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M.S.K. Mills Clerks' Union Vs. Mahaboob Shahi Gulbarga Mills Company, Ltd. (18.04.1958 - KARHC) - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtKarnataka High Court
Decided On
Case Number(I.D.) No. 2 of 1957
Judge
Reported in(1958)IILLJ164Kant
ActsIndustrial Disputes Act, 1947 - Sections 2, 36(1) and 36(2)
AppellantM.S.K. Mills Clerks' Union
RespondentMahaboob Shahi Gulbarga Mills Company, Ltd.
Excerpt:
.....managed. these principles underlie the industrial employment (standing orders) act, the industrial dispute act and other statutes of like nature and standing orders settled on the basis of such statutes will have to be regarded as conditions of service as per which the employer and employee are to be governed. 1. without any charges or reasons, applying the fundamental principles mentioned above and on the basis of the principles of justice, equity and good conscience, is improper and wrong. in the absence of any good reasons for the termination of the services of p. the ii party has neither examined the manager nor the weaving master though they were the best and most competent persons to say what sort of work the p. the very purpose of calling for statements from the parties..........industrial disputes act, unless it has developed into an industrial dispute on being taken up by a union of workmen where there is one. the union which has taken up the case of that workman to make his dispute an industrial dispute must be a union of workmen of that particular industry or concern in which he is employed. a union of workmen of a sister industry will not be an appropriate one for the purpose.' their lordships have then referred to s. 36(1) of the act and explained its scope. in the latest decision of the supreme court in 1958 - i l.l.j. 500 [assam chah karamachari sangh v. dimakuchi tea estate] the supreme court has held, while analysing the definition of the industrial dispute as defined in the industrial disputes act, that 'the dispute between employers and workmen must.....
Judgment:
AWARD

1. Under notification No. LLH. 12 ILD. 57, dated 20 November 1957, the Government of Mysore has referred to this Court, the industrial dispute between the abovementioned two parties, for adjudication, the point of dispute referred for adjudication being :

'Whether the management of the M. S. K. Mills Company, Ltd., Gulbarga, was justified in terminating the services of Sri G. R. Kembhavi, the assistant spinning master of the mills; if not, to what relief, if any, he is entitled ?'

* * *

2. Only at the time of enquiry Sri Ramanuj Das orally raised some objection to the effect that Sri Kembhavi was not a 'workman' as defined in the Industrial Disputes Act and the work he was doing was of an administrative nature and so the dispute cannot be an industrial dispute. He also filed a memorandum at the time of arguments raising new points by way of objections.

3. That Sri Kembhavi examined as P.W. 1 was assistant spinning master in employment of M. S. K. Mills, from September 1949 till to 16 February 1957 is not disputed, and is also proved. On 16 February 1957 P.W. 1 Sri Kembhavi was served with a notice Ex. A. 1 informing him that his services were no longer required from 17 February 1957 and he would be paid a month's salary in lieu of notice. This notice is silent as to why his services were so terminated, though Sri Kembhavi had put in more than seven years of service in the M. S. K. Mills as an assistant spinning master, and his service could not have been dispensed with by the II party in such arbitrary manner, without advancing any good grounds for their doing so. Exhibit A. 1 does not set out any such reason for terminating the services of P.W. 1 all of a sudden. The II party also did not advance any reasons for so terminating the services of P.W. 1, at the time of conciliation proceedings, where the stand taken by them was that P.W. 1 was dismissed from service and not discharged, as was sought to be made out at the time of enquiry of this case in this court. Again, the II party has refrained from filing a counter-statement answering, traversing or covering the facts stated by the I party in the claim statement or raising their pleas of defence; nor did they raise any preliminary points of law. Ordinarily all this will mean that the II party has nothing to say on these facts mentioned in the claim statement so that the Court can take or presume them as admitted facts. Even at the time of the trial, nothing has been put forward by the mills managements as valid reason for dispensing with the services of P.W. 1.

4. If P.W. 1 was dismissed, as contended by II party before the conciliator, then the dismissal order must be set aside, as the principles of natural justice had not been observed before such action was taken against P.W. 1 inasmuch as no explanation had been called from P.W. 1 as regards the alleged misconduct or any other thing and no opportunity had admittedly been given to answer and disprove the charges, if any, against him, and to defend himself in any enquiry held before he was punished.

5. The II party having failed to take any definite plea or stand that Sri Kembhavi was discharged as per Ex. A. 1 in accordance with the provisions of any standing orders, which provided for such discharge, which may not amount to punishment, has tried to confuse the matter by producing Ex.B. 1 at the time of the trial, to suggest vaguely that action taken against P.W. 1 was as per those standing orders and is proper. But the union has made it clear that there are no such standing orders Ex.B. 1 now applicable to me mills and that no such standing orders are exhibited or posted in the timekeeper's office and other places as required. Exhibit B. 1 reveals that those standing orders were settled under some law in force in the erstwhile Hyderabad State before it became part and parcel of Bharat and before the Industrial Disputes Act, 1947, was made applicable to that State and was put into force. These standing orders are not those framed or settled under the Industrial Employment (Standing Orders) Act, 1946. It was pointed out that fresh standing orders have now been framed as per this Act XX of 1946 and sent to the Commissioner of Labour. It would appear, therefore, that there are no standing orders settled for the M. S. K. Mills as per the Act XX of 1946, which are in force now. Even assuming for argument's sake, that standing orders as per Ex.B. 1 are in force, it is seen that definition of 'operative' given there does not cover the case of an employee like P.W. 1 or of any clerk working in the mills. It must therefore be said that so far as this case is concerned, there are no standing orders which are in force as per which action could have been taken against P.W. 1. Further, granting that these standing orders apply even to P.W. 1, the action purported to have been taken as per standing order 19A cannot be justified at all, inasmuch as the requirements of that standing order that 'the reasons for the termination of services shall be recorded in writing and shall be communicated to the employee at the time of discharge,' has not been complied with. The only thing stated in Ex. A. 1 is that 'his (P.W. 1'S) services are no longer required' which is only a statement made to the effect that his services were terminated from 17 February 1957, and is no reason at all for the discharge, No reasons are also given for the alleged discharge even after Ex. A. 2 or even now when at least the II party should have given the reason, if any, justifying the discharge. In Sholapur Spinning and Weaving Company v. Narayan Tukaram Madikar [1948 I.C.R. 305], his lordship has made the following observations :-

'As to the nature of reasons that the employer is expected to give as the justification of an order for discharge, speaking for myself, I find very little difference, in any, between the statements 'I am discharging you' and 'your services are no longer required.' In my opinion a reason such as was given in this case hardly amounts to any reason at all and the lower court has in my judgment rightly held order of discharge should be held improper in the circumstances of the case ...............'

6. A perusal of this Sholapur case would show that wording of standing order 19A applicable there, is practically the same as 19A in Ex. B. 1. As per item 1 of Sch. II of the Industrial Disputes Act 'propriety or legality of the order passed by an employer under standing orders fall within the jurisdiction of labour court' and this wording is exactly the same to S. 78(1)A(a)(i) of Bombay Industrial Relations Act as per which the abovementioned Sholapur case was enquired into by the labour court and decided. The observations of his lordship made as above, therefore, equally apply here and it must be held that the statement made in Ex. A. 1 that 'the services of P.W. 1 are no longer required' is no reason at all and the discharge of P.W. 1 is improper and is liable to be set aside with all the consequential reliefs that P.W. 1 should be reinstated without any break in service and be paid compensation as regards wages from the date of discharge to the date of reinstatement, as was ordered in the above Sholapur case. There is therefore total absence of reasons or grounds to justify the discharge and hence the termination of services of P.W. 1 as per the alleged standing order 19A in Ex. B. 1. was unjustified and improper.

7. If there are no standing orders in force which are applicable to the M. S. K. Mills as per which a distinction has been made between dismissal, discharge and termination of services by laying down the limits of each and laying down the procedure for the enquiry to be held in matters dealt under them, the question as to whether the termination of services of P.W. 1 as per Ex. A. 1 is proper or not, has to be decide with reference to the general principle of law applicable to such cases, that the parties, i.e., employer and employee, would in their relationship, be governed by the principles of natural justice, equity and good conscience, as to think otherwise will amount to complete negation of the principle of security of service to an employee. The services of permanent employee cannot be terminated in an arbitrary manner at the sweet will and whim of an employer; the employee is entitled to be protected in such cases, as the very basis of the security of service which is vital to the employee will be shattered otherwise. In the Buckingham and Carnatic Company v. Their workmen [1951 - II L.L.J. 314] as well as in Liptons, Ltd. [1956 - I L.L.J. 319], the fundamental principles which should guide the industrial tribunal in interfering with different cases of termination of services have been laid down and those are :

(1) That the industrial worker must be placed in such a position that the security of his service may not depend upon the caprice or arbitrary will of the employer.

(2) That industrial peace should be maintained.

(3) That industry should be efficiently managed.

These principles underlie the Industrial Employment (Standing Orders) Act, the Industrial Dispute Act and other statutes of like nature and standing orders settled on the basis of such statutes will have to be regarded as conditions of service as per which the employer and employee are to be governed. When services of an employee are terminated and an industrial dispute is raised, the concerned industrial court would be competent to determine whether the termination of services is proper and is justified as per the standing orders, or in the absence of any standing orders, on the basis of and following the general fundamental principles laid down as above. Further, in all these, there is requirement of bona fides, and the termination of services in colourable exercise of the power or as a result of victimization or unfair labour practice or of caprice, should be prevented .... and arbitrary conduct or unnecessary harshness on the part of the employer, judged by the normal standard of a reasonable man, may be cogent evidence of victimization or of unfair labour practice.

8. The II party's action in terminating the service of P.W. 1. without any charges or reasons, applying the fundamental principles mentioned above and on the basis of the principles of justice, equity and good conscience, is improper and wrong. In the absence of any good reasons for the termination of the services of P.W. 1, it must be held that it was done with some ulterior motive and the II party's action is not bona fide. The evidence of P.W. 1 discloses that on 4 February 1957 one Sri Patel was appointed as assistant spinning master and to make room for him, his (P.W. 1'S) services were terminated soon after that. There is no evidence adduced on the side of the II party to show that this statement of P.W. 1 is not correct. Evidently the management of the M. S. K. Mills wanted to provide their own man Sri Patel with a job as assistant spinning master at the cost of others, i.e., P.W. 1'S job. Hence, here is a case where the action of the management in terminating the services of P.W. 1 is not only arbitrary, capricious but is mala fide and is also a case of unfair labour practice, so much so that this Court cannot uphold the action of the management in turning P.W. 1 out of employment after eight years' service in the mill. Considering everything it has to be held that the termination of services of Sri Kembhavi is improper, wrong and cannot be upheld.

9. I now take up the question whether P.W. 1 was or was not a 'workman' as defined in the Industrial Disputes Act. The II party concedes that P.W. 1 was doing supervisory work and he would come within the definition of a 'workman' in S. 2(s) of the Act, but according to them, because his case is one which falls within clauses iii and iv of that section because he was doing administrative work, he cannot be a workman. In both these, S. 2(s) iii and iv, the word 'mainly' is used and that is very significant. The evidence of Sri Kembhavi makes it clear that the work he was doing as assistant spinning master was almost cent per cent of a supervisory nature. The II party has neither examined the manager nor the weaving master though they were the best and most competent persons to say what sort of work the P.W. 1 was doing while he was in service. Even R.W. 1 Sri Sinha, the labour welfare officer in the mill, does not say that the duties of assistant spinning master were and are mainly of an administrative nature. His evidence on this point appears to be hearsay evidence. His admission in cross-examination that the suspension and file slips in all cases were being signed by the spinning master and not by P.W. 1 shows that P.W. 1 was doing very little administrative work or functions of a managerial nature. Even assuming that some administrative work was being done by P.W. 1 as part of the duties, he would still be doing mainly the job of a supervisory nature. There is very little support for the objection raised that P.W. 1 was not a 'workman' as defined in the Act.

10. In Paras. 1(a) to (d) in the memorandum filed on the day fixed for arguments, the II party has raised the objection that the workmen who are parties to the reference have not taken up the case, but it is the officers of the M. S. K. Mills Clerks' Union who have taken up the matter and represent the matter before this Court, that there is no proper representation of the workers, that P.W. 1 has admitted that he is not a member of the said union and so the union representatives cannot represent him under S. 3(1)(a) of the Industrial Disputes Act. The II party cannot be allowed to take the opposite side by surprise or attempt to set up a new case to the prejudice of the other side on the basis of some stray statement made by P.W. 1 which was not relevant on any point in dispute then. The very purpose of calling for statements from the parties on the subject-matter of the dispute would be frustrated if objections taken like this are not ignored. Merely because the word workmen has been used in the reference made by the Government, it does not mean that as a matter of fact it was not the union representing the workmen which is a party to the reference. It is the union which in this case has espoused the cause of Sri Kembhavi. Exhibit A. 3 as well as the evidence and the conduct of the parties show that the II party was fully aware about it throughout. The conciliation proceedings were held because this union put forward the grievance. The II party did not raise any such objections then. It is too late in the day for the II party to contend now that it was all the workmen who should have been represented in this case as the I party and not the union. No prejudice can possibly be caused to the II party, because the word 'workmen' has been used in the reference, as they really were aware throughout that it was and is the union which was and is the real party to the reference. The Government order referring the matter for adjudication shows that the notice was sent to the union on behalf of the workmen, evidently because it represented the one side to the dispute representing that section of the workers who had a union of their won and espoused the cause of the P.W. 1 and raised the industrial dispute. The union is, therefore, fully competent to file a claim-statement on its own behalf and be represented before this Court by its duly authorized office-bearers.

11. Section 36(1)(a) is only to the effect that if a workman happens to be a party to a industrial dispute, he has a right to get assistance of any trade union of which he is a member to be represented in any such proceedings, under the Act. Section 36(2) gives a similar right to the employer. 'There is a distinction between a union merely helping the employee, who, it thinks should be helped and its taking up his cause as one which affects general body of workers and adopting it as its own.' [1955 - II L.L.J. 477.] See also p. 4543 of the Calcutta Gazette Part I, dated 19 December 1957. A union which is not connected with the industry or the concern, where the employee concerned was working may represent him in such proceedings under the Act, as per S. 36(1)(a) but cannot and is incompetent to raise an industrial dispute by taking up his cause. Section 36(1)(c) gives a right to such workmen as P.W. 1 to be represented by any other workman employed in, or by an officer of the union connected with the industry in which the worker is employed even though such co-worker or union officer authorized to represent like that is not competent to raise an industrial dispute in connexion with the dispute of the affected workman. The question of competence to raise such industrial dispute is entirely a different matter than representing the workmen in such proceedings. Anyway S. 36(1)(c) which entitles P.W. 1 to be represented by an officer of the union like the M. S. K. Mills Clerks' Union in this case, of which he is not a member, is an answer to the objection raised. The point raised by the objection also may at the most amount to an irregularity which is not very material and cannot in any way affect the validity of the reference made.

12. Sri Das then vaguely suggested that the reference is bad and is not maintainable because the union in this case cannot raise an industrial dispute taking up the cause of P.W. 1 as Sri Kembhavi was not a member of that union. The point has not been specifically taken anywhere before or in the memo referred to above, giving rise to an issue on the point so that the matter be thoroughly enquired into and decided. In a case like this where the point raised is as regards the maintainability of the reference, the plea should have been pleaded in advance giving the union which is the party to the reference an opportunity to reply to the objection and meet it and if necessary take steps to cure the defects pointed out. Such plea is similar to the plea in a civil suit that the suit as framed is not maintainable for some reason or the other or the suit is bad for partial portion or non-joinder of necessary parties. The defects become material to the decision in the case only when those are not cured even after the objection is raised and the objection is found tenable ultimately. In this case the suggestion has taken the union by surprise and it had no opportunity to meet it and therefore cannot be permitted and should be ignored, especially because the point raised is about a certain fact about which an issue should have been raised and framed allowing both parties to have their say in the matter and also because the II party who throughout knew that as a matter of fact and in reality it was the M. S. K. Mills Clerks' Union which has espoused the cause of Sri Kembhavi were aware of those facts, but did not raise any objection till at a late stage.

13. It is well established now by a series of decisions of the High Courts and of the Supreme Court that if the workmen or a substantial part of them in the entire establishment or part of it or trade union of its employees of which the affected workman is a member espouse the cause of that workman, whatever be the reason for the step, and make his cause as their own, the dispute develops into an industrial dispute. The fact that the concerned workman became a member of the union after discharge is immaterial. [1958 - I L.L.J. 148.] But nowhere a question has come up in the form that :

'when the union has in fact espoused the cause of the employee in the same undertaking or establishment, and the factual existence of the dispute between the workers represented by the union on one side and the employer on the other is not disputed, whether it is not an industrial dispute as defined in the Act, merely because the employee was not its member at that time.'

In an award at p. 4541 of the Calcutta Gazette, Part I, of 19 December 1957, extracts from a recent decision of the Calcutta High Court are given, where their lordships have stated as follows.

'It must be taken as settled that an individual dispute cannot be considered to be an industrial dispute within the meaning of the Industrial Disputes Act, unless it has developed into an industrial dispute on being taken up by a union of workmen where there is one. The union which has taken up the case of that workman to make his dispute an industrial dispute must be a union of workmen of that particular industry or concern in which he is employed. A union of workmen of a sister industry will not be an appropriate one for the purpose.'

Their lordships have then referred to S. 36(1) of the Act and explained its scope. In the latest decision of the Supreme Court in 1958 - I L.L.J. 500 [Assam Chah Karamachari Sangh v. Dimakuchi Tea Estate] the Supreme Court has held, while analysing the definition of the industrial dispute as defined in the Industrial Disputes Act, that

'The dispute between employers and workmen must be a real dispute capable of settlement or adjudication by directing one of the parties to the dispute to give necessary relief to the other. It is also obvious that the parties to the dispute must be directly or substantially interested therein so that if it is workmen (and not employers) who raise the dispute it must be related to the establishment or part of the establishment in which they are employed.'

The Supreme Court has further held that the expression 'any person' in the S. 2(k) means a person in whose employment or non-employment the workmen as a class have direct substantial interest-with whom they have, under the scheme of the Act, a community of interest. Where the workmen raise a dispute as against their employer, the person regarding whose employment or non-employment the dispute is raised need not be, strictly speaking, a workman, within the meaning of the Act, but must be one in whose employment or non-employment the workmen as a class have a direct or substantial interest. In a case where the party to the dispute is composed of aggrieved workmen themselves and the subject-matter of the dispute relates to them or any of them, they clearly have a direct interest in the dispute. Where, however, the party to the dispute, also composed of workmen, espouse the cause of another person whose employment or non-employment, etc., may prejudicially affect their interest, the workmen have a substantial interest in the subject-matter of the dispute. The workmen in the particular establishment or a group of particular class of workmen joined together in a union can take up the cause of the affected person in the general interest of labour welfare. The M.S.K. Mills Clerks' Union which has taken up the cause of P.W. 1 in the general interest of the labour welfare, just like any substantial portion of the workers in the mills, could have taken up the cause for the same reason, and have substantial interest in the subject-matter of the dispute. Anyway in the face of the fact that a real industrial dispute has developed in this case between this union on the one hand and the II party on the other, the dispute or difference being connected with the termination of services of the person Sri Kembhavi, and the parties to the dispute have substantial interest in the subject-matter of the dispute, the point whether P.W. 1 was the member of the union appears to be immaterial. Considering all the things I am of opinion that even if the II party could have raised the point in the case as above, the point in no way could be considered material, and that, in view of the decision of the Supreme Court cited above there seems to be no force in it. The II party also cannot be permitted to raise such a question to the opposite party as stated already, and hence should be ignored.

14. In the result I find that the termination of services of P.W. 1 by the management of the M.S.K. Mills was improper and unjustified and cannot be upheld. The position in such a case where the action of the management is found to be invalid, is that the workman must be deemed to continue in service. There are also no valid grounds urged or found to deny the relief of reinstatement of Sri Kembhavi. I find therefore that Sri Kembhavi is entitled to reinstatement in service, without any break in the continuity thereof since the date of the termination of service till reinstatement.

15. There are no valid reasons to deny the relief of compensation. It may be that the II party terminated the service of P.W. 1 in the manner they did, being under the impression that it was within right to do so after giving a month's salary in lieu of notice. Besides that, P.W. 1 has not worked actually in the mill, and considerable time has also elapsed since the date of termination. I am therefore of opinion that the ends of justice would be met if 50 per cent of the emoluments are paid to Sri Kembhavi.

16. In the result I direct as follows :-

(i) The M.S.K. Mills shall reinstate Sri Kembhavi in service in his old post, on the same terms and conditions as before within fifteen days from the date when this award becomes enforceable, and there shall be no break in service from the date of termination till the date of reinstatement.

(ii) The said mill shall pay Sri Kembhavi 50 per cent of all the emoluments that he would have been entitled to draw had be continued in service, from the date of termination of service till the date of reinstatement.

(iii) If Sri Kembhavi is not reinstated within the period fixed as above, he shall be entitled to draw emoluments at the full rate from the date of the expiry of the abovementioned period of fifteen days till the date of reinstatement, in addition to the emoluments prescribed in Para. (ii).

17. I pass an award accordingly.


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