- 1 - HC-KAR NC: 2026:KHC:4621 WP No. 15758 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 28TH DAY OF JANUARY, 2026 BEFORE THE HON'BLE MR. JUSTICE ANANT RAMANATH HEGDE WRIT PETITION NO. 15758 OF 2024 (L-KSRTC) BETWEEN: DIVISIONAL CONTROLLER, WEST DIVISION, KENGERI, BENGALURU-560060, REPRESENTED BY ITS CHIEF LAW OFFICER, BMTC, CENTRAL OFFICE K.H.ROAD, SHANTHINAGARA, BENGALURU 560027. …PETITIONER (BY SRI HAREESH BHANDARY T,ADVOCATE) AND: SRI BHARATHESH YATHAGIRI, REPRESENTED BY GENERAL SECRETARY, KSRTC AND BMTC, UNITED EMPLOYEES UNION, NO.23, 4TH MAIN, MATHIKERE EXTENSION, BENGALURU-560054. …RESPONDENT (BY SRI SHEKAR L., ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER DTD. 05.08.2023 PASSED BY THE INDUSTRIAL TRIBUNAL, BANGALORE IN I.D.NO. 157/2018 IN SETTING ASIDE THE DISCIPLINARY ORDER DTD. 31.07.2014 VIDE ANNX-A. THIS PETITION, COMING ON FOR FURTHER HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE ANANT RAMANATH HEGDE Digitally signed by PRAMILA G V Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:4621 WP No. 15758 of 2024 ORAL ORDER This petition is filed assailing the award dated 05.08.2023 passed by the Industrial Tribunal, Bangalore. In terms of the said award, the penalty of withholding two annual increments with cumulative effect imposed on the respondent/workman in terms of order dated 31.07.2014 is set aside. Hence, the petitioner/employer is before this Court. 2. Certain facts which are admitted are as under: - Respondent/workman was working as a driver cum conductor under the petitioner. On 22.04.2012, the bus in which the respondent/driver cum conductor was officiating was intercepted by the checking squad and the petitioner/ Corporation alleges that Rs.491/- was found to be in excess or found to be in possession of the respondent and said cash was excess compared to the tickets sold to the passengers travelling on the bus. 3. In this behalf, articles of charges were issued against the respondent. The respondent replied to the articles of charges denying the allegations. Not being satisfied with the - 3 - HC-KAR NC: 2026:KHC:4621 WP No. 15758 of 2024 explanation, the domestic inquiry was initiated against the respondent. The respondent participated in the domestic inquiry. 4. Based on the materials placed on record, the Enquiry officer has held that the charges against the respondent are proved. Then the disciplinary authority accepting the report has imposed the penalty after issuing second show cause notice to which the respondent had again replied denying the findings. As already noticed, two annual increments with cumulative effect were withheld. 5. Learned counsel appearing for the petitioner would urge that the fact that Rs.491/- was found in the custody of the respondent/workman is admitted. The respondent/workman has taken a stand that one of the passengers had tendered a Rs.500/- currency to purchase Rs.9/- ticket and he forgot to collect the change and Rs.491/- remained with the respondent. Thus, the burden is on the respondent/workman to establish that Rs.500/- currency was tendered by a passenger to the respondent and that fact is not established. - 4 - HC-KAR NC: 2026:KHC:4621 WP No. 15758 of 2024 6. To substantiate the contention, the learned counsel for the petitioner would also refer to Exhibit M1. Referring to said document, it is urged that the denominations recovered from the custody of the respondent were specifically mentioned and said document is signed by respondent and the said document would indicate that Rs.500/- currency was not tendered by any of the passengers to the respondent as such, the defence raised by the respondent that Rs.500/- currency was tendered to the respondent by one of the passengers is not established. 7. In addition to that when the enquiry was held while cross-examining the witness examined on behalf of the petitioner, it is suggested by the respondent workman that a passenger had tendered a Rs.500/- currency to the respondent to purchase a ticket worth Rs.9/- and without collecting the change, he has alighted from the bus, as such, the respondent admitted to be in possession of excess amount. A passenger tendering Rs.500/- currency is not established given the fact that Exhibit M1 which is signed by respondent does not reveal the seizure of currency of Rs.500/- denomination from the respondent. - 5 - HC-KAR NC: 2026:KHC:4621 WP No. 15758 of 2024 8. Learned counsel elaborating his submission would also urge that the Tribunal has not considered the documents in proper perspective and has erroneously come to the conclusion that the charges are not established on the premise that the disciplinary authority has not properly verified the records. 9. Learned counsel for the petitioner would invite the attention of the Court to the finding of the inquiry officer wherein it is clearly discussed by the enquiry officer to come to the conclusion that Rs.500/- was never seized from the respondent as such, the contention that one of the passengers has tendered Rs.500/- currency is not established. Thus, he urged that the award has to be set aside. 10. Learned counsel for the petitioner would also place reliance on the judgment of the Apex Court in Divisional Controller, KSRTC (NWKRTC) vs A.T.Mane1 to urge the contention that once the excess currency is found in the custody of the respondent, it is the burden of the respondent to explain the excess currency. It is also urged that in case the 1 (2005)3 SCC 254 - 6 - HC-KAR NC: 2026:KHC:4621 WP No. 15758 of 2024 driver or the conductor is required to carry excess currency or cash, they need to file a declaration as required under the Regulation and in the absence of any such declaration, it is to be considered as misconduct on the part of the employee. 11. Learned counsel would also refer to the judgment of the Division Bench of this Court in Bengaluru Metropolitan Transport Corporation vs Fakruddin2 to urge the contention that even under Section 106 of the Indian Evidence Act, the burden lies on the respondent who has asserted that he received a Rs.500/- currency from a passenger who wanted to purchase a ticket worth Rs.9/-. Thus, he would urge that impugned award is to be set aside. 12. Learned counsel for the respondent would urge that the explanation provided by the respondent/employee is not properly considered by the disciplinary authority. It is his submission that there was no allegation that Rs.500/- currency was not seized from the employee. Had it been the allegation, respondent would have explained as to how Rs.500/- currency 2 Writ Appeal No. 7169/1999 - 7 - HC-KAR NC: 2026:KHC:4621 WP No. 15758 of 2024 though was issued by one of the passengers, was not found with him by the time the interception took place. 13. It is his contention that probably the respondent/ employee would have handed over that Rs.500/- currency to another passenger who had paid a bigger denomination to purchase a ticket of smaller value. In addition, it is also urged that the penalty of withholding 2 increments with cumulative effect is also disproportionate to the alleged misconduct and the misconduct if at all proved, is only a technical misconduct and there is no loss caused to the Corporation and it is not the case of the Corporation that the respondent/employee has collected the fair ticket value from the passengers and not issued the ticket. Thus, he would urge that the Labour Court is justified in setting aside the penalty. 14. The Court has considered the contentions raised at the bar and perused the records. 15. Admittedly, the respondent/driver cum conductor was officiating on the bus on the given day when the interception took place. The respondent had admitted that he was in possession of excess currency worth Rs.491/-. The - 8 - HC-KAR NC: 2026:KHC:4621 WP No. 15758 of 2024 question before this Court is whether the excess currency is properly explained. 16. Admittedly, it is not the case of the respondent that he has furnished a declaration which enabled him to carry excess currency. Thus going by the defence of the respondent/ workman, the respondent/workman has to establish that Rs.500/- currency was tendered to him by a passenger and he handed over a ticket worth Rs.9/- and the passenger forgot to collect the change of Rs.491/- and that excess amount remained with the respondent/workman. 17. It is an admitted factual position that in case the employee is required to carry cash in excess of Rs.50/-, he is required to furnish a declaration before the start of the duty. That is not done. Thus, the burden is on the respondent/ employee to establish as to how he came in possession of Rs.491/- in excess of the tickets sold. 18. Respondent/employee has made an attempt to establish his defence that a passenger has tendered Rs.500/- currency note to purchase a ticket of Rs.9/- and Rs.491/- cash was returned to him and he forgot to collect the cash. It is to - 9 - HC-KAR NC: 2026:KHC:4621 WP No. 15758 of 2024 be noticed that the cash form signed by the respondent/ employee would disclose the denomination of the currency notes recovered from the respondent employee. It is very much apparent that Rs.500/- currency note was never recovered from the respondent/employee on that day. Thus, the defence that a passenger tendered Rs.500/- currency note to the respondent is not established. Thus, the explanation offered by the respondent/employee that Rs.500/- currency note was given to him by a passenger who purchased the ticket worth Rs.9/- and he forgot to collect the change is not accepted. 19. The Labour Court has come to the conclusion that the offence is not established on the premise that the explanation offered by the respondent/workman is not properly appreciated and considered by the disciplinary authority. Accordingly, it has set aside the award imposing penalty of withholding two annual increment with cumulative effect. 20. It is relevant to notice that Labour Court has not at all considered Exhibit M1. The inference arising from Exhibit M1 is not taken into account. Exhibit M1 is the answer to the contentions raised by the respondent/employee in his defence. - 10 - HC-KAR NC: 2026:KHC:4621 WP No. 15758 of 2024 This being the position, this Court is of the view that a material evidence i.e. Exhibit M1 which is not disputed by the respondent/employee is completely overlooked by the Tribunal and the Tribunal has erroneously come to the conclusion that the charges are not proved. 21. Though the learned counsel for the respondent would urge that the employee had time to make necessary entries in the way bill after the completion of the duty, but before completion of the duty there was an interception and he was not permitted to offer his legitimate explanation, the Court is of the view that it is an admitted fact from the records that by the time the interception took place, 10 trips were completed and at the beginning stage of the 11th trip the interception took place. This being the position, the contention that the respondent-employee still had time to deposit excess cash before the authority with a request to return the change of Rs.491/- to the passenger cannot be accepted. 22. It is to be noticed that the employer has not alleged that the respondent - employee has collected money without issuing ticket. It appears when the interception took place, all - 11 - HC-KAR NC: 2026:KHC:4621 WP No. 15758 of 2024 passengers had tickets. Division Bench of this Court in North Eastern Karnataka Road Transport Corporation versus Shivashankar3 has concluded that in a case of this nature, penalty of dismissal is disproportionate and it is also noticed that such misconduct would amount to a technical misconduct and has set aside the penalty of dismissal and ordered reinstatement without back wages. 23. It is noticed in the instant case that there was no such penalty of dismissal. So there is no question of denying back wages to the respondent. But what is to be noticed is that the authority has imposed a penalty of withholding two annual increments with cumulative effect. It is noticed that in the aforementioned judgment, the Division Bench of this Court has held that for two years, the workman will not earn increments. 24. This Court is of the view that the offence referred to in the aforementioned judgment is also similar to the offence in the present case. Under the circumstances, the respondent is not entitled to increment for 2 years from the date of the initial order of the disciplinary authority. 3 W.A.No.7328/2001 - 12 - HC-KAR NC: 2026:KHC:4621 WP No. 15758 of 2024 25. Hence the following: ORDER (i) The Writ Petition is allowed. (ii) The impugned award dated 05.08.2023 in I.D.No.157/2018 on the file of the Industrial Tribunal, Bengaluru is set aside. (iii) The increment of the respondent is withheld for 2 years. Sd/- (ANANT RAMANATH HEGDE) JUDGE BRN List No.: 1 Sl No.: 12