As per case facts, employees were appointed as Clerk-cum-Typist but later suspended and terminated amidst allegations of malpractice and fraud against the management, leading to criminal proceedings. An internal inquiry ... exonerated them from misconduct, but their services were terminated. They challenged this as illegal, seeking reinstatement and back wages, especially since some similar employees were retained. The Labour Court found the termination illegal but granted only nominal lump-sum compensation. The employer also challenged the compensation grant. The question arose whether the Labour Court could inquire into the legality of the original appointments when employees were exonerated from misconduct, and if termination was justified due to alleged illegal appointments without following constitutional norms. Finally, the Court affirmed that despite exoneration, appointments had legal defects like absence of sanctioned posts or non-compliance, which disciplinary inquiry exoneration couldn't cure. Reinstatement was denied to avoid perpetuating an illegality. However, considering the employees' substantial service, lack of involvement in initial fraud, and hardship, the Court enhanced the compensation awarded by the Labour Court and dismissed the employer's petitions, finding monetary recompense appropriate despite appointment irregularities.