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K.B. Khatavkar Vs. S. Taki Beligrami - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtMumbai High Court
Decided On
Case NumberSpl. Application Nos. 1559 of 1964 and 351 of 1966
Judge
Reported in(1971)73BOMLR570; (1971)IILLJ445Bom; 1971MhLJ753
ActsIndustrial Disputes Act, 1947 - Sections 2, 5, 10(1), 17, and 25H; Minimum Wages Act 1948 - Sections 5 and 17; Employees Provident Funds and Misc. Provisions act - Sections 2 and 2(10)
AppellantK.B. Khatavkar
RespondentS. Taki Beligrami
Excerpt:
.....to. - - 79(1). these provisions clearly establish that an ex-employee is an 'employee' and that he is entitled to apply to a labour court under s. it will be noticed that the definition of the word 'employee' with which the supreme court was concerned, like the material portion of the definition in the case before us, consisted of two parts, the main part and the inclusive part, that the inclusive part of the definition covered employee 'discharged' on account of any dispute relating to a change .it was argued before the supreme court on behalf of the employers 'that it could not have been the intention of the legislative to include in definition of an employee even those who had creased to be in service, as otherwise there was no need for the further provision in s. ' these..........in our opinion, that clause was inserted ex abundanti cautela to repel a possible contention that employee discharged under ss. 31 and 32 of the act would not fall within s. 2(10), and cannot be read as importing an intention generally to exclude dismissed employees from that definition. we must accordingly hold agreeing with the decision in western india automobile asscon v. industrial tribunal, bombay [1949] f.c.r. 32: 51 bom. l.r. 894, that the definition of 'employee' in the act would include one who has been dismissed and the respondent cannot be denied relief only reason of the fact that he was not in employment on the date of the application.' these observations of the supreme court, and particularly the statement that the inclusive part of the definition was inserted ex abundant.....
Judgment:

Tarkunde, J.

1. At the relevant time S. 3(13) of the Bombay Industrial Relations Act ran as follows :

'employee' means any person employed to do any skilled or unskilled work for hire or reward in any industry, and includes -

(a) a person employed by a contractor to do any work for him in the execution of a contract with an employer within the meaning of sub-clause (e) clause (14);

(b) a person who has been dismissed or discharged from employment on account of any dispute relating to change in respect of which a notice is given or an application made under S. 42 whether before or after his dismissal or discharge ......'

The clause goes on to provide that a person employed in a managerial, supervisory or technical capacity is not included in the term 'employee', but we are not concerned with that part of the clause.

2. It will be noticed that the definition of the word 'employee' quoted above is in two parts. In the main part the term as defined to mean any person employed to do any skilled or unskilled work for hire or reward in any industry. In the second part, which may be called the inclusive part, of the definition are included contractor's employees and employees who are dismissed or discharged under certain circumstances.

3. It may be added that sub-clause (b) of the inclusive part of the definition was amended recently by Maharashtra Act XXII of 1965. As amended the sub-clause reads as follows :

'(b) a person who has been dismissed, discharged or retrenched or whose services have been terminated from employment on account of any dispute relating to change in respect of which a notice is given or an application made under S. 42 whether before or after his dismissal, discharge, retrenchment or, as the case may be, termination from employment;'

The question which we are referring to a Full Bench arises under the definition prior to this amendment.

4. We have noticed above that the Industrial Court relied on a previous decisions of its Full Bench in Soma Ramjee Varghade v. Shri Madhusudan Mills Ltd., Bombay [1965] I C R 261 for holding that a retrenched employee was not an 'employee' under S. 3(13). The decision of the Full Bench of the Industrial Court in that case was based on the assumption that an ex-employee is not covered by the main part of the definition of 'employee' in S. 3(13) and that he can be held to be an employee only if he is covered by sub-clause (b) of the inclusive part of the definition. On that assumption the Full Bench considered whether a retrenched employee is covered by the expression 'dismissed or discharged' which occurred in sub-clause (b). The Full Bench held that a retrenched employee is neither dismissed nor discharged and that he is, therefore, not an 'employee' and cannot file an application for reinstatement under Ss. 78 and 79 of the Act.

5. It would, with respect, not be difficult to show that the Full Bench was wrong in its view that the word 'discharge' is not wide enough to include a case of retrenchment. The ordinary meaning of the word retrenchment was considered by the Supreme Court in Hariprasad Shivshankar v. A. D. Divelkar (1956) 59 Bom. L.R. 384. Their Lordships observed that 'retrenchment means discharge of surplus workmen in an existing or continuing business.' It is thus clear that retrenchment is a particular kind of discharge and that the word 'discharge' is wide enough to include cases of retrenchment. We are accordingly of the view that the Full Bench of the Industrial court was not right in holding that a retrenched worker is not covered by the expression 'dismissed or discharged' in sub-clause (b) of S. 3(13).

6. Another difficulty, however, arises if we are to accept as correct the assumption of the Full Bench that an ex-employee cannot come within the definition of the word 'employee' unless he is covered by sub-clause (b) of the inclusive part of the definition. Sub-clause (b) applies only to those workmen who were dismissed or discharged 'on account of any dispute relating to change .......' Under the Act the dismissal or discharge of an employee is itself a change, but it cannot be said that whenever an employee is dismissed or discharged his dismissal or discharge was 'on account of any dispute relating to change'. What sub-clause (b) requires is that there should have been a dispute relating to a change prior to the dismissal or discharge of an employee and that the dismissal or discharge should have been on account of that dispute. It must follow that where an employee is dismissed or discharged on account of an alleged misconduct unconnected with a pending industrial dispute, he is not an employee within sub-clause (b). Unless such a person is covered by the main part of the definition of 'employee' in S. 3(13) he would not be able to apply to the Labour Court to challenge the legality or propriety of his dismissal or discharge. In other words an employee who has been dismissed or discharged for any reason unconnected with a pending industrial dispute cannot be regarded as an employee unless the word 'employee' includes an ex-employee under the main part (as distinguished from the inclusive part) of the definition of that term in S. 3(13).

7. It appears to have been brought to the notice of the Full Bench of the Industrial Court that its approach to the definition of 'employee' would lead to the result that a worker who is dismissed or discharged for misconduct would be debarred from making an application to the Labour Court. The Full Bench brushed aside the objection by observing : 'It is unnecessary for us to enter into this point which does not arise in this reference. Shri Narayanaswami (employer's advocate) concedes that such a person would not be debarred from challenging his dismissal or discharge in a Labour Court.' This was obviously a very unsatisfactory way of dealing with the issue. The concession which was made before the Full Bench was not made before us by the advocate who appeared for the employers. On the contrary, he argued that retrenched workers were not 'employees' because, even if they are held to have been discharged, their discharge was not 'on account of' any dispute relating to a change.

8. In my view, there is adequate justification and binding authority for holding that the word 'employee' in the main part of the definition in S. 3(13) of the Act includes an ex-employee. The main part of the definition says that an employee means 'any person employed' to do any skilled or un-skilled work for hire or reward in any industry. The expression 'any person employed' is wide enough to include 'any person who is or was employed.' According to this view, the reference in the inclusive part of the definition to persons dismissed or discharged on account of industrial disputes was made by way of abundant caution and was not intended to limit the amplitude of the main part of the definition. I will first deal with the jurisdiction of this view without reference to any authority.

9. The object of the Bombay Industrial Relations Act, according to its preamble, was to regulate the relations of employers and employees in certain matters, to consolidate and amend the law relating to the settlement of industrial disputes and to provide for certain other purposes. Now, one of the main causes which affects adversely the relations between employers and employees and leads to industrial disputes is the termination of the services of persons employed in an industry. That being so, it is unlikely that the Legislature intended that the term 'employee' used in the Act should not include ex-employees. Just as in tenancy legislation the word 'tenant' normally includes an ex-tenant, so in legislation relating to industrial disputes the word 'employee' normally includes an ex-employee. This is borne out by several provisions of the Bombay Industrial Relations Act.

10. Section 3(17) defines 'industrial dispute' to mean any dispute or difference between an employer and employee or between employers and employees or between employees and employees which is connected with any industrial matter. The expression 'industrial matter' is then defined in S. 3(18) to mean 'any matter relating to employment, work, wages, hours of work, privileges, rights or duties of employers or employees, or the mode, terms and conditions of employment,' and to include, inter alia, '(a) all matters pertaining to the relationship between employers and employees, or to the dismissal or non-employment of any person;'

Thus the dismissal or non-employment of any person is an industrial matter, and a dispute connected with this industrial matter 'between an employer and an employee' is an industrial dispute under S. 3(17). It would thus appear that the word 'employee' used in S. 3(17) includes a person who is aggrieved by his dismissal or non-employment, i.e., an ex-employee.

11. Notice may then be taken of some of the provisions of the Act dealing with standing orders. Sub-section (1) of S. 35 requires every employer to submit for the approval of the Commissioner of Labour 'draft standing orders regulating the relations between him and his employees with regard to the industrial matters mentioned in Schedule I.' Schedule I gives a list of the matters on which standing orders are required to be framed, and item 10 of that list is 'termination of employment including notice to be given by employer and employee'. Thus all forms of termination of employment, including termination by way of retrenchment, are intended to be covered by standing orders. Sections 36 to 39 deal with the settlement of standing orders, and sub-s. (1) of S. 40 then lays down that the standing orders so settled 'shall be determinative of the relations between the employer and his employees in regard to all industrial matters specified in Schedule I.' It is clear from these provisions that the legislature intended to protect, inter alia, those employees whose employment is terminated contrary to the provisions contained in the standing orders. It is difficult to believe that the legislature did not intend that an employee whose employment is terminated contrary to the provisions of the standing orders should be able to approach a Labour Court for the purpose of securing appropriate relief.

12. Section 78 of the Act deals with the powers of a Labour Court and S. 79 with the commencement of proceedings before a Labour Court. Section 78(1)(A)(a)(i) says that a Labour Court shall have power to decide disputes regarding 'the propriety or legality of an order passed by an employer acting or purporting to act under the standing orders.' Then S. 78(1)(A)(a)(iii) lays down that a Labour Court shall have the power to decide disputes regarding 'any change made by an employer or desired by an employee in respect of an industrial matter specified in Schedule III [except item (5) thereof] and matters arising out of such changes.' Item (6) of Schedule III is 'Employment including - (i) reinstatement and recruitment; (ii) unemployment of persons previously employed in the industry concerned.' Reading S. 78(1)(A)(a)(iii) with item (6) of Schedule III it is clear that a Labour Court has power to decide any dispute regarding any change made by an employer or desired by an employee in respect of the unemployment of any person previously employed or the reinstatement of any person in the industry concerned. Then sub-s. (1) of S. 79 provides that proceedings before a Labour Court in respect of disputes falling under S. 78(1)(A)(a)(iii) 'shall be commenced on an application made by any of the parties to the dispute.' Obviously an employee whose services are terminated contrary to the standing orders, or who claims that the termination of his service was otherwise improper, is a party to the dispute and is entitled to file an application to a Labour Court under S. 79(1). These provisions clearly establish that an ex-employee is an 'employee' and that he is entitled to apply to a Labour Court under S. 79(1) of the Act.

13. Clause (4) of S. 42 provides, inter alia, that any employee who desire a change in respect of industrial matters specified in Schedule III [except item (5) thereof shall make an application to the Labour Court and that before he makes such an application he shall approach the employer with a request for the change. If an ex-employee is entitled to make an application to a Labour Court under S. 79(1) as noticed above, it must follow that the word 'employee' used in Clause (4) of S. 42 includes an ex-employee.

14. Turning to authorities, it appears to me that the question which we intend to refer to Full Bench is concluded by the decision of the Supreme Court in C. P. T. Service v. Raghunath : (1957)ILLJ27SC . A reference to a Full Bench has become necessary nevertheless, become a Division Bench of this Court interpreted that decision in a very different way than the way in which I understand it. The Supreme Court was concerned in that case with the interpretation of the word 'employee' in S. 2(10) of the C.P. and Bear Industrial Disputes Settlement Act, 1947. At the relevant time S. 2(10) of the said Act ran as follows :

''employee' means any person employed by an employer to do any skilled or unskilled manual or clerical work for contract or hire reward in any industry and includes an employee discharge on account of any dispute relating to a change in respect of which a notice is given under S. 31 or 32 whether before or after the discharge.'

It may observed in this connection that the provisions of Ss. 31 and 32 of the C.P. and Berar Industrial Disputes Settlement Act are very similar to those of S. 42 of the Bombay Industrial Relation Act. In the case before the Supreme Court an employee who had been dismissed for alleged misconduct had applied to the Labour Commissioner for reinstatement and compensation under S. 16 of the C.P. and Berar Industrial Disputes Settlement Act, and one of the questions raised was whether he was an employee within the definition of employee in S. 2(10) of the said Act. On behalf of the employers it was contended that he was not employee because he had creased to be in service at the time of application. It will be noticed that the definition of the word 'employee' with which the Supreme Court was concerned, like the material portion of the definition in the case before us, consisted of two parts, the main part and the inclusive part, that the inclusive part of the definition covered employee 'discharged' on account of any dispute relating to a change .....' It was argued before the Supreme Court on behalf of the employers 'that it could not have been the intention of the legislative to include in definition of an employee even those who had creased to be in service, as otherwise there was no need for the further provision in S. 2(10) that discharged employees would in certain cases be employees; and that in any event, the include portion of the definition would, on the principle expressio unius est exclusio alterius, operate to exclude all employees, other than those mentioned therein.' In rejecting this argument the Supreme Court observed (p. 107) :

'We are also unable to accede to the contention of the appellant that the inclusive clause in S. 2(10) of the Act is indication that the legislature did not intend to include within that definition those who ceased to be in service. In our opinion, that clause was inserted ex abundanti cautela to repel a possible contention that employee discharged under Ss. 31 and 32 of the Act would not fall within S. 2(10), and cannot be read as importing an intention generally to exclude dismissed employees from that definition. We must accordingly hold agreeing with the decision in Western India Automobile Asscon v. Industrial Tribunal, Bombay [1949] F.C.R. 32: 51 Bom. L.R. 894, that the definition of 'employee' in the Act would include one who has been dismissed and the respondent cannot be denied relief only reason of the fact that he was not in employment on the date of the application.'

These observations of the Supreme Court, and particularly the statement that the inclusive part of the definition was inserted ex abundant cautela, clearly implies that all ex-employees are included in the definition of employee in S. 2(10) of the said Act and not only those who are covered by the inclusive part of the definition.

15. This decision of the Supreme Court was, however, differently interpreted by a Division Bench consisting of Mr. Justice L. M. Paranjape and my learned brother Justice Bal when decided Special Civil Applications 345 and 575 of 1966 at Nagpur on March 11, 1967, Laxman v. The State Industrial Court at Nagpur, (unreported). In that case a retrenched employee had applied under S. 16 of the C.P. and Berar Industrial Disputes Settlement Act for reinstatement. The Division Bench held that the retrenched employee was not an 'employee' under S. 2(10) and was not entitled to apply for reinstatement under S. 16 of the Act. On account of the intervening amendment the terms of the definition of 'employee' in S. 2(10) considered by the Division Bench were somewhat different than the terms of the definition which was considered by the Supreme Court in the Central Provinces Transport Service case mentioned above. The amendment, however, was not material to the question in issue. The amendment was confined to the inclusive part of the definition of 'employee' in S. 2(10) of the said Act. The inclusive part of the definition originally read 'and includes an employee discharged on account of any dispute relating to a change in respect of which a notice is given under S. 31 or 32 whether before or after the discharge.' After the amendment the inclusive part of the definition read :

'and include an employee dismissed, discharged or removed on account of any industrial disputes.'

On the construction of the definition of 'employee' the Division Bench stated :

'It appears from the definition that it contemplates two categories of persons who can be termed as 'employees'. The first category consists of persons who are actually in the employment of the employer at the date of the application and the second, of those who have creased to be in the employment prior to the date of the application, the reason for ceasing being 'dismissal, discharge or removal on account of any industrial dispute.' In other words, the definition does not includes all ex-employees but only those of the specified categories out of them.'

The Division Bench was of the view that the word 'discharge' covered cases of retrenchment, and that a retrenched employee was a discharged employee. The Division Bench, however, held that the retrenched employee before them was not an employee within S. 2(10) because his discharge was not 'on account of any industrial dispute.' Referring to the Supreme Court decision in the C.P.T. Services case the Division Bench observed in its judgment :

'It will be seen that in the case before the Supreme Court, the employee had been dismissed after an inquiry, which involved an industrial dispute.'

Thus, according to the Division Bench, the dismissed employee with whom the Supreme Court were concerned was an employee under S. 2(10) because an inquiry had been held before his dismissal. The inquiry, according to the Division Bench involved an industrial dispute relating to change and employee, therefore, fell within the inclusive part of the said definition.

16. I am, with great respect, unable to agree with the interpretation of the judgment of the Supreme Court. In the first place, the employee before the Supreme Court could not be held to have been discharged 'on account of any dispute relating to the charge'. The dismissal of the employee was itself a change and preceding inquiry may, with some stretch of language, be regarded as a dispute relating to change. The employee, however, was dismissal as a result of the inquiry and not on account of inquiry. What led to his dismissal was alleged misdemeanour and not the inquiry which was held for the purpose of deciding whether the misdemeanour was committed by him. Moreover, the reasoning of the Division Bench implies that if any inquiry is held before the dismissal of an employee, the dismissed employee gets the privileges conferred by the C.P. and Berar Industrial Disputes Settlement Act, but he does not get those privileges if he is summarily dismissed without any inquiry whatever. Apart from these considerations, there is more basic reason why I cannot accept the interpretation put by the Division Bench on the judgment of the Supreme Court. The Supreme Court did not hold that the dismissed employee before them was covered by the inclusive part of the definition of the term 'employee'. On the contrary, the Supreme Court stated in express terms that the inclusive part of the definition had been inserted ex abundanti cautela to repel a possible contention that employees discharged under Ss. 31 and 32 of the Act would not fall within 2(10). The Supreme Court went on to say that the inclusive clause 'cannot be read as importing an intention generally to exclude dismissed employees from that definition.' It is thus clear that, according to the Supreme Court, the dismissed employee was on employee within the main part of the definition of that term and not within the inclusive part.

17. A reference may then be made to the decision of Chagla C.J. and Dixit J. in P. L. Mayekar v. Aminchand : AIR1956Bom30 . In that case a dispute with regard to the claim for reinstatement of two dismissed employees had been referred by the Government to the Industrial Court under S. 10(1)(c) of the Industrial Disputes Act, 1947. One of the question before the Court was whether the dismissed employees were workmen within S. 2(s) of the Act as it then stood. Section 2(s) at the relevant time read as follows :

''workmen' means any person employed including an apprentice in any industry to do any skilled or unskilled manual or clerical work for hire or reward and includes, for the purposes of any proceeding under this Act in relation to an industrial dispute, a workman discharged during that dispute, but does not include any person employed in navel, military or air service of the Government.'

The material portion of this definition, it will be noticed, was also in two parts - the main part and the inclusive part. The dismissed employees before the Court had not been discharged during an industrial dispute and were not covered by the inclusive part of the definition. The Court, however, held that they were workmen because they came under the main part of the definition of 'workman' in S. 2(s). Delivering the judgment of the Court Chagla C.J. observed (p. 1003) :

'... Without looking at the authorities, on a plain construction of the section, it is not possible to accept the contention of Mr. Gupte (employer's counsel) that a the workman means a person who was employed at the date when the dispute was referred by Government under S. 10(1)(c). Mr. Gupte contends that if a workman has already been dismissed, no industrial dispute can be referred with regard to his dismissal to the Industrial Court. Now, the definition of 'workman' does not indicate that the workman must be employed at a particular moment of time. What is emphasised is that he must be employed in any industry to do skilled or unskilled manual or clerical work for hire or reward; in other words, the definition is intended to point out what the nature and characteristic of a person is who can be deemed to be a workman within the meaning of the Act. In our opinion, a workman as defined in the sub-section means any person who is employed at any time in an industry.'

These observations, it may be added, were brought to the notice of the Division Bench consisting of Mr. Justice L. M. Paranjape and my learned brother Mr. Justice Bal when they decided the case referred to above. The learned Judges, however, held that these observations had no reference to the facts before them and to provision of the statute with which they were concerned. I am of the view, with great respect, that S. 2(s) of the Industrial Disputes Act of 1947, S. 2(10) of the C.P. and Berar Industrial Disputes Settlement Act of 1947, and S. 3(13) of the Bombay Industrial Relations Act of 1946 are substantially in pari materia, and that the term 'workman' or 'employee' defined by these provisions includes an ex-workman or an ex-employee.

Per Bal, J.

18. I regret my inability to persuade myself to share the view expressed by my learned brother regarding the effect of the decision of the Supreme Court in C. P. T. Service v. Raghunath : (1957)ILLJ27SC and regarding the correct interpretation of the definition of the word 'employee' under the C.P. and Berar Industrial Disputes Settlement Act, 1947, as it stood after its amendment in 1955. In the case of the C.P.T. Service the Supreme Court was considering the unamended definition of the term 'employee' which was materially different from the amended definition. That decision would, therefore, have no application to cases governed by the amended definition. The definition as it stood after its amendment in 1955 read :

''employee' means any person employed by an employer to do any skilled or unskilled manual or clerical work for contract or hire or reward in any industry and includes an employee dismissed, discharged or removed on account of any industrial dispute.'

If the Legislature intended that the main part of the amended definition should include all ex-employees, nothing would have been easier than to enact the inclusive part to read : 'and includes an employee dismissed, discharged or removed', or to drop the inclusive clause altogether and to add to the definition some such explanation as : 'The term 'employee' shall include an ex-employee', or 'An ex-employee shall be deemed to be an employee within the meaning of this definition.'

2. The expression 'on account of an industrial dispute' would be wholly inappropriate to convey such an intention. In order to hold that an ex-employee, whatever the cause which led to the termination of his services, is an 'employee' within the meaning of the amended definition, one must ignore the expression 'on account of any industrial dispute.' I see no reason to justify such a course. In my view, the definition in S. 2(10) of the C.P. and Berar Industrial Disputes Settlement Act, 1947 as it stood after its amendment in 1955 includes only those ex-employees whose services had been terminated as a result of some industrial dispute. Other reasons for this view of mine appear in the judgment of the Division Bench at Nagpur dated March 11, 1967 in Special Civil Applications No. 345 and 575 of 1966. Laxman v. State Industrial Court, Nagpur

3. I, however, agree that the question arising in the present case formulated by my learned brother regarding the correct interpretation of the term 'employee' as defined in S. 3(13) of the Bombay Industrial Relations Act 1946, is one of general importance likely to arise in a large number of cases, and it is desirable that it should be considered and decided by a larger Bench so that all doubts regarding the correct legal position may be set at rest.

PER CURIAM :

We refer the following question for the decision of a Full Bench :

'Whether a retrenched employee is an 'employee' within S. 3(13) of the Bombay Industrial Relations Act, 1946, and can apply for reinstatement to a Labour Court under Ss. 78 and 79 of the said Act ?'

The question was considered by a Full Bench composed of Kotval C.J. and Mody and Kantawala JJ. who agreed with the view expressed by Tarkunde, J.


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