- 1 - HC-KAR NC: 2026:KHC:10643-DB WP No. 25249 of 2022 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 20TH DAY OF FEBRUARY, 2026 PRESENT THE HON'BLE MR. JUSTICE D K SINGH AND THE HON'BLE MR. JUSTICE S RACHAIAH WRIT PETITION NO. 25249 OF 2022 (L-TER) BETWEEN: 1. K T SHIVAPRAKASH S/O LATE K M THIMMAIAH AGED ABOUT 51 YEARS NO.282, NEW BAZAR STREET K R PURAM, BENGALURU-560036 …PETITIONER (BY SRI. NARAYANA BHAT M., ADVOCATE) AND: 1. THE UNION BANK OF INDIA (PREVIOUSLY KNOWN AS THE CORPORATION BANK) REP BY ITS CHAIRMAN AND MANAGING DIRECTOR HEAD OFFICE, UNION BANK BHAVAN NO.239, VIDHAN BHAVAN MARG NARIMAN POINT, MUMBAI MAHARASHTRA-400021 …RESPONDENT (BY SRI. PRADEEP.S.SAWKAR, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA, PRAYING TO ISSUE A WRIT OF CERTIORARI OR ANY OTHER APPROPRIATE WRIT, ORDER OR DIRECTION QUASHING THE PORTION OF THE AWARD DATED Digitally signed by VASANTHA KUMARY B K Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:10643-DB WP No. 25249 of 2022 23/06/2020 PASSED IN C.REF. NO. 23/2011 PRODUCED AT ANNEXURE-E IN SO FAR AS IT RELATES TO DENIAL OF BACK WAGES, ETC. THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE D K SINGH and HON'BLE MR. JUSTICE S RACHAIAH ORAL ORDER (PER: HON'BLE MR. JUSTICE D K SINGH) The present writ petition has been filed impugning the Award dated 23.06.2020 passed by the Central Government Industrial Tribunal-cum-Labour Court (hereinafter referred to as 'the CGIT'), Bengaluru in CR No. 23/2011. 2. The Central Government vide Order No.L- 12012/87/2010-IR(B-II) dated 27.05.2011, in exercise of its powers conferred by Clause (d) of Sub-Section (1) and Sub-Section 2(A) of Section 10 of Industrial Dispute Act, 1947, (hereinafter referred to as 'the Act') referred the Industrial Dispute for adjudication by the CGIT. - 3 - HC-KAR NC: 2026:KHC:10643-DB WP No. 25249 of 2022 3. The petitioner was working as a Clerk in the 'Corporation Bank' now merged with the 'Union Bank of India'. He was charge sheeted for alleged misappropriation of Rs.1,000/-. The Enquiry Officer however, found the charge proved against the petitioner. The Disciplinary Authority after giving him an opportunity to show cause for the proposed major punishment, dismissed him from service vide order dated 30.06.2009. Against the said order of Disciplinary Authority, the appeal resulted in dismissal. 4. The Industrial Tribunal vide impugned Award has set aside the order of dismissal of the petitioner from service and directed his reinstatement with continuity of service without backwages. 5. The present writ petition has been filed only confining to the 'not granting backwages' to the petitioner by the CGIT. It may also be noted that the said award came to be challenged by the respondent/Bank in Writ petition - 4 - HC-KAR NC: 2026:KHC:10643-DB WP No. 25249 of 2022 No.13043/2020 (L-TER). The said writ petition was dismissed vide judgment and order dated 05.04.2022, whereby the Co-ordinate Bench of this Court specifically held that when the misappropriation of the petitioner was not established, there was no question of losing confidence in the employee and therefore, the order passed by the Tribunal for reinstatement of the petitioner to his original post with continuity of service without backwages, was justified. 6. The SLP (Civil) Diary No.25676/2022 filed by the Bank against the said order also resulted in dismissal vide order dated 26.09.2022. 7. The learned counsel for the petitioner has submitted that once the Tribunal had recorded a finding that the charge of misappropriation was not proved and therefore, the punishment and Appellate Order, being set aside and by directing the respondent-Bank to reinstate the petitioner with continuity of service, the backwages - 5 - HC-KAR NC: 2026:KHC:10643-DB WP No. 25249 of 2022 normally should have been granted. No special circumstances have been stated by the Tribunal in denying the backwages to the petitioner. He therefore, submits that the petitioner would be entitled to the back wages, may not be 100% but certainly up to 50% backwages. 8. On the other hand, learned counsel appearing for the respondent-Bank has submitted that the order for backwages is not automatic but it depends on the facts and circumstances of the case. In the present case, when the Tribunal after considering the facts and circumstances of the case, has denied the grant of backwages, this Court should not interfere with the order passed by the Tribunal insofar as the question of grant of backwages, is concerned. 9. In support of his submission learned counsel for the respondent-Bank has placed reliance on the judgments in KV PATHROS Vs. THE DIVISIONAL CONTROLLER KSRTC IN CIVIL APPEAL NO.4390/2025 DATED 26.03.2025 and - 6 - HC-KAR NC: 2026:KHC:10643-DB WP No. 25249 of 2022 in J. K. SYNTHETICS LTD. VS. K. P. AGRAWAL AND ANOTHER [(2007) 2 SCC 433], wherein at paragraph Nos. 17 to 19 it is held as follows :- "17. There is also a misconception that whenever reinstatement is directed, “continuity of service” and “consequential benefits” should follow, as a matter of course. The disastrous effect of granting several promotions as a “consequential benefit” to a person who has not worked for 10 to 15 years and who does not have the benefit of necessary experience for discharging the higher duties and functions of promotional posts, is seldom visualised while granting consequential benefits automatically. Whenever courts or tribunals direct reinstatement, they should apply their judicial mind to the facts and circumstances to decide whether “continuity of service” and/or “consequential benefits” should also be directed. We may in this behalf refer to the decisions of this Court in A.P. SRTC v. S. Narsagoud [(2003) 2 SCC 212 : 2003 SCC (L&S) 161] , A.P. SRTC v. Abdul Kareem [(2005) 6 SCC 36 : 2005 SCC (L&S) 790] and Rajasthan SRTC v. Shyam Bihari Lal Gupta [(2005) 7 SCC 406 : 2006 SCC (L&S) 67] . - 7 - HC-KAR NC: 2026:KHC:10643-DB WP No. 25249 of 2022 18. Coming back to back wages, even if the court finds it necessary to award back wages, the question will be whether back wages should be awarded fully or only partially (and if so the percentage). That depends upon the facts and circumstances of each case. Any income received by the employee during the relevant period on account of alternative employment or business is a relevant factor to be taken note of while awarding back wages, in addition to the several factors mentioned in Rudhan Singh [(2005) 5 SCC 591 : 2005 SCC (L&S) 716] and Uday Narain Pandey [(2006) 1 SCC 479 : 2006 SCC (L&S) 250] . Therefore, it is necessary for the employee to plead that he was not gainfully employed from the date of his termination. While an employee cannot be asked to prove the negative, he has to at least assert on oath that he was neither employed nor engaged in any gainful business or venture and that he did not have any income. Then the burden will shift to the employer. But there is, however, no obligation on the terminated employee to search for or secure alternative employment. Be that as it may. 19. But the cases referred to above, where back wages were awarded, related to termination/retrenchment which were held to be - 8 - HC-KAR NC: 2026:KHC:10643-DB WP No. 25249 of 2022 illegal and invalid for non-compliance with statutory requirements or related to cases where the Court found that the termination was motivated or amounted to victimisation. The decisions relating to back wages payable on illegal retrenchment or termination may have no application to the case like the present one, where the termination (dismissal or removal or compulsory retirement) is by way of punishment for misconduct in a departmental inquiry, and the court confirms the finding regarding misconduct, but only interferes with the punishment being of the view that it is excessive, and awards a lesser punishment, resulting in the reinstatement of employee. Where the power under Article 226 or Section 11-A of the Industrial Disputes Act (or any other similar provision) is exercised by any court to interfere with the punishment on the ground that it is excessive and the employee deserves a lesser punishment, and a consequential direction is issued for reinstatement, the court is not holding that the employer was in the wrong or that the dismissal was illegal and invalid. The court is merely exercising its discretion to award a lesser punishment. Till such power is exercised, the dismissal is valid and in force. When the punishment is reduced by a court as being excessive, there can be either a direction for - 9 - HC-KAR NC: 2026:KHC:10643-DB WP No. 25249 of 2022 reinstatement or a direction for a nominal lump sum compensation. And if reinstatement is directed, it can be effective either prospectively from the date of such substitution of punishment (in which event, there is no continuity of service) or retrospectively, from the date on which the penalty of termination was imposed (in which event, there can be a consequential direction relating to continuity of service). What requires to be noted in cases where finding of misconduct is affirmed and only the punishment is interfered with (as contrasted from cases where termination is held to be illegal or void) is that there is no automatic reinstatement; and if reinstatement is directed, it is not automatically with retrospective effect from the date of termination. Therefore, where reinstatement is a consequence of imposition of a lesser punishment, neither back wages nor continuity of service nor consequential benefits, follow as a natural or necessary consequence of such reinstatement. In cases where the misconduct is held to be proved, and reinstatement is itself a consequential benefit arising from imposition of a lesser punishment, award of back wages for the period when the employee has not worked, may amount to rewarding the delinquent employee and punishing the employer for taking action for the misconduct - 10 - HC-KAR NC: 2026:KHC:10643-DB WP No. 25249 of 2022 committed by the employee. That should be avoided. Similarly, in such cases, even where continuity of service is directed, it should only be for purposes of pensionary/retirement benefits, and not for other benefits like increments, promotions, etc." 10. His next submission is that in the writ petition filed by the respondent-Bank, this Court has upheld the award i.e. the reinstatement without backwages against which SLP has been dismissed and therefore, the question of not granting backwages has attained finality. 11. No doubt the Supreme Court in J. K. SYNTHETICS LIMITED supra has held that it is not necessary that whenever reinstatement is directed, continuity of service and consequential benefits should follow as a matter of course. Whenever the Courts or Tribunals direct reinstatement, they should apply their judicial mind to the facts and circumstances of the case to decide, whether the 'continuity of service' and/or 'consequential benefits' should also be directed. So far as the question of - 11 - HC-KAR NC: 2026:KHC:10643-DB WP No. 25249 of 2022 backwages is concerned, if the Court finds it necessary to award backwages, the question will be whether the backwages should be awarded fully or only partially. That depends on the facts and circumstances of each case. 12. It is further observed in the said judgment that any income received by the employee during the relevant period on account of alternative employment or business is a relevant factor to be taken note of, while awarding backwages in addition to the several other factors as mentioned in G.M. HARYANA ROADWAYS Vs. RUDHAN SINGH [(2005) 5 SCC 591] and in U.P. STATE BRASSWARE CORPORATION LIMITED Vs. UDAY NARAIN PANDEY [(2006) 1 SCC 479]. 13. We have considered the aforesaid submissions and perused the judgments cited by the learned counsel for the respondent-Bank. The Tribunal has unequivocally held that the charge of misappropriation of Rs.1,000/- against the petitioner was not proved. The said finding was also - 12 - HC-KAR NC: 2026:KHC:10643-DB WP No. 25249 of 2022 affirmed by the Division Bench of this Court. Once the charge of misappropriation of Rs.1,000/- was not proved against the petitioner, a mere deposit made by him, to avoid unnecessary harassment would not mean that the charge stood proved. The mere charge on which the petitioner was dismissed from service was misappropriation of Rs.1,000/-, which according to the CGIT was not proved and this Court has affirmed the order of the CGIT to that extent. 14. It is not the case of the respondent-Bank that the petitioner was gainfully employed or he had earned some wages/income during this period, when he was out of employment. Therefore, we are of the view, that denying backwages fully for the period, when he remained out of employment from the date of dismissal till date of award, would be highly unjustified. 15. Therefore, considering the facts and circumstances of the case, we deem it appropriate that the petitioner would - 13 - HC-KAR NC: 2026:KHC:10643-DB WP No. 25249 of 2022 be entitled to, and award backwages of 50% from the date of dismissal till date of award. However, he shall not be entitled for 2 years backwages inasmuch as he has filed the writ petition after 2 years from the date of award. 16. The respondent-Bank is directed to calculate the backwages for the period from the date of dismissal till the date of award, less two years, as stated above, and make payment within a period of 6 weeks from today. 17. With the aforesaid direction the writ petition stands allowed. Sd/- (D K SINGH) JUDGE Sd/- (S RACHAIAH) JUDGE NG CT:SN List No.: 2 Sl No.: 7