G.E.C. (P) Ltd. Naini, Allahabad Vs.
The Labour Court, Allahabad  INSC 176 (5 August 1968)
05/08/1968 VAIDYIALINGAM, C.A.
CITATION: 1969 AIR 235 1969 SCR (1) 543
Misconduct--Illegal strike--Dismissal of
workmen who had been given warning about an earlier strike--Warning held
wrongly given-Punishment after taking into account such warning cannot be
There was a strike in the establishment of
the appellant company betseen 18th and 30th March, 1964, and again a token
strike on 10th April, 1964. For the misconduct of going on the first strike
some of the workmen were charged and given a warning. The second strike was
held to be illegal by an enquiry officer and six of the workmen who had been
given a warning in respect of the first strike were dismissed for taking part
in the second strike also. The Labour Court held that in the compromise that
had ended the first strike the company had given the undertaking that it would not
take any action by way of punishment against the workmen, and therefore the
warning in respect of the first strike which was given only after the enquiry
report relating to the second strike had been already received, was not only
not bona fide but illegal. Because this warning was taken into account against
the six workmen who were dismissed, the Labour Court set aside the order of
dismissal, although holding that the second strike was ille.gal because of want
of notice under subs. 4 of s. 6-S of the U.P. Industrial Disputes Act, 1947.
The company appealed to this Court.
HELD: (i) The Labour Court rightly held on
the facts that the warning given to the workmen in respect of the.
first strike was not only not bona fide but
also against the terms of the settlement by which the first strike was ended.
[548 G] (ii) The second strike was, as held by the Labour Court, illegal and
therefore 'misconduct' under sub-cl. (2) of cl.
21 of the Standing Orders of the company. Any
punishment imposed under el. 22 of the said Orders in respect of an illegal
strike after a fair enquiry, being a managerial function would not normally be
interfered with. But in the present case the management was not entitled to
account the warning given in respect of the
first strike in view of the settlement it had entered into with the workers to
end that strike. The Labour Court was therefore again right in holding the
punishment of dismissal of the six respondents as vindictive and unjustified.
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 958 of 1966.
Appeal by special leave from the Award dated
September 16, 1965 of the Labour Court, Allahabad in Adjudication Case No. 78
G.R. Gokhale, O.P. Malhotra and 1. B.
Dadachanji, for the appellant.
R. Vasudev Pillai and Subodh Markandeya, for
respondents Nos. 2(a) to 2(k).
541 The Judgment of the Court was delivered
by Vaidialingam, J. In this appeal, by special leave, the question, that arises
for consideration, is as to whether the award of the Labour Court, Allahabad,
dated September 16, 1965, directing the reinstatement of six workmen, referred
to in the order of reference, is justified.
The facts leading up to the award may be
There was a strike, in the establishment of
the appellant company, from March 18, 1964. There was a meeting, of the
District Industrial Relations Advisory Committee, on March 29, 1964, presided
over by the District Magistrate of the area. Representatives of the management
and the workmen, attended the said meeting. The proceedings of the meeting show
that the Advisory Committee, decided to appeal to the appellant not to take any
action, against the workers, on the gro.und that they had on strike, from March
There was an appeal, to the District
Magistrate, Allahabad, to release, as a gesture of goodwill, the arrested
employees of the company, who were not involved in violence. The Union,
representing the workers of the appellant, in turn, decided to call off the
strike and directed the workmen to resume work with effect from the morning of
March 30, 1964.
There is no controversy that the strike was
called off, and certain workers, who had been arrested in connection with the
strike, were also released from is 'it, on March 29, 1964 itself. This strike
will be referred to, as the first strike, in the course of this judgment.
On March 20, 1964, the respondent-Union had
given to the appellant, another notice, stating that the workmen of the appellant
company would be going on a token strike, for one day, after fourteen days of
the receipt of the notice, in sympathy with the workers of the Swadeshi Cotton
Mills, Nalni. The exact date, on which the strike was to take place, was not
given in the notice, as required under sub-s.
(4) of s. 6S of the U.P. Industrial Disputes
Act, 1947 (hereinafter referred to as the Act). On April 9, 1964, the
respondent Union again intimated to the management about the workmen's
intention to go on strike on April 10, 1964, and offered to work on a Sunday,
so that there would be no loss of production; but the management intimated the
Union that the factory would work on April 10, 1964. A token strike actually
took place, on April 10, 1964. This strike will be termed as the second strike,
in these proceedings.
In respect of the first strike, the
Management had, on March 28, 1964, charge-sheeted, for going on an illegal
strike, some of the workmen, including the workmen, whose dismissal had been
set aside by the present award. A joint reply was sent, by the concerned
workmen, on April 9, 1964, to the management, drawing their attention to the
decision of the District Industrial Rela- 545 tions Advisory Committee, dated
March 29, 1964, and the settlement, arrived at, therein, between the management
and the Union. The workmen also requested the management, not 'to disobey the
decision of the Committee. The appellant sent a communication, on April 10,
1964, to the workmen, stating that they had not made any commitment, at the
meeting on March 29, 1964, that the management would not proceed with the
taking of disciplinarY action, against an employee, who committed a
mis-conduct, according to the Standing. Orders of the Company. The work-men
were again directed to furnish, within 24 hours, their reply, if any, to the
charge-sheet, dated March 28, 1964.
On May 8, 1964, the Acting Works Manager, of
the appellant company, passed orders, warning the concerned workmen, for having
mis-conducted themselves, as stated in the chargesheet, dated March 28, 1964.
It is further stated, in this order, that, after hearing the explanation,
furnished by the workmen, the management holds the workmen guilty of
mis-conduct, for which they could have been dismissed; but the management has
taken a lenient view and, hoping that the mis-conduct will not be repeated,
administers an earnest warning.
In respect of the second strike, which took
place on April 10,1964, the management charge-sheeted, on April 16, 1964,
thirteen workmen, for going on illegal strike which is a mis-conduct, under
sub-cl. (2) of el. 21, of the Certified Standing Orders of the company, and as
the strike was in violation of sub-s. (4) of s. 6-S of the Act. There was a
further charge that the workmen, concerned, had intimidated and prevented other
willing workers, from going to work.
The workmen were directed to offer their
explanation, as to why disciplinary action need not be taken for their conduct.
On April 17, 1964, the thirteen workmen,
jointly sent a reply saying that the strike, on April 10, 1964, was legal, and
due notice had been given, under the provisions of the Act. They also denied
having intimidated, or restrained, any willing worker from going to work. They
further stated that they had not committed any mis-conduct. The management
proceeded to conduct an inquiry, against the thirteen workmen, and Sri K. 'D.
Gupta, an officer of the company, was entrusted with the conduct of the said
inquirY. Shri Gupta accordingly conducted an enquirY on April 20, 1964, and
sent his report to the Acting Works Manager, .on April 24, 1964. After
referring to the conduct of the inquiry proceedings, Shri Gupta has stated that
the thirteen workmen are' guilty of participation in an illegal strike, on
April 10, 1964, and, as participation in an illegal strike, is a mis-conduct
under el. 21 (2 ) of the Certfied Standing Orders of the Company, the workmen,
concerned, are guilty.
of mis-conduct, but, regarding the 546 charge
of intimidation and incitement, the inquiry officer found that the said charge
was not established.
On May 22, 1964, the Acting Works Manager of
the appellant accepted the report of Shri Gupta and passed orders,
administering a warning, to seven, out of the thirteen, workmen, but, regarding
the remaining six workmen, the Works Manager, after taking into account the
warning that had been administered to them, on May 8, 1964, for go.ing on an
illegal strike (referring to the first strike), passed orders dismissing them
The Union raised a dispute, regarding the dismissal
of the six workmen and, accordingly, the said dispute was referred to the
Labour Court, Allahabad, for adjudication.
The case of the workmen was that the strike,
on April 10, 1964, was legal, and that the domestic inquiry, conducted by Shri
Gupta, was neither bona fide, not fair.
They also contended that in view of the
settlement, arrived at on March 29, 1964, in respect of the first strike, the
management had no right to take any action, by way of warning the workmen, as
it purported to do, on May 8, 1964.
Taking the said warning into account, for the
purpose of imposing the punishment of dismissal, amounted to a vindictive
conduct, on the part of the management and, therefore, the order of dismissal
The management, on the other hand, contended
that the strike, that took place on April 10, 1964, was illegal, as it was not
in accordance with the provisions of the Act and participation, in such illegal
strike, was a mis-conduct, under el. 21 (2) of the Standing Orders of the
Company and, such mis-conduct could be punished by dismissal, under cl. 22.
According to the management, the inquiry proceedings, conducted by Shri Gupta,
were quite fair, and bona fide, and the workmen were given full opportunity to
participate in the inquiry proceedings. They also pleaded that the management
was entitled, to impose punishment for mis-conduct, by taking into account the
previous conduct of the workmen, concerned; and, in this case, the warning,
recorded against them on May 8, 1964, was legitimately and properly taken into
account, inasmuch as the management had not agreed to withdraw the proceedings,
against the workmen.
The Labour Court has upheld the plea of the
management, that the second strike, on April 10, 1964, being contrary to sub-
s. (4) of s. 6-S, was illegal under s. 6-T of the Act; but it has further held
that, notwithstanding the infirmity in the notice, issued by the workmen
regarding the second strike, all the managements in the area, including the
appellant, were fully aware of the fact of the intended token strike on April
10, 1964. The Labour Court has further held that the inquiry proceedings,
conducted by Shri Gupta, were bona fide and fair, and they suffered from no.
infirmity, 547 whatsoever. The Labour Court further holds that, though normally
imposing of a punishment, for mis-conduct, under the Standing Orders, is a
managerial function, in this case, the appellant was not justified in taking
into account the warning, recorded on May 8, 1964, in respect of the first
strike. It is the further view, of the Labour Court, that the continuance of
disciplinary proceedings, and recording of warnings, on May 8, 1964, by the
appellant, against the six concerned workmen, in respect of the first strike,
was with a view to create a ground for punishment and dismissal, in the
subsequent proceedings, relating to the second strike, and, as such, the action
of the management was not bona fide. The Labour Court, in this connection,
refers to the proceedings of the District Industrial Relations Advisory
Committee, that took place on March 29, 1964, in the presence of the
representatives of the appellant, and the Union, and the Labour Court is of the
view that a settlement had been arrived at, by which the management has agreed,
not to take any disciplinary action, against the workers, in connection with
the first strike: Ultimately, the Labour Court holds that the punishment of
dismissal, inflicted on the six workmen, by the appellant, on May 22, 1964, is
unconscionable and unjustified, and not recorded in a bona fide manner. In
consequence, the order of dismissal, passed against the six concerned workmen,
named in the annexure to the order of reference, was set aside and the workmen
were directed to be reinstated, with 50% back wages.
We have fairly elaborately referred to the
various circumstances, leading to the passing of the order of dismissal, bY the
management, in order to appreciate the contentions, urged on behalf of the
management, that the Labour Court had committed a serious illegality, in
interfering with an order, passed by the management, for mis-conduct, as
provided under the standing orders of the company.
Mr. H.R. Gokhale, learned counsel, for the
appellant, raised two contentions before us:.(1)that'the finding of the Labour
Court, that at the meeting of the District Industrial Relations Committee, held
on March 29, 1964, the appellant agreed not to take disciplinary action,
against its' workmen, in respect of the first strike, is erroneous;
and (ii) that having held that the second
strike was illegal as being contrary to sub-s. (4) of s. 6-S of the Act, the
Labour Court has committed an error in interfering with the act of the
management, when it imposed a punishment, for mis-conduct, under the standing
orders of the company.
Mr. R. Vasudeva Pillai, learned counsel for
the Union, has supported, in full, the award of the Labour Court.
We are not impressed with either of the
contentions, of the learned counsel for the appellant. We have already referred
to LI3Sup. CI/68--4 548 the proceedings, of the District Industrial Relations
Committee, March 29, 1964. No doubt, a day prior to that, the appellant had
issued notices to the workmen, asking them to show cause as to why disciplinary
action should not be taken against them, for going on strike from March 18,
1964. There was a joint reply given by the workmen, on April 9, 1964, to the
effect that, at the meeting held on March 29, 1964, the managem.ent had agreed,
not to take any disciplinary action, against the workmen, and that, it was on
that' basis that the strike itself was called off, and the workmen, arrested,
were also released by the Government. There was no doubt an attempt, by the
management, in their reply of April 10, 1964, to make it appear that they had
not committed themselves, at the meeting of March 29, 1964, as mentioned by the
workmen. But it is rather surprising that, when the President of the Union,
WWI, gave evidence to the effect that there was a settlement, on March 29,
1964, whereby the management had agreed not to take any disciplinary action,
against the workmen, there was absolutely no cross-examination, by the
appellant, of that witness. There is no dispute that Mr.
Wright represented the management, at the
said meeting, and no suggestion even has been made to WWI that the evidence,
given by him, is not correct. No doubt, the appellant, in their letter of April
10, 1964, had taken the stand that the company had not committed itself, not to
take any action against the workmen, in respect. of the first strike. The
inquiry report of Shri Gupta, in respect of the second strike, was already in
the hands of the management, on April 24, 1964. It is really after the receipt
'of this report, that the Acting Works Manager of the appellant-company
recorded warnings, as against the concerned workmen, on May 8, 1964,I in
res'peet of the first strike. This warning has been taken into account, by the
Works Manager, when he passed the order of dismissal, in respect of the Second
strike, on May 23, 1964. Having due regard to these circumstances, the finding
of the Labour Court, that the continuance of the disciplinary proceedings, and
recording of punishments of warnings, as against the six concerned workmen, on
May 8, 1964, in respect of the fixst strike, by the management was to create a
ground for punishment and dismissal, in respect of the second strike, is
perfectly justified. The further finding of the Labour Court, that 'the action
of the management, in recording warnings in respect of the first strike, is not
only not bona fide, but also against the settlement, 'arrived at, on March 29,
1964, is. also correct. The first contention, on behalf of the management,
There is the finding of the Labour Court,
that the second strike, on April 10, 1964 is illegal. Going on illegal strike,
is certainly 'mis-conduct' under sub-el. (2) of el. 21, of the Standing Orders
of the company. Under el.
22 of the Standing Orders, the 549 punishment
for mis-conduct is dismissal, or, in the alternative, suspension, for a period
not exceeding four days. If the management had, without any regard to what
happened, in respect of the first strike, imposed punishment under cl. 22, in
respect of an illegal strike, which is 'mis-conduct' under cl. 21 (2)of the
Standing Orders, after a fair inquiry, the punishment, meted out being a
managerial function, would not be normally interfered with. But in this case,
even the order of dismissal clearly shows that the management has taken into
account the previous conduct of the workmen, in having gone on the first
strike, and the punishment of warning, administered on May 8, 1964. It is
because of this past conduct, it is further stated in the order, that the six
workmen were being dismissed from service. The finding of the Labour Court is
that the management was not entitled to take into account the warning, given on
May 8, 1964, in respect of the first strike, in view of the settlement, on
March 29, 1964. In view of the fact that the warning has been taken into
account, by the management, which it is not entitled to, the punishment of
dismissal has been rightly considered, by the Labour Court, to be not bona
fide, and vindictive. In fact, the Labour Court is also of the view that the
punishment is unconscionable, and unjustified. It is on these grounds, that the
Labour Court has interfered with the order of dismissal, passed by the
management. The second contention, of learned counsel for the appellant, also
fails, as we are in agreement with the reasons, given by the Labour Court, 'on
this aspect of the matter.
The result is that this appeal fails, and is
There will be no order as to costs.
G.C. Appeal dismissed.