IN THE HIGH COURT AT CALCUTTA
Constitutional Writ Jurisdiction
'D'
Versus
The Institute of Cost Accountants of India & Ors.
W.P. No.4806 (W) of 2019
INTRODUCTION
The Calcutta High Court in 'D' vs The Institute Of Cost Accountants & Ors 2019, held that once the allegations of sexual harassment are proven before the Internal Complaints Committee (ICC) under Sections 11 and 13(3) of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("the Act"), the disciplinary proceedings should initiated as per service rules by treating the act as misconduct since grounds for initiating the disciplinary proceedings already exist based on the inquiry report under Section 13(3). It was further held that not filing a statutory appeal under Section 18 of the Act does not take away the right of party from contesting the disciplinary proceedings under the service rules.
FACTS
Ms. D, the "Petitioner, (name hidden for sake of privacy)" filed a Writ Petition to contest the impugned memorandum dt. 19/02/2019 issued by Respondent No. 3, the President of the Institute of Cost Accountants of India. The petitioner filed a complaint of sexual harassment under the the Act against the Respondent No. 7 on 17/11/2016, alleging that he had verbally and mentally harassed her on several occasions in the year 2015, more specifically in August 2015, and on subsequent occasions further harassed her by denying her leave on medical grounds.
The Internal Committee's proceedings began, and on April 21, 2017, the IC made a recommendation in accordance with Section 13(3) of the Act which also contained penalty. On account of delay in implementing the recommendation petitioner filed a Writ Petition while the Respondent 7 also filed Writ Petition being aggrieved by the recommendation. In a combined judgement, the parties were granted the liberty to appeal to a statutory appellate authority under Section 18 of the Act.
Petitioner receive the impugned memorandum dt. 19/02/2019 was issued by Respondent 3 after considering the answer of respondent 7 to the show cause notice regarding the ICC report. The memo remitted the matter back to the ICC for fresh consideration. This Writ Petition was filed by Petitioner against the impugned memorandum.
Contentions of Petitioner
The Petitioner challenged the Memorandum mainly on the following grounds:
Respondent 3, the president is not the appellate authority and hence does not have the jurisdiction to remit the matter back to the ICC with the impugned memorandum to produce a new report after considering the facts, witness depositions, and arguments from the parties
The recommendations made by the ICC are binding on the employer
As per Section 19(i) of the Act, the employer is obligated to treat sexual harassment as misconduct under the applicable service rules and impose a punishment based on the recommendation made by the ICC but the employer does not need to initiate another disciplinary proceedings
The recommendation of ICC became binding on Respondent 7 since he did not prefer an appeal under Section 18 despite the liberty granted by the Court and hence cannot be challenged before any forum
The President's action of sending Respondent No. 7 a show cause notice asking him to respond to the ICC's findings and then sending out the Memorandum was against the law, completely ill-conceived, and violated natural justice principles.
Findings
Under Service Rule 91 (viii), the appointing authority, if it is not the inquiring authority, has the power to remit case for fresh inquire. By exercising powers under the said rule, respondent 3, remitted the case back to ICC for fresh consideration and thus acted as the appointing authority and not as the appellate authority.
Combined reading of Sections 11, 13 (3) and 13(4) of the Act, clarifies that once the complaint is received by the ICC, it should proceed as per the service rules and where there are no service rules, it should proceed in the manner prescribed.
From combines reading of Sections 13(3) of the Act and Rule 7 and 9 of POSH Rules, it emerges that when service rules exist, the report by the ICC is a fact finding or preliminary report and that the employer is bound to proceed as per service rules before imposing any major penalty. Where service rules exist, the disciplinary proceedings should initiate based on the service rules. Where there are no service rules, the ICC is empowered to recommend a punishment.
When an offence is proved before ICC, there is already a basis for initiating disciplinary proceedings against the employee as per service rules.
In the present case, the Institution has service rules and on the basis of recommendation of the ICC, respondent 3 should have initiated disciplinary proceedings under Rule 91(iii) of the Service Rules instead of issuing the impugned memorandum dt. 19/2/2019 under Rule 91(viii) after considering the response of respondent 7 to the show cause. The invocation of power under Rule 91 (viii) does not require respondent 3 to issue a show-cause notice and seek a responses on the report by the ICC. Hence the memorandum is misconceived, contrary to law and contravenes the service rules.
Section 28 of the Act clarifies that the POSH Act is an addition to other laws for the time being in force but not derogatory of that law and this also indicates that the Act is not an alternative to the service rules.
Section 18 of the Act provides that a party has right to appeal without prejudice to any other law for the time being in force. This means that even if respondent 7 does not file statutory appeal under Section 18, he does not loose the right to appeal under the service rules.
The Act does not intend the ICC proceedings to be treated as regular disciplinary proceeding before an inquiring authority unless the employer adopted a policy or framed a rule which amended the existing provisions or dispenses with the existing service rules. In the present case, the there is no policy adopted by the respondent 3 to treat the ICC as an inquiring authority under the service rules. The proceedings before the ICC were not accordance with the service rules nor the ICC was functioning as a delegated legislation of the disciplinary authority. The present proceedings before the ICC cannot be treated as disciplinary proceedings under Rule 91 of the service rules since it is not in consonance with the said Rule nor did the ICC adhere to the service rules applicable to respondent 7 for imposing major penalty. Furthermore the copies of the report were not made available to the parties to invite their response. The contention that respondents 3 and 7 are bound by the report and punishment must be imposed immediately cannot be accepted as it would violate principles of natural justice and would also be contrary to the principles governing service jurisprudence.
Since this Court did not interfere with the recommendation of the IC in W.P. No.329 (w) of 2017 and respondent 7 did not file an appeal, the findings and recommendations of the ICC set forth the ground for initiating the disciplinary proceedings against the employee by treating sexual harassment as misconduct.
OBSERVATIONS
"The provisions of the said Act cannot be treated to be in suppression of service rules but, the Act and Rules are an appropriate complaint mechanism created in an organization or work place to protect female employees from any gender injustice or harassment at their workplace and for timely disposal of such complaint in order to ensure that complaints were aptly dealt with"
COURT HELD
The respondent 3 did not adhere to the service rules and the Act by the issuances of the impugned memorandum that remitted the report back to ICC for fresh consideration without even considering that the recommendation was in the favor of petitioner. The Memorandum suffers from procedural irregularities and for violating the natural justice standards. The respondent 3 was directed to take steps as per Rule 91(iii) of the service rules by treating sexual harassment as misconduct, and that the disciplinary actions should be concluded within three months. Since the decision of the ICC is not challenge before the Court, the contention of procedural illegality of the said decision cannot be decided.
CONCLUSION
It is crucial that the employer make sure the complaint of sexual harassment is dealt with in accordance with both the Act and the service rules. It may be concluded that the POSH Law provisions should be read is as addition to the existing service rules when dealing with complaints of sexual harassment. Once the allegations of sexual harassment is proven before the ICC, a disciplinary proceedings needs to be initiated as per the service rules by treating the act as misconduct. The IC cannot make recommendations about the action to be taken against the employee when service rules exist.
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