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Kannan Devan Hills Produce Company Ltd. (by General Manager, J.B. Soutar) Vs. Labour Court and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtKerala High Court
Decided On
Judge
Reported in(1967)IILLJ631Ker
AppellantKannan Devan Hills Produce Company Ltd. (by General Manager, J.B. Soutar)
RespondentLabour Court and ors.
Cases ReferredLtd. v. Industrial Tribunal
Excerpt:
.....labour practice, (iii) when the management has been guilty of a basic error or violation of a principle of natural justice, and (iv) when on the materials, the finding la completely baseless or perverse. on the other hand, the passage extracted above clearly states that when a dispute arises, industrial tribunals have been given the power to see whether the termination of service of a workman la justified and to give appropriate relief. the result is that the petitioner failed to establish before respondent 1 that the action taken against cherian was for just and sufficient reasons......of tea to the visiting agent, it was no longer possible for the petitioner to keep him as a tea-maker. cherian understood the position, and accepted the decision of the petitioner to transfer him to another as a time keepar without any deduction in emoluments. according to respondent 2, cherian's transfer was a punishment imposed without any justification and without any enquiry; and it was an act of victimization. it denied that the petitioner was getting adverse remarks about cherian; and contended that the existence of such adverse remarks, if any, had never been brought to the notice of cherian, and that he was not given an opportunity to meet or explain the same. regarding the interview of the visiting agent of the petitioner with cherian, respondent 2 stated that the interview.....
Judgment:

M.U. Isaac, J.

1. One P. A. Cherian was an assistant tea-maker In the employment of Kannan Devan Hills Produce Company, Ltd., who is the petitioner in this case. The petitioner found him Incompetent for this work; and he was, therefore, transferred to another estate of the petitioner as factory timekeeper, on the same salary and appropriate allowances with effect from 1 December 1961. The Estates Staffs Union of South India, Munnar, who is respondent 2 In this case, objected to the action taken by the petitioner, and raised a dispute. At Its instance, the State of Kerala, who is respondent 3, made a reference of the dispute under Section 10(1)(c) of the Industrial Disputes Act, 1947, for adjudication to the labour court, Quilon, who is respondent 1 in this case. This reference was filed as Industrial Dispute No. 21 of 1963; aid respondent 1, by Its award made on 8 October 1965 and published In Part I of the Kerala Gazette No. 49, dated 21 December 1965, held that the transfer of P. A. Cherian was unjustified and not proper and directed the petitioner to transfer him book as assistant tea-maker. Exhibit A Is a copy of this award. This original petition has been filed to quash the said award.

2. Cherian joined the petitioner's service In 1934 as an apprentice in a tea factory, and In 1935, he was promoted as a timekeeper. In 1939 he was promoted as assistant tea-maker. He has also acted as head tea-maker In leave vacancies. According to the petitioner, the circumstances under which he was sent back as timekeeper In 1961 are the following: From 1951-62 onwards, the yearly confidential reports received by the petitioner regarding Cherian's work contained adverse remarks. Towards the end of 1961, the visiting agent of the petitioner Inspected the factory In which Cherian was working. He was questioned about various aspects of tea-manufacturing; and It was found that he did not even know many of the elementary things relating to the manufacture. Thereafter Cherian was called to the headquarters office; and the Industrial relations officer of the petitioner explained to cherian that, since the annual reports regarding his work were adverse for a number of years, and also because he was not able to answer elementary questions regarding the manufacture of tea to the visiting agent, It was no longer possible for the petitioner to keep him as a tea-maker. Cherian understood the position, and accepted the decision of the petitioner to transfer him to another as a time keepar without any deduction In emoluments. According to respondent 2, Cherian's transfer was a punishment Imposed without any justification and without any enquiry; and It was an act of victimization. It denied that the petitioner was getting adverse remarks about Cherian; and contended that the existence of such adverse remarks, If any, had never been brought to the notice of Cherian, and that he was not given an opportunity to meet or explain the same. Regarding the interview of the visiting agent of the petitioner with Cherian, respondent 2 stated that the interview was at a time, when Cherian was mentally upset by the death of his brother, and that the wrong and wars said to have been given to him under such circumstances did not constitute a sufficient ground for the demotion of Cherian, who had 22 years of service as assistant tea-maker, and was due to be promoted as head tea-maker. Respondent 1 found that the action taken against Cherian was a punishment, that. the petitlonar's contention that it was done with the consent of Cherian was not sustainable, that no enquiry was conducted before the said punishment was effected, and that the petitioner did not place sufficient materials before respondent 1 to Justify the said action. The petitioner's learned Counsel contended before me that respondent 1's finding that the action of the petitioner amounted to a punishment was without any basis and perverse, and that Cherian's transfer was a bona fide action made by the petitioner in its business Interest.

3. The reasons for and the circumstances under which Cherian was transferred as a timekeeper are best stated In the letter which the petitioner wrote to Cherian on 21 November 1961. This letter Is extracted in Ex. A; and it reads as follows:

I refer to Sri W.C. Roy's recent inspection of 'Grahamsland factory and the written explanation which you have submitted to the manager of Grahamsland estate on 2 October 1961 and the Interview which you had with the undersigned on 31 October during which I explained to you that in the light of the past reports on you and your extremely unsatisfactory performance during Sri Roy's Inspection, it Is no longer possible for the company to have the responsibilities of an assistant tea-maker in your hands. You understand the position and accepted my decision that you will be transferred to another factory where you will be employed as a factory timekeeper. Accordingly I am Instructing the manager of Grahamsland to transfer you to Nettigudi estate with effect from 1 December 1961 where you will work as a factory timekeeper. Although you will be employed as a factory timekeeper in Nettigudi, you will continue to draw your present basic salary of Rs. 180 per month and the appropriate allowances.

In this connexion I would like to advise you that unless yon convince the manager of Nettigudi by sustained good work that you are capable of assuming once again the responsibilities of an assistant tea-maker, you may not ba considered for promotion in future. I am sure you will bear this in mind and do everything to rectify the deficiencies.

It is evident from the above letter that the reasons for sending out Cherian as a timekeeper are:

(1) the alleged extremely unsatisfactory performance of Cherlan during the inspection of the factory by the visiting agent; and

(2) the past reports said to contain adverse remarks about him.

There can be little doubt that the employer is entitled to put a worker in any section of the establishment, which the employer thinks best suited in the Interest of the Industry, provided it does not cause any detriment to the worker. The transfer of Cherian as a timekeeper, who was formerly promoted from that post, and has worked as an assistant tea-maker for 22 years, and who, In the ordinary course, could expect to be further promoted as head tea-maker, with a warning that he would not be considered In future for promotion as assistant tea maker, unless he convinced the manager of the estate by sustained good work, certainly causes humiliation to Cherian as a worker, and affects his career In the employment of the petitioner In several respects. It was admittedly a demotion from office.

4. The petitioner's learned Counsel, however, contended that It was not a punishment, as the demotion was not on account of any misconduct, and that the action taken by the petitioner was not, therefore, liable to be questioned by the worker. According to the learned Counsel, if the action taken against a worker is not a punishment, It can be set aside In an Industrial adjudication, only If it is established to be a mala fide act or an act of victimization. I am unable to accept this contention. In my opinion, It makes no difference whether the action taken against a worker is termination of his service, demotion from office, or anything else which causes a detriment to him or whether it was taken for misconduct, neglect of duty, inefficiency or incompetency. An action causing a detriment to the worker cannot be taken by an employer by way of punishment or otherwise, except on sufficient and reasonable grounds. The learned Counsel referred me to a decision of Raman Nayar, J., in Kannan Devan Hills 'Produce Co. Ltd. v. its workmen and Ors. 1965 K.L.J. 181 In support of his contention. In this case, the service of a motor-oar driver was terminated by the employer for incompetency. This gave rise to a dispute and a reference to as Industrial tribunal. The tribunal held that the termination of service of the worker was not bona fide, but a colourable exercise of power by the employer. This finding was based on two assumptions, namely, that the Impugned action was taken by the employer for misconduct and that, In snob a case, action can be taken only as a punishment after a due enquiry. His lord ship held that the second assumption was a patent error, and It vitiated the award. He set aside the award, and remitted the case back to the tribunal to decide the case afresh, after determination of the sole issue whether the termination of service of the worker was for reasonable cause. Some of the observations contained in this decision are very pertinent to the point under consideration. Regarding the contention that the tribunal's assumption, that the term ination of service was for misconduct was erroneous, and that no question of any enquiry arose, If it was not for misconduct, the learned Judge observed :. In law, it seems to me to make no difference whether the charges were of misconduct or of something not amounting to misconduct.

And his lordship held:

What the employer has to show, and what an industrial tribunal is to consider and decide is whether there was reasonable cause, Irrespective of whether or not -that cause amounts to misconduct.

I respectfully agree with the above proposition.

5. The petitioner's learned Counsel, than referred ma to the decision of the Supreme Court in Indian Iron and Steel Co. Ltd., and Anr. v. their workmen 1958-I L.L.J. 260 in support of his contention, and relied on the following passage appearing in the said decision at p. 269:. Undoubtedly, 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 of a workman la Justified and to give appropriate relief. In oases of dismissal on misconduct, the tribunal does not, however, act as a Court of appeal and substitute lea own judgment for that of the management. It will Interfere

(i) when there IB a want of good faith,

(ii) when there la victimization or unfair labour practice,

(iii) when the management has been guilty of a basic error or violation of a principle of natural justice, and

(iv) when on the materials, the finding la completely baseless or perverse.

6. The learned Counsel submitted that these are the only four circumstances under which an Industrial tribunal can Interfere with an action against a worker by his employer. I do not agree with this submission. The four circumstances indicated by the Supreme Court In the above passage are circumstances under which an industrial tribunal can Interfere with the dismissal of a worker for misconduct, as a result of a domestic enquiry, and not the circumstances, under which alone the Industrial tribunal can Interfere with an action taken against a worker. On the other hand, the passage extracted above clearly states that. when a dispute arises, industrial tribunals have been given the power to see whether the termination of service of a workman la Justified and to give appropriate relief.

This is against the contention of the learned Counsel.

7. Reference was also made by the petitioner's learned Counsel to the decisions of the Supreme Court in Assam Oil Co. Ltd. v. its workmen 1960-I L.L.J. 687; Chartered Bank, Bombay v. Chartered Bank Employees' Union and Anr. 1960-II L.LJ. 222; Canara Banking Corporation v. Vittal 1963- II L.L.J. 354 and Murugan Mills, Ltd. v. Industrial Tribunal, Madras, and Anr. 1965-I L.L.J. 422. These decisions only reiterate the propositions laid down In Indian Iron and Steel Co. case 1958-I L.L.J. 260 (vide supra). The question arising In the Instant casa la whether, when a dispute is raised regarding the action taken against a worker, If It be for misconduct or for some cause not amounting to misconduct, the Industrial tribunal la entitled to enquire and find feather It was taken for just and sufficient reasons. This question did not arise in any of the above four decisions of the Supreme Court; and It la not, therefore, necessary to examine them. On the other hand, the observations contained In the judgment of Raman Nayar, J., In Kannan Devan Hills Produce Co. Ltd. v. its workmen and Ors. 1965 K.L.J. 181 (vide supra) and in the decision of the Supreme Court In Indian Iron and Steel Co. Ltd., and Anr. v. its workmen 1958-I L.L.J. 260 (vide supra) are authorities for the proposition that the Industrial tribunal has got the power to enquire into and see whether the action taken against the worker was justified. Therefore, the question arises for determination In this case whether the demotion of Cherlan from his post was for just and sufficient reasons.

8. The learned Counsel for the petitioner contended that the demotion of Cherian was with his consent, and hence respondent 2 is not entitled to raise a dispute In respect of the said action. This contention was advanced before respondent also ; but It was not accepted. The alleged consent was admittedly a choice by Cherian of the two evils proposed to be meted out to him, one of termination of service and the other of demotion. I am prepared to assume that Cherian agreed to suffer the lesser evil, and that the petitioner's action was In accordance with the said agreement. Eat this is no answer under the industrial law, to a dispute raised by the worker regarding the propriety and the justice of the action taken against him. Agreement of the worker concerned la no justification for a punitive or detrimental action taken against him. The doctrine of the absolute freedom of contract has to yield to the higher claims of social Justice. A worker la always entitled to question the propriety and justice of a punitive or detrimental action taken against him, in applet of any contract between the employer and the worker, or the worker's consent to suffer the said action. In Assam Oil Co. Ltd. v. its workmen 1960-I L.L.J. 587 (vide supra) the Supreme Court said:

In other words, the jurisdiction of the Industrial tribunal to direct reinstatement of a discharged or dismissed employee is no longer In doubt. That being the nature and extent of the Jurisdiction of the Industrial tribunal, it IB too late now to contend that the contractual power of the employer to discharge his employee under the terms of the contract cannot be Questioned In any case.

9. I now proceed to consider the question whether the demotion of Cherian was on sufficient and reasonable grounds. Admittedly no enquiry was conducted by the petitioner, before It came to the conclusion that Cherian was Incompetent to be continued as an assistant tea-maker. Respondent 2 has got a case that Cherian's demotion was an act of victimization, but there Is no material In support of this allegation. Respondent 1 has not also found that the demotion of Cherian was an act of victimization, If the petitioner had conducted an enquiry In accordance with the principles of natural Justice and found that Cherian was Incompetent to work as an assistant tea-maker, the said finding would have justified the action taken against him; and It would not have been open to the worker to canvass the correctness of the said finding. Hence the petitioner has to let In evidence before respondent 1 to show that the action taken against the petitioner was Justified. On this point respondent 1 states:

According to the management, the result of Sri Roy's inspection in 1951 only prompted them to take immediate action against Cherian, and the managemant was already contemplating such a move on the basis of the earlier reports received from the several managers, regarding the Incapacity or Inefficiency of 0 Her Ian. These adverse reports have not been produced before this Court. What exactly happened when Sri Roy Inspected Crahamsl and factory in November 1931 is also not placed before this Court accurately or In sufficient detail by the management.

All that was produced before respondent 1 to Justify the action taken against Cherian was the letter, dated 31 November 1961, which the petitioner wrote to Cherian Informing Its decision to demote him, and the reasons 'for the same. Absolutely no materials were placed before respondent 1 to substantiate the reasons stated In the above letter. The result is that the petitioner failed to establish before respondent 1 that the action taken against Cherian was for just and sufficient reasons. Respondent 1 was, therefore, right in setting aside the action taken against Cherian, and directing his reinstatement to the post of a tea-maker which he was holding before the demotion.

10. The petitioner's learned Counsel contended that respondent 1 proceeded on the assumption that the action taken against Cherian was a punishment, that this was an error apparent on the face of the records, and that the whole award is vitiated, as It 10 based on this patent erroneous assumption. It IB true that respondent 1 has considered the question whether Cherlan's demotion was Justified or not, on the assumption that it was a punishment. At the same time, he has not found that this action was taken for any alleged misconduct of Cherian. So, whether the use of the expression ' punishment ' was right or not in such a context. It is apparent that all that was meant by the use of this word is the action taken against the worker to his detriment. However, In view of my finding, that, in all oases of a detrimental action taken against a worker, whether it be for misconduct or for a cause not amounting to misconduct, the employer has to establish that It was takan for Just and sufficient reasons, It makes no difference whether the said action amounted to a punishment or not. Respondent 1 states In its award:

The management has also not placed sufficient materials before this Court on which the decision of the management is alleged to have been based.

No exception can be taken to the above finding of respondent 1. Hence the learned Counsel's contention that the award la vitiated by error apparent on the face of It, cannot succeed.

11. In the result, I dismiss this original petition. The petitioner will pay the costs of respondent 2.


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