Management of Brooke Bond India (P)
Ltd. Vs. Workmen  INSC 232 (1 November 1965)
01/11/1965 WANCHOO, K.N.
GAJENDRAGADKAR, P.B. (CJ) HIDAYATULLAH, M.
CITATION: 1966 AIR 668 1966 SCR (2) 465
R 1982 SC 78 (9) RF 1984 SC1683 (9,10,11,12)
Industrial Dispute--Promotions by management
allegedly based on mala fides and victimisation-Tribunal's jurisdiction to set
aside promotions-Tribunal whether can decide whom to promote.
The appellant-concern promoted two employees
from grade A to grade B. One of these promotees M superseded one employee while
the other D superseded six, A dispute was -raised by the respondents workmen on
account of this supersession, and a reference was made to the industrial
tribunal by the Government of Mysore. The case of the workmen was that the
action of the management was not bona fide and was taken to victimise the six
employees in disregard of seniority. The case of the appellant on the other hand
was that seniority alone could not be the criterion for promotion and that
other factors like merit. personality etc had -to be taken into consideration.
The Tribunal came to the conclusion that the action of the management was mala
fide because it took eleven weeks to reply to the query of the workmen asking
for -reasons for their supersession. The Tribunal also found substance in the
allegations of victimisation on the ground that those superseded were more or
less active members of the union. The Tribunal then came to the conclusion that
five of the superseded employees were as good as those who had been promoted
-and ordered that they should be promoted from grade A to grade B, with effect
from the date from which the other two had been promoted. The appellants came
to this Court by special leave against the Tribunal's award and contended : (1)
On the face of it the award could not be sustained for there were only two
promotions by the management and the Tribunal had ordered the management to
promote five more persons. The promotions of M could not be assailed at all as
he was second in seniority. (2) The Tribunal's finding that there were mala
fides and victimisation was based on no evidence.
HELD: (i) Although promotion is a management
function it may be recognised that there may be occasions when a Tribunal may
have to interfere on grounds of mala fides or victimisation. But it is none of
the Tribunal's functions to consider the merits of various employees itself and
then decide whom to promote or not to promote. The Tribunal can only set aside
the wrongful promotion and ask the management to make a fresh promotion. [468
F-H] In the present case M was second in seniority and therefore only D's case
required 'he consideration of the Tribunal.
Assuming that D's promotion was liable to be
set aside the Tribunal had no justification for promoting five persons in
addition to the two promoted by the management. [469 B-C] (ii) The management
had stated in its reply to the superseded employees that it had considered all
the relevant factors and had also considered the cases of all senior employees
due for promotion before promoting M and D. It was difficult to see how the
tribunal could come to the conclusion merely from the fact that there was some
delay in 466 giving the reply to the query as to the reasons that the
management had not considered the relative merits of all senior employees
before making the promotions. There could be no doubt that the findings of the
Tribunal that the relative merits were not considered or that there was mala
fides or that there was victimisation were based on no evidence and must
therefore be set aside. Once that conclusion was reached there was no reason
for the Tribunal to interfere with the promotions made by the management.
CIVIL APPELLATE JURISDICTION : Civil Appeal
No. 541 of 1964.
Appeal by special leave from the Award dated
the March 14, 1963 of the Industrial Tribunal, Mysore, in I.T. No. 13 of 1961.
M. C. Setalvad, J. B. Dadachanji, 0. C.
Mathur and Ravinder Narain, for the appellant.
S. V. Gupte, Solicitor-General and Janardan
Sharma, for the respondents.
The Judgment of the Court was delivered by
Wanchoo, J This is an appeal by special leave in an industrial matter. The
appellant-concern promoted two employees from grade A to grade B on April 1,
1959. These two employees were Manerikar and Dhume. As a result of this
promotion, Manerikar superseded one employee while Dhume superseded six
employees. A dispute was raised by the respondents-workmen on account of this
supersession. This was based on an earlier award with reference to this very
concern by the National Tribunal which provided as follows :"All things
being equal, seniority shall count for promotion. If the senior person has been
overlooked in the question of promotion, he is at liberty to ask the concern
for the reason why he has been overlooked, in which case the concern shall give
him the reasons, provided that it does not expose the concern or the officer
giving reasons, to any civil or criminal proceedings." It appears that
when the supersession became known the management was asked to give the reasons
and the management gave the same and said that in making promotions it took
into consideration the merit, personality and suitability of the employees.
This did not satisfy the employees who are superseded and a dispute was raised
on their behalf by the workmen which was referred to the industrial tribunal by
the government of Mysore in these terms "Whether the promotion of Sriyuths
P. D. Dhume and Y. S. Manerkar, superseding Sriyuths G. N. Kamat, B. V.
Kulkarni, H. S. Deshpande, G. R. Balgi and D. N..
467 Naik is justified ? If not, to what
relief are the affected workmen entitled It may be added that the name of Sri
V. R. Kulkarni was added later in the list of persons superseded. The case of
the workmen was that the action of the management was not bona fide and was
taken to victimise the six employees on account of their trade union activities
and that the reasons given for superseding the senior employees were vague and
of a general character. The case of the appellant on the other hand was that
seniority alone could not be the criterion for making promotion and that other
factors like merit, personality, etc. have to be taken into consideration. The
appellant asserted that all these facts had been taken into consideration when
the two promotions in question were made.
It was also asserted that promotions were
made after considering the qualities and abilities of the employees concerned. The
appellant further denied that there were any mala fides in the matter of these
promotions or that the action was taken with a view to victimise those who were
The tribunal recognised that normally the
question of promotion was a management function and had to be left mainly to
the discretion of the management which had to make a choice from among the
employees for promotion. But it was of the view that in a proper case the
workmen had a right to demand relief when just claims of senior employees were
overlooked by the management. It therefore first considered the question
whether this was a case in which the workmen had the right particularly in view
of the earlier decision in this very concern to demand that the two promotions
made should be scrutinised by the industrial tribunal. It came to the
conclusion that the action of the management was mala fide mainly because it
took 11 weeks to reply to the query of the workmen asking for reasons for their
It was of the view that the evasive replies
and inordinate delay showed that the two promotions were mala fide. The
tribunal also seems to have held that the six employees were superseded on the
ground that they were more or less active members of the union and because, of
their trade union activities, though there is no specific finding to that
effect. The tribunal further seems to have held that the delay made by the
management in giving the reasons when asked to do so showed that the management
had not considered the reasons for supersession prior to or at the time the
promotions were made; that was why it took time to formulate reasons for
supersession. Thereafter the, tribunal went into the merits of the case and
considered the records of the six employees which were.
468 produced before it and came to the
conclusion that five of them were as good as those who had been promoted.
Finally, it ordered that these five employees should be promoted from. grade A
to grade B with effect from the date on which the other two persons were
promoted. It further ordered that these persons be given their due place with
respect to their seniority. It also ordered that they were entitled to
increments which they would have got if they were promoted along with the two
persons namely, Manerikar and Dhume.
The appellant has attacked the correctness of
this award on two main grounds. In the first place it is urged that on the face
of it the award cannot be sustained for there were only two promotions by the
management and the tribunal has ordered the management to promote five more
persons. It is urged that the tribunal could riot do this even if it found that
the promotions were not justified. In any event promotion of Manerikar could
not be assailed as he was No. 2 in seniority and only the promotion of Dhume
could be assailed. In any case it is urged that there was no occasion to
promote seven persons from the date from which these two promotions were made,
for on that date there were only two promotions to be made and what in effect
the tribunal had done is to make seven promotions on that date.
Secondly, it is urged that the tribunal's
finding that there were mala fides and victimisation is based on no evidence.
Further it is urged that even if the tribunal
found that there was case for interference with the promotions made, the
tribunal should have set aside the promotion of Dhume for Manerikar in any case
was entitled to promotion being No. 2 in the seniority list and should have
directed the appellant to promote another person in place of Dhume after
considering all relevant factors.
We are of opinion that both the contentions
raised on behalf of the appellant are correct. Generally speaking, promotion is
a management function; but it may be recognised that there may be occasions
when a tribunal may have to interfere with promotions made by the management
where it is felt that persons superseded have been so superseded on account of
mala fides or victimisation. Even so after a finding of mala fides or
victimisation, it is not the function of a tribunal to consider the merits of
various employees itself and then decide whom to promote or whom not to
promote. If any industrial tribunal finds that promotions have been made which
are unjustified on the ground of mala fides or of victimisation, the proper
course for it to take is to set aside the promotions and ask the management to
consider the cases of superseded 46 9 employees and decide for itself whom to
promote, except of course the person whose promotion has been set aside by the
Bearing these principles in mind we now turn
to the contentions raised before us. In the firm place only two promotions were
made on April 1, 1959. of these Manerikar was No. 2 and he in any case would
have been promoted even if promotions went only by seniority. So it was only
the, case of Dhume which required serious consideration by the tribunal.
Assuming that the tribunal came to the conclusion that Dhume's promotion
suffered from the infirmity of victimisation or mala fides that promotion alone
should have been set aside and the management directed to promote someone-else
in his place after considering the records of all senior employees worth
consideration. But there was in our opinion no justification for the tribunal
to promote five persons in addition to the two promoted by the management and
to make those promotions retrospective from April 1, 1959. It is obvious that
only two promotions were made on April 1, 1959 and the tribunal could not
impose seven promotions on the management as from that date. The order
therefore passed by the tribunal promoting five other employees is clearly
wrong. It is true that one term of reference was with respect to the relief to
be given to the workmen who were superseded. That however did not mean that the
tribunal should promote five more persons from the same date as the two
promoted by the management. The order of the tribunal therefore promoting these
five persons in addition to the two already promoted by the management must be
set aside on this ground alone.
Turning now to the question of mala fides,
the only -ground which the tribunal has given for coming to that conclusion is
that the management made a delay of 11 weeks in giving its reply to the
workmen's query for reasons for their supersession. We are of opinion that this
is hardly a reason for coming to the conclusion that the promotions were mala
fide. Another reason given by the tribunal is that the replies were evasive and
vague. Now the reply was that the promotions were made after considering the merits,
personality and suitability of the employees concerned. We cannot agree that
these reasons amount to evasive replies for after all promotion will depend
upon merit, suitability and personality of the persons concerned. Nor do we
think that initiative and efficiency which were later emphasised by the
management before the tribunal as among the grounds for promotion can be said
to be an after-thought, for initiative and efficiency must be deemed to be
included in the word "merit" which appeared in the replies 470 given
by the management. There was thus in our opinion no basis whatsoever for the
tribunal to come to the conclusion that the promotions were mala fide.
Turning now to the question of victimisation,
we have already :said that there is no clear finding of the tribunal that there
was victimisation. But it appears to be suggested in para. 53 of the -award
that the tribunal felt that there was victimisation. of the six superseded
employees we find that only one was an official of the union while the other
live were merely members just like Manerikar. Dhume it appears was not a member
of the union.
But there was no evidence to show that there
were any strained relations between the management and these six employees on
account of their trade union activities. We have already said that five of them
were ordinary members of the union like Manerikar and only one Balgi was an
official of the union. But there is nothing to show that because of that there
was any bad blood between Balgi and the management. We are therefore of the
-opinion that there is no evidence worth the name on which the tribunal could
have come to the conclusion that these two promotions were as a result of
victimisation of those persons who were superseded.
The management had stated in its reply that
it had considered all the relevant factors and had also considered the cases of
all senior employees due for promotion before promoting these two persons. We
cannot see how the tribunal could come to the conclusion merely from the fact
that there was some delay in giving the reply to the query as to the reasons
that the management had not considered the relative merits of all senior
employees before making the promotion.
We have no doubt that the finding of the
tribunal that the relative merits were not considered or that there were mala
fides or that there was victimisation are based on no evidence and must
therefore be set aside. Once that conclusion is reached there was in our
opinion no reason for the tribunal to interfere with the promotions made by the
We therefore allow the appeal, set aside the
award of the tribunal and hold that the promotions of Y. S. Manerikar and P. D.
Dhume were justified. 'No relief is therefore due to the other six employees.
In the circumstances we pass no order as to costs.