The Calcutta High Court has delivered a significant judgment holding that an employee looking for another job, even with a rival company, is a basic right and does not constitute moral turpitude. The court ruled that withholding an employee’s gratuity dues on such grounds is contrary to the principles of natural justice. This decision reinforces the legal protections afforded to employees under the Payment of Gratuity Act and clarifies the narrow scope of “moral turpitude” in service law.
Background of the Dispute
The case originated from a dispute between a company, which claimed to be the sole manufacturer of a particular type of insulator film in India, and one of its technicians. The company terminated the employee in October 2022, alleging that he was in regular contact with a rival entity and was passing on confidential information regarding technology and manufacturing processes. On the basis of this alleged misconduct, which it classified as an act of moral turpitude causing it loss, the company forfeited the employee’s gratuity. The employee, who had joined in 2012, contested this and claimed to have tendered his resignation.
Proceedings Before Lower Authorities
Following the forfeiture of his dues, the employee, Sudip Samanta, approached the Controlling Authority under the Payment of Gratuity Act. The Authority ruled in his favor and directed the company to pay the outstanding amount. The company subsequently challenged this decision before the Appellate Authority, which also upheld the employee’s claim. The company then escalated the matter by filing a writ petition before the Calcutta High Court, seeking to overturn the orders of both the Controlling and Appellate Authorities.
High Court’s Analysis and Observations
In her judgment, Justice Shampa Dutt (Paul) conducted a thorough review of the company’s disciplinary proceedings. The court observed that looking for another job, even if with a rival for better perks, is a basic right. It held that such an act does not constitute moral turpitude, as it is not inherently contrary to honesty, modesty, or good morals. The court found that the company had failed to prove that any damage, loss, or destruction of its property was caused by the employee’s alleged actions.
Furthermore, the court heavily criticized the internal enquiry conducted by the company, deeming it a clear abuse of power and a violation of the principles of natural justice. It was noted that the company could not produce any witnesses or call records to substantiate its serious charges. The witnesses who were presented only stated that they had seen the employee speaking to personnel from the rival company, which was insufficient to prove the allegations of sharing confidential data.
The Final Verdict
Ultimately, the High Court found no merit in the company’s petition and dismissed it. Justice Dutt (Paul) affirmed the decision of the Appellate Authority, describing it as well-reasoned and lawfully rendered within its jurisdiction. Setting aside the punishment imposed by the company’s disciplinary authority, the court directed it to release the employee’s gratuity dues amounting to Rs 1.37 lakh. The court further ordered that this amount be paid along with simple interest calculated at a rate of 8% per annum.
