1. The Secretary of the Spencer and Company Limited (the company) terminated the services of their two probationary employees K. Lakshminarayana (KL) and Muralikrishnamacharyulu (KM). They were working in the Vijayawada branch of the company. The two employees, thereupon, approached the authority under the Shops and Establishments Act, 15 of 1966 (Shops Act), for reinstatements and by separate application under the Industrial Disputes Act, 14 of 1947 (Under S. 33C) for wages to be paid to them. The shops authority on July 26, 1978 directed the company to reinstate the employees. On further appeal by the company, the Labour Court at Guntur on July 4, 1979, directed the company to pay salaries and a sum of Rs. 10,000/- each was ordered towards compensation instead of reinstatement. That Court as a Court under Act 14 of 1947, considered the claim of wages under six heads (a) Bonus, (b) leave wages, (c) house rent allowance, (d) attendance allowance, (e) special allowance and (f) increments. As respects (a) the company and the employees agreed that the bonus be paid as per the award pending at Madras before the Industrial Tribunal. It is represented the award was passed and bonus will be paid to the employees : under (b) KL was ordered to be paid Rs. 2,272-10p. and KM was paid Rs. 2,302-30p. Under (c) the allowance at Rs. 20/- per month was ordered on December 1, 1977 to May 31, 1978 to the employees. Under (d) the two were ordered at the rate of Rs. 15/- per month from December 1, 1977 to May 31, 1978 : Under (e) and (f) the claim of the two employees was totally rejected. The company and the employees assail the finding of the Labour Court under Shops Act and under Act, 14 of 1947, in these group of cases. The order of the Labour Court under the Shops Act where compensation is ordered, the order is attacked both by the company and the contestants on different grounds.
2. The Labour Court exercised its discretion under Clause (2) of S. 41 of Shops Act and passed 'compensation' order. That clause invests in the Labour Court the power to direct an employee to be reinstated with or without wages and in suitable cases, in the alternative, may direct even compensation or accord such relief in the circumstances 'fit' to be ordered.
3. The learned Counsel for the company argued that the company's branch at Vijayawada was closed for they ceased to have business agency at Vijayawada. The two employees were probationers. The Labour Court had regard to these circumstances. Notwithstanding the circumstances, it is argued, by the company compensation was ordered to be paid. This plea, the learned Counsel though attempted to argue, but at the debate, on a consideration of the relevant circumstances, he did not press for the same. The learned Counsel for the employees argued that the 'normal' and 'natural relief was to have reinstated the employees, but, such relief was denied to them. It is in this regard, the Counsel stressed, the company is an All India Company. The company has branches all over India. These two employees should have been reinstated at any place other than at Vijayawada, therefore, the two should have been reinstated.
4. The question when considered from the standpoint of power, it is obvious the Labour Court had power to have regard to relevant circumstances. On this question, this Court in Pamarru Co-operative Marketing Society Ltd. v. N. Venkateshwara Rao (1977) 1 Andh. WR 308, held that the 'natural' and 'normal relief' that would be awarded is to reinstate the two employees; 'if some special circumstances exist', compensation can be ordered. In the instant case, special circumstances were considered and Rs. 10,000/- was ordered compensation to each of the employees. This Court cannot ignore the fact that in exercise of its powers under Art. 226, it cannot act as an appellate authority. The circumstances show that the two employees were probationary officers; the company ceased to have any business at Vijayawada. Having regard to these and other cognate circumstances like pay, salary, the Labour Court, in its discretion, directed compensation to be paid. This decision does not appear to suffer from any error of jurisdiction or from any error apparent from the record.
5. It was next argued by the company that the grant of Rs. 10,000/- is excessive while it was argued on behalf of the employees, compensation is meagre and inadequate. On the question of quantum of compensation, when the counsel pointed out by seeing imponderable circumstances, the company and the employees did not press this part of their attack. Therefore, nothing further need be stated on this aspect of the case.
6. As respect wages, the learned Counsel for the employees argued, the allowance (c) for the period from October, 1973 to December 1, 1977 was denied : allowance (d) between May 3, 1976 was to December 1, 1977 was not ordered. The allowance (e) and increments (f) have completely been denied. It was argued allowance (e) was claimed at Rs. 5/- per month for the period October, 1973 to September 30, 1975. The increments (f) were claimed at Rs. 5/- from October, 1974 to May 3, 1976 and between May 4, 1976 at Rs. 7-50 p.
7. It is necessary to state the wages in toto are claimed under two settlements arrived at under S. 18 of the Act, 14 of 1947. They are known as S. 18 settlements'. The first settlement is dated July 8, 1971, the second settlement is dated May 3, 1976. The employees have allowances (b) to (d) wages under two settlements. Before the Labour Court, the company stated that the two employees have no claim under the first settlement and under the second settlement, their claim can only be considered from December 1, 1977, the date when they were declared to be probationers. This was specifically stated by them in their counter. The learned Counsel, however, in this Court raised the question that the two employees are covered under Clause F of the Time Scales from A to H as per the first settlement. The first agreement was effective from April 1, 1971. This contention that they are covered under Clause F of Time Scale is a question of fact and it was not claimed before the Labour Court nor argued nor any finding has been given in this regard. As to the second settlement, the company in their counter before the Labour Court stated, KL and KM were probationers from December 1, 1977. This was not denied by the employees before the Labour Court.
8. This aspect is now argued on behalf of the employees that there no evidence to show that they were declared probationers from December 1, 1977 and there is no reason as to why the anterior claim of the employees prior to December 1, 1977 should be rejected on that ground. This again is a contention which was not raised before the Labour Court. The two employees did not dispute the date of their declaration of probation. The Labour Court as regards allowance (e) did not give relief on the ground that they are not entitled to claim the same under the first agreement and as regards the house rent allowance (c), attendance allowance (d) their claim prior to December 1, 1977 was denied on the question of fact that they were not entitled to the same for the anterior period.
9. As regards the increments (f), the learned Counsel for the company argued that the company does not object the encashment of privilege leave, but objects encashment of casual leave and special leave. The learned Counsel for the company maintained that so far as the privilege leave is concerned, the employees are entitled to have encashment under Clause (5) of S. 24 of the Shops Act, but there is no provision under the Shops Act enabling them to encash casual leave and special leave.
10. From the orders of the Labour Court it is seen, KL has been given Rs. 2,272-10p. and KM has been given Rs. 2,302-30p. on all the three counts of privilege leave, casual leave and special leave. Since there is no provision in that Act enabling employee to cash casual leave and special leave, that part of the encashment cannot be sustained. Therefore, to the extent of casual leave and special leave, the order of the Labour Court cannot be sustained. In the result, in W.P. Nos. 7638 of 1939 of 1979, there shall be an order that the Labour Court to quantify only the encashment of privilege leave and for that purpose, the case is remitted for passing further orders in the light of this judgment. For all the aforesaid reasons, the rest of the six writ petitions by the company and the employees are dismissed. No costs in all writ petitions.