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South Indian Bank Ltd. Vs. P.T. Antony and anr. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtKerala High Court
Decided On
Judge
Reported in(1980)IILLJ42Ker
AppellantSouth Indian Bank Ltd.
RespondentP.T. Antony and anr.
Excerpt:
- - this the learned judge sought to make good in proceedings under article 226, by discussing the evidence in regard to the terms and conditions of employment and the nature of the business on which the 1st respondent was engaged, and came to the conclusion that the 1st respondent was as employee liable to be dealt with under the shops and commercial establishments act and competent to prefer an appeal there under......this appeal is by the south indian bank ltd. a non-nationalised bank against the judgment of a learned judge who dismissed the appellant's writ petition to quash ext. p3 order of the appellate authority, under the kerala shops and commercial establishments act, allowing the 1st respondent's appeal against the order of termination passed by the bank against him. this writ appeal was posted and heard along with w.a. no. 298 of 1977 arid o.p. 1419 of 1978. but as the other cases related to nationalised banks and involved certain other fundamental questions, it was felt unnecessary to club this appeal along with those cases. this appeal is accordingly disposed of separately.2. the respondent was a canvasser for deposits engaged by the bank on terms of a contract evidenced by ext. p1,.....
Judgment:

Gopalan Nambiyar, C.J.

1. This appeal is by the South Indian Bank Ltd. a non-nationalised bank against the judgment of a learned Judge who dismissed the appellant's writ petition to quash Ext. P3 order of the Appellate Authority, under the Kerala Shops and Commercial Establishments Act, allowing the 1st respondent's appeal against the order of termination passed by the Bank against him. This writ appeal was posted and heard along with W.A. No. 298 of 1977 arid O.P. 1419 of 1978. But as the other cases related to Nationalised Banks and involved certain other fundamental questions, it was felt unnecessary to club this appeal along with those cases. This appeal is accordingly disposed of separately.

2. The respondent was a canvasser for deposits engaged by the Bank on terms of a contract evidenced by Ext. P1, dated 14th June, 1972. According to the terms of Ext. P1 the Bank was to allow the 1st respondent to canvass deposits for it, for a term of five years. The Bank was to pay the canvasser a commission of Rs. 2 for every Rs. 100 collected by the canvasser from depositors and accounted to the Bank. The commission payable for remittance made during the calendar month was to be paid on the last working day of that month. We are not going into the other terms and conditions of Ext. P1 in view of the course that we propose to adopt. The agreement was followed by Ext. P2 letter dated 14th June, 1972 written by the 1st respondent to the appellant-Bank, in which the 1st respondent declared that he had executed Ext. P1 agreement fully understanding the implications of the terms and conditions contained therein, and stated that:

I am in no way in the employment under the Bank. I also declare that I will not raise now or in future any claim by virtue of the work I am doing in terms of the agreement for any right or benefit arising out of the provisions in any Act or Award that is applicable now or that will be made applicable in future,

The 1st respondent's services were terminated; and against the order of termination he filed an appeal under the Shops and Commercial Establishments Act. Objection was taken to the jurisdiction of the Appellate Authority who heard the appeal on the ground that the canvasser was not an 'employee' as defined under the Act and that no appeal would lie to the authority. Section 2 Sub-section (6) of the Act defines the term 'employee' thus:

'employee' means a person wholly or principally employed in, and in connection with, any establishment and includes an apprentice.

Section 18 Sub-section (2) provides for an appeal in these terms:

18(2). Any employee whose services are dispensed with may appeal to such authority and within such time as may be prescribed either on the ground that there was no reasonable cause for dispensing with his services or on the ground that he had not been guilty of misconduct as held by the employer.

It will thus be noticed that only an employee who satisfies the definition under Section 2(6) is entitled to maintain the appeal under Section 18(2) of the Act. The appellant's contention was that a canvasser is not an employee of the Bank and therefore the appeal was not maintainable. The Tribunal noticed that there was a Government notification under Section 4 of the Act, making the Act applicable even to canvassers of deposits, withdrawing the immunity conferred on them by Section 3(b) of the Act. In view of this, the Tribunal seems to have held that the 1st respondent could no longer claim exemption from the operation of the Act and was an employee for the purpose of the Act. It was in that view that it allowed the appeal and directed reinstatement of the employee with backwages of Rs. 6,000 and also payment of a sum of Rs. 316 as compensation in lieu of reinstatement within thirty days. It was this award that was sought to be quashed by the appellant.

3. The learned Judge noticed that the Tribunal's Award was unsatisfactory. The only ground on which the Tribunal rested its award was that the immunity conferred by Section 3(b) having been withdrawn under Section 4, the 1st respondent must be regarded as an employee. But this was quite unsatisfactory reasoning. The withdrawal of an immunity alone will not constitute the 1st respondent an employee, unless he satisfies the requirements of the definition of the term under Section 2 Sub-section (6) of the Act. About this, there was no independent consideration or discussion or finding by the Tribunal. This the learned Judge sought to make good in proceedings under Article 226, by discussing the evidence in regard to the terms and conditions of employment and the nature of the business on which the 1st respondent was engaged, and came to the conclusion that the 1st respondent was as employee liable to be dealt with under the Shops and Commercial Establishments Act and competent to prefer an appeal there under.

4. Counsel for the appellant has objected to the learned Judge having sustained the order of the Tribunal, by discussing and considering matters of evidence, and facts which ought to have been appreciated by the Tribunal. We think this criticism of counsel for the appellant is justified and must be sustained. Having rightly found that the Tribunal's reasoning for holding that the 1st respondent was an employee of the Bank cannot be sustained, the learned Judge should have remitted the matter back to the Tribunal for fresh disposal instead of having discussed the evidence himself in writ proceedings and entered a finding on the basis of the facts and the evidence disclosed by the records. This is one of the infirmities in the judgment of the learned Judge.

5. More serious and fundamental seem to be certain other objections raised by counsel for the appellant. We have extracted the definition of the term employee in Section 2 Sub-section (6) of the Act. The question requires to be considered seriously whether the 1st respondent was an 'employee' of the appellant, Bank and if so whether he was employed wholly or principally in connection with the appellant's establishments This must, to a great extent, depend upon the terms and conditions of the contract Ext. P1, supplemented, as we see, by the letter Ext. P2. Of relevance certainly, is the statement to which the 1st respondent has subscribed that he was in no way in the employment of the bank. A fresh approach to the question in the light of the materials is indicated ; and the learned Judge, in our view, was wrong in taking upon himself the responsibility of discussing and deciding the matter in writ proceedings when the Tribunal itself had not chosen to consider and to enter a finding on the merits in regard to the question.

6. There is, again, another aspect of the matter which appears rather unsatisfactory. The Tribunal directed payment of backwages. We have referred to the terms of Ext. P1 contract according to which the canvasser was to be paid remuneration by way of commission at a certain percentage of the deposits canvassed by him. This being the contract between the parties, it is difficult for us to imagine and understand how the Tribunal decreed backwages, and on what basis it proceeded to assess the back wages at a sum of Rs. 6,000 as done by it. The law of average seems ill suited to mulct an employer on the ground that had an employee continued in employment he would have procured so much of work and earned so much of commission. We are not expressing ourselves either finally, or more fully on the question, as, on this ground again, we feel that the matter requires a second look and a fresh consideration by the Tribunal.

7. For reasons noticed above, and in the circumstances, we allow this appeal and set aside the judgment of the learned Judge. O.P. No. 528 of 1977K will stand allowed and Ext. P3 decision of the Appellate Authority will stand quashed and the Shop Appeal No. 8 of 1974 will stand remitted back to that Authority for fresh disposal in accordance with law and in the light of the observations contained in this judgment. We make no order as to Costs.


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