July, 2015. A conjoint reading of the various provisions would

reveal, that the Assessing Officer can charge the taxes only from

the   assessment   year   commencing   on   or   after   01.04.2016.

However,   the   value   of   the   said   asset   has   to   be   as   per   its

valuation in the previous year. As such, even if there was no

change of date  in sub­section (3) of Section  1 of the  Black

Money Act, the value of the asset was to be determined as per

its valuation in the previous year.  The date has been changed

only for the purpose of enabling the assessee(s) to take benefit of

Section   59   of   the   Black   Money   Act.   The   power   has   been

exercised   only   in   order   to   remove   difficulties.   The   penal

provisions under Sections 50 and 51 of the Black Money Act

would come into play only when an assessee has failed to take

benefit of Section 59 and neither disclosed assets covered by the

Black Money Act nor paid the tax and penalty thereon. As such,

we find that the High Court was not right in holding that, by the

13

notification/order impugned before it, the penal provisions were

made retrospectively applicable.

21. In any case, in the factual scenario of the present case, it

would reveal, that the assessment year in consideration was

2019­2020 and the previous year relevant to the assessment

year was the year ending on 31.03.2019.

22.  In that view of the matter, we find that the interim order

passed by the High Court is not sustainable in law, the same is

quashed and set aside.

23. The High Court is requested to decide the writ petition on

its own merits. However, we clarify that the observations made

by us are only for the purposes of examining the correctness of

the interim order passed by the High Court and the High Court

would decide the writ petition uninfluenced by the same.

24. The appeal stands allowed as indicated above.

…....................J.

                             [ARUN MISHRA]

......................J.

                             [M. R. SHAH]

       ......................J.

[B.R. GAVAI]

NEW DELHI;

OCTOBER  15, 2019.

Whether the State Legislature can enact a law providing an appeal directly to the Supreme Court of India? We, therefore, have no doubt in our mind that Section 13(2) of the Act, in so far as it provides an appeal directly to the Supreme Court, is totally illegal, ultra vires the Constitution and beyond the scope of the powers of the State Legislature. Section 13(2) of the Act is accordingly struck down. we hold that an appeal under Section 13 (2) of the Act directly to the Supreme Court is not maintainable. We, therefore, dismiss this appeal. However, we leave it open to the appellant to approach the High Court for redressal of his grievance under Article 227 of the Constitution. If the appellant does so, the High Court shall decide the matterstrictly in accordance with law.

Whether the State Legislature can enact a law providing an appeal directly to the Supreme Court of India?
We, therefore, have no doubt in our mind that Section 13(2)
of the Act, in so far as it provides an appeal directly to the
Supreme Court, is totally illegal, ultra vires the Constitution and
beyond the scope of the powers of the State Legislature.  Section
13(2) of the Act is accordingly struck down.  
we hold that an appeal under Section 13   (2)   of   the   Act   directly   to   the   Supreme   Court   is   not maintainable.  We, therefore, dismiss this appeal.  However, we leave it open to the appellant to approach the High Court for redressal of his grievance under Article 227 of the Constitution.
If the appellant does so, the High Court shall decide the matterstrictly in accordance with law. 

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL  NO(S).  5153 OF 2019
H. S. YADAV      …APPELLANT(S)
Versus
SHAKUNTALA DEVI PARAKH  …RESPONDENT(S)
J U D G M E N T
Deepak Gupta, J.
“Whether the State Legislature can enact a law providing an
appeal directly to the Supreme Court of India?” is the question
arising in this appeal.
2. The State of Chhattisgarh enacted the Chhattisgarh Rent
Control Act, 2011 (hereinafter referred to as ‘the Act’).  Under this
Act, in the hierarchy of adjudicating authorities there is a Rent
Controller and above that, a Rent Control Tribunal.  In terms of
Section 7 of the Act the State can appoint one or more officers
not below the rank of Deputy Collector, as Rent Controller with
territorial jurisdiction to be specified by the Collector.  The Rent
1
Control   Tribunal   (hereinafter   referred   to   as   ‘the   Tribunal’)   is
constituted   under   Section   6   of   the   Act.     This   Tribunal   has
appellate and supervisory jurisdiction.     Section 6 of the Act
reads as under:­
“6. Constitution of the Rent Control Tribunal.– 
(1) The State Government shall by notification constitute,
within thirty days of this Act, a Tribunal in terms of
Article   323­B   of   the   Constitution,   to   be   called   as
Chhattisgarh Rent Control Tribunal, to give effect to the
provisions of this Act, and for the adjudication or trial of
any   disputes,   complaints,   or   offences   with   respect   to
rent,   its   regulation   and   control   and   tenancy   issues
including the rights, title and obligations of landlords and
tenants.
Explanation.­   Matters   relating   to   transfer   of   property
and/or disputes regarding title over any property shall
continue to be considered under relevant laws by the
courts of law.
(2) The State Government in consultation with the High
Court shall appoint the Chairman of the Rent Control
Tribunal, a retired Judge of the High Court or serving or
retired District Judge not below the rank of Super Time
Scale.
(3)  The  Tribunal shall  have  such  members  with  such
qualification, as the State Government may prescribe.
(4) The State Government shall appoint an officer as the
Registrar of the Tribunal, who shall not be below the
cadre   of   Civil   Judge   Class­I   or   the   rank   of   Deputy
Secretary to the State Government. 
(5)   From   the   date,   the   Tribunal   becomes   functional,
which date shall be published in the State Gazette, the
jurisdiction of all courts, except the jurisdiction of the
Supreme Court under Article 136 and High Court under
Articles  226  and  227  of  the Constitution,  shall stand
excluded   in   respect   of   all   matters   falling   within   the
jurisdiction of the Tribunal:
2
Provided,   however,   that   all   cases   pending   before   any
court or authority immediately before the establishment
of the Tribunal, shall continue to be processed under the
old Act, as amended from time to time.
(6)  The Tribunal shall have its headquarters at Raipur
and the State Government may, by notification, fix such
other places for hearing of matters by the Tribunal, as it
deems fit.
(7)   The   terms   and   conditions   of   the   service   of   the
Chairman and members of the Tribunal shall be such as
may be prescribed by the State Government.”
3. Section 13 of the Act provides for an appeal against orders
of the Rent Controller and the Tribunal.  It reads thus:­
“13.   Appeal.­(1)     Notwithstanding   anything   to   the
contrary contained in this Act, a landlord and/or tenant
aggrieved by any order of the Rent Controller shall have
the right to appeal in the prescribed manner within the
prescribed time to the Rent Control Tribunal.
(2) Appeal against an order of the Rent Control Tribunal
shall lie with the Supreme Court.”
4. A bare perusal of Section 13 shows that from any order of
the Rent Controller an appeal lies to the Rent Control Tribunal
and in terms of Section 13(2), an appeal lies as a matter of right
to the Supreme Court. 
5. When the present appeal, filed under Section 13(2) of the
Act, came up for admission, while issuing notice we had also
ordered as follows:­
“xxx xxx xxx
Notice be given to the learned Advocate General of the
State of Chhattisgarh and the learned Attorney General
3
for   India   as   to   whether   the   provisions   contained   in
Section 13(2) of the Chhattisgarh Rent Control Act, 2011
providing for an appeal to the Supreme Court of India
against   the   order   of   the   Rent   Control   Tribunal,
Chhattisgarh would be within the legislative competence
of the State Legislature.
xxx xxx xxx”
6. Pursuant   to   the   notice,   learned   Attorney   General   has
appeared and assisted the Court.
7. At the outset, we would like to point out that the Tribunal
has been constituted in exercise of the powers vested in the State
Legislature under Article 323B of the Constitution of India which
deals with tribunal for other matters.  Sub­clause (h) of Clause
(2) of the said Article which empowers the appropriate legislature
to constitute a tribunal to deal with the issues relating to rent
and its regulations read as follows:­
“323B. Tribunals for other matters.­
(1)         xxx                        xxx                      xxx
(2)           The   matters   referred   to  in   clause  (1)   are   the
following, namely:­
xxx xxx xxx
(h)   rent, its regulation and control and tenancy issues
including the rights, title and interest of landlords and
tenants;”
8. It is not disputed before us that the State has the power to
constitute the Tribunal.   The only issue is whether in terms of
4
Section 13(2) of the Act, the State Legislature could provide an
appeal as a matter of right from the order of the Tribunal to the
Supreme Court. 
9. Article   246   of   the   Constitution   specifically   provides   that
Parliament   has   exclusive   powers   to   make   laws   in   respect   of
matters   enumerated   in   List   I   (Union   List)   of   the   Seventh
Schedule.  Likewise, the State has exclusive powers to make laws
in respect of matters falling in List II (State List) of the Seventh
Schedule.  As far as the Concurrent List, i.e. List III is concerned,
both the Union and the State have the power to enact laws but if
the field is occupied by any law enacted by Parliament then the
State cannot legislate on the same issue. 
10. Entry 77 of List I of the Seventh Schedule reads as under:­
“77. Constitution, organisation, jurisdiction and powers
of the Supreme Court (including contempt of such Court),
and the fees taken therein; persons entitled to practise
before the Supreme Court.”
Entry 77 gives power to the Union in respect of jurisdiction
and the powers of the Supreme Court.   This power cannot be
exercised by the State Legislature.
11. It would also be apposite to refer to Entry 65 of List II of the
5
Seventh Schedule, which reads as follows:­
“65. Jurisdiction and powers of all courts, except  the
Supreme Court, with respect to any of the matters in
this List.”
A bare reading of Entry 65 clearly indicates that the State
Legislature   has   no   power   to   enact   any   legislation   relating   to
jurisdiction and power of the Supreme Court.   This power is
specifically excluded.
12. Entry 46 of List III of the Seventh Schedule is also relevant.
This reads as follows:­
“46. Jurisdiction and powers of all courts, except  the
Supreme Court, with respect to any of the matters in
this list.”
Even   Entry   46   makes   it   clear   that   as   far   as   the
jurisdictional powers of the Supreme Court are concerned, they
cannot be exercised under the Concurrent List.   Therefore, the
powers with regard to jurisdiction and power of the Supreme
Court vest with the Union and Parliament alone can enact a
legislation in this regard.     The power of the Supreme Court
under Article 136 is always there.   However, the State cannot
enact a legislation providing an appeal directly to the Supreme
Court.  That would amount to entrenching upon the jurisdiction
of the Union, which the State Legislature does not have.
6
13. We are constrained to observe that the men who drafted the
Act did not even consider the hierarchy of Courts.   As pointed
above, the Rent Control Tribunal is headed by a retired Judge of
the High Court or District Judge in the Super Time Scale or
above.     What   was   the   rationale   of   making   such   an   order
appealable directly to the Supreme Court?     We see no reason
why the supervisory jurisdiction of the High Court should be
excluded. 
14.  We, therefore, have no doubt in our mind that Section 13(2)
of the Act, in so far as it provides an appeal directly to the
Supreme Court, is totally illegal, ultra vires the Constitution and
beyond the scope of the powers of the State Legislature.  Section
13(2) of the Act is accordingly struck down.  
15. While dealing with the issue, we may make reference to the
fact   that   the   Rent   Control   Tribunal   is   a   tribunal   constituted
under Article 323B of the Constitution.
16. In L. Chandrakumar vs. Union of India1
, this Court clearly
held that tribunals constituted under Articles 323A and 323B of
the Constitution are subject to the writ jurisdiction of the High
Courts.   In view of the law laid down in  L.  Chandrakumar’s
1 (1993) 4 SCC 119
7
case  (supra),   the   High   Court   can   exercise   its   supervisory
jurisdiction under Article 227 of the Constitution against the
orders of the Rent Control Tribunal. 
17. In view of the above, we hold that an appeal under Section
13   (2)   of   the   Act   directly   to   the   Supreme   Court   is   not
maintainable.  We, therefore, dismiss this appeal.  However, we
leave it open to the appellant to approach the High Court for
redressal of his grievance under Article 227 of the Constitution.
If the appellant does so, the High Court shall decide the matter
strictly in accordance with law.   Pending application(s) if any,
stand(s) disposed of.
…….…....................J.
[DEEPAK GUPTA]
..…..…....................J.
[SURYA KANT]
NEW DELHI
OCTOBER 15, 2019
8

DASARA GREETINGS

Wishing you  and your families a HAPPY DASARA NAVATRATHRI

God bless you all with great health, wealth and prosperty 

with regards

Advocatemmmohan