Gujarat Steel Tubes Ltd. Vs. Gujarat
Steel Tubes Mazdoor Sabha [1979] INSC 242 (19 November 1979)
KRISHNAIYER, V.R.
KRISHNAIYER, V.R.
DESAI, D.A.
KOSHAL, A.D.
CITATION: 1980 AIR 1896 1980 SCR (2) 146 1980
SCC (2) 593
CITATOR INFO:
E 1984 SC1805 (16) R 1992 SC 96 (14)
ACT:
Industrial Disputes Act, 1947-Section
11A-Scope of- Whether the arbitrator could exercise the power conferred on a
Tribunal under section 11A of the Act and interfere with the punishment awarded
by the management to the workmen.
Constitution of India, 1950, Article
227-Power of the High Court to interfere with the decision of the management
and revise the punishment to the delinquent workmen.
Model Standing orders made under Section
15(2) of the Industrial Employment (Standing Orders) Act, 1946-M.S.Os. 23, 24
and 25 scope of-Whether the discharge en masse of workmen valid.
Value vision of Indian Industrial
Jurisprudence- Constitution of India- Articles 39, 41, 42, 43 43A and the
Golden Rule for the Judicial resolution of an industrial dispute.
HEADNOTE:
The appellant manufactures steel tubes in the
outskirts of Ahmedabad city. It started its business in 1960, went into
production since 1964 and waggled from infancy to adulthood with smiling
profits and growling workers, punctuated by smouldering demands, strikes and
settlement until there brewed a confrontation culminating in a head-on
collision following upon certain unhappy happenings. A total strike ensued
whose chain reaction was a whole-sale termination of all employees followed by
fresh recruitment of workmen defacto breakdown of the strike and dispute over
restoration of the removed workmen.
As per the last settlement between the
management and the workmen of 4th August, 1972, it was not open to the workmen
to resort to a strike till the expiry of a period of five years; nor could the
management declare a lock out till then. Any dispute arising between the
parties, according to the terms arrived at were to be sorted out through
negotiation or, failing that by recourse to arbitration. The matter was
therefore, referred to an arbitrator and the arbitrator by his award held the
action of the management warranted. The respondent challenged the decision of
the arbitrator under Article 226/227 of the Constitution and the High Court of
Gujarat reversed the award and substantially directed reinstatement. Hence the
appeals both by the Management and the workmen.
Dismissing the appeals and modifying the awards
substantially, the Court
HELD: (By Majority) Per Iyer J. On behalf of
D. A. Desai J. and himself.
(i) The basic assumption is that the strike
was not only illegal but also unjustified. [210 H] 147 (ii) The management did
punish its 853 workmen when it discharged them for reasons of misconduct set
out in separate but integrated proceedings; even though with legal finesse, the
formal order was phrased in harmless verbalism.
[211 A] (iii) The action taken under the
general law or the standing orders, was illegal in the absence of
individualised charge sheets, proper hearing and personalise punishment if
found guilty. None of these steps having been taken, the discharge orders were
still born. But, the management could, as in this case it did, offer to make
out the delinquency of the employees and the arbitrator had, in such cases, the
full jurisdiction to adjudge de novo both guilt and punishment. [211 B-C] (iv)
Section 11A of the Industrial Disputes Act, 1947 does take in an arbitrator
too, and in this case, the arbitral reference, apart from section 11A is
plenary in scope. [211 C-D] (v) Article 226 of the Constitution, however
restrictive in practice Is a power wide enough in all conscience, to be a
friend in need when the summons comes in a crisis from a victim of injustice;
and more importantly this extra-ordinary reserve power is unsheathed to grant
final relief without necessary recourse to a remand. What the Tribunal may in
its discretion do the High Court too under Article 226, can, if facts compel
so. [211 D-E] (vi) The Award, in the instant case, suffers from a fundamental
flaw that it equates an illegal and unjustified strike with brozen misconduct
by every workman without so much as identification of the charge against each,
after adverting to the gravamen of his misconduct meriting dismissal. Passive
participation in a strike which is both illegal and unjustified does not ipso
facto invite dismissal or punitive discharge. There must be active individual
excess such as master-minding the unjustified aspects of the strike, e.g.,
violence, sabotage or other reprehensible role. Absent such gravamen in the
accusation, the extreme economic penalty of discharge is wrong. An indicator of
the absence of such grievous guilt is that the management, after stating in
strong terms all the sins of workmen, took back over 400 of them as they
trickled back slowly and beyond the time set, with continuity of service,
suggestive of the dubiety of the inflated accusations and awareness of the
minor role of the mass of workmen in the lingering strike.
Furthermore, even though all sanctions short
of punitive discharge may be employed by a Management, low wages and high cost
of living, dismissal of several hundred with disastrous impact on numerous
families is of such sensitive social concern that, save in exceptional
situations, the law will inhibit such a lethal step for the peace of the
industry, the welfare of the workmen and the broader justice that transcends
transcient disputes. The human dimensions have decisional relevance. The
discharge orders though approved by the Arbitrator are invalid. [211 E-H, 212
A-B]
HELD FURTHER: 1. In a society, capital shall
be the brother and keeper of labour and cannot disown this obligation of a
partner in management, especially because social justice and Articles 43 and
43A are constitutional mandates. The policy directions in Articles 39, 41, 42,
43 and 43A speak at the right to an adequate means of livelihood, the right to
work, humane conditions of work, living wages ensuring a decent standard of
life and enjoyment of leisure and participation of workers in management of
industries. De hors these 148 mandates, law will fail functionally. Suck is the
value vision of Indian Industrial Jurisprudence. [155 B, G-H, 156 A]
2. Jural resolution of labour disputes must
be sought in the law life complex beyond the factual blinkers of decided cases,
beneath the lexical littleness of statutory tests, in the economic basics of
industrial justice which must enliven the consciousness of the Court and the
corpus juris. [154 F-G] The golden rule for the judicial resolution of an
industrial dispute is first to persuade fighting parties, by judicious
suggestions, into the peace-making zone, disentangle the differences, narrow
the mistrust gap and convert them through consensual steps, into negotiated
justice. Law is not the last word in justice, especially social justice.
Moreover in an hierarchical system, the little man lives in the short run but
most litigation lives in the long run. So it is that negotiation first and
adjudication next, is a welcome formula for the Bench and the Bar, the
Management and Union. [157 C-E] The anatomy of a dismissal order is not a
mystery, once it is agreed that substance, not semblance, governs the decision.
Legal criteria are not so slippery that verbal manipulations may outwit the
Court. The fact is the index of the mind and an order fair on its face may be
taken at its face value. But there is more to it than that, because sometimes
words are designed to conceal deeds by linguistic engineering. The form of the
order of the language in which it is couched is not conclusive. The Court will
lift the veil to see the nature of the order. [171 G-H. 172 A] If two
factors-motive and foundation of the order-co- exist, an interference of
punishment is reasonable though not inevitable. If the severance of service is
effected the first condition is fulfilled and if the foundation or causa
causans of such severance is the servant's misconduct, the second is fulfilled.
If the basis or foundation for the order of termination is clearly not
turpitudes or stigmatic or rooted in misconduct or visited with evil pecuniary
effects, then the inference of dismissal stands negated and vice versa. These
canons run right through the disciplinary branch of master and servant
jurisprudence, both under Article 311 and in other cases including workmen
under managements. The law cannot be stultified by verbal haberdashery because
the Court will lift the mask and discover the true face. [172 C-E] Masters and
servants cannot be permitted to play hide and seek with the law of dismissals
and the plain and proper criteria are not to be misdirected by terminological
cover- ups or by appeal to psychic processes but must be grounded on the
substantive reason for the order, whether disclosed or undisclosed. The Court
will find out from other proceedings or documents connected with the formal
order of termination what the true ground for the termination is. If thus
scrutinised the; order has a punitive flavour in cause or consequence, it is
dismissal. If it falls short of this test, it cannot be called a punishment. A
termination effected because the master is satisfied of the misconduct and of
the consequent desirability of terminating the service of the delinquent
servant, it is a dismissal even if he had the right in law to terminate with an
innocent order under the standing order or otherwise. Whether, in such a case
the grounds are recorded in a different proceeding from the formal order does
not detract from its nature. Nor the fact that, after being satisfied of the
guilt, the master abandons the enquiry and proceeds to terminate. Given 149 an
alleged misconduct and a live nexus between it and the termination of service
the conclusion is dismissal, even if full benefits as on simple termination are
given and non- injurious terminology is used. [173 E-H, 174 A] On the contrary,
even if there is suspicion of misconduct, the master may say that he does not
wish to bother about it and may not go into his guilt but may feel like not
keeping a man he is not happy with. He may not like to investigate nor take the
risk of continuing a dubious servant. There it is not n dismissal, but
termination simpliciter, if no injurious record of reasons or punitive
pecuniary cut back on his full terminal benefits is found.
For, in fact, misconduct is not then the
moving factor in the discharge, What is decisive is the plain reason for the
discharge, not the strategy of a non-enquiry or clever avoidance of
stigmatising epithets. If the basis is not misconduct, the order is saved.
[174 B-D] Management of Murugan Mills v.
Industrial Tribunal [1965] 2 SCR 148; Chartered Bank v. Employees' Union [1960]
3 SCR 441; Western India Automobile Association v.
Industrial Tribunal, Bombay [1949] S.C.R.
321; Assam Oil Co.
v. Workmen, [1960] 3 SCR 457; Tata Oil Mills
Co. v. Workmen, [1964] 2 SCR 125 @ 130; Tata Engineering & Locomotive Co.
Ltd. v. S.C. Prasad & Anr. [1969] 3 SCR
372; L. Michael and Anr. v. M/s. Johnson Pumps India Ltd., [1975] 3 SCR 372;
Workmen of Sudder Office, Cinnamore v.
Management, [1970] 2 L.L.J. 620, Municipal Corporation of Greater Bombay v.
P.S. Malvankar, [1978] 3 SCR 1000; referred to.
Every wrong order cannot be righted merely
because it was wrong. It can be quashed only if it is vitiated by the
fundamental flaws of gross miscarriage of justice, absence of legal evidence,
perverse misreading of facts, serious errors of law on the face of the order,
jurisdictional failure and the like. [182 P-G] While the remedy under Art. 226
is extraordinary and is of Anglosaxon vintage, it is not a carbon copy of
English processes. Article 226 is a sparing surgery but the lancet operates
where injustice suppurates. While traditional restraints like availability of
alternative remedy hold back the Court, and judicial power should not
ordinarily rush in where the other two branches fear to tread. judicial daring
is not daunted where glaring injustice demands even affirmative action. The
wide words of Article 226 are designed for service of the lowly numbers in
their grievances if the subject belongs to the Court's province and the remedy
is appropriate to the judicial process. There is a native hue about article
226, without being anglophilic or anglophobic in attitude. Viewed from this
jurisprudential perspective the Court should be cautious both in not over
stepping as if Article 226 were as large as an appeal and not failing to
intervene where a grave error has crept in.
And an appellate power interferes not when
the order appealed is not right but only when it is dearly wrong. The
difference is real, though fine. [182 G-H, 183 A-B] The principle of law is
that the jurisdiction of the High Court under Article 226 of the Constitution
is limited to holding the judicial or quasi judicial powers within the leading
sings of legality and to see that they do not exceed their statutory
jurisdiction and correctly administer the law laid down by the statute under
the Act. So long as the hierarchy of officers and appellate authorities created
by the statute function within their ambit the manner in which they do so can
be no ground for interference. The power of judicial supervision of the High
Court under Article 227 of tho Constitution (as it then stood) is not 150
greater than those under Article 226 and it must be limited to seeing that a
tribunal functions within the limits of its authority. The writ power is large,
given illegality and injustice even if its use is severely disciplinary. The
amended Article 226 would enable the High Court to interfere with an Award of
the industrial adjudicator if that is based on a complete misconception of law
or it is based on no evidence, or that no reasonable man would come to the
conclusion to which the Arbitrator has arrived. [15 E-G 1 86 D-E] Navinchandra
Shanker Chand Shah v. Manager, Ahmedabad Cooperative Department Stores Ltd.,
[1978] 19 Guj. L.R. 108 @ 140; approved.
Rohtas Industries & Anr. v. Rohtas
Industries Staff Union and Ors. [1976] 3 SCR 12: followed.
Nagendranath Bata and Anr. v. The Commissioner
of Hills Divisions and Appeals, Assam & Ors., [1958] SCR 1240;
Engineering Mazdoor Sabha v. Hind Cycle Lrd.
[1963] Suppl. 1 SCR 625; State of A.P. v. Sreeeama Rao, [1964] 3 SCR 25 @ 33;
P. H. Kalyani v. M/s Air France, Calcutta, [1964] 2 SCR 104; referred to.
"Tribunal" simpliciter has a
sweeping signification and does not exclude Arbitrator. A tribunal literally
means a seat of justice, may be, a commission, a Court or other adjudicatory
organ created by the State. All these are tribunal and naturally the import of
the word, in Section 2(r) of the Industrial Disputes Act, embraces an
arbitration tribunal. [188 E-F-H 189 A] Dawking v. Rokely, L.R. 8 Q.B. 255;
quoted with approval.
An Arbitrator has all the powers under the
terms of reference, to which both sides are party, confer. In the instant case,
the Arbitrator had the authority to investigate into the propriety of the
discharge and the veracity of the mis conduct. Even if section 11A of the Industrial
Disputes Act is not applicable, an Arbitrator under Section 10A is bound to act
in the spirit of the legislation under which he is to function. A commercial
Arbitrator who derives his jurisdiction from the terms of reference will by
necessary implication be bound to decide according to law and when one says
"according to law", it only means existing law and the law laid down
by the Supreme Court being the law of land, an Arbitrator under section 10A
will have to decide keeping in view the spirit of section 11A. [196 B-D] Union
of India v. Bungo Steel Furniture (P) Ltd. [1967] 1 SCR 324; referred to.
Per Koshal J. (Contra)
1. The orders of discharge could not be
regarded as orders of their dismissal and were on the other hand, orders of
discharge simpliciter properly passed under Model Standing order 23. [235 C-D]
(a) Clauses (3) and (4) of M.S.O. 25 speak of an inquiry only in the case of an
order falling under sub- clause (g) of clause (1) of that M.S.O. The only sub
clause of clause (1) of M.S.O. 25 to which the provisions of clauses (3) and
(4) of that M.S.O. would be attracted is sub clause (g) and if an order of
discharge falls under M.S.O. 23, an inquiry under clauses (3) and 151 (4) of
M.S.O. 25 would not be a pre-requisite thereto even though such an a older is
mentioned in sub-clause (f) clause (1) of that M.S.O. [222 H, 223 A] (b) Under
M.S.O.s. 23 and 25, the Management has the powers to effect termination of the
services of an employee by having recourse to either or them. In action taken
under M.S.O. 23, no element of punishment is involved and the discharge is a
discharge simpliciter; and that is why no opportunity to the concerned employee
to show cause against the termination is provided for. Dismissal, however,
which an employer may order is in its very nature, a punishment, the infliction
of which therefore has been made subject to the result of an inquiry (having
the semblance of a trial in a criminal proceeding). Exercise of each of the two
powers has the effect of the termination of the services of the concerned
employee but must be regarded, because of the manner in which each has been
dealt with by the M.S.O. as separate and distinct from the other. [223 C-E] (c)
To contend that once it was proved that the order of discharge of a workman was
passed by reason of a misconduct attributed to him by the management, the order
cannot but amount to an order of dismissal is wrong for two reasons. For one
thing, clause (1) of M.S.O. 25 specifically states in sub-clauses (f) that a
workman guilty of misconduct may be discharged under M.S.O. 23. This clearly
means that when the employer is satisfied that a workman has been guilty of
misconduct he may [apart from visiting the workman with any of the punishments
specified in sub-clauses (a), (b), (c), (d) and (e) of clause (1) of M.S.O. 25]
either pass against him an order of discharge for which no inquiry precedent
as, provided for in clauses (3) and (4) of M.S.O. 25 would be necessary, or may
dismiss him after holding such an inquiry which of the two kinds of order, the
employer shall pass is left entirely to his discretion. [223 E-H] It is true
that the employer cannot pass a real order of dismissal in the garb of one of
discharge. But that only means that if the order of termination of services of
an employee is in reality intended to push an employee and not merely to get
rid of him because he is considered useless, inconvenient or troublesome, the order
even though specified to be an order of dismissal covered by sub clause (g) of
clause (1) of M.S.O. 25. On the other hand if no such intention is made out the
order would remain one of discharge simpliciter even though it has been passed
for the sole reason that a misconduct is imputed to the employee.
That is how M.S.Os. 23 and 25 have to be
interpreted. M.S.O.
25 specifically gives to the employer the
power to get rid of "a workman guilty of misconduct' by passing an order
of his discharge under M.S.O. 23. [224 A-D] Secondly, the reasons for the
termination of service of a permanent workman under M.S.O. 23 have to be
recorded in writing and communicated to him if he so desires, under clause
(4-A) thereof. Such reasons must obviously consist of an opinion derogatory to
the workman in relation to the performance of his duties, and whether such
reasons consist of negligence, work shirking or of serious overt acts like
theft or embezzlement, they would in any case amount to misconduct for which he
may be punished under M.S.O. 25.
There being no case in which such reasons
would not amount to misconduct, the result is that M.S.O. 23 would be render
otiose if termination of service thereunder for misconduct could be regarded as
a dismissal and such a result strikes at the very root of accepted canons of
interpretation. If it was open to the Court to. "lift 152 the veil"
and to hold an order of discharge to amount to dismissal merely because the
motive behind it was a misconduct attributed to the employee, the services of
an employee could be terminated without holding against him an inquiry such as
is contemplated by clauses (3) and (4) of M.S.O. 25. [224 D-G] Bombay
Corporation v. Malvankar [1978] 3 SCR 1000;
applied.
Merely because it is the reason which weighed
with the employer in effective the termination of services would not male the
order of such termination as one founded on misconduct, for such a proposition
would run counter to the plain meaning of clause (1) of M.S.O. 25. For an order
to be "founded" an misconduct, it must be intended to have been
passed by way of punishment, that is, it must be intended to chastise, or cause
pain in body or mind or harm or loss in reputation or money to the concerned
worker. If such an intention cannot be spelled out of the prevailing
circumstances, the order of discharge or the reasons for which it was
ostensibly passed, it cannot be regarded as an order of dismissal. Such would
be the case when the employer orders discharge or the interests of the factory
or of the general body of workers. [226 A-C] Chartered Bank, Bombay v. The
Chartered Bank Employees Union, [1960] 3 SCR 441; The Tata Oil Mills Co. Ltd.
[1964] 2 SCR p. 123; The Tara Engineering and Locomotives Co. Ltd.
v. S.C. Prasad, [1969] 3 S.C.C. 372; Workmen
of Sudder Office, Cinnamore v. Management, [1970] 2 L.L.J. 620 followed.
The real criterion which formed the
touchstone of a test to determine whether an order of termination of services
is an order of discharge simpliciter or amounts to dismissal is the real nature
of the order, that is, the intention with which it was passed. If the intention
was to punish, that is to chastise, the order may be regarded as an order of
dismissal; and for judging the intention, the question of mala fides (which is
the same thing as colourable exercise of power) becomes all important. If no
mala fides can be attributed to the management, the order of discharge must be
regarded as one having been passed under M.S.O. 23 even though the reason for
its passage is serious misconduct.
(2) The arbitrator could not exercise tho
power conferred on a Tribunal under section 11A of the 1947 Act and could not
therefore interfere with the punishment awarded by the Management to the
workmen (even if the discharge could be regarded a punishment). [235 D-E]
Throughout the I.D. Act, while 'arbitrator' would include an umpire, a Tribunal
would not include an arbitrator but would mean only an Industrial Tribunal
constituted under the Act unless the context makes it necessary to give the word
a different connotation. In sub section (1) of section 11, the word 'Tribunal'
has been used in accordance with the definition appearing in clause (r) section
2 because an arbitrator is separately mentioned in that sub-section. In
sub-sections (2) and (3) of that section a Board, a Labour Court, a Tribunal
and a National Tribunal have been invested with certain powers. A Tribunal as
contemplated by sub-sections (2) and (3) then, would not include an arbitrator.
[233 A-B] It is a well settled canon of interpretation of statutes that the
language used by the Legislature must be regarded as the only source of its
intention unless such language is ambiguous, in which situation the Preamble to
the Act, the statement of objects of and Reasons for bringing it on the statute
book and 153 the purpose underlying the legislation may be taken into
consideration for ascertaining such intention. That the purpose of the
legislation is to fulfil a socio-economic need, or the express object
underlying it does not come into the picture till an ambiguity is detected in
the language and the Court must steer clear of the temptation to mould the
written word according to its own concept of what should have been enacted. It
is thus not permissible for the Supreme Court to take the statements of objects
and Reasons or the purpose underlying the enactment into consideration, while
interpreting section 11A of the I.D. Act. [231 F-G, 234 Cl
3. The High Court exceeded the limits of its
jurisdiction in interfering with the said punishment, in the instant case,
purporting to act in the exercise of its powers under Article 227 of the
Constitution of India. [235 E-F] The High Court, while discharging its
functions as envisaged by that Article, does not sit as a Court of Appeal over
the Award of the Arbitrator but exercises limited jurisdiction which extends
only to seeing that the arbitrator has functioned within the scope of his legal
authority. In this view of the matter it was not open to the High Court to
revise the punishment (if the discharge is regarded as such) meted out by the
Management to the delinquent workmen and left intact by the arbitrator whose
authority in doing so has not been shown to have been exercised beyond the
limits of his jurisdiction. [234 G-E, 235 A-C] Nagendra Nath Bora and Anr. v.
The Commissioner of Hills Division and Appeals, Assam and Ors., [1958] SCR
1240;
P. H. Kalyani v. M/s Air France, Calcutta,
[1964] 3 SCR 25, of A.P. v. Sree Rama Rao, [1964] 3 SCR 25; Navinchandra
Shakerchand Shakerchand Shah v. Manager Ahmedabad Cooperative Stores Ltd,
[1978] 15 Guj. L.R. 108; referred to.
CIVIL APPELLATE JURISDICTION: Civil Appeal
Nos. 1212, 2089 and 2237 of 1978.
From the Judgment and order dated 15-6-1978
of the Gujarat High Court in Special Civil Application No. 1150 of 1976.
Y.S. Chitale, J.C. Bhatt, A.K. Sen, J.M.
Nanavati, D.C. Gandhi, A.G. Menses, K.J. John and K.K. Manchanda for the
Appellants in C.A. 1212 and 2237/78 and RR. 1 in CA 2089.
V.M. Tarkunde, Y.S. Chitale, P.H. Parekh and
N.J. Mehta for the Appellant in CA 2089 and R. 1 in CA 1212.
M.C. Bhandare and B. Datta for the Intervener
in CA 1212 (Ahmedabad Nagar Employee Union).
R.K. Garg, Vimal Dave and Miss Kailash Mehta
for the Intervener Gujarat Steel Tubes Mazdoor Sabha in CA 1212.
The Judgment of V.R. Krishna Iyer, and D.A.
Desai, JJ was delivered by Krishna Iyer, J.A.D. Koshal, J. gave a dissenting
Opinion.
154 KRISHNA IYER, J.-Every litigation has a
moral and, these appeals have many, the foremost being that the economics of
law is the essence of labour jurisprudence.
The case in a nutshell- An affluent
Management and an indigent work force are the two wings of the Gujarat Steel
Tubes Ltd. which manufactures steel tubes in the outskirts of Ahmedabad city
and is scarred by an industrial dispute resulting in these appeals. This
industry, started in 1960, went into production since 1964 and waggled from
infancy to adulthood with smiling profits and growing workers, punctuated by
smouldering demand, strikes and settlements, until there brewed a confrontation
culminating in a head-on collision following upon certain unhappy happenings. A
total strike ensued, whose chain reaction was a wholesale termination of all
the employees, followed by fresh recruitment of workmen, de facto breakdown of
the strike and dispute over restoration of the removed workmen. This
cataclysmic episode and its sequel formed the basis of a Section 10A
arbitration and award, a writ petition and judgment, inevitably spiralling up
to this Court in two appeals one by the Management and the other by the
Union-which have been heard together and are being disposed of by this common
judgment.
The arbitrator held the action of the
Management warranted while the High Court reversed the Award and substantially
directed reinstatement.
The Judge Perspective A few fundamental
issues, factual and legal, on which bitter controversy raged at the bar, settle
the decisional fate of this case. A plethora of precedents has been cited and
volumes of evidence read for our consideration by both sides. But the jural
resolution of labour disputes must be sought in the law-life complex, beyond
the factual blinkers of decided cases, beneath the lexical littleness of
statutory texts, in the economic basics of industrial justice which must
enliven the consciousness of the court and the corpus juris. This Court has
developed Labour Law on this road basis and what this Court has declared holds
good for the country. We must first fix the founding faith in this juristic
branch before unravelling the details of the particular case.
Viewing from this vantage point, it is
relevant to note that the ethical roots of jurisprudence, with economic
overtones, are the clan vital of any country's legal system.
So it is that we begin with two
quotations-one from the old Testament and the other from Gandhiji, the Indian
New Testament-as perspective-setters. After all, 155 industrial law must set
the moral-legal norms for the modus vivendi between the partners in management,
namely, Capital and Labour. Cain reported, when asked by God about his brother
Abel, in the Old Testament: 'Am I my brother's keeper ?', 'Yes' was the
implicit answer in God's curse of Cain. In the fraternal economics of national
production, worker is partner in this biblical spirit. In our society, Capital
shall be the brother and keeper of Labour and cannot disown this obligation,
especially because Social Justice and Articles 43 and 43A are constitutional
mandates.
Gandhiji, to whom the Arbitrator has adverted
in passing in his award, way back in March 1946, wrote on Capitalism and
Strikes h the Harijan:
"How should capital behave when labour
strikes ? This question is in the air and has great importance at the present
moment. One way is that of suppression named or nicknamed 'American'. It
consists in suppression of labour through organised goondaism. Everybody would
consider this as wrong and destructive. The other way, right and honorable,
consists in considering every strike on its merits and giving labour its
due-not what capital considers as due, but what labour itself would so consider
and enlightened public opinion acclaims as just.
In my opinion, employers and employed are
equal partners, even if employees are not considered superior. But what we see
today is the reverse. The reason is that the employers harness intelligence on
their side. They have the superior advantage which concentration of capital
brings with it, and they know how to make use of it...... Whilst capital in
India is fairly organised, labour is strike in a more or less disorganised
condition in spite of Unions and Federation. Therefore, it lacks the power that
true combination gives.
Hence, my advice to the employers would be
that should willingly regard workers as the real owners of the concerns which
they fancy they have created.
Tuned to these values are the policy
directives in Articles 39, 41, 42, 43 and 43A. They speak of the right to an
adequate means of livelihood, the right to work, humane conditions of work,
living wage ensuring a decent standard of life and enjoyment of leisure and
participation of workers in management of industries. De hors these man- 156
dates, law will fail functionally. Such is the value-vision of Indian
Industrial Jurisprudence.
The Matrix of facts-A Pre-view The nidus of
facts which enwomb the issues of law may be elaborated a little more at this
stage. In the vicinity of Ahmedabad City, the appellant is a prosperous
engineering enterprise which enjoys entrepreneureal excellence and employs over
800 workmen knit together into the respondent Union called the Gujarat Steel
Tubes Mazdoor Sabha (the Sabha, for short). Fortunately, the industry has had
an innings of escalating profits but the workmen have had a running complaint a
raw deal. Frequent demands for better conditions, followed by negotiated
settlements, have been a lovely feature of this establishment, although the
poignant fact remains that till the dawn of the seventies, the gross wages of
the workmen have hovered round a harrowing hundred rupees or more in this
thriving Ahmedabad industry.
The course of this precarious co-existence
was often ruffled, and there was, now and then, some flare-up leading to
strike, conciliation and even reference under Section 10.
When one such reference was pending another
unconnected dispute arose which, alter some twists and turns, led to an
industrial break-down and a total strike. The episodic stages of this bitter
battle will have to be narrated at length a little later. Suffice it to say
that the Management jettisoned all the 853 workman and recruited some fresher
to take their place and to keep the wheels of production moving. In the war of
attrition that ensued, labour lost and capitulated to Capital. At long last,
between the two, a reference to arbitration of the disputes was agreed upon
under Section 10A of the Industrial Disputes Act 1947 (the Act, for short). The
highlight of the dispute referred for arbitration was whether the termination
orders issued by the Management against the workmen whose names were set out in
the annexure to the reference were "legal, proper and justified"; if
not, whether the workmen were 'entitled to any reliefs including the relief of
reinstatement with continuity of service and full back wages'. The arbitrator's
decision went against the Sabha while, on a challenge under Article 226, the
High Court's judgment virtually vindicated its stand. This is the hang of the
case. The substantial appeal is by the Management while the Sabha has a
marginal quarrel over a portion of the judgment as disclosed in its appeal. The
'jetsam' workmen, a few hundred in number, have been directed to be reinstated
with full or partial back pay and this is the bitter bone of contention.
157 A stage-by-stage recapitulation of the
developments is important to get to grips with the core controversy.
Sri Ashok Sen, for the appellant-Management,
and Sri Tarkunde for the respondent-Sabha, have extensively presented their
rival versions with forceful erudition. Sri R.K. Garg, of course, for some
workmen has invoked with passion the socialist thrust of the Constitution as a
substantive submission and, as justificatory of the workmen's demands, relied
on the glaring contrast between the soaring profits and the sagging wages,
while Sri Bhandare has pressed the lachrymose case of the several hundreds of 'interregnal'
employees whose removal from service, on reinstatement of the old, might spell
iniquity.
Olive Branch Approach: At this stage we must
disclose an effort at settlement we made with the hearty participation of Sri
Ashok Sen and Sri Tarkunde at the early stages of the hearing.
The golden rule for the judicial resolution
of an industrial dispute is first to persuade fighting parties, by judicious
suggestions, into the peace-making zone, disentangle the differences, narrow
the mistrust gap and convert them, through consensual steps, into negotiated
justice. Law is not the last word in justice, especially social justice.
Moreover, in our hierarchical court system the little man lives in the short
run but most litigation lives in the long run. So it is that negotiation first
and adjudication next, is a welcome formula for the Bench and the Bar,
Management and Union. This 'olive Branch' approach brought the parties closer
in our court and gave use a better understanding of the problem, although we could
not clinch a settlement. So we heard the case in depth and felt that some of
the legal issues did merit this court's declaratory pronouncement, settlement
or no settlement.
Mercifully, counsel abbreviated their oral
arguments into an eight-day exercise, sparing us the sparring marathon of 28
laborious days through which the case stretched out in the High Court.
Orality ad libitem may be the genius of
Victorian era advocacy but in our 'needy' Republic with crowded dockets,
forensic brevity is a necessity. The Bench and the Bar. must fabricate a new
shorthand form of court methodology which will do justice to the pockets of the
poor who seek right and justice and to the limited judicial hours humanly
available to the court if the delivery system of justice is not to suffer
obsolescence.
The facts: Back to the central facts. Proof
of the 'efficient' management of the Gujarat Steel Tubes Ltd. is afforded by
the testimony of larger turnover and profits, year after year, from the
beginning down 158 to date. The mill was commissioned in January 1964 but by
the accounting year 1971-72 the turnover had leapt to Rs. 560 lakhs. It scaled
to Rs. 680 lakhs the next year, to Rs. 1136 lakhs the year after and to Rs. 20
crores in 1974-75.
This enterprise entered the export trade and
otherwise established itself as a premier manufactory in the line.
Steel shortage is the only shackle which
hampers its higher productivity. But its increasing shower of prosperity was a
sharp contrast, according to Sri Garg, to the share of the wage bill. The
worker started on a magnificent sum per mensem of Rs. 100/- in toto even as
late as 1970, although some workmen, with more service, were paid somewhat
higher.
The extenuatory plea of the Management,
justificatory of this parsimony, was that other mill-hands were receiving more
niggardly wages in comparable enterprises. Probably, unionisation, under these
luridly low-paid circumstances, caught on and a workers' union was born
somewhere around 1966. A sensible stroke of enlightened capitalism persuaded
the Management to enter into agreements with the Union, somewhat improving
emoluments and ameliorating conditions.
By 1968, the Sabha, a later union, came into
being and commanded the backing of all or most of the mill-hands. By March 1969,
the Sabha presented a charter of demands, followed by resistance from the
Management and strike by the workers. By July 1969, a settlement with the Sabha
was reached. Agreements relating to the various demands brought quiet and
respite to the industry although it proved temporary.
A vivid close-up of the sequence and
consequence of the dramatic and traumatic events culminating in the reference
to arbitration and the impugned award is essential as factual foundation for
the decision of the issues. Even so, we must condense, since labyrinthine
details are not needed in a third tier judgment. Broad lines with the brush
bring out the effect, not minute etches which encumber the picture.
An agreement of futuristic import with which
we may begin the confrontational chronicle is that of April 1970.
Clause 6 thereof runs thus:
"Management of the Company agrees to
implement recommendations of the Central Wage Board for Engineering Industries
as and when finally declared and all the increments granted to workmen from
time to time under this agreement shall be adjusted with those recommendations
provided that such adjustment shall not adversely affect the wages of
workman." The engineering industry, where India is forging ahead, was
apparently exploitative towards labour, and to make amends for this un- 159
healthy position, the Central Wage Board was appointed in 1964 although it took
six long years to recommend revision of wages to be implemented with effect
from 1-1-1969.
Meanwhile, the masses of workers were living
'below the broad line' Saintly patience in such a milieu was too much to expect
from hungry demands and pressing for the recommendations of the Wage Board to
be converted into immediate cash. But, as we will presently unravel, Wage Board
expectations' were proving teasing illusions and premises of unreality because
of non-implementation, viewed from the Sabha's angle. The Management, on the
other hand, had a contrary version which we will briefly consider.
Luckily, agreed mini-increases in wages were
taking place during the years 1970, 1971 and 1972. Likewise, bonus was also the
subject of bargain and agreement. But in September 1971, an allegedly violent
episode broke up the truce between the two, spawned criminal cases against
workers, led to charges of go-slow tactics and lock-outs and burst into
suspension, discharge and dismissal of workmen.
The crisis was tided over by continued
conciliations and two settlements. We are not directly concerned with the
cluster of clauses therein save one. 64 workmen had been discharged or
dismissed, of whom half the number were agreed to be reinstated. The fate of
the other half (32 workers) was left for arbitration by the Industrial
Tribunal. The dark clouds cleared for a while but the sky turned murky over again,
although the previous agreement had promised a long spell of normalcy. The
Sabha, in October 1972, met and resolved to raise demands of which the
principal ones were non-implementation of the Wage Board recommendations, bonus
for 1971 and wages during the lockout period. The primary pathology of
industrial friction is attitudinal. The Management could have (and, indeed,
did, with a new Union) solved these problems had they regarded the Sabha as
partner, not saboteur. Had the bitter combativeness of the Sabha been
moderated, may be the showdown could have been averted.
Apportioning blame does not help now, but we
refer to it here because Sri Ashok Sen, with feeling fury, fell foul of the
criticism by the High Court that the Management had acted improperly in
insisting on arbitration, and argued that when parties disagreed, arbitral
reference was the only answer and the workers' fanatical rejection of
arbitration made no sense We need not delve into the details of the
correspondence relied on by either side to reach the truth.
For, the Unions case is that in the prior
settlement between the two parties arbitral reference came only after
negotiations failed. That was why they 160 pressed the Management to reason
together, avoiding wrestling with each other before a slow-moving umpire.
Sri Tarkunde, for the Sabha, urged that the
workmen were not intransigent but impatient and pleaded for a negotiated
settlement since the main point in dispute, namely the implementation of the
Central Engineering Wage Board's recommendations, was too plain to admit of
difference, given good faith on both sides. We will examine the substance of
this submission later but it needs to be emphasised that workmen, surviving on
starving wages and with notoriously fragile staying power, are in no mood for
adjudicatory procedures, arbitral or other, if the doors of negotiation are
still ajar. The obvious reason for this attitude is that the litigative length
of the adjudicatory apparatus, be it the tribunal, the court or the arbitrator,
is too lethargic and long-winded for workmen without the wherewithal to survive
and is beset with protracted challenges either by way of appeal upon appeal or
in the shape of writ petitions and, thereafter, appeals upon appeals. The
present case illustrates the point. Where workmen on hundred rupees a month
demand immediate negotiation the reason is that privations have no patience
beyond a point. Now and here, by negotiation, is the shop- floor glamour. In
this very matter, although the controversy before the arbitrator fell within a
small compass, he took a year and ninety printed pages to decide, inevitably
followed by a few Years and hundred and thirty printed pages of judgment in the
High Court and a longer spell in this Court with slightly lesser length of
judgment. Which workman under Third World Conditions can withstand this wasting
disease while hunger leaves no option save to do or die ? Raw life, not rigid
logic, is the mother of law.
After the demands were raised by the Union,
the main issue being implementation of the Wage Board recommendations, a stream
of correspondence, meetings and inchoate settlements ensued, but the crucial
question, which would have meant 'cash and carry' for the workmen, baffled
solution. Do negotiate since the application of the Wage Board recommendations
are beyond ambiguity, was the Sabha's peremptory plea. We differ; therefore, go
to arbitration, was the Management's firm response. A stalemate descended on
the scene.
No breakthrough being visible, the Sabha
charged the Management by its letter of January 25, 1973 with breach of clause
6 of the Agreement of August 4, 1972 which ran thus:
"That the parties agree that for a
period of 5 years from the date of this settlement all disputes will be solved
by mutual negotiations or, failing that, by joint arbitration under 161 Section
10A of the I.D. Act, 1947. Neither party shall take any direct action including
go-slow, strike and lock-out for a period of 5 years from the date of this
settlement." Various aspersions of anti-labour tactics were included in
the Sabha's letter but the most money-loaded item was the grievance about the
Wage Board recommendations. The temper, by now, was tense.
The Management, on the same day, (January 25,
1973) set out its version on the notice board and the High Court's summary of
it runs thus .
"The notice stated that during the
course of the meeting with the representatives of the Sabha held on January 20,
1973 the Company had expressed its willingness to implement the Wage Board
recommendations according to its interpretation on and with effect from January
1, 1969 without prejudice to the rights and contentions of the workmen and
leaving it open to the parties to take the matter to arbitration for resolution
of the points of dispute. The Sabha, however, had turned down this suggestion
and it came to the notice of the Company that workmen were being instigated by
making false representations. The Company clarified that on and with effect
from January 1, 1972 every workman would be entitled to the benefits of Wage
Board recommendations, irrespective of whether the concerned workman had put in
240 days attendance." The Sabha's answer was a strike two days later. This
event of January 27 was countered quickly by the Management restating its attitude
on the Wage Board recommendations, asserting that the strike was illegal and in
breach of the settlement of August 4, 1972 and wholly unjustified because the
offer of reference to arbitration, negotiations failing, had been spurned by
the Sabha. The notice wound up with a command and a caveat:
"If the workmen do not immediately
resume duty, the Company would not be under any obligation to continue in
service those 32 workmen who have been taken back in service pursuant to the
settlement dated August 4, 1972. Besides, if (the workmen) continue causing
loss to the Company from time to time in this manner, the Company will not also
be bound to implement the Wage Board, recommendations on and with effect from
January 1, 1969, which may also be noted. The Company hereby withdraws all its
proposals unless the Workmen withdraw the strike and resume work within two
days." 162 This threat was dismissed by the workmen as a brutum fulmen and
the strike continued. The Management, therefore, came up on the notice board
castigating the Sabha with irresponsible obduracy in waging an illegal and
unjustified strike. A warning of the shape of things to come was given in this
notice. The High Court has summed it up thus:
"The Company gave an intimation that in
view of such obstinate attitude on the part of the Sabha and the workmen, it
had decided to withdraw its earlier offer to implement the Wage Board
recommendations on and with effect from January 1, 1969 as already cautioned in
the notice dated January 27, 1973. The said decision must be taken to have been
thereby communicated to the workmen and Sabha. The notice further stated that
having regard to the obdurate, unreasonable and illegal attitude adopted by the
workmen and Sabha, the Company had decided to take disciplinary proceedings
against the defaulting workmen. In this connection, the attention of the
workmen was drawn to the fact that the strike was illegal not only because of
the terms of the settlement dated August 4, 1972 but also because of the
pendency of the reference relating to reinstatement of 32 workmen before the
Industrial Court and, that, therefore, the Company was entitled to take
disciplinary action against them. Finally, the Company appealed to the workmen
to withdraw their illegal and unjustified strike forthwith and to resume
work." These exercises notwithstanding, the strike raged undaunted, the
production was paralysed and the Management retaliated by an elaborate notice
which dilated on its preparedness to negotiate or arbitrate and the Sabha's unreason
in rejecting the gesture and persisting on the war path. The stern economic
sanction was brought home in a critical paragraph:
"By this final notice the workmen are
informed that they should withdraw the strike and resume work before Thursday,
February 15, 1973. If the workmen resume duty accordingly, the management would
be still willing to pay salary according to the recommendations of the Wage
Board on and with effect from January 1, 1969. Furthermore, the management is
ready and willing to refer to the arbitration of the Industrial Tribunal the
question as to whether the management has implemented the settlement dated
August 4, 1972 and all other labour problems. In spite of this, if the workmen
do not resume duty before Thursday, February 15, 1973.
then the Company will terminate the services
of all workmen who are on strike and thereafter it will run the 163 factory by
employing new workmen. All workmen may take note of this fact." The
count-down thus began. February 15, 1973 arrived, and the Management struck the
fatal blow of discharging the strikers-all the labour force, 853 strong-and
recruiting fresh hands and thus work was resumed by February 19, 1973.
This public notice was allegedly sent to the
Sabha and circulated to such workmen as hovered around the factory. It is
common case that the notice of February 15,1973, was not sent to individual
workmen but was a signal for action. The drastic consequence of disobedience
was spelt out in no uncertain terms:
"The workmen are hereby informed that
they should resume duty on or before Monday, February 19, 1973 failing which
the Management will presume that the workmen want to continue their strike and
do not wish to resume work until their demands as aforesaid are accepted by the
management.
Parallel negotiations were going on even
while mailed fist manoeuvres were being played up-thanks to the basic goodwill
and tradition of dispute settlements that existed in this company. Even amidst
the clash of arms, bilateral diplomacy has a place in successful industrial
relations.
The Management and the Sabha allowed the
talks to continue which, at any rate, clarified the area of discord. One thing
that stood out of these palavers was that both sides affirmed the pre-condition
of negotiations before arbitration over differences although the content,
accent and connotation of 'negotiations' varied with each side. No tangible
results flowed from these exercises and the inevitable happened on February 21,
1973 when the Management blotted out the entire lot of 853 workmen from the
roster, by separate orders of discharge from service, couched in identical
terms. The essential terms read thus :
"Your services are hereby terminated by
giving you one month's salary in lieu of one month's notice and accordingly you
are discharged from service.
You should collect immediately from the
cashier of the factory your one month's notice-pay and due pay, leave
entitlements and gratuity, if you are entitled to the same. The payment will be
made between 12 noon and 5 p.m.
If and when you desire to be employed, you
may apply ill writing to the Company in that behalf and on receipt of the
application, a reply will be sent to you in the matter." 164 Casual
workmen were issued separate but similar orders.
The Management did record its reasons for the
action taken, on February 20, 1973 and forwarded them to the Sabha and to the
individual workmen on request. The anatomy of this proceeding is of critical
importance in deciding the character of the action. Was it a harm less farewell
to the workmen who were unwilling to rejoin or a condign punishment of
delinquent workmen ? The separate memorandum of Reasons refers to the strike as
illegal and unjustified and narrates the hostile history of assault by workmen
of the officers, their go-slow tactics and sabotage activities, their
contumacious and a host of other perversities vindicating the drastic action of
determining the services of all the employees. The concluding portion reads
partly stern and partly non- committal:
"In the interest of the Company it is
decided to terminate the services of all the workmen who are on illegal and
unjustified strike since 27th January, 1973.
Under the circumstances, it is decided that
the services of all the workmen who are on illegal and unjustified strike
should be terminated by way of discharge simpliciter. These workmen, however,
may be given opportunity to apply for employment in the Company and in case
applications are received for employment from such employees, such applications
may be considered on their merits later on.
It may be mentioned here that while arriving
at the aforesaid decision to terminate the services of the workmen, various
documents, notices, correspondence with the Union and others, records of
production, etc.
have been considered and therefore the same
are treated as part of the relevant evidence to come to the conclusion as
aforesaid.
FINAL CONCLUSION The services of all the
workmen who are on illegal and unjustified strike since 27-1-1973 should be
terminated by way of discharge simpliciter and they should be offered all their
legal dues immediately.
The Administrative Manager is hereby directed
to pass orders on individual workers as per draft attached.
We thus reach the tragic crescendo when the
Management and the workmen fell apart and all the workmen's services were
severed. Whether each of these orders using, in the contemporaneous reasons,
165 the vocabulary of misconduct but, in the formal part, the expression
'discharge simpliciter', should be read softly as innocent termination or
sternly as penal action, is one of the principal disputes demanding decision.
We may as well complete the procession of
events before taking up the major controversies decisive of the case. The total
termination of the entire work force of 853 employees was undoubtedly a
calamity of the first magnitude in a country of chronic unemployment and
starving wages.
Nevertheless, under certain circumstances,
discharge of employees may well be within the powers of the Management subject
to the provisions of the Act. With all the strikers struck off the rolls there
was for a time the silence of the grave. The conditional invitation to the
employees to seek de novo employment by fresh applications which would be
considered on their merits, left the workers cold. So the factory remained
closed until April 28, 1973 when, with new workers recruited from the open
market, production recommenced. Among the militants, the morale which kept the
strike going, remained intact but among the others the pressure to report for
employment became strong. Re- employment of discharged workmen began and slowly
snowballed, so that by July 31, 1973 a substantial number of 419 returned to
the factory.
The crack of workman's morale was accelerated
by escalating reemployment and the Management's restoration of continuity of
service and other benefits for re-employed hands. The Employer relied on this
gesture as proof of his bond fides. Meanwhile, there were exchanges of letters
between and 'trading' of charges against each other. The Management alleged
that the strikers were violent and prevented loyalists' return while the Sabha
was bitter that goondas were hired to break the strike and promote blacklegs.
These imputations have a familiar ring and their impact on the legality of the
discharge of workmen falls for consideration a little later. The stream of
events flowed on. The Sabha protested that the Management was terrorising
workmen, exploiting their sagging spirit and illegally insisting on fresh
applications for employment while they were in law continuing in services. With
more 'old workers' trickling back for work and their discharge orders being
cancelled, the strike became counter-productive. Many overtures on both sides
were made through letters but this epistolary futility failed to end the
imbroglio and brought no bread. The worker wanted bread, job, and no phyrric
victory.
A crescent of hope appeared on the industrial
sky. The Management but out a 'final offer' on May 31, 1973, calling on all
workmen 166 to rejoin last the remaining vacancies also should be filled by
fresh recruits. The Sabha responded with readiness to settle and sought some
clarifications and assurances. The employer informed :
"Our offer is open till 10-6-1973. From
11-6-1973 we shall recruit new hands to the extent necessary.
Thereafter workers who will not have reported
for work shall have no chance left for re-employment with us.
We repeat that those workers who will report
for work will be taken back in employment with continuity of their services,
that the orders of discharge passed against them on 21-2-1973 shall be treated
as cancelled and they will also be paid the difference in wages from 1969 as
per the recommendations of the Wage Board." The Sabha was willing and
wrote back on June 8, 1973 but sought details about the attitude of the
Management to the many pending demands. Meanwhile, the sands of time were
running out and so the Sabha telegraphed on 9th June that the workers were
willing to report for work but were being refused work. They demanded the
presence of an impartial observer. The reply by the Management repelled these
charges, but there was some thaw in the estrangement, since the time for return
to work of the strikers was extended upto 16-6-73. An apparent end to a long
strike was seemingly in sight with the Sabha sore but driven to surrender. On
13- 6-73 the Sabha Secretary wrote back:
"This is a further opportunity to you
even now to show your bona fides. If you confirm to take all the workmen
discharged on 21-2-1973 as stated in your various letters and to give them
intimation and reasonable time to join, l will see that your offer is accepted
by the workmen." Here, at long last, was the Management willing to
'welcome' back all the former employees and the Sabha limping back to the old
wheels of work. Was the curtain being finally drawn on the feud ? Not so soon,
in a world of bad blood and bad faith; or may be, new developments make old
offers obsolete and the expected end proves an illusion.
Anyway, the victor was the Management and II
the vanquished the Sabha and the re-employment offered was watered down. In our
materialist cosmos, often Might is Right and victory dictates morality ! 167
Hot upon the receipt of the Sabha's letter accepting the offer the Management
back-tracked or had second thoughts on full re-employment. For, they replied
with a long catalogue of the Sabha's sins, set out the story of compulsion to
keep the production going and explained that since new hands had come on the
scene full re-employment was beyond them. In its new mood of victorious
righteousness, the Management modified the terms of intake of strikers and
saddled choosy conditions on such absorption suggestive of breaking the Sabha's
solidarity:
"As on the present working of the Company,
the Company may still need about 250 more workers including those to be on the
casual list as per the employment position prior to the start of the strike.
You may, therefore, send to us immediately
per return of post the list of the workers who can and are willing to join duty
immediately so as to enable us to select and employ the workmen as per the
requirement of the Company. Further, it would also be necessary for you to
state in your reply that you have called off the strike and have advised the
workers to resume the work as otherwise it is not clear from your letter as to
whether you are still advocating the continuance of the strike or that you have
called off the strike.
Therefore, unless we have a very definite
stand known from you on this issue, it may not be even now possible for us to
enter into any correspondence with you.
We may again stress that if your tactics of
prolonging the issue by correspondence are continued the management would be
constrained to fake new recruits and in that case, at a later date it may not
be even possible to employ as many workmen as may be possible to employ
now." Nothing is more galling, says Sri Tarkunde, than for a Union which
has lost the battle and offered to go back to work to be told that it should further
humiliate itself by formally declaring the calling off of the strike. Sentiment
apart, the Sabha had agreed to go back, but then the Management cut down the
number to be re employed to 250 and, even this, on a selective basis. This
selection could well be to weed out Union activists or to drive a wedge among
the Union members. These sensitive thoughts and hard bargains kept the two
apart. The Sabha, wounded but not wiped 168 out, did not eat the humble pie.
The Management, on account of the intervening recruitments and injuries
inflicted-by the strike, did not budge either.
At this point we find that out of 853
employees who had been sacked 419 had wandered back by July 31, leaving 434
workmen at flotsam. Their reinstatement became the focus of an industrial
dispute raised by the Sabha. A few more were left out of this jobless mass, and
through the intercession of the Commissioner of Labour both sides agreed to
resolve their disagreement by arbitral reference under Sec. 10A of the Act,
confining the dispute to reinstatement of 400 workmen discharged on February 21
1973. A reference under Sec. 10A materialised. The 'Labour litigation' began in
May 1975 and becoming 'at each remove a lengthening chain' laboured from deck
to deck and is coming to a close, hopefully, by this decision. Is legal justice
at such expensive length worth the candle or counter-productive of social
justice? Is a streamlined alternative beyond the creative genius of Law India?
An aside As urgent as an industrial revolution is an industrial law revolution,
if the rule of law were at all to serve as social engineering. The current
forensic process needs thorough overhaul because it is over-judicialised and
under- professionalised, lacking in social orientation and shop- floor know-how
and, by its sheer slow motion and high price, defects effective and equitable
solution leaving both Managements and Unions unhappy. If Parliament would heed,
we stress this need. Industrial Justice desiderates specialised processual
expertise and agencies.
This factual panorama, omitting a welter of
debatable details and wealth of exciting embellishments, being not germane to
the essential issues, leads us to a formulation of the decisive questions which
alone need engage our discussion. The Management might have been right in its
version or the Sabha might have been wronged as it wails, but an objective
assessment of the proven facts and unbiased application of the declared law
will yield the broad basis for working out a just and legal solution. Here, it
must be noticed that a new Union now exists even though its numerical following
is perhaps slender. We are not concerned whether it is the favoured child of
the Management, although it has received soft treatment in several settlements
which have somewhat benefited the whole work force and suggests a syndrome not
unfamiliar among some industrial bosses allergic to strong unions.
169 The central problem on the answer to
which either the award of the arbitrator or the judgment of the High Court can
be sustained as sound is whether the discharge of the workmen en masse was all
innocuous termination or a disciplinary action. If the latter. the High Court's
reasoning may broadly be invulnerable. Secondly, what has been mooted before us
is a question as to whether the evidence before the Arbitrator, even if
accepted at its face value, establishes any misconduct of any discharged
workman and further whether the misconduct, if any, made out is of such degree
as to warrant punitive discharge. Of course, the scope of Section 11A as
including arbitrators, the power of arbitrators, given sufficiently wide terms
of reference, to examine the correctness and propriety of the punishment, inter
alia, deserve examination. Likewise the rules regarding reinstatement, retrenchment,
back wages and the like, fall for subsidiary consideration.
Prefatory to this discussion is the
appreciation of the constitutional consciousness with regard to Labour Law. The
Constitution of India is not a non-aligned parchment but a partisan of social
justice with a direction and destination which it sets in the Preamble and Art.
38, and so, when we read the evidence, the rulings, the statute and the rival
pleas we must be guided by the value set of the Constitution. We not only
appraise Industrial Law from this perspective in the disputes before us but
also realise that ours is a mixed economy with capitalist mores, only slowly
wobbling towards a socialist order, notwithstanding Sri Garg's thoughts. And,
after all ideals apart. 'law can never be higher than the economic order and
the cultural development of society brought to pass by that economic order'.
The new jurisprudence in industrial relations must prudently be tuned to the
wave-length of our constitutional values whose emphatic expression is found in
a passage quoted by Chief Justice Rajamannar of the Madras High Court.
The learned judge observed :
"The doctrine of 'laissez faire' which
held sway in the world since the time of Adam Smith has practically given place
to a doctrine which emphasises the duty of the state to interfere in the
affairs of individuals in the interests of the social well-being of the entire
community. As Julian Huxley remarks in his essay on "Economic Man and
Social Man": "Many of our old ideas must be retranslated, so to
speak, into a new language. The democratic idea of freedom, for instance, must
lose its nineteenth century meaning of individual liberty in the economic
sphere, and become adjusted to new conception of social duties and
responsibilities.
170 When a big employer talks about his
democratic rights to individual freedom, meaning thereby a claim to socially
irresponsible control over a huge industrial concern and over the lives of tens
of thousands of human beings whom it happens to employ, he is talking in a
dying language." Homo economicus can no longer warp the social order.
Even so the Constitution is ambitiously
called socialist but realists will agree that a socialist transformation of the
law of labour relations is a slow though steady judicial desideratum. Until
specific legislative mandates emerge from Parliament the court may mould the
old but not make the new law. 'Interstitially, from the molar to the molecular'
is the limited legislative role of the court, as Justice Holmes said and Mr.
Justice Mathew quoted (see [1976] 2 S.C.C. at p. 343).
The Core Question Right at the forefront
falls the issue whether the orders of discharge are, as contended by Sri
Tarkunde, de facto dismissals, punitive in impact and, therefore, liable to be
voided if the procedural imperatives for such disciplinary action are not
complied with, even though draped in silken phrases like 'termination
simpliciter'. It is common case that none of the processes implicit in natural
justice and mandated by the relevant standing orders have been complied with,
were we to construe the orders impugned as punishment by way of discharge or
dismissal. But Sri Ashok Sen impressively insists that the orders here are
simple terminations with no punitive component, as, on their face, the orders
read. To interpret otherwise is to deny to the employer the right, not to
dismiss but to discharge, when the law gives him option.
An analysis of the standing orders in the
background of disciplinary jurisprudence is necessitous at this point of the case.
The Model Standing orders prescribed under
Section 15 of the Industrial Employment (Standing Orders) Act, 1946, apply to
this factory. Order 23, clauses (1) and (4), relate to termination of
employment of permanent workmen.
Termination of their services on giving the
prescribed notice or wages in lieu of such notice is provided for. But clause
(4A) requires reasons for such termination of service of permanent workmen to
be recorded and, if asked for, communicated. This is obviously intended to
discover the real reason for the discharge so that remedies available may not
be defeated by clever phraseology of orders of termination. Clause (7) permits
the services or non- permanent workmen to be terminated without notice 171
except when such temporary workmen are discharged by way of punishment.
Punitive discharge is prohibited unless opportunity to show-cause against
charges of misconduct is afforded (Standing order 15). Orders of termination of
service have to be by the Manager and in writing and copies of orders shall be
furnished to the workmen concerned.
Standing order 24 itemizes the acts and
omissions which amount to misconduct "According to clause (b) of the said
Standing order, going on an illegal strike or abetting, inciting instigating or
acting in furtherance thereof amounts to misconduct. Standing order 25 provides
for penalty impossible on a workman guilty of misconduct.
Accordingly amongst other punishments, a
workman could be visited with the penalty of discharge under order 23 of
dismissal without notice for a misconduct [see sub- clauses (f) and (g) of
clause ( 1 ) j. Clause (3) provides that no order of dismissal under sub clause
(g) of clause (1) shall be made except after holding an enquiry against the
workman concerned in respect of the alleged misconduct in the manner set forth
in clause (4). Clause (4) provides for giving to the concerned workman a
charge-sheet and an opportunity to answer the charge and the right to be
defended by a workman working in the same department as himself and production
of witnesses and cross-examination of witnesses on whom the charge rests. Under
clause (6), in awarding punishment the Manager has to take into account the
gravity of the misconduct, the previous record, if any, of the workman, and any
other extenuating or aggravating circumstances." The finding of the
Arbitrator that the workmen went on a strike which was illegal and in which
they had participated is not disputed. In this background, the application of
the procedural imperatives before termination of services of the workmen, in
the circumstances of the present case, has to be judged. This, in turn, depends
on the key finding as to whether the discharge orders issued by the management
were punitive or non-penal.
The anatomy of a dismissal order is not a
mystery, once we agree that substance, not semblance, governs the decision.
Legal criteria are not so slippery that verbal manipulations may outwit the
court. Broadly stated, the face is the index to the mind and an order fair on
its face may be taken at its face value. But there is more to it than that,
because sometimes words are designed to conceal deeds 172 by linguistic
engineering. So it is beyond dispute that the form of the order or the language
in which it is couched is not conclusive. The court will lift the veil to see
the true nature of the order.
Many situations arise where courts have been
puzzled because the manifest language of the termination order is equivocal or
misleading and dismissals have been dressed up as simple termination. And so,
judges have dyed into distinctions between the motive and the foundation of the
order and a variety of other variations to discover the.
true effect of an order of termination.
Rulings are a maze on this question but, in sum, the conclusion is clear. If
two factors coexist, an inference of punishment is reasonable though not
inevitable. What arc they ? If the severance of service is effected, the first
condition is fulfilled and if the foundation or causa causans of such severance
is the servant's misconduct the second is fulfilled. If the basis or foundation
for the order of termination is clearly not turpitudinous or stigmatic or
rooted in misconduct or visited with evil pecuniary effects, then the inference
of dismissal stands negated and vice versa. These canons run right through the
disciplinary branch of master and servant jurisprudence, both under Article 311
and in other cases including workmen under managements The law cannot be
stultified by verbal haberdashery because the court will lift the mask and
discover the true face. It is true that decisions of this Court and of the,
High Courts since Dhingra's case (1958 SCR 828) have been at times obscure. if
cited de hors the full facts. In Samsher Singh's case the unsatisfactory state
of the law was commented upon by one of us, per Krishna Iyer, J., quoting Dr.
Tripathi for support:
"In some cases, the rule of guidance has
been stated to be 'the substance of the matter' and the 'foundation' of the
order. When does 'motive' trespass into 'foundation' ? When do we lift the veil
of form to touch the 'substance' ? When the Court says so. These 'Freudian'
frontiers obviously fail in the work-a-day world and Dr. Tripathi's observations
in this context are not without force. He says:
'As already explained, in a situation where
the order of termination purports to be a mere order of discharge without.
173 stating the stigmatizing results of the
departmental enquiry a Search for the 'substance of the matter' will be
indistinguishable from a search for the motive (real, unrevealed object) of the
order. Failure to appreciate this relationship between motive (the real, but
unrevealed object) and from (the apparent, or officially revealed object) in
the present con text has lead to an unreal inter-play of words and phrases
wherein symbols like 'motive', 'substance' 'form' or 'direct' parade in
different combinations without communicating precise situations or entities in
the world of facts.' The need, in this branch of jurisprudence, is not so much
to reach perfect justice but to lay down a plain test which the administrator
and civil servant can understand without subtlety and apply without difficulty.
After all, between 'unsuitability' and 'misconduct' thin partitions do their
bounds divide'.
And over the years, in the rulings of this
Court the accent has shifted, the canons have varied and predictability has
proved difficult because the play of legal light and shade has been baffling. The
learned Chief Justice has in his judgement, tackled this problem and explained
the rule which must govern the determination of the question as to when
termination of service of a probationer can be said to amount to discharge
simpliciter and when it can be said to amount to punishment so as to attract
the inhibition of Art 311." Masters and servants cannot be permitted to
play hide and seek with. the law of dismissals and the plain and proper
criteria are not to be misdirected by terminological cover-ups or by appeal to
psychic processes but must be grounded on the substantive reason for the order,
whether disclosed or undisclosed. The Court will find out from other
proceedings or documents connected with the formal order of termination what
the true ground for the termination is. If, thus scrutinized, the order has a
punitive flavour in cause or consequence, it is dismissal. If it falls short of
this test, it cannot be called a G punishment. To put it slightly differently,
a termination effected because the master is satisfied of the misconduct and of
the consequent desirability of terminating the service of the delinquent
servant, it is a dismissal, even if he had the right in law to terminate with
an innocent order under the standing order or otherwise. Whether, in such a
case the grounds are recorded in a different proceeding from the formal order
does not detract from its nature. Nor the fact that, after being satisfied of
the guilt, the master abandons the enquiry and proceeds to 174 terminate. Given
an alleged misconduct and a live nexus between it and the termination of
service the conclusion is dismissal. even if full benefits as on simple
termination, are given and non-injurious terminology is used.
On the contrary, even if there is suspicion
of misconduct the master may say that he does not wish to bother about it and
may not go into his guilt but may feel like not keeping a man he is not happy
with. He may not like to investigate nor take the risk of continuing a dubious
servant. Then it is not dismissal but termination simpliciter, if no injurious
record of reasons or punitive pecuniary cut-back on his full terminal benefits
is found.
For, in fact, misconduct is not then the
moving factor in the discharge. We need not chase other hypothetical situations
here.
What is decisive is the plain reason for the
discharge.
not the strategy of a non-enquiry or clever
avoidance of stigmatizing epithets. If the basis is not misconduct, the order
is saved. In Murugan Mills, this Court observed:
"The right of the employer to terminate
the services of his workman under a standing order, like cl. 17(a) in the
present case, which accounts to a claim "to hire and fire' an employee as
the employer pleases and thus completely negatives security of service which has
been secured to industrial employees through industrial adjudication. came up
for consideration before the Labour Appellate Tribunal in Buckingham and
Carnatic Co. Ltd. v. Workers of the Company. The matter then came up before
this before this Court also in Chartered Bank v. Chartered Bank Employees
Union(3) and the Management of U.B. Dutt & Co. v. Workmen of U. B. Dutt
& Co.(4) Wherein the view taken by Labour Appellate Tribunal was approved
and it was held that even in a case like the present the requirements of bona
fides was essential and if the termination of service was a colourable exercise
of the power or as a result of victimization or unfair labour practice the
industrial tribunal would have the jurisdiction to intervene and set aside such
termination. The form of the order in such a case is not conclusive and the
Tribunal can go behind the order to find the reasons which led to the 175 order
and then consider for itself whether the termination was a colourable exercise
of the power or was a result of victimisation or unfair labour practice. If it
came to the conclusion that the termination was a colourable exercise of the
power or was a result of victimisation or unfair labour practice. it would have
the jurisdiction to intervene and set aside such termination." Again, in
Chartered Bank v. Employees Union his Court emphasised:
" .... The form of the order of
termination is not conclusive of the true nature of the order, for it is
possible that the form may be merely a camouflage for an order of misconduct.
It is, therefore, always open to the Tribunal to go behind the form and look at
the substance and if it comes to the conclusion, for example, that though in
form the order amounts to termination simpliciter, it in reality cloaks a
dismissal for misconduct, it will be open to it to set it aside as a colourable
exercise of the Power." A rain of rulings merely adds to the volume, not
to the weight of the proposition, and so we desist from citing all of them. A
bench of seven judges of this Court considered this precise point in Shamsher
Singh's case and Chief Justice Ray ruled:
"The form of the order is not decisive
as to whether the order is by way of punishment. Even an innocuously worded
order terminating the service may in the facts and circumstances of the case
establish that an enquiry into allegations of serious and grave character of
misconduct involving stigma has been made in infraction of the provision of
Article 311. In such a case the simplicity of the form of the order will not
give any sanctity. That is exactly what has happened in the case of Ishwar
Chand Agarwal. The order of termination IS illegal and must he set aside."
Simple termination or Punitive Discharge ? We must scan the present order of
discharge of 853 workmen and ask the right questions to decide whether they are
punishments or innocent terminations. Neither judicial naivete nor managerial
ingenuity will put the court off the track of truth. What. then, are the
diagnostic factors in the orders under study ? An isolated reading of the
formal notices terminating their services reveals no stigma, no penalty, no
misconduct. They have just been told 176 off. But the Management admits that as
required by the Standing orders it has recorded reasons for the discharge.
There, several pages of damnatory conduct
have been heaped on the workers collectively accounting for the resort of the
Management to the extreme step of discharging the whole lot, there being no
alternative. Sri A. K. Sen took us through the various appeals made by the
Management, the losses sustained. the many offers to negotiate and arbitrate,
the Sabha's deaf obduracy and resort to sudden strike and violent tactics and,
worst of all, its attempts to persuade the Central Government to take over the
factory as a `sick' mill. These ordeals were, described by Sri Ashok Sen
graphically to justify the submission that the Management had no choice, caught
between Scylla of strike and Charybdis of take-over, but to get rid of the
strikers and recruit new workers. If the employer did not discharge the
strikers they were adamant and would not return to world, and the very closure
compelled by the Sabha was being abused by it to tell the Central Government
that for three months there had been no production and so the mill qualified to
be taken over as `sick' under the Industries (Development and Regulation) Act.
If the Management discharged the workers to facilitate fresh recruitment and
save the factory from statutory takeover the cry was raised that the action was
dismissal because an elaborate enquiry was not held. The Management had avoided
injury to the workmen, argued Sri Sen, by merely terminating their services
without resort to disciplinary action and recording the uncomplimentary grounds
in a separate invisible order. He also underscored the fact that the strike was
illegal and unjustified as concurrently held by the Arbitrator and the High
Court.
We agree that industrial law promotes
industrial life, not industrial death, Any realism is the soul of legal
dynamics. Any doctrine that destroys industrial progress interlaced with social
justice is lethal juristic and cannot be accepted. Each side has its own
version of the role of the other which we must consider before holding either
guilty. Sri Tarkunde told us the tale of woe of the workmen.
In 3 country where the despair of Government
is appalling unemployment it is a terrible tragedy to put to economic death 853
workmen. And for what? For insisting that the pittance of Rs. 100 per month be
raised in terms of the Central Wage Board recommendations, as long ago agreed
to by the Management but put off by the tantalizing but treacherous offer of
arbitration. When the point admitted of easy negotiated solution. Arbitration
looks nice, but. since 1969, the hungry families have been yearning for a
morsel more, he urged. Blood, toil, sweat and tears for the workers and all the
profits' and production for the Management, was the industrial irony! Knowing
that every arbitral or other adjudicatory agency in 177 India, especially when
weak Labour is pitted against strong Capital in the sophisticated processual
system, consumes considerable time, the lowly working class is allergic to this
dilatory offer of arbitration. They just don't survive to eat the fruits. Such
was his case.
The story of violence was also refuted by Sri
Tarkunde, since the boot was on the other leg. Goondas were hired by the
Management to sabotage the fundamental right to strike and with broken hearts
several of them surrendered. When, at last, the Sabha agreed to see that all
workmen reported for work within the extended time, the Management took to the
typical tactics of victimisation of refusing work for all, as first offered,
and of picking and choosing even for the 250 vacancies. Moreover, other
conditions were put upon the Sabha calculated to break unionism which those
familiar with trade union movements would painfully appreciate. This insult and
injury apart, the orders of termination were painly dismissals for a series of
alleged misconducts which were chronicled in separate proceedings. The formal
order was like a decree, the grounds recorded contemporaneously were like the
judgment, to use court vocabulary. It was obvious that the foundation for the
termination was the catena of charges set out by the Management. The true
character of the order could not be hidden by the unfair device of keeping a
separate record and omitting it from the normal communication. Law is not such
an ass as yet and if the intent and effect is damnatory the action is
disciplinary.
Between these two competing cases, presented
by counsel, we have to gravitate towards the correct factual- legal conclusion.
A number of peripheral controversies have been omitted from this statement, for
brevity's sake. When two high tribunals have spread out the pros and cons it is
supererogation for this Court to essay likewise, and miniaturization is a wise
husbandry of judicial resources.
First, we must decide whether the order of
termination was a punitive discharge or a simple discharge.
Here we reach the dilemma of the law for
discovering unfailing guidelines to distinguish between discharge simpliciter
and dismissal sinister. The search for infallible formulae is vain and only
pragmatic humanism can help navigate towards just solutions. We have earlier
explained that from Dhingra's case to Shamsher Singh's case, the law has been
dithering but some rough and ready rules can be decocted to serve in most
situations. Law, in this area, is a pragmatist, not a philologist, and we have
set out the dual diagnostic tests applicable in such cases.
178 It was not retrenchment, according to the
Management.
Then what was it ? If there was work to be
done, why terminate services of workmen except as punishment ? Because, argued
Sri Sen, the workers did not work, being on strike and the Management, bent on
keeping the factory going, needed workmen who work. To recruit fresh hands into
the lists and to keep the old hands on the roster was double burden, and,
therefore, the strikers had to be eased out to yield place to new recruits. The
object was not to punish the workmen but to keep the factory working Accepting
this plea, as it were, the award of the arbitrator has exonerated the
Management of the charge of dismissal while the High Court has held the action to
be dismissal for misconduct and therefore bad in law.
In our opinion, the facts of the case before
us speak for themselves Here are workmen on strike. The strike is illegal. The
Management is hurt because production is paralyzed. The strikers allegedly indulge
ill objectionable.
activities. The exasperated Management hits
back by ordering their discharge for reasons set out in several pages in the
appropriate contemporaneous proceeding. Misconduct after misconduct is flung on
the workers to justify the drastic action In all conscience and common sense,
the discharge is the punishment for the misconduct. The Management minces no
words. What is explicity stated is not a colourless farewell to make way for
fresh hands to work the factory until the strike is settled but a hard hitting
order with grounds of guilt and penalty of removal.
The inference is inevitable, however,
ingenious the contrary argument, that precisely because the Management found
the workmen refractory in their misconduct they were sacked. Maybe, the
management had no other way of working the factory but that did not change the
character of the action taken. Once we hold the discharge punitive the
necessary consequence is that enquiry before punishment was admittedly
obligatory and confessedly not undertaken. The orders were bad on this score
alone.
Sri A. K. Sen urged that in a dismissal the
employee is denied some of the retiral and other benefits which he gets in a
simple discharge, and here all the employees were offered their full monetary
benefits, so that it was wrong to classify the orders of discharge as punitive.
Maybe, a dismissed servant may well be disentitled to some, at least, of the
financial benefits which his counterpart who-is simply discharged may draw. But
that is not a conclusive test. Otherwise, the master may 'cashier' his servant
and camouflage it by offering full retiral benefits. Dismissal is not discharge
plus a price. The substance of 179 the action is the litmus test. In the
present case, the penal core, 'tied ,4. in tooth and claw, shows up once we
probe; and the non-committal frame of the formal order is a disguise. For a
poor workman loss of his job is a heavy penalty when inflicted for alleged
misconduct, for he is so hungry that, in Gandhiji's expressive words, he sees
God Himself in a loaf of bread.
Before we leave this part of the case, a
reference to some industrial law aspects and cases may be apposite though a
little repetitive Standing orders certified for an industrial undertaking or
the model Standing orders framed under the Industrial Employment Standing
orders Act provide for discharge simpliciter, a term understood in
contradistinction to punitive discharge or discharge by way of penalty. It is
not unknown that an employer resorts to camouflage by garbing or cloaking, a
punitive discharge in the innocuous words of discharge simpliciter. Courts have
to interpose in order to ascertain whether the discharge is one simpliciter or
a punitive discharge, and in doing so the veil of language is lifted and the
realities perceived. In the initial stages the controversy raised was whether
the court/tribunal had any jurisdiction to lift such a veil.
Prove and penetrate so as to reveal the
reality, but this controversy has been set at rest by the decision in Western
India Automobile Association v. Industrial Tribunal Bombay.
The wide scope of the jurisdiction of
industrial tribunal,' court in this behalf is now well established. If standing
orders or the terms of contract permit the employer to terminate the services
of his employee by discharge simpliciter without assigning reasons, it would be
open to him to take recourse to the said term or condition and terminate the
services of his employee but when the validity of such termination is
challenged in industrial adjudication it would be competent to the industrial
Tribunal to ensure whether the impugned discharge has been effected in the bona
fide exercise of the power conferred by the terms of employment. If the
discharge has been ordered by the employer in bona fide exercise of his power,
then the industrial tribunal may not interfere with it; but the words used in
the order of discharge and the form which it may have taken are not conclusive
in the matter an(l the industrial tribunal would be entitled to go behind the
words and form and decide whether the discharge is a discharge simpliciter or
not If it appears that the purported exercise of power to terminate the
Services of the employee was in fact the result of the misconduct alleged
against him. then the tribunal would be justified in dealing with the dispute
on the basis; that, despite its appearance to the contrary.
the order of discharge is in effect an order
of dismissal.
In the exercise of this power, the 180
court/tribunal would be entitled to interfere with the order in question [see
Assam Co. v. Its Workmen]. In the matter of an order of discharge of an
employee as understood within the meaning of the Industrial Disputes Act the iron
of the order and the language in which it is couched are not decisive. If the
industrial court is satisfied that the order of discharge is punitive or that
it amount; to victimisation or unfair labour practice it is competent to the
Court/tribunal to set aside the order in a proper case and direct reinstatement
of the employee [see Tata oil Mills Co. Ltd. v. Workmen]. The form used for
terminating the service is not conclusive and the tribunal has jurisdiction to
enquire into the reasons which led to such termination In the facts of the case
it was found that Standing orders provided that an employee could ask for
reasons for discharge in the case of discharge simpliciter. Those reasons were
given before the tribunal by the appellant, viz., that the respondents services
were terminated because he deliberately resorted to go-slow and was negligent
in the discharge of his duty. It was accordingly held that the services of the
employee were terminated for dereliction of duty and go-slow in his work which
clearly amounted to punishment for misconduct and. therefore. to pass an order
under cl. 17(a) of the Standing orders permitting discharge simpliciter in such
circumstances was clearly a colorable exercise of power to terminate services
of a workman under the provision of the Standing orders. In these circumstances
the tribunal would be justified in going behind the order and deciding for
itself whether the termination of the respondent's services could be sustained
(vide Management of Murugan Mills Ltd. v. Industrial Tribunal, Madras &
Anr. This view was affirmed in Tata Engineering & Locomotive Co. Ltd. v. S.
C. Prasad & Anr.(4). After approving the ratio in Murugan Mills case, this
Court in L. Michael & Anr. v. M/s.
Johnson Pumps India Ltd observed that the
manner of dressing up an order did not matter. The slightly different
observation in Workmen of Sudder office, Cinnamare v.
Management was explained by the Court and it
was further affirmed that since the decision of this Court in the Chartered
Bank v. The Chartered Bank Employee's Union it has taken the consistent view
that if the termination of service is a colourable exercise of power vested in
the management or is a result of victimization 181 or unfair labour practice,
the court/tribunal would have jurisdiction to intervene and set aside such
termination. It was urged that a different view was taken by this Court in
Municipal Corporation of Greater Bombay v. P. S. Malvenkar & ors. The
employee in that was discharged from service by paying one month's wages in
lieu of notice This action was challenged by the employee before the Labour
Court and it was contended that it was a punitive discharged. The Corporation
contended that wider Standing order No. 26 the Corporation had the power to
discharge but there was an obligation to give reasons if so demanded by the
employee.
The Corporation had also the power to
discharge by way of punishment. The Court in this connection observed as under:
"Now one thing must be borne in mind
that these are two distinct and independent powers and as far as possible
either should be construed so as to emasculate the other cr to render it
ineffective. One is the power to punish an employee for misconduct while the
other is the power to terminate simpliciter the service of an employee without
any, other adverse consequence. Now.
proviso (i) to clause (1) of Standing order
26 requires that the reason for termination of the employment should be given
in writing to the employee when exercising the power of termination of service
of the employee under Standing order 26. Therefore, when the service of an
employee is terminated simpliciter under Standing order 26, the reason for such
termination has to be given to the employee and this provision has been made in
the Standing order with a view to ensuring that the management does not act in
an arbitrary manner. The management is required to articulate the reason which
operated on its mind in terminating the service cf the employee. But merely
because the reason for terminating the service of the employee is required to
be given and the reason must obviously not be arbitrary, capricious or
irrelevant-it would not necessarily in every case make the order or termination
punitive in character so as require compliance with the requirement of clause
(2) of Standing order 21 read with Standing order 23.
Otherwise. the power of termination of
service of an employee under Standing order 26 would be rendered meaningless
and futile for in no case it would be possible to exercise it. Of course, if
misconduct of the employee constitutes the 182 foundation for terminating his
service, then even if the order of termination is purported to be made under
Standing order 26, it may be liable to be regarded as punitive in character
attracting the procedure of clause (2) of Standing order 21 read with Standing
order 23, though even in such a case it may be argued that the management n has
not punished the employee but has merely terminated his service under Standing
order 26." It does not purport to run counter to the established ratio
that the form of the order is not decisive and the Court can lift the veil. However,
it may be noted that there was an alternative contention before the Court that
even if the order of discharge was considered punitive in character, the
employer corporation had led evidence before the labour court to substantiate
the charge of misconduct and that finding was also affirmed.
We are satisfied that the Management,
whatever its motives vis-a-vis keeping the stream of production flowing, did
remove from service, on punitive grounds, all the 853 workmen.
The law is trite that the Management may
still ask for an opportunity to make out a case for dismissal before the
Tribunal. The refinements of industrial law in this branch need not detain u.s
because the arbitrator did investigate and hold that the workmen were guilty of
misconduct and the 'sentence' of dismissal was merited, even as the High Court
did reappraise and reach, on both counts, the reverse conclusion.
The sweep of Article 226 Once we assume that
the jurisdiction of the arbitrator to enquire into the alleged misconduct was
exercised, was there any ground under Article 226 of the Constitution to
demolish that holding ? Every wrong order cannot be righted merely because it is
wrong. It can be quashed only if it is vitiated by the fundamental flaws of
gross miscarriage of justice, absence of legal evidence, perverse misreading of
facts, serious errors of law on the face of the order, jurisdictional failure
and the like.
While the remedy under Article 226 is
extraordinary and is of Anglo-Saxon vintage, it is not a carbon copy of English
processes. Article 226 is a sparing surgery but the lancet operates where
injustice suppurates. While traditional restraints like availability of
alternative remedy hold back the court, and judicial power should not
ordinarily rush in where the other two branches fear to tread, judicial daring
is not daunted where glaring injustice demands even affirmative action.
183 The wide words of Article 226 are
designed for service of the lowly numbers in their grievances if the subject
belongs to the court's province and the remedy is appropriate to the judicial
process. There is native hue about Article 226, without being anglophile or
anglophobic in attitude. Viewed from this jurisprudential perspective, we have
to be cautious both in not overstepping as if Article. 226 were as large as an
appeal and not failing to intervene where a grave error has crept in. Moreover,
we sit here in appeal over the High Court s Judgement. And an appellate power
interferes not when the order appealed is not right but only when it is clearly
wrong. The difference is real, though fine.
What are the primary facts which have entered
the Tribunal's verdict in holding the strikers guilty of misconduct meriting
dismissal ? We must pause to remove a confusion and emphasise that the
dismissal, order is not against the Union but the individual workers. What did
each one do ? Did his conduct, when sifted and scrutinised, have any exculpation
or extenuation ? Not strikers in the mass, but each worker separately, must be
regarded as the unit of disciplinary action. Each one's role and the degree of
turpitude, his defence on guilt and punishment, must be adjudged before
economic death sentence is inflicted. A typical trial process instance will
illumine the point.
Suppose there is case of arson and murder in
a village because of communal faction and a hundred men from the aggressive
community are charged in court with serious offences. Suppose further that
convincing testimony of the provocation and aggression by that community is
produced.
Can any single member of the violent
community be convicted on 'mass' evidence, without specific charges of
participation or clear proof of constructive involvement ? Judicial
perspicacity clears this common fallacy. It is dangerous to mass-convict on the
theory of community built.
Anger sometimes brings in this error.
In our assessment, the arbitrator has been
swayed by generalities where particularities alone would have sufficed. A long
story may be made short by skipping the details and focussing on essentials. We
must, in fairness, state that the Arbitrator, an experienced and accepted
tribunal in labour disputes, has exhaustively brought into the Award all
available details pro and con with over- emphasis here and there. There are
only a few confusions in his long award but, regrettably, they happen to be on
a few fundamentals. The foremost, of course, is a mix-up between mob-misconduct
and individual guilt. The next is getting lost in the oceanic evidence while
navigating towards a 1 specified port. The High Court too has excelled in
marshalling the details and handling the legal issues, although, even there,
shortcomings 184 on basic issues have been pointed out by Sri A. K. Sen. We too
are apt to err and reverse ourselves although we try our best to avoid error.
The Supreme Court is final not because it is infallible; it is infallible;
because it is final.
propose to examine the essential issues from
the perspective We have set out and in their proper jurisprudential bearings.
If misconduct was basic to the discharge and
no enquiry precedent to the dismissal was made the story did not end there in
favour of the workmen. The law is well-settled that the Management may still
satisfy the tribunal about the misconduct.
As a fact the arbitrator held misconduct
proved. He further found that the circumstances justified dismissal though he
decided the order to mean discharge simpliciter Was misconduct proved against
each discharged worker at least before the arbitrator ? If it was, did every
worker deserve punitive discharge ? Dual jurisdictional issues arise here which
have been argued at some length before us. The position taken up by Sri Sen was
that the High Court could not, under Article 226, direct reinstatement, and
even it felt that the arbitrator had gone wrong in refusing reinstatement, the
court could only demolish the order and direct the arbitrator to reconsider the
issue. What belonged, as a discretionary power, to a tribunal or other
adjudicatory body could not be wrested by the writ court. To put it pithily,
regarding the relief of reinstatement, the arbitrator could but would not and
the High Court would but could not. (We will deal later with the point that the
arbitrator had himself no power under Section 11 A of the Act but did have it
in view of the wide terms of reference.) The basis of this submission as we
conceive it. is the traditional limitations woven around high prerogative writs.
Without examining the correctness of this
limitation, we disregard it because while Article 226 has been inspired by the
royal writs its sweep and scope exceed hide-bound British processes of yore. We
are what we are because our Constitution-framers have felt the need for a
pervasive reserve power in the higher judiciary to right wrongs under our
conditions. Heritage cannot hamstring; nor custom constrict where the language
used is wisely wide. The British paradigms are not necessarily models in the Indian
Republic. So broad are the expressive expressions designedly used in Article
226 that any order which should have been made by the lower authority could be
made by the High Court.
The very width of the power and the
disinclination to meddle, except where gross injustice or fatal illegality and
the like are present inhibit the exercise but do not abolish the power.
185 We may dilate a little more on Article
226 vis-a-vis awards of arbitrators. The first limb of the argument is that
when there is a voluntary joint submission of an industrial dispute to an
Arbitrator named by them under s. 10A of the Industrial Disputes Act, he does
not function as a Tribunal and is not amenable to the jurisdiction of that
Court under Article 227 or under Article 226. Without further elaboration this
contention can be negatived on a decision of this Court in Rohtas Industries
Ltd. & Anr. v. Rohtas Industries State Union ors. (1) This Court observed
that as the Arbitrator under s. 10A has the power to bind even those who are
not parties to the reference or agreement and the whole exercise under s. 10A
as well as the source of the force of the Award on publication derived from the
statute, it is legitimate to regard such an arbitrator now as part of the
infrastructure of the sovereigns dispensation of justice, thus falling within
the rainbow of statutory tribunals amenable to judicial review.
The second limb of the argument was that a
writ of certiorari could not be issued to correct errors of facts.
In this connection after affirming the ratio
in Engineering Mazdoor Sabha v. Hind Cycle Ltd., this Court observes that what
is important is a question of law arising on the face of the facts found and
its resolution ex facie or sub silentio. The Arbitrator may not state the law
as such; even then such acute silence confers no greater or subtler immunity on
the award than plain speech. We do not dilate on this part of the argument as
we are satisfied that be the test the deeply embedded rules to issue certiorari
or the traditional grounds to set aside an arbitration award 'thin partition do
their bounds divide' on the facts and circumstances of the present case.
Broadly stated, the principle of law is that the jurisdiction of the High Court
under Article 226 of the Constitution is limited to holding the judicial or
quasi-judicial tribunals or administrative bodies exercising the quasi-judicial
powers within the leading strings of legality and to see that they do not
exceed their statutory jurisdiction and correctly administer the law laid down
by the statute under which they act. So long as the hierarchy of officers and
appellate authorities created by the statute function within their ambit the
manner in which they do so can he no ground for interference. The power of
judicial supervision of the High Court under Article 227 of the Constitution
(as it then stood) is not greater than those under Article 226 and it must be
limited to seeing that a tribunal functions within the limits of its authority
[see Nagendra Nath Bora & Anr.
v. The Commissioner of Hills Division &
Appeals, Assam & ors.(a) ]. This led to a proposition that in 186
exercising jurisdiction under Article 226 the High Court is not constituted a
Court of appeal over the decision of authorities, administrative or
quasi-judicial. Adequacy or sufficiency of evidence is not its meat. It is not
the function of a High Court in a petition for a writ under Art 226 to review
the evidence and to arrive at an independent finding on the evidence. [See
State of Andhra Pradesh v. S. Shree Rama Rao ] A constitution Bench of this
Court in P. H. Kalyani v. M/s-. Air France, Calcutta ) succinctly set out the
limits of the jurisdiction of the High Court in dealing with a writ petition.
It was said that in order to justify a writ of certiorari it must be shown that
an order suffers from an error apparent on the face of the record. It was
further pointed out that in the finding of fact is made by the impugned order
and it is shown that it success from an error of law and not of fact, a writ
under Article 226 would issue, and, while so saying, the decision in Nagendra
Nath Bora's case was affirmed. Following the aforementioned decision, the
Gujarat High Court in Navinchandra Shakerchand Shah v. Manager, Ahmedabad Coop.
Department Stores Ltd.
observed that the amended Article 226 would
enable the High Court to interfere with an Award of the industrial adjudicator
if that is based on a complete misconception of law or it is based on no
evidence or that no reasonable man would come to the conclusion to which the
Arbitrator has arrived.
Even apart from, but while approving, the
Gujarat ruling in 19 G.L.R. p. 108 cited before us, we are satisfied that the
writ power is larger given illegality and injustice, even if its use is
severely discretionary as decided cases have repeatedly laid down. We over-rule
the objection of invalidity of the High Court’s order for want of power.
The more serious question is whether the
arbitrator had the plenitude of power to re-examine the punishment imposed by
the Management, even if he disagreed with its severity.
In this ease the arbitrator expressed himself
as concurring with the punishment. But if he had disagreed, as the High Court,
in his place, did, could he have interfered? Armed with the language of Sec.
11A, which confers wide original power to the tribunal to re-fix the
'sentence', Sri Sen argued that an arbitrator was uncovered by this new
Section.
So, even if he would, he could not. And, in
this case if he could, he would not. There the matter ended, was the argument.
We disagree. Even if he could. he would not, true;
but that did not preclude the High Court from
reviewing the order in exercise of its extraordinary constitutional power.
Moreover, Sec. 11A did clothe the arbitrator
with similar 187 power as tribunals, despite the doubt created by the abstruse
absence A of specific mention of 'arbitrator' in Sec. 11A. This position needs
closer examination and turns on interpretational limitations. At this stage, to
facilitate the discussion, we may read the provision:
"11A. Where an industrial dispute
relating to the discharge or dismissal of a workmen has been referred to a 1
Labour Court, Tribunal or National Tribunal for adjudication and, in the course
of the adjudication proceedings, the Labour Court, Tribunal or National
Tribunal, as the case may be, is satisfied that the order of discharge or
dismissal was not justified, it may, as it thinks fit, or give such other
relief to the Workman on such terms and conditions, if any, as it thinks fit,
or give such other relief to the workman, including the award of any lesser
punishment in lieu of discharge or dismissal as the circumstances of the case
may require:
Provided that in any proceeding under this
section the Labour Court Tribunal or National Tribunal as the case may be,
shall rely on the materials on record and shall not take any fresh evidence in
relation to the matter".
Sec. 11A was introduced in purported
implementation cf the I.L.O. recommendation which expressly referred, inter
alia to arbitrators. The Statement of objects and Reasons which illumines the
words of the legislative text when it is half-lit, even if it cannot directly
supplement the section, does speak of the I.L.o. recommendations and, in terms
of tribunals and arbitrators. When it came to drafting Section 11A the. word
'arbitrator' was missing. Was this of deliberate legislative design to deprive
arbitrators, who discharge identical functions as tribunals under the Industrial
Disputes Act, of some vital powers which vested in their tribunal brethren ?
For what mystic purpose could such distinction be ? Functionally, tribunals and
arbitrators being to the same brood. The entire scheme, from its I.L.O.
genesis, through the objects and Reasons, fits in only with arbitrators being
covered by Section 11A, unless Parliament cheated itself and the nation by
proclaiming a great purpose essential to industrial justice and, for no rhyme
or reason and wittingly or unwittingly, withdrawing one vital word. Every
reason for clothing tribunals with Sec. 11A powers applies a fortiori to
arbitrators. Then why omit ? Could it be a synopic omission which did not affect
the semantics because a tribunal, in its wider connotation, embraced every
adjudicatory organ, including an arbitrator ? An economy of words is a
legislative risk before a judiciary accustomed to the Anglo-Saxon
meticulousness in 188 drafting. We may easily see meaning by one construction.
A 'tribunal' is merely a seat of justice or a judicial body with jurisdiction
to render justice. If an arbitrator fulfils this functional role and he does
-how can he be excluded from these scope of the expression ? A caste
distinction between courts, tribunals, arbitrators and others, is functionally
fallacious and, in our context, stems from confusion. The Section makes only a
hierarchical, not functional, difference by speaking of tribunals and national
tribunals. So we see no ground to truncate the natural meaning of 'Tribunal' on
the supposed intent of Parliament to omit irrationally the category of
adjudicatory organs known as arbitrators. To cut down is to cripple and the art
of interpretation makes whole, not mutilates, furthers the expressed purpose,
not hampers, by narrow literality.
Section 2(r) defines Tribunal thus:
'Tribunal' means an Industrial Tribunal
constituted under Section 7A and includes an Industrial Tribunal constituted
before the 10th day of March, 1957, under this Act, Prima-facie it is a
different category from arbitrators but all statutory definitions are subject
to contextual changes.
It is perfectly open. to the court to give
the natural meaning to a word defined in the Act if the context in which it
appears suggests a departure from the definition because then there is
something repugnant in the subject or context.
Then what is the natural meaning of the
expression "Tribunal"? A 'tribunal' literally means a seat of
justice.
May be, justice is dispensed by a
quasi-judicial body, an arbitrator, a commission, a court or other adjudicatory
organ created by the State. All these are tribunals and naturally the import of
the word embraces an arbitration tribunal. Stroud's Judicial Dictionary (Vol. 4
p. 3093) speaks of 'Tribunal in this, wider sense and quoted Fry, L.J. in
Dawkins v. Rokeby [L.R. 8 Q.B. 255, affirmed, L.R. 7 H.L. 744]:
"I accept that, with this qualification
that I do not like the word 'tribunal'. The word is, ambiguous, because it has
not like 'court' any ascertainable meaning in English law" (Royal
Acsuarium v. Parkinson.
[1892] Q.B. 431, cited COURT) .
There is a reference to the bishop's
commission of enquiry as judicial tribunal and, significantly, specific mention
has been made in these terms.
189 "Disputes between employers and
employees are A referred to such tribunals as the Civil Service Arbitration
Tribunal, National Arbitration Tribunal and the Industrial Disputes
Tribunal". (Stroud's Judicial Dictionary p. 3094) We have hardly any doubt
that 'tribunal' simpliciter has a sweeping signification and does not exclude
'arbitrator'.
Here we come upon a fundamental dilemma of
interpretative technology vis-a-vis the judicative faculty.
What are the limits of statutory construction
? Does creativity in this jurisprudential area permit travel into semantic
engineering as substitute for verbalism ? It is increasingly important for
developing countries, where legislative transformation of the economic order is
an urgent item on the national agenda, to have the judiciary play a meaningful
role in the constitutional revolution without ferreting out laws in the
draftsman, once the object and effect are plain. Judges may not be too
'anglo-phonic' lest the system fail.
It is edifying to recall from Robert Stevens'
Law and Politics of the House of Lords as a judicial body:
"Moreover, Macmillan, who began to
specialize in the increasingly frequent tax appeals, continued to develop this
highly artificial approach in Inland Revenue Commissioner v. Ayrshire Employers
Mutual Insurance Association, when Parliament had clearly intended to make the
annual surpluses of mutual insurance companies subject to tax, Macmillan found
a particularly formalistic argument to show that this had not been the effect
of section 31 of the Finance Act of 1933. He was then happily able to announce,
"The Legislature has plainly missed. fire."(a). Of this decision Lord
Diplock was later to say that "if, as in this case, the Courts can
identify the target of Parliamentary legislation their proper function is to
see that it is hit: not merely to record that it has been missed. Here is
judicial legislation at its worst."(3) ' We would rather adopt Lord
Diplock's thought and have the court help hit the legislative target, within
limits, than sigh relief that the legislative fire has missed the bull's eye.
Of course, the social philosophy of the Constitution has, as ruled by this
court in several cases, a role in interpretative enlightenment and judicial
value vision.
190 We may reinforce this liberal rule of
statutory construction, being a matter of importance in the daily work of the
Court, by reference even to Roman Law from Justinian's days down to the
American Supreme Court. "Not all special cases can be contained in the
laws and resolutions of the Senate", said the Roman jurist Jullianus,
"but where their meaning is manifest in some case, the one who exercises
jurisdiction must apply the provision analogously and in this way administer
justice." Prof.
Bodenheimer has explained that Civil Law does
not regard words as the sole basis of law but allows it to be modified by
purpose. "Celsus added the following admonition to these general
principles of interpretation: "The laws should be liberally interpreted,
in order that their intent be preserved".
"Samuel Thorne has shown that, during
certain periods of English medieval history, the position of the Common Law
towards the construction of statutes was similar to the general attitude of the
Roman and Civil Law. Statutes were frequently extended to situations not
expressly covered by them."(3) Plowden pointed out that "when the
words of a statute enact one thing, they enact all other things which are in
the like degree," Plowden demonstrated that a statutory remedy at that
time was deemed to be merely illustrative of other analogous cases that
deserved to be governed by the same principle.
"our law (like all others) consists of
two parts, viz.
OF body and soul, the letter of the law is
the body of the law, and the sense and reason of the law is the soul of the
law.. And it often happens that when you know the letter, you know not the
sense, for sometimes the sense is more confined and contracted than the letter,
and sometimes it is more large and extensive"(5) Prof. Bodehheimer states
that the American trend is towards a purpose-oriented rather than a
plain-meaning rule in its rigid orthodoxy. In United States v. American
Trucking Association. The U.S. Supreme Court wrote:
"When the plain meaning has led to
absurd or futile results .. this Court has looked beyond the words to the
Purpose of the Act. Frequently, however, even when the 191 plain meaning did
not produce absurd results but merely an unreasonable one "plainly at
variance with the policy of the legislation as a whole" this Court has
followed that purpose rather than the literal words.
When aid to construction of the meaning of
words, as used in the statute, is available, there can certainly be no
"rule of law" which forbids its use, however, clear the words may be
on "superficial examination." B In the present case, as the narration
of the facts unfolded, the reference of the dispute was to an arbitrator.
He reinvestigated and reassessed the evidence
bearing on the guilt of-the discharged workmen after giving an opportunity to
both sides to adduce evidence thereon Admittedly, he had this power. But had he
the follow-up power, if he held the men guilty of punitive misconduct, to
reweigh the quantum of punishment having regard to the degree of culpability ?
This jurisdiction he enjoys if Sec. 11A includes 'arbitrators'.
This, in turn, flows from our interference as
to whether the word 'tribunal' takes in an adjudicatory organ like the
arbitrator. It is plain that the expression 'arbitrator' is not expressly
mentioned in Section 11A. Nevertheless, if the meaning of the word 'tribunal'
is wider rather than narrower, it will embrace arbitrator as well. That is how
the dynamics of interpretation are, in one sense, decisive of the fate of the
present appeal.
Competing interpretative angles have
contended for judicial acceptance English preferences apart, Indian socio-
legal conditions must decide the choice in each situation.
Sometimes Judges are prone to castigate
creative interpretation in preference to petrified literality by stating that
Judges declare the law and cannot make law. The reply to this frozen faith is
best borne out by Lord Radcliffe's blunt words:
" There was never a more sterile
controversy than that upon the question whether a judge makes law. Of course he
does. How can he help it ?.... Judicial law is always a reinterpretation of
principles in the light of new combinations of facts.. Judges do not reverse
principles once well established, but they do modify them, extend them,
restrict them and even deny their application to the combination in hand.
Lord Devlin in his "Samples of
Lawmaking", agreed that Judges are fashioners of law, if not creators out
of material supplied to them and went on to observe:
"If the House of Lords did not treat
itself as bound by its own decisions, it might do its own lopping and pruning
192 .... and perhaps even a little grafting, instead of leaving all that for
the legislature. But it could not greatly alter the shape of the tree."
Even so eminent a Judge as Lord Reid leaned to the view that the law should be
developed since it was not static and, in this limited sense, Judges are
law-makers although this view prevented "technical minded Judges (from
pressing) precedents to their logical conclusions". On the whole, a just
and humanist interpretative technique, meaning permitting, is the best. We do
not mean to conclude that Judges can take liberties with language ad libitem
and it is wholesome to be cautious as Lord Reid in Shaw v. D.P.P.
warned: "Where Parliament fears to tread
it is not for the courts to rush in." We are persuaded that there is much
to learn from Lord Denning's consistent refrain about the inevitable creative
element in the judicial process in the interpretative area.
We permit ourselves a quote from Lord Denning
because Shri A. K. Sen did draw our attention to straightening the creases as
permissible but not stitching the cloth, making a critical reference to the
controversial activism of which Lord Denning was a leading light:
"The truth is that the law is uncertain.
rt does not cover all the situations that may arise. Time and again
practitioners and judges are faced with new situations where the decision may
go either way. No one can tell what the law is until the courts decides it.
The judges do every day make law, though it
is almost heresy to say so. If the truth is recognized then we may hope to
escape from the dead hand of the past and consciously mould new principles to
meet the needs of the present." Mr. Justice Mathew in Kesavananda Bharti's
case referred with approval-and so do we-to the observations of Justice Holmes.
"I recognize without hesitation that
Judges do and must legislate. but they can do so only interstitially;
they are confined from molar to molecular
motions." 193 Arthur Selwyn Miller writes, "Some have called it (the
Supreme A Court) the highest legislative chamber in the nation. Although there
is no question that the Court can and does make law, and does so routinely, ..
".
Assuming the above approach to be too
creatively novel for traditionalism, let us approach the same problem from a
conventional angle authenticated by case-law. The question of construction of
s. 11A was argued at length, as to whether an omission of any reference to
Arbitrator appointed under s. 10A in s. 11A would suggest that the Arbitrator
under s. 10A, notwithstanding the terms of reference, would not enjoy the power
conferred on all conceivable industrial adjudicators under s. 11A. It was said,
after referring to the objects and reasons in respect of the bill which was
moved to enact s. 11A in the Industrial Disputes Act, that while the I.L.O. had
indicated that an arbitrator selected by the parties for adjudication of
industrial dispute must be invested with power by appropriate legislation as
found in s. 11A, the Parliament, while enacting the section in its wisdom, did
not include the Arbitrator even though other adjudicators of industrial
disputes have been conferred such power and, therefore, it is a case of Sasus
omissions.
Reliance was placed on Gladstone v. Bower
where the question arose whether a reference to a tenancy from year to year in
s. 2(1) of the Agricultural Holdings Act, 1948 would also cover a tenancy for
18 months which could be terminated at the end of the first year. The
submission was that even though no notice was necessary at common law because
the tenancy would automatically terminate at the expiry of the specified period
of tenancy, the tenancy took effect as tenancy from year to year by virtue of
S. 2(1) of the Act so that it continued until terminated by notice to quit and,
therefore the landlord was not entitled to possession without notice. It was
further contended that if a tenancy from year to year was to get the protection
of the Act it is inconceivable that tenancy for a longer duration would not
qualify for that protection. Court of Appeal negatived this contention holding
that this is a case simply of casus omissus and the Act is defective. The court
further held that if it were ever permissible for the Court to repair a
defective Act of Parliament, the Court would be very glad to do so in this case
so far as the Court could. The Court will always allow the intention of a
statute to override the defects of wording buts the Court's ability to do so is
limited by the recognised canons of interpretation. The Court may, for example,
prefer an alternative construc- 194 tion which is less well-fitted to the words
but better fitted to the intention of the Act. But here, for the reasons given
by the learned Judge, there is not alternative construction; it is simply a
case of something being overlooked. The Court cannot legislate for a casus
omissions. To do so would be to usurp the function of the legislature [see
Magor & St. Mellons Rural District Council v. Newport Corporation. Where
the Statute's meaning is clear and explicit, words cannot be interpolated. Even
where the meaning of the statute is clear and sensible, either with or without
the omitted word, interpolation is improper, since the primary source of the
legislative intent is in the language of the statute [see Crawford's
"Construction of Statutes". 1940 Edn., p. 269 extracted in S.
Narayanaswami v. G. Panneerselvam.] Undoubtedly, the Court cannot put into the
Act words which 'are not expressed, and which cannot reasonably he implied on
any recognised principles of construction. That would be a work of legislation,
not of construction, and outside the province of the Court [see Kamalaranjan v.
Secretary of State(3).] Similarly, where the words of the statute are clear it
would not be open to the Court in order to obtain a desired result either to
omit or add to the words of the statute. This is not the function of the Court
charged with a duty of construction. This approach has, however, undergone a
sea change as expressed by Denning, I.. J. in Seaford Court Estates Ltd. v.
Asher wherein he observed as under:
"When a defect appears a Judge cannot
simply fold his hands and blame the draftman. He must set to work on the
constructive task of finding the intention of Parliament.... and then he must
supplement the written words so as to give 'force and life' to the intention of
legislature ...., A judge should ask himself the question how, if the makers of
the Act had themselves come across this ruck in the texture of it, they would
have straightened it out ? He must then do as they would have done. A judge
must not alter the material of which the Act is woven, but he can and should
iron out the creases." (Approved in State of Bihar & Anr. v. Dr. Asis
Kumar Mukherjee & ors. where in he observed as under:
195 This long excursion has become important
because, once in a while, social legislation which requires sharing of social
philosophy between the Parliament and the Judiciary;
meets with its Waterloo in the . higher
courts because the true role of interpretation shifts from Judge to Judge. We
are clearly of the view that statutory construction which fulfills the mandate
of the statute must find favour with the Judges, except where the words and the
context rebel against such , flexibility. We would prefer to be liberal rather
than lexical when reading the meaning of industrial legislation which develops
from day to day in the growing economy of India. The necessary conclusion from
this discussion is that the expression 'tribunal' includes, in the statutory
setting, an arbitrator also. Contemporaneous par-legislative material may
legitimately be consulted when a word of wider import and of marginal obscurity
needs to be interpreted. So viewed, we are not in a 'sound-proof system' and
the I.L.O. recommendation accepted by India. and the objects and Reasons of the
amending Act leave no doubt about the sense, policy and purpose. Therefore
Section 11A applies to the arbitrator in the present case and he has the power
to examine whether the punishment imposed in the instant case is excessive. So
has the High Court, if the Award suffers from a fundamental flaw.
A study of the lengthy award discloses no
mention of Section 11A, and presumably, the authority was unmindful of that
provision while rendering the verdict. In a limited sense, even prior to
Section 11A, there was jurisdiction for a labour tribunal, including an
arbitrator, to go into the punitive aspect of the Management's order. This
Court has, in a catena of cases, held that a mala fide punishment is bad in law
and when the punishment is grotesquely condign or perversely harsh or glaringly
discriminatory, an easy inference of bad faith, unfair labour practice or
victimisation arises. The wider power tn examine or prescribe the correct
punishment belongs to tribunal/arbitrator even under Sec. 11 in no enquiry (or
a defective enquiry which is bad, and, therefore, can be equated with a 'no
enquiry' situation) has been held by the Management. For, then, there is no
extant order of guilt or punishment and the tribunal determines it fresh. In
such a virgin situation both culpability and quantification of punishment arc
within the jurisdiction of the tribunal/arbitrator. The present is such a case.
Volleys of rulings from both sides were fired
during arguments, the target being the limited area of the tribunal's power to
overturn the quantum of punishment awarded by the Management. We do not think
it necessary to re-gurgitate all that has been said by this Court 196 upto now,
since it is sufficient to bring out the correct law in the light of the leading
citations. It is incontrovertible that where, as here, no enquiry has been held
by the Management, the entire subject is at large and both guilt and
punishment, in equal measure, may be determined, without inhibition of
jurisdiction, by the tribunal.
Lastly, as rightly urged by counsel for the
Sabha, an arbitrator has all the powers the terms of reference, to which both
sides are party, confer. Here, admittedly, the reference is very widely worded
and includes the nature of the punishment. The law and the facts do not call
for further elaboration and we hold that, in any view, the arbitrator had the
authority to investigate into the propriety of the discharge and the veracity
of the misconduct. Even if S. 11A is not applicable, an Arbitrator under s. 10A
is bound to act in the spirit of the legislation under which he is to function.
A commercial arbitrator who derives his jurisdiction from the terms of
reference will by necessary implication, be bound to decide according to law
and, when one says 'according to law', it only means existing law and the law
laid down by the Supreme Court being the law of the land, an Arbitrator under
s. 10A will have to decide keeping in view the spirit of S. 11A [See Union of
India v. Bungo Steel Furniture Pvt. Ltd.
(1967)] 1 S.C.R. 324]. The Jurisdictional
hurdles being thus cleared, we may handle the basic facts and the divergences
between the Arbitrator and the High Court before moulding the final relief.
Prefatory to the discussion about the factum
of misconduct and its sequel, we must remind ourselves that the strike was
illegal, having been launched when another industrial dispute was pending
adjudication. Sec. 23 (a) appears, at a verbal level, to convey such a meaning
although the ambit of sub-clause (a) may have to be investigated fully in some
appropriate case in the light of its scheme and rationale. It looks strange
that the pendency of a reference on a tiny or obscure industrial dispute-and
they often pend too long-should block strikes on totally unconnected yet
substantial and righteous demands. The constitutional implications and
practical complications of such a veto of a valuable right to strike often
leads not to industrial peace but to seething unrest and lawless strikes.
But in the present case, both before the
arbitrator and the High Court, the parties have proceeded, on the agreed
footing that the strike was illegal under Section 23(a). We do not reopen the
issue at this late stage and assume the illegality of the strike.
The Fatal Flaw in the Award:
The Achilles heel of the arbitrator's award
is where he makes, as a substitute for specific and individuated findings of
guilt and 197 appropriate penalty vis-a-vis each workmen, a wholesale survey of
A the march of events, from tension to breakdown, from fair settlement to
illegal and unjustified strike, from futility of negotiation to readiness for
arbitration, from offer of full re-employment to partial taking back on
application by workmen in sack cloth and ashes, by picking and choosing after a
humble declaration that the strike has been formally buried, from episodes of
violence and paralysis of production to backstage manoeuvres to get the factory
taken over as a 'sick mill', and after a full glimpse of this scenario, holds
that the Sabha was always in the wrong, and inevitably, the Management was
surely reasonable AND, ergo, every employee must individually bear the cross of
misconduct and suffer dismissal for the sins of the Sabha leadership-its
secretary was not an employee of the mill-by some sub-conscious doctrine of
guilt by association! Non Sequitur.
Each link in the chain of facts has been
challenged by the respondents but let us assume them to be true, to test the
strength of the legal fibre of the verdict. (We may mention by way of aside, D.
that the Company seems to be a well managed one.) The cardinal distinction in
our punitive jurisprudence between a commission of enquiry and a Court of
Adjudication, between the cumulative causes of a calamity and the specific
guilt of a particular person, is that speaking generally, we have rejected, as
a nation, the theory of community guilt and collective punishment and instead
that no man shall be punished except for his own guilt. Its reflection in the
disciplinary jurisdiction is that no worker shall be dismissed save on proof of
his individual delinquency.
Blanket attainder of a bulk of citizens on
any vicarious theory for the gross sins of some only, is easy to apply but
obnoxious in principle. Here, the arbitrator has found the Sabha Leadership
perverse, held that the strikers should have reasonably reported for work and
concluded that the Management had, for survival, to make-do with new recruits.
Therefore what ? What, at long last, is the
answer to the only pertinent question in 6. a disciplinary proceeding viz. what
is the specific misconduct against the particular workmen who is to lose his
job and what is his punitive desert? Here you can't generalise any more than a
sessions judge can, by holding a faction responsible for a massacre, sentence
every denizen of that factions village to death penalty. The legal error is
fundamental, although lay instinct may not be outraged.
What did worker A do ? Did he join the strike
or remain at home for fear of vengeance against blacklegs in a para- violent
situation ? Life 198 and limb are dearer than loyalty, to the common run of
men, and discretion is the 'better part of valour. Surely, the Sabha complained
of Management's goondas and the latter sought police aid against the unruly
core of strikers. In between, the ordinary rustic workmen might not have
desired to be branded blacklegs or become martyrs and would not have reported
for work. If not being heroic in daring to break through the strike
cordon-illegal though the strike be-were misconduct, the conclusion would have
been different. Not reporting for work does not lead to an irrebuttable
presumption of active participation in the strike. More is needed to bring home
the mens rea and that burden is on the prosecutor, to wit the Management.
Huddling together the eventful history of deteriorating industrial relations
and perverse leadership of the Sabha is no charge against a single worker whose
job is at stake on dismissal. What did he do ? Even when lawyers did go on
strike in the higher Courts or organize a boycott, legally or illegally, even
top law officers of the Central Govt. did not attend court, argued Shri Tarkunde,
and if they did not boycott but merely did not attend, could workers beneath
the bread line be made of sterner stuff. There is force in this pragmatic
approach. The strike being illegal is a non-issue at this level. The focus is
on active participation. Mere absence, without more, may not compel the
conclusion of involvement.
Likewise, the further blot on the strike, of
being unjustified, even if true, cuts no ice. Unjustified, let us assume; so
what? The real question is, did the individual worker, who was to pay the
penalty, actively involve himself in this unjustified misadventure ? or did he
merely remain a quiescent non-worker during that explosive period ? Even if he
was a passive striker, that did not visit him with the vice of activism in running
an unjustified strike. In the absence of proof of being militant participant
the punishment may differ. To dismiss a worker, in an economy cursed by massive
unemployment, is a draconian measure as a last resort. Rulings of this Court
have held that the degree of culpability and the quantum of punishment turn on
the level of participation in the unjustified strike.
Regrettably, no individualised enquiry has
been made by the Arbitrator into this significant component of delinquency.
Did any dismissed worker instigate, sabotage
or indulge in vandalism or violence ? The Management's necessity to move the
mill into production for fear of being branded a 'sick unit' is understandable.
Of course, collective strike is economic pressure by cessation of work and not
exchange of pleasantries. It means embarrassing business. Such a quandary
cannot alter the law. Here the legal confusion is obvious.
199 No inquest into the Management's
recruitment of fresh hands is being made at this stage. The inquiry is into the
personal turpitudes of particular workmen in propelling an illegal and
unjustified strike and the proof of their separate part therein meriting
dismissal. The despair of the Management cannot, by specious transformation of
logic, be converted into the despair of each of the 853 workmen.
Sympathies shall not push one into fallacies.
We may now concretize this generalised
criticism of the otherwise well-covered award. The crowd of documents and
camping attitudes must have added to the strain on the Arbitrator.
"A voluminous record of documents and
correspondence has been produced before me by both sides. There have been
allegations and counter allegations made by both sides not only against each
other but even against the Police, the Department of Labour and persons in
Authority. The history has been sought to be traced right from the inception of
the Company in 1966 or 1967, by the Company to show that their conduct has been
always proper and above reproach and by Sabha to establish that not only the
Gujarat Steel Tubes Ltd. were not fair to the employees but that every action
of theirs good or bad was ill- motivated, was executed with some sinister
ulterior motives." The Award set out the history of the Company, its
vicissitudes, the hills and valleys, the lights and shadows, of industrial
relations with mob fury and lock-outs and allied episodes often ending in
settlements and pious pledges. Then the Arbitrator stressed Clause 6 of the
Agreement of December, 1971 which bespoke a no-strike zone for five years.
There was reference to the Management's promise to implement the Wage Board
recommendations. The Arbitrator was upset that despite Clause a strike was
launched but was not disturbed that despite the Wage Board proposals,
negotiations were being baulked and an interminable arbitral alternative was
being offered by the Management. He exclaimed: "If such a settlement
arrived at was not respected and implemented the, machinery provided by law
would lose all meaning and so also the sanctity of the word of the Management
or the word of the union. It is, therefore, essential tn ascertain who was
responsible for the breach of the agreement so solemnly entered into. - Serious
breach by management is alleged and this is given as a reason or is made as an
cause for getting rid of the obligations 200 arising out of the agreement which
specifically could not be terminated for five years." The narration
continues and the following conclusion is reached:
"It is thus very clear that the company
had fully discharged its obligation under the agreement in respect of 64
discharged or dismissed workmen and the other workmen and the allegation made
by the Sabha of the company having made a breach thereof is not correct."
We thus see, that at this stage, the arbitrator has merely made r) a
generalised approach as if a commission of inquiry were going into the conduct
of the Management and the Sabha to discover who was blameworthy in the
imbroglio.
The award then swiveled round to a study of
the case of the Sabha vis-a-vis the triple grievances, the Sabha had:
"I shall first deal with the grievance
regarding demands for implementation of the recommendations of the Wage
Board".
The long and sterile correspondence was set
out and the arbitrator arrived at the conclusion that the insistence on
reference to arbitration as against negotiation was justified on the part of
the Management:
"I, therefore, have accepted the version
of: the Management and disbelieved the motivated denial of the Sabha in this
respect." The culmination of the protracted discussion on the atmosphere
and environment, rather than on the actual charge against each worker, was
recorded in the Award:
"I have exhaustively, perhaps more
exhaustively than even necessary, dealt with the allegations made by the Sabha
that the Management had committed breach of agreement by refusing to accede to
the demand of the Sabha for implementation of recommendations of the Wage
Board. There appears to be no doubt that the Management had agreed to implement
the recommendation of the Wage Board. There is also not the least doubt the
Management was ready and willing to implement the recommendations of the Wage
Board it was because it was prevented by .
the Sabha from doing so." 201 An
analysis of the Management's conduct in the matter of non-implementation of the
Wage Board recommendation was thereafter made by the Arbitrator and he wound up
thus :
"I am satisfied that the Company had not
committed any breach of the settlement dated 4-8-1972 at least so far as
implementation of the recommendations of the Wage Board is concerned." The
question of bonus for the year 1971 was also considered and dismissed and the
Sabha's case to that extent was negatived. Again, the plea for wages for the
period of the lock-out was also negatived with the observations :
"I fail to see how the Sabha can allege
breach of the agreement dated 4-8-1972 in view of the clear unequivocal terms
contained in clause 4 of that Agreement." In this strain the Award
continued and the refrain was the same that the Sabha was in the wrong. The
Award even went to the exaggerated extent of morbidly holding that the workers
were wearing printed badges which, along with other circumstances, amounted to
a breach of the agreement ! The Award then moved on to the strike of January
27, 1973 because it led to the dismissal of all the workmen.
Until this stage, the arbitrator was merely
painting the background and, at any rate, did not engage himself in isolating
or identifying any worker or any misconduct. He merely denounced the Sabha,
which is neither here nor there, in the matter of disciplinary proceedings
against each individual workman. He missed the meat of the matter. The relevant
portion of the Award based on generalisation proved this error :
"I am concerned herein with the question
whether the discharge or dismissal of the 400 workmen was legal and proper or
not and what relief to grant to them.
Approached from any point of view the action
of the Company appears to me to be legal, proper and justified and the demands
on behalf of these workmen must be rejected." A condemnation of the Sabha
and an approval of the Management's handling of the strike are miles away from
the issue on hand.
202 We observe here also an unfortunate
failure to separate and scan the evidence with specific reference to charges
against individual workman. On the contrary, all that we find in the award is
an autopsy of the strike by the Sabha and a study of its allegedly perverse
postures. A disciplinary inquiry resulting in punishment of particular delinquents
cannot but be illegal if the evidence is of mass misconduct by unspecified
strikers led by leaders who are perhaps not even workmen. We are constrained to
state that pointed consideration of facts which make any of the 400 workmen
guilty, is a search in vain. The award being ex facie blank from this vital
angle, the verdict must prima facie rank as void since vicarious guilt must be
brought home against the actively participating members of a collectivity by
positive testimony, not by hunch, suspicion or occult intuition. The short
position is this. Is there a punishment of any workman ? If yes, has it been
preceded by an enquiry ? If not, does not the Management desire to prove the
charge before the tribunal ? If yes, what is the evidence, against whom, of
what misconduct ? If individuated proof be forthcoming and relates to an
illegal strike, the further probe is this : was the strike unjustified ? If
yes, was the accused worker an active participant therein ? If yes, what role
did he play and of what acts was he author ? Then alone the stage is set for a
just punishment. These exercises, as an assembly line process are fundamental.
Generalisation of a violent strike of a
vicious Union leadership, of strikers fanatically or foolishly or out of fear,
failing to report for work, are good background material. Beyond that, these
must be identified by a rational process, the workmen, their individual
delinquency and the sentence according to their sin. Sans that, the dismissal
is bad. Viewed from this perspective, the Award fails.
The Arbitrator comes to grips with the core
question of discharge simpliciter versus dismissal as punishment but not with
the identification of delinquents and delinquency.
After referring to Order 23 of the Model
Standing Orders he goes on to state the law correctly by extracting
observations from the Assam Oil Company case.
Another vital facet of industrial law is that
when no enquiry has been held by the Management before imposing a punishment
(or the enquiry held is defective and bad), the whole field of delinquency and
consequent penalty is at large for the tribunal. Several rulings support this
logic.
We are constrained to hold that a certain
observation made per incuriam by Mr. Justice Vaidyalingam, strongly relied on
by Sri A. K. Sen, does not accurately represent the law, although the learned
203 Judge had earlier stated the law and case-law correctly, if we may say so
with respect.
A selective study of the case-law is proper
at this place. Before we do this, a few words on the basis of the right to
strike and progressive legal thinking led by constitutional guidelines is
necessitous. The right to unionise, the right to strike as part of collective
bargaining and, subject to the legality and humanity of the situation, the
right of the weaker group, viz., labour, to pressure the stronger party, viz.,
capital, to negotiate and render justice, are processes recognised by
industrial jurisprudence and supported by Social Justice. While society itself,
in its basic needs of existence, may not be held to ransom in the name of the
right to bargain and strikers must obey civilised norms in the battle and not
be vulgar or violent hoodlums, Industry, represented by intransigent
Managements, may well be made to reel into reason by the strike weapon and
cannot then squeal or wail and complain of loss of profits or other ill-effects
but must negotiate or got a reference made. The broad basis is that workers are
weaker although they are the producers and their struggle to better their lot
has the sanction of the rule of law. Unions and strikes are no more
conspiracies than professions and political parties are, and, being far weaker,
need succour.
Part IV of the Constitution, read with Art.
19, sows the seeds of this burgeoning jurisprudence. The Gandhian quote at the
beginning of this judgement sets the tone of economic equity in Industry. Of
course, adventurist, extremist, extraneously inspired and puerile strikes,
absurdly insane persistence and violent or scorched earth policies boomerang
and are anathema for the law. Within these parameters the right to strike is
integral to collective bargaining.
Responsible trade unionism is an instrument
of concerted action and the laissez faire law that all strikes are ipso facto
conspiracies, is no longer current coin even in Adam Smith's English country.
Lord Chorley, in Modern Law Review, Vol. 28, 1965, p. 451, is quoted as saying
that law must be altered as a consequence of Rookes v. Barnard, so as to remove
the effects of decisions of conspiracy and intimidation. He goes on to state
that Allen v. Flood and Quinn v. Leathem taking the conspiratorial view must
never be permitted to be quoted in courts. In contrast, reference was made to
Willis on Constitutional Law, pp. 878-879, wherein the Supreme Court of America
reflects the impact of capitalistic development and the economic views of the
judges and the fact that the judges are members of a social order and a social
product and the decisions are due more to the capitalistic system and the world
of ideas in which the judges live. Our Constitution is clear 204 in its
mandate, what with Art. 39A superadded and we have to act in tune with the
values enshrined therein.
The benign attitude towards strike being what
we have outlined, the further question arises whether in the light of the
accepted finding that the strike as such was illegal and, further, was
unjustified, all the strikers should face the penalty of dismissal or whether
individual cases with special reference to active participation in the strike,
should be considered. A rapid but relevant glance at the decided cases may
yield dividends. In India General Navigation and Railway Co. Ltd. v. Their
Workmen, (supra) this court did observe that if a strike is illegal, it cannot
be called 'perfectly justified'. But, between 'perfectly justified' and
'unjustified' the neighbourhood is distant. More illegality of the strike does
not per se spell unjustifiability. For, in Crompton Greaves Ltd. v. Workmen
(supra) this Court held that even if a strike be illegal, it cannot be
castigated as unjustified, unless the reasons for it are entirely perverse or
unreasonable-an aspect which has to be decided on the facts and circumstances
of each case.
In that decision, this Court awarded wages
during the strike period because the Management failed to prove that the
workmen resorted to force and violence. Even in India General Navigation and
Railway Co. Ltd. (supra) where the strike was illegal and affected a public
utility service, this Court observed that "the only question of practical
importance which may arise in the case of an illegal strike, would be the kind
or quantum of punishment, and that, of course, has to be modulated in
accordance with the facts and circumstances of each case.... There may be reasons
for distinguishing the case of those who may have acted as mere dumb-driven
cattle from those who have taken an active part in fomenting the trouble and
instigating workmen to join such a strike or have taken recourse to
violence." The court after holding that the strike was illegal "and
that it was not even justified" made a pregnant observation :
"To determine the question of
punishment, a clear distinction has to be made between those workmen who are
only joined in such a strike, but also took part in obstructing the loyal
workmen from carrying on their work, or took part in violent demonstrations, or
acted in defiance of law and order, on the one hand, and those workmen who were
more or less silent participators in such a strike, on the other hand. It is
not in the interest of the industry that there should be a wholesale dismissal
of all the workmen who merely participated in such a strike. It is certainly
not in the 205 interest of the workmen themselves. An Industrial Tribunal,
therefore, has to consider the question of punishment, keeping in view the
overriding consideration of the full and efficient working of the Industry as a
whole. The punishment of dismissal or termination of services, has, therefore,
to be imposed on such workmen as had not only participated in the illegal
strike, but had fomented it, and had been guilty of violence or doing acts
detrimental to the maintenance of law and order in the locality where work had
to be carried on." After noticing the distinction between peaceful
strikers and violent strikers, Sinha, J., in that case, observed "it must
be clearly understood by those who take part in an illegal strike that thereby
they make themselves liable to be dealt with by their employers. There may be
reasons for distinguishing the case of those who may have acted as mere dumb
driven cattle from those who have taken an active part in fomenting the trouble
and instigating workmen to join such a strike, or have taken recourse to
violence." The same line of dichotomy is kept up :
"Both the types of workmen may have been
equally guilty of participation in the illegal strike, but it is manifest that
both are not liable to the same kind of punishment." Significantly, the
Court stressed the need for individual chargesheet being delivered to
individual workmen so that the degree of misconduct of each and the punitive
deserts of each may be separately considered. We may as well refer to a few
more rulings since considerable argument was expended on this point.
This Court in M/s. Burn & Co. Ltd. v.
Their Workmen & Ors.(1) clearly laid down that mere participation in the
strike would not justify the suspension or dismissal of workmen particularly
where no clear distinction can be made between those persons and the very large
number of workmen who had been taken back into service although they had
participated in the strike. After referring to the ratio in M/s. Burn & Co.
Ltd. case, this Court in Bata Shoe Co. (P) Ltd. v. D. N. Ganguly & Ors.(2)
observed that there is no doubt that if an employer makes an unreasonable
discrimination in the matter of taking back employees there may in certain
circumstances be reason for the industrial tribunal to interfere; but the
circumstances 206 of each case have to be examined before the tribunal can interfere
with the order of the employer in a properly held managerial inquiry on the
ground of discrimination. The Court then proceeded to determine the facts
placed before it. Sri Sen specifically pointed out that in the Bata Shoe Co.'s
case this Court distinguished the decision in India General Navigation &
Railway Co. Ltd.'s and observed that the decision in that case was on the facts
placed before the Court. In fact, Bata Shoe Co.'s case does not lay down any
distinct proposition about the treatment to be meted out to participants in
strike and actually it is a decision on its own facts.
In The Swadeshi Industries Ltd. v. Its
Workmen(1), the Management after holding that the strike was illegal,
terminated the services of 230 workmen without framing any chargesheet or
holding any enquiry. It was contended that the strike was not legal. The Court
observed that collective bargaining for securing improvement on matters like
basic pay, dearness allowance, bonus, provident fund and gratuity leave and
holidays was the primary object of a trade union and when demands like these
were put forward and thereafter a strike was resorted to in an attempt to
induce the company to agree to the demands or at least to open negotiations the
strike must prima facie be considered justified. As the order of termination
was found to be illegal it was held that reinstatement with back wages must
follow as a matter of course, not necessarily because new hands had not been
inducted.
In I. M. H. Press, Delhi v. Additional
Industrial Tribunal Delhi & Ors.,(2) this Court was called upon to examine
the ratio in Model Mills(3) case and India General Navigation & Railway Co.
Ltd. case and this Court in terms affirmed the ratio in India General
Navigation & Railway Co.
Ltd. case observing that mere taking part in
an illegal strike without anything further would not justify the dismissal of
all the workmen taking part in the strike.
In Indian Iron & Steel Co. Ltd. &
Anr. v. Their Workmen(4), this Court observed that the management of a concern
has power to direct its own internal administration and discipline but the
power is not unlimited and when a dispute arises, Industrial Tribunals have
been given the power to see whether the termination of service 207 of a workman
is justified and to give appropriate relief. It may be noticed that the
decision is prior to introduction of s. 11A. It would thus appear that the
important effect of omission to hold an enquiry was merely this that the
tribunal would have to consider not only whether there was a prima facie case
but would decide for itself on the evidence adduced whether the charges have
been made out. A defective enquiry in this connection stood on the same footing
as no enquiry and in either case the tribunal would have jurisdiction to go into
the entire matter and the employer would have to satisfy the tribunal that on
the facts the order of dismissal or discharge was proper. (see Workmen of
Motipur Sugar Factory (Pvt.) Ltd. v. Motipur Sugar Factory(1), and Provincial
Transport Service v. State Industrial Court) (2). Once, therefore, it was held
that the enquiry was not proper, it was irrelevant whether the workman withdrew
from the enquiry or participated in it, the decision had to be on appraisal of
evidence, and if it was found that the enquiry was not proper the whole case
was open before the labour court to decide for itself whether the charge of
misconduct was proved and what punishment should be awarded (see Imperial
Tabacco Company of India Ltd. v. Its Workmen) (3).
As against the above propositions, Sri Sen
relied upon the observations of this Court in Oriental Textile Finishing Mills,
Amritsar v. Labour Court, Jullundur & Ors.(4). We fail to see how it runs
counter to the established principle. The Court, in fact, held that even where
the strike is illegal, before any action was taken with a view to punishing the
strikers a domestic enquiry must be held.
Even though the Standing Orders prescribing
enquiry before punishment did not provide for any such enquiry the Court held
that nonetheless a domestic enquiry should have been held in order to entitle
the management to dispense with the service of the workmen on the ground of
misconduct, viz., participation in the illegal strike. After so saying, the
Court agreed with the view of the Court in Indian General Navigation &
Railway Co. Ltd. case and reaffirmed the principle that mere taking part in an
illegal strike without anything further would not necessarily justify the
dismissal of all the workers taking part in the strike and that if the
employer, before dismissing a workman, gave him sufficient opportunity of
explaining his conduct and no question of mala fides or victimisation arose,
208 it was not for the tribunal in adjudicating the propriety of such dismissal
to look into the sufficiency or otherwise of the evidence led before the
enquiry officer or insist on the same degree of proof as was required in a
court of law, as if it were sitting in appeal over the decision of the
employer.
Another aspect of this case emphasised that
it could not be dogmatised as a matter of law that an overt act such as
intimidation or instigation or violence was necessary in order to justify
termination of service for participating in an illegal strike. On the facts of
that case, even though it was found that no domestic enquiry was held,
reinstatement was refused on the ground that misconduct was made out.
Sri Sen, of course, relied on this judgment
to show that where a strike was resorted to and the workers were called upon to
join service within the stipulated time, on their failure it was open to the
company to employ new hands. This is reading more into the ruling than is
warranted.
We cannot agree that mere failure to report
for duty, when a strike is on, necessarily means misconduct. Many a workman, as
a matter of prudence, may not take the risk of facing the militant workmen or
the Management's hirelings for fear, especially when there is evidence in the
case from the Sabha that the Management had hired goondas and from the
Management that the striking vanguard was violent. It is also possible, in the
absence of evidence to the contrary, that several workmen might not be posted
with the Management's notice of recall or the terms on which they were being
recalled. In this view, we are not able to uphold the conclusion of the
arbitrator that the punishment of dismissal was appropriate for the entire mass
of workmen whose only guilt, as proved was nothing more than passive
participation in the illegal and unjustified strike by not reporting for duty. The
verdict is inevitable that the discharge is wrongful.
The only comment we reluctantly make about
the otherwise thorough award of the Arbitrator is that omnibus rhetoric about
the obnoxious behaviour of a class may not make-do for hard proof of specific
acts of particular persons where a punitive jurisdiction is exercised.
What, then, is the normal rule in the case of
wrongful dismissal when the workmen claim reinstatement with full back wages? The
High Court has held the discharge wrongful and directed restoration 209 with an
equitable amount of back wages. The following rulings of this Court, et al,
deal with this subject :
The recent case of Hindustan Tin Works v. Its
Employees (1) sets out the rule on reinstatement and back wages when the order
of this Court, et al, deal with this subject :
"It is no more open to debate that in
the field of industrial jurisprudence a declaration can be given that the
termination of service is bad and the workman continues to be in service. The
spectre of common law doctrine that contract of personal service cannot be
specifically enforced or the doctrine of mitigation of damages does not haunt
this branch of law. The relief of reinstatement with continuity of service can
be granted where termination of service is found to be invalid. It would mean
that the employer has taken away illegally the right to work of the workman
contrary to the relevant law or in breach of contract and simultaneously
deprived the workman of his earnings. If thus the employer is found to be in
the wrong as a result of which the workman is directed to be reinstated, the
employer could not shirk his responsibility of paying the wages which the
workmen has been deprived of by the illegal or invalid action of the employer.
Speaking realistically, where termination of service is questioned as invalid
or illegal and the workman has to go through the gamut of litigation, his
capacity to sustain himself throughout the protracted litigation is itself such
an awesome factor that he may not survive to see the day when law's proverbial
delay has become stupefying. If after such a protracted time and energy
consuming litigation during which period the workman just sustains himself,
ultimately he is to be told that though he will be reinstated, he will be denied
the back wages which would be due to him, the workman would be subjected to a
sort of penalty for no fault of his and it is wholly undeserved. Ordinarily
therefore, a workman whose service has been illegally terminated would be
entitled to full back wages except to the extent he was gainfully employed
during the enforced idleness. That is the normal rule. Any other view would be
a premium on the unwarranted litigative activity of the employer.
If the employer terminates the service
illegally and the termination is motivated as in this 210 case, viz., to resist
the workmen's demand for revision of wages, the termination may well amount to
unfair labour practice. In such circumstances reinstatement being the normal
rule it should be followed with full back wages. Articles 41 and 43 of the
Constitution would assist us in reaching a just conclusion in this
respect.............. In the very nature of things there cannot be a
strait-jacket formula for awarding relief of back wages. All relevant
considerations will enter the verdict. More or less, it would be a motion
addressed to the discretion of the Tribunal. Full back wages would be the
normal rule and the party objecting to it must establish the circumstances
necessitating departure. At that stage the Tribunal will exercise its
discretion keeping in view all the relevant circumstances." Dealing with
the complex of considerations bearing on payment of back wages the new
perspective emerging from Art.
43A cannot be missed, as explained in
Hindustan Tin Works, Labour is no more a mere factor in production but a
partner in Industry, conceptually speaking, and less than full back wages is a
sacrifice by those who can best afford and cannot be demanded by those, who
least sacrifice their large 'wages' though can best afford, if financial
constraint is the ground urged by the latter (Management) as inability to pay
full back pay to the former. The morality of law and the constitutional
mutation implied in Art. 43A bring about a new equation in industrial relations.
Anyway, in the Hindustan Tin Works' case 75 per cent of the past wages was
directed to be paid. Travelling over the same ground by going through every
precedent is supererogatory and we hold the rule is simple that the discretion
to deny reinstatement or pare down the quantum of back wages is absent save for
exceptional reasons.
It must be added however that particular
circumstances of each case may induce the court to modify the direction in
regard to the quantum of back wages payable as happened in the India General
Navigation and Railway Co. Ltd. vs. Their Workmen (Supra). We may, therefore,
have to consider, when finally moulding the relief, what, in this case, we
should do regarding reinstatement and back wages.
A Sum-up We may now crystallise our conclusions
in the light of the long discussion. The basic assumption we make is that the
strike was not only illegal but also unjustified. On the latter part, a
contrary 211 view cannot be ruled out in the circumstances present but we do
not reinvestigate the issue since the High Court has proceeded on what both
sides have taken for granted. The Management, in our view, did punish its 853
workmen when it discharged them for reasons of misconduct set out in separate
but integrated proceedings, even though, with legal finesse, the formal order
was phrased in harmless verbalism.
But fine words butter no parsnips, and law,
in its intelligent honesty, must be blunt and when it sees a spade, must call
it a spade. The action taken under the general law or the standing orders, was
illegal in the absence of individualised chargesheets, proper hearing and
personalised punishment, if found guilty. None of these steps having been
taken, the discharge orders were still born. But the Management could, as in
this case it did, offer to make out the delinquency of the employees and the
arbitrator had, in such cases, the full jurisdiction to adjudge de novo both
guilt and punishment. We hold that sec. 11A does take in an arbitrator too,
and, in this case, the arbitral reference, apart from sec. 11A, is plenary in
scope.
In the second chapter of our sum-up, the
first thing we decide is that Art. 226, however restrictive in practice, is a
power wide enough, in all conscience, to be a friend in need when the summons
comes in a crisis from a victim of injustice; and, more importantly, this
extraordinary reserve power is unsheathed to grant final relief without
necessary recourse to a remand. What the tribunal may, in its discretion, do,
the High Court too, under Art. 226, can, if facts compel, do. Secondly, we hold
that the Award suffers from a fundamental flaw that it equates an illegal and
unjustified strike with brazen misconduct by every workman without so much as
identification of the charge against each, the part of each, the punishment for
each, after adverting to the gravamen of his misconduct meriting dismissal.
Passive participation in a strike which is both illegal and unjustified does
not ipso facto invite dismissal or punitive discharge. There must be active
individual excess such as master-minding the unjustified aspects of the strike,
e.g., violence, sabotage or other reprehensible role. Absent such gravamen in
the accusation, the extreme economic penalty of discharge is wrong. An
indicator of the absence of such grievous guilt is that the Management, after
stating in strong terms all the sins of the workmen, took back over 400 of them
as they trickled back slowly and beyond the time set, with continuity of
service, suggestive of the dubiety of the inflated accusations and awareness of
the minor role of the mass of workmen in the Engineers strike. Furthermore,
even though all sanctions short of 212 punitive discharge may be employed by a
Management, in our current conditions of massive unemployment, low wages and
high cost of living, dismissal of several hundreds, with disastrous impact on
numerous families, is of such sensitive social concern that, save in
exceptional situations, the law will inhibit such a lethal step for the peace
of the Industry, the welfare of the workmen and the broader justice that
transcends transient disputes. The human dimensions have decisional relevance.
We hold the discharge orders, though approved by the Arbitrator, invalid.
The last part of our conclusions relates to
the relief which must be fashioned with an eye on mutual equities. We cannot
ignore a few raw realities since law is not dogmatics but pragmatics, without
temporising on principle. The Management's limitations in absorbing all the
large number of discharged employees all at once when, steel, the raw material,
is scarce, is a problem. Likewise, their inability to pay huge sums by way of
back wages or otherwise, without crippling the progress of the industry, cannot
be overlooked but cannot be overplayed after Hindustan Tin Works. Another
factor which cannot be wished away is the presence of over a couple of hundred
workmen, with varying lengths of service, who may have to be sacked if the old
workmen are to be brought back. It is a problem of humanist justice. Lastly,
the rugged fact of life must not be missed that some of the workmen during the
long years of desperate litigation, might have sought jobs elsewhere and most
of them perhaps have, for sheer survival, made at least a starving wage during
the prolonged idle interval. This factor too is a weak consideration, tested by
the reasoning in Hindustan Tin Works. Moreover, rationalisation of
re-absorption of the removed workmen requires attention to the classification
of permanent workmen and their casual counterparts. Every proposal must be
bottomed on the basic economic fact that the beneficiaries are from the many
below the destitution line. This Court has, in a very different context though,
has drawn attention to the Gandhian guideline:
"Whenever you are in doubt .. apply the
following test.
Recall the face of the poorest and the
weakest man whom you may have seen, and ask yourself, if the step you
contemplate is going to be of any use of him." It is apt here.
This perspective informs our decision. What
did the High Court do regarding reinstatement and should we modify and why? If
the discharge is bad, reinstatement is the rule.
In India General Navi- 213 gation, Punjab
National Bank and Swadeshi Industries, et al, restoration, despite large
numbers, was directed. But most rules have exceptions wrought by the pressure
of life and Oriental, was relied on to contend that reinstatement must be
denied. There is force in the High Court's reasoning to distinguish Oriental,
as we hinted earlier and we quote:
"There were only 22 workmen involved in
that case. The management had made genuine and persistent efforts to persuade
the concerned workmen to call of the strike and join work. Those efforts were
made at three different stages, namely, (1) immediately after the workers went
on the lightening strike and before chargesheets were issued, (2) after the
charges were dropped and individual notices were sent to the workmen asking
them to resume work by specified dates and (3) after the orders of termination
were served and conciliation proceedings were commenced pursuant to the demand
notice. But this is not all. Even the Labour Officer and Labour Inspector had
tried to persuade the concerned workmen to joint duty before the charge-sheet
came to be issued. As against these repeated bona fide attempts on the part of
the management and an outside agency to persuade the erring workmen, they not
only did not resume work but also failed to acknowledge or send a reply to the
individual notices served upon them requesting them to resume work and they
appear to have made it a condition precedent to their joining duty that the
suspended workmen should also be taken back.
Even under such circumstances, the management
did not straightaway terminate their services but gave individual notices
requiring the concerned workmen to show cause why their names should not be
struck off and asked them to submit their reply by a certain date.
Even those notices were not replied. It is
only thereafter that the services of the concerned workmen came to be terminated.
It is against this background that the Supreme Court held that there was
"a persistent and obdurate refusal by the workmen to joint duty"
notwithstanding the fact that "the management has done everything possible
to persuade them and give them opportunities to come back to work" and
that they had without any sufficient cause refused to do so which constituted
"misconduct" so as to 'justify the termination of their
services".
214 "....If the workmen had been
approached individually, not only those amongst them who were unwilling to join
strike but were prevented from joining work would have taken courage to resume
duty but even those amongst them who were undecided could also have been won
over.
That apart, those notices, as their contents
disclose, were hardly persuasive efforts. They were a mixture of ultimatums,
threats, complaints and indictment of the workmen and the Sabha. Was it,
therefore, a genuine effort on the part of a keenly desirous employer to offer
an olive branch? In Oriental, orders of termination were passed only after
giving individual notices to the concerned workmen to showcause why their names
should not be struck off. Besides, those notices were given after charges
formally served upon each workmen earlier were dropped and persuasive efforts
made in the meantime had failed. None of those steps was taken herein. All that
happened was that in one of the notices meant for mass consumption and
circulation, such intimation was given." Even so, during the several years
of the pendency of the dispute, surely some workmen would have secured
employment elsewhere as was conceded by counsel at a certain stage, and it is
not equitable to recall them merely to vindicate the law especially when new
workmen already in precarious service may have to be evicted to accommodate
them. In the course of the debate at the Bar we gained the impression that
somewhere around a hundred workmen are likely to be alternatively employed.
Hopefully, there is no hazard in this guess.
Another, facet of the relief turns on the
demand for full back wages. Certainly, the normal rule, on reinstatement, is
full back wages since the order of termination is non est. [see Lad's case(1)
and Panitole Tea Estate's case(2)]. Even so, the industrial court may well
slice off a part if the workmen are not wholly blameless or the strike is
illegal and unjustified. To what extent wages for the long interregnum should
be paid is, therefore, a variable dependent on a complex of circumstances. [See
for e.g. 1967 (15) F.L.R. 395 paras 3 and 4].
We are mindful of the submission of Sri
Tarkunde, urged in the connected appeal by the Sabha, that where no enquiry has
preceded 215 a punitive discharge and the tribunal, for the first time, upholds
the punishment this Court has in D. C. Roy v. The presiding Officer, Madhya
Pradesh Industrial Court, Indore & Ors.(1) taken the view that full wages
must be paid until the date of the award. There cannot be any relation back of
the date of dismissal to when the Management passed the void order.
Kalyani(2) was cited to support the view of
relation back of the Award to the date of the employer's termination orders. We
do not agree that the ratio of Kalyani corroborates the proposition propounded.
Jurisprudentially, approval is not creative but confirmatory and therefore
relates back. A void dismissal is just void and does not exist. If the
Tribunal, for the first time, passes an order recording a finding of misconduct
and thus breathes life into the dead shall of the Management's order, predating
of the nativity does not arise. The reference to Sasa Musa in Kalyani
enlightens this position. The latter case of D. C.
Roy v. The Presiding Officer, Madhya Pradesh
Industrial Court, Indore & Ors. (supra) specifically refers to Kalyani's
case and Sasa Musa's case and holds that where the Management discharges a
workmen by an order which is void for want of an enquiry or for blatant
violation of rules of natural justice, the relation-back doctrine cannot be
invoked. The jurisprudential difference between a void order, which by a
subsequent judicial resuscitation comes into being de novo, and an order, which
may suffer from some defects but is not still born or void and all that is
needed in the law to make it good is a subsequent approval by a tribunal which
is granted, cannot be obfuscated.
We agree that the law stated in D. C. Roy
(supra) is correct but now that the termination orders are being set aside, the
problem does not present itself directly. Even the other alternative submission
of Sri Tarkunde that if the plea of the Management that the order is a
discharge simpliciter were to be accepted, the result is a retrenchment within
the meaning of s. 2(00) which, in this case, is in violation of s. 25F and
therefore bad, is not a point urged earlier. We are disposed to stand by the
view that discharge, even where it is not occasioned by a surplus of hands,
will be retrenchment, having regard to the breadth of the definition and its
annotation in 1977 1 SCR 586. But the milieu in which the order was passed in
February 1973 is not fully available, viewed from this new angle. So we decline
to go into that contention.
216 Final Relief We are concerned with 400
workmen, some of whom have been claimed by death or other irreversible causes-
casualties of litigative longevity ! are 370 workmen are left behind, of whom
239 are admittedly permanent. We have already stated that 100, out of them, are
probably fixed up elsewhere. So, we exclude them and direct that the remaining
139 alone will be reinstated. A list of the aforesaid 100 workmen will be
furnished to the Management by the Sabha within two weeks from today. That
shall be accepted as correct and final.
While reinstatement is refused for these 100
workmen, when shall they be deemed to have ceased to be in service for drawal
of terminal benefits ? Their discharge orders having been quashed, they remain
in service until today. We concluded the arguments on August 3, 1979 and on the
eve of the closure of counsel's submissions certain inconclusive settlement
proposals were discussed. We, therefore, consider August 3, 1979 as a pivotal
point in the calender with reference to which the final relief may be moulded.
We direct that the 100 workmen for whom reinstatement is being refused will be
treated as in service until August 3, 1979 on which date they will be deemed to
have been retrenched.
We direct this step with a view to pragmatise
the situation in working out the equities. These 100 will draw all terminal
benefits plus 75 per cent of the back wages. This scaling down of back pay is
consistent with the assumption that somewhere in the past they had secured
alternative employment. The long years and the large sum payable also persuade
us to make this minor cut. Of course, in addition, they will be entitled to
retrenchment benefits under s. 25F of the Act, and one month's notice pay.
The remaining 139 will be awarded 50 per cent
of the back wages since we are restoring them. The High Court has adopted this
measure and so we do not depart from it. The case of the hundred stands on a
slightly different footing, because some compensation in lieu of refusal of
reinstatement is due to them and that also has entered our reckoning while
fixing 75 per cent for them. The computation of the wages will be such as they
would have drawn had they continued in service and on that the cut directed
will be applied.
We have disposed of the case of the permanent
workmen except to clarify that in their case continuity of service will be
maintained and accrual of benefits on that footing reckoned. The next category
relates to casual employees, 131 in number of whom 57 have less 217 than nine
months' service. The policy of the Act draws a distinction between those with
service of 240 days and more and others with less. The casuals with less than nine
months service are 57 in number and we do not think that this fugitive service
should qualify for reinstatement especially when we find a number of
intermediate recruits, with longer though untenable service, have to be baled
out. We decline reinstatement of these 57 hands. The other 74 must be
reinstated although nationally but wrongly they are shown as casual. In the
'life' sense, all mortals are casuals but in the legal sense, those with a
record of 240 days on the rolls, are a class who have rights under industrial
law. We direct the 74 long-term casuals aforesaid to be reinstated but not the
57 short-term ones. To this extent, we vary the High Court's order.
We adopt the directive of the High Court
regarding the back wages to both categories of casuals except that for the
lesser class of 57 casuals, a flat sum of 1000/- more will be paid as a token
compensation in lieu of reinstatement.
The reinstated casuals (74 of them) will be
put back as casuals but will be confirmed within six months from the date of
rejoining since it is meaningless to keep them as casual labourers when they
are, by sheer length of service, on the regular rolls.
Two issues remain When are the workmen to be
retaken and what is to happen in the meanwhile ? How is the amount payable by
the Management to be discharged and on what terms ? Many years have flowed by,
thanks to the long-drawn-out litigation. Further delay in putting back the
workers will be unfair. But the Management pleads that steel shortage cuts into
the flesh of the factory's expansion, without which additional intake of
workers is beyond their budget unless considerable time for reabsorption were
given. But the lot of the workmen is unspeakable while the overall assets and
outlook of the Company are commendable enough to bear an increased wage bill.
Divas cannot complain when Lazarus asks for more crumbs. Even if a slight slant
be made in favour of the Management, the direction to them to take back, in
order of seniority, the first 70 out of the 139 permanent workmen on or before
December 31, 1979 and the rest on or before March 31, 1980 is the least that is
just.
Until those dates the workmen will be paid
2/3rd of their wages as now due. Of course, if any workmen fails to report for
work within 15 days of service of written notice to him, with simultaneous copy
to the Sabha, he will not be eligible for any more reinstatement or wages.
218 The back wages run into a large sum but a
good part has been paid under the stay order of this Court. We make it clear
that the payments made will be given credit and the balance if paid as directed
below and within the time specified will not carry interest. If default is
made, the sums in default will carry 10 per cent interest.
The figures of amounts due will be worked out
by both sides and put into Court in 10 days from now. Half the amount
determined by the Court, after perusing both statements, will be paid directly
to the workmen or deposited with the Industrial Tribunal who will give notice
and make disbursements, on or before 31-3-1980 and the other half on or before
30-9-1980.
The conclusions may be capsulated for easier
consumption.
1. Out of 370 workmen directed to be
reinstated by the High Court, 239 are permanent. It is assumed that 100 have
found alternative employment and are not interested any more in reinstatement
and they are to be excluded from the direction of reinstatement. The Company
must, therefore, reinstate 139 permanent workmen and the list of 100 workmen
who are not to be reinstated would be supplied by the Sabha within two weeks
from the date of this judgment. The discharge order in respect of 100 workmen
herein-before mentioned would be set aside and they are deemed to be in service
till August 3, 1979, when they will be retrenched and they will be paid
retrenchment compensation as provided in s. 25F plus one month's pay in lieu of
notice, the compensation to be worked out on the basis of the wages that will
be admissible under the recommendations of the Engineering Wage Board as
applicable to the Company. This amount will be paid in lieu of reinstatement
and they will also be paid 75 per cent of the back wages.
2. The remaining 139 permanent employees
would be paid 50 per cent of the back wages as directed by the High Court.
3. 70 out of 139 permanent workmen directed
to be reinstated should be provided actual employment on or before December 31,
1979, and the rest on or before March 31, 1980.
During this period and till the actual
reinstatement each one of these 139 workmen should be paid 2/3 of the monthly
wages from August 9, 1979, when the hearing in this case concluded. 50 per cent
of the amount that becomes payable to each workmen under the directions herein
above given will be paid on or before March 31, 1980, and the balance on or
before September 30, 1980, and till then the amount will carry interest at the
rate of 10 per cent.
219
4. In respect of casual workmen whose service
was less than 9 months on the date of dismissal it would not be proper to grant
reinstatement. They are 57 in number. The remaining casual workmen 74 in number
shall be reinstated.
In case of 57 casual workmen to whom
reinstatement is refused, the direction of the High Court is confirmed with the
further addition that each one will be paid Rs. 1,000/- over and above the
amount payable under the direction of the High Court and this would be in lieu
of reinstatement.
Casual workmen 74 in number and having
service of more than 9 months on the date of dismissal will be treated as
confirmed within six months of the date of their rejoining and they will be
offered reinstatement by March 31, 1980, and the High Court's direction for
back wages in their respect in confirmed.
With these modifications, we dismiss both the
appeals.
The Management-appellant will pay the costs
of the Sabha- respondent, advocates fee being fixed at Rs. 5,000/-.
An Afterword This litigation, involving many
workmen living precariously on post-wages amidst agonising inflation and a
Management whose young budget, what with steel scarcity, may well be shaken by
the burden of arrears, points to the chronic pathology of our Justice
System-the intractable and escalating backlog in the Forensic Assembly Line
that slowly spins Injustice out of Justice and effectually wears down or keeps
out the weaker sector of Indian life. This truma is felt more poignantly in
Labour litigation and the legislature fails functionally if it dawdles to
radicalise, streamline and simplify the conflict resolution procedures so as to
be credibly available to the common people who make up the lower bracket of the
nation. The stakes are large, the peril is grave, the evils are worse than the
prognostics of Prof. Lawrence Tribe (of the Harvard Law School) :
"If court backlogs grow at their present
rate, Our children may not be able to bring a lawsuit to a conclusion within
their lifetime. Legal claims might then be willed on, generation to generation
like hillbilly feuds; and the burdens of pressing them would be contracted like
a hereditary disease." Law may be guilty of double injustice when it is
too late and too costly for it holds out remedial hopes which peter out into
sour dupes and bleeds the anaemic litigant of his little cash only to tantalise
him into a system equal in form but unequal in fact. The price of 220 this
promise of unreality may be the search by the lowly for the reality of
revolutionary alternatives. Compelled by the crisis in the Justice System, we
sound this sombre judicial note.
We direct payments and reinstatements as
spelt out earlier, within the specificated time, and, hopefully, leave the case
with the thought that, given better rapport between the partners in production,
the galvanic Gujarat Steel Tubes Ltd., will forge ahead as a paradigm for the
rest.
KOSHAL, J.-I have had the advantage of going
through the judgment of my learned brother Iyer, J., but after giving the same
my most serious consideration I regret that I find myself unable to endorse it
as I hold a different opinion in relation to three important findings arrived
at by him, namely, (a) that the discharge of workmen amounted really to their
dismissal because the motivation for it was their alleged misconduct.
(b) that an arbitrator would fall within the
ambit of the term "Tribunal" as used in sub- section (2) of section
11A of the Industrial Disputes Act (hereinafter called the 1947 Act), and (c)
that the High Court acted within the four corners or its jurisdiction under
article 227 of the Constitution of India while interfering with the finding of
the arbitrator that the workmen were correctly punished with dismissal if the
orders of discharge could be construed as such.
I am therefore appending this note which may
be read in continuation of that judgment.
2. The parties are admittedly governed by the
Industrial Employment (Standing Orders Act, 1946 (hereafter referred to as the
"S.O. Act" section 15(2) of which empowers the appropriate Government
to make rules, inter alia setting out model standing orders for the purposes of
that Act. The expression 'standing orders' is defined in section 2(g) of the
S.O. Act to mean rules relating to the matters set out in the schedule thereto,
items 8 and 9 of which run thus :
"8. Termination of employment, and the
notice therefor to be given by the employer and workmen.
221 "9. Suspension or dismissal for
misconduct and acts or omissions which constitute misconduct." The
appropriate Government (in this case the Government of Gujarat) has prescribed
Model Standing Orders (M.S.Os.
for short) under section 15(2) of the S.O.
Act. The relevant part of M.S.O. 23 is extracted below :
"23. (1) Subject to the provisions of
the Industrial disputes Act, 1947, the employment of a permanent workman
employed on rates other than the monthly rates of wages may be terminated by
giving him fourteen days' notice or by payment of thirteen days' wages
(including all admissible allowances) in lieu of notice.
"(2)................................
"(3)................................
"(4) The employment of a permanent
workman employed on the monthly rates of wages may be terminated by giving him
one month's notice or on payment of one month's wages (including all admissible
allowances) in lieu of notice.
"(4-A) The reasons for the termination
of service of a permanent workman shall be recorded in writing and communicated
to him, if he so desires, at the time of discharge, unless such communication,
in the opinion of the Manager, is likely directly or indirectly to lay any
person open to civil or criminal proceedings at the instance of the workman.
"(5)....................................
"(6)....................................
"(7) All classes of workmen other than
those appointed on a permanent basis may leave their service or their service
may be terminated without or pay in lieu of notice : Provided that services of
a temporary workman shall not be terminated as a punishment unless he has been
given an opportunity of explaining the charges of misconduct alleged against
him in the manner prescribed in Standing Order 25.
"(8).....................................
"(9)...................................."
222 M.S.O. 24 enumerates 25 kinds of acts or omissions on the part of a workman
which amount to misconduct. Clauses (a) and (b) of the M.S.O. describe two of
such acts thus :
"(a) willful insubordination or
disobedience, whether or not in combination with another, of any lawful and
reasonable order of a superior;
(b) going on illegal strike or abetting,
inciting, instigating or acting in furtherance thereof;" M.S.O. 25 lays
down the manner in which a workman guilty of misconduct may be dealt with. It
states :
"25. (1) A workman guilty of misconduct
may be - (a)............................................
(b)............................................
(c)............................................
(d)............................................
(e).............................................
(f) discharged under Order 23;
(g) dismissed without notice.
"(2)............................................
"(3) No order of dismissal under
sub-clause (g) of clause (1) shall be made except after holding an inquiry
against the workman concerned in respect of the alleged misconduct in the
manner set forth in clause (4).
"(4) A workman against whom an inquiry
has been held shall be given a charge-sheet clearly setting forth the
circumstances appearing against him and requiring explanation. He shall be
given an opportunity to answer the charge and permitted to be defended by a
workman working in the same department as himself.
Except for reasons to be recorded in writing
by the officer holding the inquiry, the workman shall be permitted to produce
witnesses, in his defence and cross-examine any witnesses on whose evidence the
charge rests. A concise summary of the evidence led on either side and the
workman's plea shall be recorded.
"(5)
.............................................. ." Clauses (3) and (4) of
M.S.O. 25 speak of an inquiry only in the case of an order falling under
sub-clause (g) of clause (1) of 223 that M.S. It is thus quite clear (and this
is not disputed) that the only sub-clause of clause (1) of M.S.O. 25 to which
the provisions of clauses (3) and (4) of that M.S.O. would be attracted is
sub-clause (g) and that if an order of discharge falls under M.S.O. 23 an
inquiry under clauses (3) and (4) of M.S.O. 25 would not be a prerequisite
thereto even though such an order is mentioned in subclause (f) of clause (1)
of that M.S.O. And that is why it has been vehemently urged on behalf of the
workmen who were discharged en masse and who were not taken back by the Management
that the orders of discharge made in relation to them amount really to orders
of dismissal and are bad in law by reason of the fact that no inquiry of the
type above mentioned was held before they were passed.
3. Under M.S.Os. 23 and 25 the Management has
the power to effect termination of the services of an employee by having
recourse to either of them. In action taken under M.S.O. 23 no element of
punishment is involved and the discharge is a discharge simpliciter; and that
is why no opportunity to the concerned employee to show cause against the
termination is provided for. Dismissal, however, which an employer may order,
is, in its very nature, a punishment, the infiction of which therefore has been
made subject to the result of an inquiry (having the semblance of a trial in a
criminal proceeding). Exercise of each of the two powers has the effect of the
termination of the services of the concerned employee but must be regarded,
because of the manner in which each has been dealt with by the M.S.Os., as
separate and distinct from the other.
4. It was vehemently argued on behalf of the
workmen that once it was proved that the order of discharge of a workman was
passed by reason of a misconduct attributed to him by the management, the order
cannot but amount to an order of dismissal. But this argument, to my mind, is
wholly without substance, and that for two reasons. For one thing, clause (1)
of M.S.O. 25 specifically states in sub-clause (f) that a workman guilty of
misconduct may be discharged under M.S.O. 23. This clearly means that when the
employer is satisfied that a workman has been guilty of misconduct, he may
(apart from visiting the workman with any of the punishments specified in
sub-clauses (a), (b), (c), (d) and (e) of clause (1) of M.S.O. 25) either pass
against him an order of discharge for which no inquiry precedent as provided
for in clauses (3) and (4) of M.S.O. 25 would be necessary, or, may dismiss him
after holding such an inquiry. Which of the two kinds of order the employer shall
pass is left entirely to his own discretion.
224 It is true that the employer cannot pass
a real order of dismissal in the garb of one of discharge. But that only means
that if the order of termination of services of an employee is in reality
intended to punish an employee and not merely to get rid of him because he is
considered useless, inconvenient or troublesome, the order, even though
specified to be an order of discharge, would be deemed to be an order of
dismissal covered by sub-clause (g) of clause (1) of M.S.O. 25. On the other
hand if no such intention is made out, the order would remain one of discharge
simpliciter even though it has been passed for the sole reason that a
misconduct is imputed to the employee. That is how, in my opinion, M.S.Os. 23
and 25 have to be interpreted. The argument that once an alleged misconduct is
shown to have been the motive for the passage of an order of discharge, the
same would immediately and without more, amount to an order of dismissal, is
not warranted by the language used in M.S.O. 25 which specifically gives to the
employer the power to get rid of "a workman guilty of misconduct" by
passing an order of his discharge under M.S.O. 23.
5. Secondly, the reasons for the termination
of service of a permanent workman under M.S.O. 23 have to be recorded in
writing and communicated to him, if he so desires, under clause 4-A) thereof.
Such reasons must obviously consist of an opinion derogatory to the workman in
relation to the performance of his duties; and whether such reasons consist of
negligence, work-shirking or of serious overt acts like theft or embezzlement,
they would in any case amount to misconduct for which he may be punished under
M.S.O. 25. It is difficult to conceive of a case in which such reasons would
not amount to misconduct. The result is that M.S.O. 23 would be rendered otiose
if termination of service thereunder for misconduct could be regarded as a
dismissal and such a result strikes at the very root of accepted canons of
interpretation. If it was open to the Court to "lift the veil" and to
hold an order of discharge to amount to a dismissal merely because the motive
behind it was a misconduct attributed to the employee, the services of no
employee could be terminated without holding against him an inquiry such as is
contemplated by clauses (3) and (4) of M.S.O. 25.
6. The interpretation placed by me on M.S.Os.
23 and 25 finds ample support in Bombay Corporation v. Malvankar(1) of which
the 225 facts are on all fours with those in the present case. Miss P. S.
Malvankar, respondent No. 1 in that case, was a clerk in the employment or the
Bombay Electric Supply and Transport Undertaking which was being run by the
Bombay Corporation. Her services were terminated on the ground that her record
of service was unsatisfactory. It was however stated in the order of
termination of her services that she would be paid one month's wages in lieu of
notice and would also be eligible for all the benefits as might be admissible
under the Standing Orders and Service Regulations of the Undertaking. Those
Standing Orders correspond to the standing orders with which we are here
concerned.
Thereunder, two powers were conferred on the
employer, one being a power to impose punishment for misconduct following a
disciplinary inquiry under clause (2) of Standing Order 21 read with Standing
Order 23 and the other one to terminate the service of the employee by one
calendar month's written notice or pay in lieu thereof under Standing Order 26.
The question arose as to which power had been exercised by the employer in the
case of Miss Malvankar and Jaswant Singh, J., delivering the judgment of the
Court on behalf of himself and Bhagwati, J., was answering that question when
he made the observations reproduced from his decision by my learned brother
Iyer, J. This Court was then clearly of the opinion that- (a) the power to
terminate the services by an order of discharge simpliciter is distinct from
and independent of the power to punish for misconduct and the Standing Orders
cannot be construed so as to render either of these powers ineffective; and (b)
reasons for termination have to be communicated to the employee and those
reasons cannot be arbitrary, capricious or irrelevant but that would not mean
that the order of termination becomes punitive in character just because good
reasons are its basis.
The Court further remarked that if the
misconduct of the employee constituted the foundation for terminating his
service then it might be liable to be regarded as punitive but this proposition
was doubted inasmuch as "even in such case it may be argued that the
management has not punished the employee but has merely terminated his service
under Standing Order 26".
7. So all that remains to be determined in
this connection is as to when would misconduct be the `foundation' of an order
of dis- 226 charge. Merely because it is the reason which weighed with the
employer in effecting the termination of services would not make the order of
such termination as one founded on misconduct, for, such a proposition would
run counter to the plain meaning of clause (1) of M.S.O. 25. For an order to be
`founded' on misconduct, it must, in my opinion, be intended to have been
passed by way of punishment, that is, it must be intended to chastise or cause
pain in body or mind or harm or loss in reputation or money to the concerned
worker.
If such an intention cannot be spelled out of
the prevailing circumstances, the order of discharge or the reasons for which
it was ostensibly passed, it cannot be regarded as an order of dismissal. Such
would be the case when the employer orders discharge in the interests of the
factory or of the general body of workers themselves. That this is what was
really meant by the judicial precedents which use the word `foundation' in
connection with the present controversy finds support from a number of
decisions of this Court. In The Chartered Bank, Bombay v. The Chartered Bank,
Employees' Union(1) this Court held that if the termination of service is a
colourable exercise of the power vested in the management or is a result of
victimization or unfair labour practice, the Industrial Tribunal will have
jurisdiction to intervene and set aside such termination. Applying this
principle to the facts of the case before it, this Court ruled :
"We are satisfied that the management
has passed the order of termination simpliciter and the order does not amount
to one of dismissal as and by way of punishment" (emphasis supplied).
This case was followed in The Tata Oil Mills
Co., Ltd., v. Workmen(2) where Gajendragadkar, C.J., who delivered the judgment
of the Court, stated the law thus :
"The true legal position about the
Industrial Courts' jurisdiction and authority in dealing with cases of this
kind is no longer in doubt. It is true that in several cases, contract of
employment or provisions in Standing Orders authorise an industrial employer to
terminate the service of his employees after giving notice for one month on
paying salary for one month in lieu of notice, and normally, an employer may,
in a proper case, be entitled to exercise the said power. But where an order of
discharge passed by an 227 employer gives rise to an industrial dispute, the
form of the order by which the employees' services are terminated, would not be
decisive; industrial adjudication would be entitled to examine the substance of
the matter and decide whether the termination is in fact discharge simpliciter
or it amounts to dismissal which has put on the cloak of a discharge
simpliciter.
If the Industrial Court is satisfied that the
order of discharge is punitive, that it is mala fide, or that it amounts to
victimization or unfair labour practice, it is competent to the Industrial
Court to set aside the order and in a proper case, direct the reinstatement of
the employee. In some cases, the termination of the employee's services may
appear to the Industrial Court to be capricious or so unreasonably severe that
an inference may legitimately and reasonably be drawn that in terminating the
services, the employer was not acting bona fide. The test always has to be
whether the act of the employer is bonafide or not. If the act is mala fide, or
appears to be a colourable exercise of the powers conferred on the employer
either by the terms of the contract or by the standing orders, then
notwithstanding the form of the order, industrial adjudication would examine
the substance and would direct reinstatement in a fit case..".
The same test was laid down for determining
whether an order of discharge could be construed as one ordering dismissal in
The Tata Engineering and Locomotive Co., Ltd., v. S. C.
Prasad(1) by Shelat and Bhargava, JJ. :
"No doubt, the fact that the order was
couched in the language of discharge simpliciter is not conclusive. Where such
an order gives rise to an industrial dispute its form is not decisive and the
tribunal which adjudicates that dispute can, of course, examine the substance
of the matter and decide whether the termination is in fact discharge
simpliciter or dismissal though the language of the order is one of simple
termination of service. If it is satisfied that the order is punitive or mala
fide or is made to victimise the workmen or amounts to unfair labour practice,
it is competent to set it aside. The test is whether the act of the employer is
bona fide. If it is not, and is a colourable 228 exercise of the power under
the contract of service or standing orders, the Tribunal can discard it and in
a proper case direct reinstatement." The Chartered Bank, Bombay v. The
Chartered Bank Employees' Union (supra) was followed by this Court in Workmen
of Sudder Office, Cinnamore v. Management(1) and therein stress was laid on the
employer's right to terminate the services of a workman by an order of
discharge simpliciter under the terms of the contract where there was no lack
of bona fides, unfair labour practice or victimization.
So the real criterion which formed the
touchstone of a test to determine whether an order of termination of services
is an order of discharge simpliciter or amounts to dismissal is the real nature
of the order, that is, the intention with which it was passed. If the intention
was to punish, that is, to chastise, the order may be regarded as an order of
dismissal; and for judging the intention, the question of mala fides (which is
the same thing as a colourable exercise of power) becomes all-important. If no
mala fides can be attributed to the management, the order of discharge must be
regarded as one having been caused under M.S.O. 23 even though the reason for
its passage is serious misconduct.
8. It is in light of the conclusion just
above arrived at that the discharge of the workmen in the instant case has to
be judged. The question of intention or mala fides is really one of fact (of
which the arbitrator was, in my opinion, the sole judge, unless his finding on
the point was vitiated by perversity in which case alone it was liable to be
reviewed by the High Court). The discussion of the evidence by the arbitrator
in his award is not only full and logical but, in my opinion, also eminently
just. At all material times the Management was out to placate the Sabha (and
therefore, the workmen) and gave to it a long rope throughout. The attitude of
the Sabha on the other hand was one of intransigence and obduracy. According to
the settlement of the 4th of August, 1972, it was not open to the workmen to
resort to a strike till the expiry of a period of five years; nor could the
Management declare a lock out till then. Any disputes arising between the
parties, according to the terms arrived at, were to be sorted out through
negotiations or, failing that, by recourse to arbitration. A dispute was raised
by the Sabha soon thereafter over the implementation of the recommendations of
the Central Engineering Wage Board (hereinafter called the Board), the payment
of bonus 229 for the year 1971 and wages for an earlier lock out. In paragraph
7.47 of its award the Board had made the following recommendations :
"7.47. After considering the problem in
its entirety, we agreed to divide the industry into five regions or areas as
under and in doing so, we have also considered the prevailing wage levels at
different places and the cost of living at important centres in these places.
"1. Bombay City and Greater Bombay
including Thana Ambarnath & Kalyan Industrial Areas.
"2. Calcutta, Greater Calcutta, Howrah
Industrial area, Jamshedpur Industrial area, Durgapur, Asansol and Ranchi
industrial areas.
"3. Madras industrial area, Bangalore
industrial area, Hyderabad industrial area, Poona-Chinchwad industrial area,
Delhi industrial area and Ahmedabad.
"4. Coimbatore, Nagpur, Bhopal, Kanpur,
Baroda and Faridabad industrial areas.
"5. The rest of the country." This
classification was made for the purpose of granting `area allowance' which
varied with the category in which the area of the situation of a factory fell.
No allowance was to be paid to the factories falling in category 5 and on the
basis of the phraseology used by the Board the Management contended that
Ahmedabad industrial area (in which its factory was situated) fell within that
category. This interpretation of the categorisation made by the Board was not
acceptable to the Sabha who claimed that the factory was covered by category 3;
and this was an issue on which the Sabha was not prepared to climb down.
Similarly, the Sabha was adamant on the question of bonus for the year 1971
which it claimed at 16 per cent over and above 8.33 per cent allowed by statute
with the plea that bonus at that rate had been paid in the earlier year. This
being the position and negotiations between the parties held at two meetings
convened on 14-12-1972 and 20-1-1973 having ended in a fiasco, the Management
offered to have the disputes resolved by arbitration but that again was a
course not acceptable to the Sabha which, however, accused the Management of
flouting the settlement dated the 4th of August , 1972, by not coming to the
negotiating table. The attitude adopted by the Sabha was, to say the least,
most unreason 230 able. It could not have its own way in taking certain matters
as final and non-negotiable. Nor can it be said that stand taken by the
management was unreasonable. Paragraph 7.47 of the award of the Board
categorized various factories with reference to the areas which were either
described by the names of the cities in which they were situated or by the
names of certain industrial areas. Ahmedabad was mentioned as such and so was
Calcutta while the other areas were mentioned as such and such industrial
areas. It was thus a very reasonable plea put forward on behalf of the
Management that only Ahmedabad city and not Ahmedabad industrial area was
included in category 3 and that that industrial area fell within category 5. On
the other hand, the Sabha interpreted the word `Ahmedabad' occurring in category
3 to include Ahmedabad industrial area (in which lay the factory in question)
and demanded area allowance for its workers on that score. The reasonableness
of the plea of the Management is obvious and it was the attitude of the Sabha
which lacked reason in that on the failure of the negotiations they spurned the
offer of the Management for arbitration on the question of interpretation of
the categorisation. It can also not be said that the objection regarding
payment of bonus raised by the Management was not a reasonable one. The
argument that the stand of the Management that the negotiations between them
and the Sabha on the questions of interpretation of the Board's award and bonus
having failed as there was no meeting ground on either of them, they could be
referred to arbitration, lacked reason, is wholly unacceptable. The attitude of
the Sabha in insisting on negotiations being held only on the basis of certain
propositions formulated by it amounted really to a refusal to negotiate the
points in dispute and the Management was therefore not left with any
alternative except to suggest an arbitration as envisaged in the settlement
dated the 4th of August, 1972.
9. Later developments reveal a similar state
of affairs in so far as the attitude of the Sabha is concerned. Over and over
again it was asked not to precipitate a strike and to act within the terms of
the settlement but the advice fell on deaf ears. Even after the strike which,
it is admitted on all hands, was illegal and certainly not envisaged by the
settlement of the 4th of August, 1972, the Management continued to make
requests to the Sabha to send back the workers, but again no heed was paid to
those requests. On the other hand, the Sabha began making suggestions to the
Government to take over the factory.
Ultimately, when the Management was faced, to
adopt means to rehabilitate the factory by reports to fresh 231 recruitment,
they had no option except to terminate the services of its workmen. Each one of
the orders of termination of services which were actually passed, was on the
face of it wholly innocuous inasmuch as it did not stigmatise in any manner
whatsoever the concerned workman.
The Management had however to record reasons
for the discharge in pursuance of the provisions of clause (4A) of M.S.O. 25
and those reasons did charge each worker with misconduct inasmuch as he had
taken part in the illegal strike and had refused to resume duty inspite of
repeated demands made by the Management in that behalf. All the same, the
Management made it clear that inspite of such misconduct it had no intention of
punishing the workers who were given not only the benefit of an order of
discharge simpliciter but also the option to come back to work within a
specified period in which case they would be reinstated with full benefits. An
intention not to punish could not be expressed in clearer terms and is further
made out from the fact that more than 400 workers who resumed duty were
reinstated without break in service. In passing the orders of discharge,
therefore, the Management did nothing more than act under M.S.O. 23 and its
action cannot be regarded as amounting to dismissal in the case of any of the
workers.
They had the right to choose between a
discharge simpliciter and a dismissal and, in the interests of the factory and
the members of the Sabha and perhaps on compassionate grounds also, they chose
the former in unequivocal terms. The intention to punish being absent, the
finding of the High Court that the order of discharge amounted to one of dismissal
cannot be sustained.
10. I now turn to the interpretation of
sub-section (2) of section 11A of the 1947 Act. It is a well settled canon of
interpretation of statutes that the language used by the legislature must be
regarded as the only source of its intention unless such language is ambiguous,
in which situation the preamble to the Act the Statement of Objects of and
Reasons for bringing it on the Statute book and the purpose underlying the
legislation may be taken into consideration for ascertaining such intention.
That the purpose of the legislation is to fulfil a socio-economic need, or the
express object underlying it, does not come into the picture till an ambiguity
is detected in the language and the court must steer clear of the temptation to
mould the written word according to its own concept of what should have been
enacted. That is how I propose to approach the exercise in hand.
11. For the sake of convenience of reference
I may set out the provisions of clauses (aa) and (r) of section 2, of
sub-sections (1) 232 and (2) and the opening clause of sub-section (3) of
section 11, and of the whole of section 11A of the 1947 Act:
"2. (aa) `arbitrator' includes an
umpire;" "2. (r) `Tribunal' means an Industrial Tribunal constituted
under section 7A and includes an Industrial Tribunal constituted before the
10th of March, 1957, under this Act;" "11. (1) Subject to any rules
that may be made in this behalf, an arbitrator, a Board, Court, Labour Court,
Tribunal or National Tribunal shall follow such procedure as the arbitrator or
other authority concerned may think fit.
"(2) A conciliation officer or a member
of a Board, or Court or the presiding officer of a Labour Court, Tribunal or
National Tribunal may for the purpose of inquiry into any existing or
apprehended industrial dispute, after giving reasonable notice, enter the
premises occupied by any establishment to which the dispute relates.
"(3) Every Board, Court, Labour Court,
Tribunal and National Tribunal shall have the same powers as are vested in a
Civil Court under the Code of Civil Procedure, 1908. when trying a suit, in
respect of the following matters, namely:- .........." "11A. Where an
industrial dispute, relating to the discharge or dismissal of a workman has
been referred to a Labour Court, Tribunal or National Tribunal for adjudication
and, in the course of the adjudication proceedings, the Labour Court, Tribunal
or National Tribunal, as the case may be, is satisfied that the order of
discharge or dismissal was not justified, it may, by its award, set aside the
order of discharge or dismissal and direct reinstatement of the workman on such
terms and conditions, if any, as it thinks fit, or give such other relief to
the workman including the award of any lesser punishment in lieu of discharge
or dismissal as the circumstances of the case may require:
Provided that in any proceeding under this
section the Labour Court, Tribunal or National Tribunal, as the case may be,
shall rely only on the materials on record and shall not take any fresh
evidence in relation to the matter." Section 2 of the Act specifically
lays down that unless there is anything repugnant in the subject or context,
the expressions defined 233 therein would have the meanings attributed to them.
Throughout the Act therefore, while
'arbitrator' would include an umpire, a 'Tribunal' would not include an
arbitrator but would mean only an Industrial Tribunal constituted under the
Act, unless the context makes it necessary to give the word a different
connotation. In sub- section (1) of section 11, it is conceded, the word
'Tribunal' has been used in accordance with the definition appearing in clause
(r) of section 2 because an arbitrator is separately mentioned in that
sub-section. In sub-sections (2) and (3) of that section a Board, a Labour
Court, a Tribunal and a National Tribunal have been invested with certain
powers. Would a Tribunal as contemplated by sub- sections (2) and (3) then
include an arbitrator ? My reply to the question is all emphatic 'no'. It is
well settled that if a term or expression is used in a particular piece of
legislation in one sense at one place, the same sense will pervade the entire
legislation wherever the term is used unless an intention to the contrary is
expressed. Here the word 'Tribunal' has been used in three sub-sections of the
same section and no reason at all is fathomable for the proposition that it
means one thing in sub-section (1) and something different in sub-sections (2)
and (3). It may also be mentioned here that in all the three sub-sections the
word 'Tribunal' has a capital 'T' which is also part of the expression
'Tribunal' as occurring in clause (r) of section 2 and thus connotes a proper
noun rather than the generic word 'tribunal' as embracing all institutions
adjudicating upon rights of contending parties. A third and perhaps a clinching
reason for this interpretation is available in the use of the expression
"National Tribunal" along with the word "Tribunal" in all
the three sub-sections which militates against the argument that the word
"Tribunal" as used in sub-sections (2) and (3) means an institution
of that type. If the word "Tribunal" as used in sub-sections (2) and
(3) means such an institution, then the use of the expression "National
Tribunal" would be redundant and redundancy is not one of the qualities
easily attributable to a legislative product. In that case, in fact, other
words used in the two sub-sections last mentioned, namely, 'Court' and 'Labour
Court' would also become redundant. In this view of the matter, the word
"Tribunal" as used in all the first three sub-sections of section 11
must be held to have been used in the sense of the definition occurring in
clause (r) of section 2.
12. Section 11A is just the next succeeding
section and therein a part of the arrangement adopted is the same as in
sub-sections (2) and (3) of section 11 so that powers are conferred by it on a
"Labour 16-868SCI/79 234 Court, Tribunal or National Tribunal" which
arrangement is repeated in the section thrice over. That the word
"Tribunal" as used in section 11A has the same meaning as it carries
in the three sub-sections of section 11 is obvious and I need not repeat the
reasons in that behalf; for, they are practically the same as have been set out
by me in relation to section 11.
13. In my opinion the language employed in
section 11A sufferers from no ambiguity whatever and is capable only of one
meaning, i.e., that the word 'Tribunal' occurring therein is used in the sense
of the definition given in clause (r) of section 2. It is thus not permissible
for this Court to take the Statement of Objects and Reasons or the purpose
underlying the enactment into consideration while interpreting section 11A.
I may mention here however that a perusal of
the Statement of Objects and Reasons forming the background to the enactment of
section 11A leads me to the same conclusion. In that Statement a reference was
specifically made to tribunals as well as arbitrators in, terms of the
recommendations of the International Labour Organization.
But inspite of that the word 'arbitrator' is
conspicuous by its absence from the section. What is the reason for the
omission ? Was it consciously and deliberately made or was it due to
carelessness on the part of the draftsmen and a consequent failure on the part
of the legislature ? In my opinion the Court would step beyond the field of
interpretation and enter upon the area of legislation if it resorts to guess
work (however intelligently the same may be carried out) and attributes the
omission to the latter cause in a situation like this which postulates that the
pointed attention of the legislature was drawn to the desirability of clothing
an arbitrator with the same powers as were sought to be conferred on certain
courts and tribunals by section 11A and it did not accept the recommendation. I
would hold, in the circumstances, that the omission was deliberately made.
It follows that the powers given to a
Tribunal under section 11A are not exercisable by an arbitrator who, therefore,
cannot interfere with the punishment (awarded by the employer) in case he finds
misconduct proved.
14. The last point on which I differ with the
finding of my learned brother relates to the exercise by the High Court of its
powers under article 227 of the Constitution of India. As pointed out by him
the High Court, while discharging its functions as envisaged by that article,
does not sit as a court of appeal over the award of the arbitrator but
exercises limited jurisdiction which extends only to 235 seeing that the arbitrator
has functioned within the scope of his legal authority. This proposition finds
full support from Nagendra Nath Bora and Another v. The Commissioner of Hills
Division and Appeals, Assam and Others(1), P. H.
Kalyani v. M/s. Air France, Calcutta(2),
state of Andhra Pradesh v. S. Sree Rama Rao(3) and Navinchandra Shakerchand
Shah v. Manager, Ahmedabad Cooperative Department Stores Ltd.(4), all of which
have ben discussed at length by him and require no further consideration at my
hands. In this view of the matter it was not open to the High Court to revise
the punishment (if the discharge is regarded as such) meted out by the
Management to the delinquent workmen and left in tact by the arbitrator whose
authority in doing so has not been shown to have been exercised beyond the
limits of his jurisdiction.
15. I need not go into the other aspects of
the case.
In view of my findings- (a) that the orders
of discharge of the workmen could not be regarded as orders of their dismissal
and were, on the other hand, orders of discharge simpliciter properly passed
under M.S.O. 23;
(b) that the arbitrator could not exercise
the powers conferred on a Tribunal under section 11A of the 1947 Act and could
not therefore interfere with the punishment awarded by the Management to the
workmen (even if the discharge could be regarded a punishment), and (c) that in
any case the High Court exceeded the limits of its jurisdiction in interfering
with the said punishment purporting to act in the exercise of its powers under
article 227 of the Constitution of India, the judgment of the High Court must
be reversed and the order of the arbitrator restored. The three appeals are
decided accordingly, the parties being left to bear their own costs throughout.
O R D E R The appeals are dismissed
substantially with such modifications as are indicated in the decretal part of
the judgment of the majority.
V.D.K. Appeals dismissed.
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