Recently, in a judgment dated 4th September, 2019, the Kerala High Court in the case of Vineeth Shamil K. vs. Air India Charters Ltd. and Ors. held that a holding company cannot conduct an inquiry into an allegation of sexual harassment, when their subsidiary has already conducted a detailed inquiry as per The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (“Law”).

Facts: Vineeth Shamil K (“Petitioner”) was working as an employee of the first respondent Company i.e., the Air India Charters Limited (AICL) (“Employer”). The prayer filed was to quash the direction issued by the holding company of the Employer (“AIL”) requiring the Petitioner to be present at the proceedings of the Internal Committee (“AIL IC”).

Petitioner’s Contention: The third respondent (“Complainant”), who worked with the Employer had submitted the complaint alleging sexual harassment against the Petitioner, pursuant to which the Petitioner had submitted his reply. The Internal Committee of the Employer (“Employer IC”) had conducted a detailed inquiry into the matter and an inquiry report had been submitted. The inquiry report exonerated the Petitioner from the charges, on the basis of examination of the witnesses and the CCTV footage evidence of the alleged incident. Further, it was recommended that appropriate action by issuing warning letters be taken against two witnesses, who had not witnessed the incident, but had given false evidence, to favour the Complainant. There was a further recommendation to take disciplinary action against the Complainant to avoid repetition of such incidents. Thereafter, without any authority of law, a notice had been issued to the Petitioner to be present before the AIL IC, pursuant to which, he submitted his reply stating that since the proceedings of Employer IC stood concluded, the further notice issued to him was completely unjustified.

AIL’s Contention: The reason why AIL IC had called for fresh inquiry is because the Complainant had filed a separate writ petition stating that the higher officials of the Employer were not serious about the action on the basis of her complaint and that the Chairperson of the Employer IC (“PO”) had taken steps to see that the Respondent was exonerated. She claimed that she and her witnesses were threatened, harassed and humiliated by the PO and were not permitted to conduct her case in a befitting manner, due to which she approached the National Commission for Women (“NCW”), who directed the AIL to take action on the basis of her complaint. Thereafter, the AIL IC for the Western Region had been set up by AIL and notice had been issued to the Respondent to appear for hearing. It was contended that in view of the biased attitude of the Employer IC, the action of AIL IC was only just and proper.

Employer’s Contention: A detailed counter affidavit was placed on record by the fourth respondent i.e. “Employer IC” stating that they had considered the complaints raised by the Complainant, the reply of the Respondent as well as the statements of the witnesses and had found that the complaint had been raised without any factual basis. It is stated that, in view of the fact that there was a specific Employer IC who had considered the issue, the NCW did not have any power to direct the AICL, which is only the holding company any of the Employer, to constitute a separate committee and to consider the complaint. It was further stated that several e-mails had been sent by the Complainant raising allegations against the PO and members of the Employer IC. However, none of them were made a party to her writ petition. Employer IC had considered not only the statement of the Complainant and the Petitioner as well as the witnesses but had also examined the CCTV footages and had come to the definite conclusion that no sexual harassment, as alleged, had taken place. It was further submitted that an FIR also had been registered on the basis of the complaint raised by the Complainant and the issue is under investigation by the police.

Held: On the issue of the validity of the inquiry by the Employer, the Court held that:

“It is not in dispute before me that the employees in question are employed by the Employer. The Employer is a corporate body and a separate legal entity from AIL. It is apparent that when a complaint had been raised as regards the sexual harassment meted out, the complaint was placed before the Employer IC and a full- fledged enquiry in terms of the Law had been conducted. A report has also been placed on record, wherein, it was found that the allegations raised were not substantiated. It appears that several hearings had been conducted, witnesses were examined and CCTV footages were looked into to find the veracity of the complaints raised. After examining all relevant materials, Employer IC had come to the conclusion that there was no material to implicate the Petitioner. It was also directed that appropriate disciplinary action be taken against the Complainant for having raised a false complaint and warnings be issued to the witnesses who had supported her claim.

Regarding the allegations that the PO and other IC members were biased, the Court held that:

“Though several allegations of mala fides are raised against the PO and members of the Employer IC, it is pertinent to note that neither persons against whom such allegations are made nor Employer IC have been made a party to this writ petition. The allegations are to the effect that the PO and members of the Employer IC were all along attempting to exonerate the Petitioner. No reason whatsoever for such an attitude on the part of the members of the Employer IC is forthcoming though extensive pleadings have been placed on record. In any view of the matter, I am of the opinion that without impleading even the Employer IC collectively as a party to these writ petitions, raising of allegations as against the specific members thereof itself is impermissible, especially before a constitutional court.”

On the issue of the validity of a separate inquiry by AIL IC, the Court held that:

“The only legal question which requires an examination at the hands of this Court is whether the conduct of further inquiry by an AIL IC is justified. AIL admittedly is not the employer of either the Complainant or the Petitioner. A full-fledged inquiry under the Law had been conducted by the Employer IC and a report exonerating the Petitioner had been placed on record. In the above view of the matter, I fail to see how a holding company which is a separate legal entity could have directed the conduct of an inquiry by its own internal committee. No provision of law which empowers such a course of action is brought to my notice. In view of the fact that the Employer IC has already conducted an inquiry and since the findings in the inquiry have not challenged on any legally sustainable grounds, I am of the opinion that the action taken by the holding company to conduct a further inquiry through its own internal committee is completely without jurisdiction. In the above view of the matter, the steps taken by the AIL to conduct a further inquiry into the matter, is unsustainable and the same is set aside.”

Thus, the Court granted the writ petition and directed the implementation of the Employer IC’s inquiry report and to take appropriate further steps in the matter.

– Adv. Shivangi Prasad – Corporate Lawyer, External Member & Trainer, Head – Legal & Compliance, Partner Child Safety at Work