Thiruvananthapuram, Apr 23: Kerala High Court dismissed an appeal by the Arpookara Service Co-operative Bank Ltd., upholding an Arbitration Court’s decision to award full back wages to T.M. George, a former Secretary of the Bank.
George had been suspended in 1998 on allegations of financial mismanagement, which led to his dismissal after a departmental inquiry. Following an appeal to the Kerala Co-operative Arbitration Court, the suspension and dismissal were deemed illegal, and full back wages were granted.
The Arbitration Tribunal and the Kerala High Court later affirmed this decision, underscoring the employer’s burden of proving gainful employment during the suspension period.
It was argued that George was guilty of severe financial misconduct, justifying his suspension and dismissal. The Bank contended that granting full back wages was unwarranted as George had been gainfully employed during his suspension period.
They argued that the burden of proof rested on George to show he had not been employed elsewhere.
On the other hand, George’s counsel asserted that the dismissal was based on unsubstantiated allegations. He relied on precedents such as Deepali Gundu Surwase v. Kranti Junior Adhyapak Mahavidyalaya (2013), which holds that employees dismissed illegally are entitled to full back wages unless the employer proves gainful employment during the suspension period.
George denied being employed during his suspension, submitting an affidavit to this effect.
The division bench of Justices Anil K. Narendran and Muralee Krishna S. upheld the decisions of the Arbitration Court and Tribunal, affirming the award of full back wages to George.
Citing landmark judgments such as Hindustan Tin Works Pvt. Ltd. v. Employees of Hindustan Tin Works Pvt. Ltd. (1979), the court reiterated that employees whose services are illegally terminated are entitled to full back wages unless the employer can demonstrate gainful employment during the suspension period.
The court rejected the Bank’s argument that George was gainfully employed during his suspension, noting that no evidence was presented to substantiate this claim.
The judges emphasized that the burden of proof lies with the employer to show that the employee had alternative employment. They found George’s affidavit, denying gainful employment, credible in the absence of any contrary evidence.
The court also observed that the Bank’s actions in reinitiating disciplinary proceedings after reinstating George reflected an arbitrary and unjustified exercise of authority. It upheld the Arbitration Court’s finding that the suspension and dismissal were illegal.
Consequently, the High Court dismissed the Bank’s appeal and ordered the payment of full back wages to George, reinforcing the principle that employers must bear the burden of proving gainful employment during suspension periods.
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