In X vs. Union of India and Ors., decided by the Gujarat High Court on April 30, 2019, the Court held that an order for termination cannot be arbitrary or punitive in nature, and treatment of employees must be fair. There must be rationality in action and proportionality in taking the decision to terminate the services of employees.
The facts of the case are that X (“Petitioner”) stated in her petition that she was sexually harassed by the acting Managing Director of Respondent No. 3, a wholly-owned subsidiary of the National Dairy Development Board (“NDDB”) to whom she was reporting. X stated that, in order to make her feel inferior and uncomfortable, he would repeatedly harass her by making lewd gestures and sexual advances. She was not invited to meetings where she was otherwise concerned, was intimidated in the office by creating a hostile environment, and her day-to-day activities, including her personal life, were subjected to stalking and vigilance by certain employees. X stated that once she noticed one of her subordinates following her under his instructions. In the petition, she narrated the incident on November 28, 2017, when he touched her inappropriately, lost his temper, and abused her. X resisted these attempts, after which he threatened symbolically to get her killed. When she reached home, she was informed by her juniors that her office cabin was broken. She, in extreme shock and pain, was in the process of filing a complaint with the police on the same day when her services came to be terminated on the same day (i.e., November 28, 2017). On November 29, 2017, a counter-FIR was filed against her, alleging theft of certain material. X also approached the National Commission for Women. A formal complaint was filed with the Internal Committee in January 2018. Ultimately, X filed the present petition under Article 226 of the Constitution, challenging the order of termination dated November 28, 2017, and asking to be reinstated with all consequential benefits.
X submitted letters and communications that stated that her performance had been outstanding and exceptional and that her termination was in contravention of the NDDB Officers’ Conduct, Discipline, and Appeal Regulations, 1988, in violation of the Code of Personal Ethics, and in breach of the Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013 (“Law”). X’s counsel emphasized that X’s service tenure was highly appreciated, but within a short span, the order terminating her service came to be passed. The order, though styled as a contractual termination of service, was based on different considerations. It was submitted that the order was passed as a punitive measure, which could not have been passed without compliance with the principles of natural justice and the holding of a full-scale inquiry.
The respondent’s counsel argued that the order of termination clearly showed that the termination was to end contractual arrangements only and nothing more. It was submitted that when there was no basis, it was not permissible for X to connect any other event with the order of termination. It was submitted that the outstanding performance rating for X could not be a debarring factor for the employer to put an end to the contract.
The High Court of Gujarat stated that it is not necessary (for this Court) to undertake the exercise of finding the truth or otherwise of the allegations of sexual harassment made by X. It also states that such an exercise is neither relevant nor required to be taken under writ jurisdiction. Therefore, the Court did not adjudicate on the veracity of the allegations regarding sexual harassment and refrained from expressing any opinion on them. However, it stated that “what is relevant is whether the allegations about the sexual harassment, even when they remain in the realm of allegations, were at the root or in the foundation of taking action and passing the termination order against X.”
In coming to a conclusion regarding her termination, the Court looked at the history of X’s employment with Respondent no. 3 and noted that “the quick sequence of events was unfathomable in view of the background facts of rating X high for her exceptional performance, increasing her salary virtually double within months.”
The Court held that Respondent No. 3, being an organ of state authority, is bound by the tenets and mandates of Article 14 of the Constitution to act in a just, fair, and non-arbitrary manner in all its functional spheres and in all decisions, including the treatment to be meted out to its employees, servants, and officers. The conduct on the part of Respondent No. 3 was incomprehensible, both in terms of rationality in action and proportionality in taking the decision to terminate the services of X. In stating this, the Court said that “the whole defence was sham and was raised for the sake of raising, as already noticed even in terms of time-leg, there was a close proximity between the recognition and apprehension for the services of X on the one hand and the abrupt order of termination on the other hand. Both did not have any conceivable cause-and-effect relationship. If at all there was any nexus, it was in terms of arbitrariness.”
The Court further held that “all the above facts and events, as obtained cumulatively, created a strong foundation on which the termination order was shown to have been erected. The foundational factor, even if circumstantial in nature, was too strong to resist the conclusion that it was a retaliatory act. Such was a reasonable and inescapable conclusion in light of the facts and circumstances of the case. There was much more than what met the eye in the termination order. Though passed by styling it a contractual termination, the order clearly appeared to have been guised under different facts and foundations.”
In light of the above facts and circumstances and the reasons supplied, the court held that X deserves the relief prayed for. It said that “the order of termination has to be held arbitrary and in violation of the tenets of Article 14 of the Constitution. It was a punishment inflicted on X in disguise of contractual termination, which was by throwing to the winds even the bare minimum principles of natural justice.
Therefore, the order dated November 28, 2017 passed by Respondent No. 3 terminating the services of X was set aside, and Respondent No. 3 was directed to reinstate her in service.
Please note: While the judgment states that X had alleged sexual harassment and had approached the police, it does not mention the reason for the delay of nearly 3 months in approaching the Internal Committee.