Delhi HC Upholds DTC Conductor's Reinstatement Where Squad Failed to Verify Cash and Enquiry Breached Natural Justice

A Division Bench of the Delhi High Court dismissed DTC's appeal, holding that failure to check a conductor's cash and multiple enquiry lapses meant misconduct was never proved.

The Delhi High Court's Division Bench — comprising Chief Justice Devendra Kumar Upadhyaya and Justice Tejas Karia — on 23 May 2026 dismissed a Letters Patent Appeal filed by the Delhi Transport Corporation challenging the reinstatement of a conductor dismissed in 1994. The bench found that the Vigilance Checking Squad had intercepted the bus and recovered un-punched tickets from the conductor, Ram Avtar Sharma, but had never verified the cash in his possession. That single evidentiary gap, compounded by four distinct breaches of natural justice during the departmental enquiry, led the court to conclude that the charge of misconduct had not been established by cogent, reliable and consistent evidence. The appeal was dismissed with no order as to costs.

The Incident and Dismissal

Ram Avtar Sharma joined the DTC as a daily-rated conductor on 30 July 1983 and was placed on monthly-rated service on 30 January 1984. He was posted at Okhla Depot-I.

On 24 April 1992, the Vigilance Checking Squad intercepted Bus No. 6214 operating on the Shivaji Stadium–Sohna route at Badshahpur at around 8:00 PM. Five passengers were found travelling without tickets. They told the Squad they had paid the fare to Sharma. The Squad then found un-punched tickets bearing Nos. 66667 to 66671 of ₹2/- each on his person. A further inspection of the bus turned up five more ticketless passengers, who also said they had paid Sharma. Un-punched tickets for travel from Gurgaon to Bhondasi bearing Nos. 82297 to 82299 and Nos. 83312 to 83313 were recovered from the ticket hand block.

Sharma was placed under suspension and a chargesheet was issued. His reply was found unsatisfactory. The Enquiry Officer held the charges of misconduct proved in a report dated 29 October 1993. DTC removed Sharma from service with effect from 19 October 1994 vide Memo No. OD-I/AIT/C-66/94/1929 dated 17 October 1994.

Labour Court Findings and Award

Sharma challenged the dismissal before the Labour Court, Karkardooma Courts, Delhi. The Labour Court framed a preliminary issue on whether DTC had conducted a fair and proper enquiry in accordance with the principles of natural justice.

By its order dated 2 September 2009, the Labour Court held that DTC had failed to supply three material documents: the Driver Memo, the Log Book, and the Statements of Passengers. The Log Book had been withheld on the ground that the Enquiry Officer considered it irrelevant. Merely permitting Sharma to inspect the Statements of Passengers, rather than supplying copies, was held insufficient. The Labour Court also found that the chargesheet had expressly stated that Sharma's past record would be considered at the time of passing the final order, yet that past record was never enclosed with the chargesheet and Sharma was given no opportunity to explain it. The right to a Defence Assistant was not properly explained to him on each date of enquiry.

In the Award dated 3 May 2010, the Labour Court went further and examined the evidence on merits. It recorded that the Squad had not checked the cash in Sharma's possession at the time of interception. Without that verification, the charge of misconduct could not be established by cogent evidence. The Award directed reinstatement with continuity of service for the purposes of seniority, pension, gratuity and all other consequential benefits, but denied back wages. The denial of back wages was grounded in Sharma's past record, which showed a warning in 1986 for performing duties without uniform, a stoppage of increment in 1987 for non-issuance of tickets after collecting fare, and a warning in 1989 for refusing to hand over un-punched tickets to the Squad.

Single Judge's Order and DTC's Letters Patent Appeal

DTC challenged the Award and the Labour Court Order before a Single Judge in W.P.(C) No. 6785/2011. During the pendency of that writ petition, Sharma filed an application under Section 17B of the Industrial Disputes Act, 1947, which was allowed on 7 February 2014.

The Single Judge, by the impugned order dated 14 May 2024, dismissed the writ petition. The Single Judge agreed that the non-supply of the Log Book, the absence of proper material showing Sharma had been permitted to inspect documents, the denial of a Defence Assistant, and the non-enclosure of the past record with the chargesheet collectively established that the enquiry had been conducted in breach of the principles of natural justice. The Single Judge also found the passenger statements fraught with discrepancies: the statements of Mr. Zile Singh and Mr. Subhash did not disclose the exact point of commencement of travel, the destination, or the fare paid; no statement had been recorded from the group of five passengers alleged to have travelled from Gurgaon to Badshahpur; and the statement of Mr. Abhey Singh lacked authenticity because the number of ticketless passengers mentioned therein did not tally with the names recorded. Back wages were denied on account of Sharma's past record.

DTC then filed LPA 972/2024 before the Division Bench.

DTC's Arguments Before the Division Bench

Counsel for DTC argued that there was no violation of natural justice during the enquiry. The Enquiry Report itself recorded that Sharma did not bring any co-worker to assist him, and that recording bore Sharma's signature without objection. In proceedings dated 30 August 1993 and 15 September 1993, it was specifically noted that Sharma declined the assistance of a co-worker and refused the assistance offered by the Labour Commissioner, with endorsements signed by him.

DTC further argued that Sharma had admitted in cross-examination before both the Enquiry Officer and the Labour Court that his bus was checked on 24 April 1992 and that a challan was issued against him. All relevant documents had been supplied along with the chargesheet against Sharma's signature, which he admitted during cross-examination at trial. The Driver Memo was held unnecessary by the Enquiry Officer, and Sharma never summoned the bus driver in his own defence. As for the passenger statements, the Squad members appeared and were cross-examined in detail. DTC also pointed to Sharma's past record of similar lapses as justifying the severity of the punishment.

How the Division Bench Reasoned

Justice Tejas Karia, writing the judgment, began by examining the Division Bench precedent in Delhi Transport Corporation v. Shyam Singh (Neutral Citation: 2012:DHC:2113-DB), which involved a comparable factual matrix. In that case, the Division Bench had upheld reinstatement specifically because the Squad had failed to verify the cash found in the conductor's possession, holding that without such verification the charge of misappropriation could not be conclusively established.

The court drew on the legal position in Syndicate Bank v. The General Secretary, Syndicate Bank Staff Association, (2000) 5 SCC 65, which requires that the workman be made aware of the complaint against him, be given a genuine opportunity to state his case, and that management act in a fair, reasonable and just manner. The court also referred to Apparel Export Promotion Council v. A.K. Chopra, AIR 1999 SC 625, for the proposition that even where an opportunity of hearing is given, an Industrial Adjudicator may interfere if the management's action is found to be arbitrary and unreasonable.

Applying these principles, the Division Bench identified four distinct infirmities in the enquiry proceedings.

First, the Log Book, which Sharma had specifically sought as relevant to his defence, was denied to him on the ground that the Enquiry Officer considered it irrelevant. The court held that this was not a decision Sharma was bound to accept without recourse.

Second, the Statements of Passengers were not supplied to Sharma. He was merely permitted to inspect them. The bench held that inspection cannot be regarded as an adequate substitute for the furnishing of copies.

Third, the evidence did not satisfactorily establish that the right to a Defence Assistant was properly explained to Sharma on each date of enquiry in the manner required by law.

Fourth, and in the court's own framing the most significant point, the chargesheet itself stated that Sharma's past service record would be taken into consideration while passing the final order, yet that past record was not enclosed with the chargesheet and no opportunity was afforded to Sharma to explain or rebut it. The bench stated that “the reliance upon a person's past record for the purpose of imposing a more severe punishment, without granting such person an opportunity to address the same, constitutes a settled infraction of the principles of natural justice.”

On the evidentiary side, the bench found the passenger statements materially inconsistent. The statements of Mr. Zile Singh and Mr. Subhash did not disclose the precise point of commencement of travel, the destination, or the fare paid. No statement was recorded from the group of five passengers alleged to have travelled from Gurgaon to Badshahpur. The statement of Mr. Abhey Singh was found to lack credibility because the number of ticketless passengers referred to therein did not tally with the names mentioned. Crucially, the Squad had not verified the cash in Sharma's possession at the time of interception. In those circumstances, the bench held that DTC had not discharged its burden of proving misconduct by reliable and consistent evidence.

The bench rejected DTC's reliance on the six authorities it had cited — including State of Haryana v. Rattan Singh, (1977) 2 SCC 491, and several Delhi High Court decisions — on the ground that those decisions arose in factual settings where the charges stood duly established on credible material, which was absent here.

On back wages, the bench agreed that Sharma's past record — the 1987 increment stoppage for non-issuance of tickets after collecting fare and the 1989 warning for refusing to hand over un-punched tickets — justified the denial. That aspect of the Award and the impugned order was found to warrant no interference.

Outcome

The Division Bench upheld the impugned order dated 14 May 2024 passed by the Single Judge in W.P.(C) No. 6785/2011. LPA 972/2024 and the pending application CM APPL. 57378/2024 were dismissed. DTC is required to reinstate Ram Avtar Sharma with continuity of service for the purposes of seniority, pension, gratuity and all other consequential benefits, but without back wages. There is no order as to costs.