Skip to content


Management of Kodaikanal Motor Union (P) Ltd., thenkarai, Peria Kutam, Madurai Vs. A. Nallathambi represented by Madurai Motor Labourers' Union Branch thenkarai, Periakulam and Ors. (14.08.1968 - MADHC) - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtChennai High Court
Decided On
Case NumberWrit Petn. No. 4435 of 1965
Judge
Reported inAIR1969Mad374; [1969(18)FLR151]; (1969)IILLJ141Mad
ActsIndustrial Disputes Act, 1947 - Sections 33C(2); Constitution of India - Article 226
AppellantManagement of Kodaikanal Motor Union (P) Ltd., thenkarai, Peria Kutam, Madurai
RespondentA. Nallathambi represented by Madurai Motor Labourers' Union Branch thenkarai, Periakulam and Ors.
Appellant AdvocateS. Chellaswami, Adv.
Respondent AdvocateN.G.R. Prasad and ;J. Kanakaraj, Advs. for ;Govt. Pleader
Disposition Petition partly allowed
Cases ReferredBombay. (The Eastern Chemical Co. (India) Bombay v. Its Workmen). It
Excerpt:
.....') mine). what would appear from the foregoing is that while it may not be a safe precedent in labour management relations, to hold that the dismissal of a worker for misconduct, per se, would disentitle him to payment of bonus for a year when other employees similarly situated but who continued in service had been paid bonus, it will be proper to recognise an exception to this rule in cases where the dismissal has been for misconduct which involved loss or damage to the management. 4. in the present case the order of dismissal passed by the management on 21-11-1961, which i have extracted above, states precisely that it was for misconduct which caused loss to the company. the labour court observed that the management had failed to adduce satisfactory evidence to prove that workers..........case, the issue of dismissal for misconduct of a worker, and whether it would disentitle him to claim bonus. this issue has come in for consideration in several awards of labour tribunals of which the awards in ganesh flour mills co.v. their workmen, 1952 1 lab lj 524 , burmah shell oil co. v. their employees, 1954 1 lab lj 21 (lati at luck) and mill owners association, bombay v. rashtriya mill mazdoor sangh bombay, 1950 2 lab lj 1247 (lati at bom) may be mentioned. in the first decision, the labour appellate tribunal held that employees dismissed for misconduct would not be entitled to claim bonus for the year. in the second of the above decisions the labour appellate tribunal refused to grant bonus to workers dismissed for misconduct involving financial loss to the company. in the.....
Judgment:
ORDER

Ramakrishnan, J.

1. This petition is filed by the Management of the Kodaikanal Motor Union (P) Ltd. aggrieved against the order of the second respondent, the Presiding Officer, Labour Court, Madurai. in a claim petition under Section 33-C(2) of the Industrial Disputes Act, (Act XIV of 1947). The worker in question, first respondent, who filed the claim petition, was employed as a conductor. It is common ground that he was dismissed from service by the management on 21-11-1961, for the reasons stated in the order of dismissal (Ex. M. 6):

'He was dismissed from service as He meddled with the brake tube of the bus MDU 6590 which caused serious accident and damage to the extent of Rs. 3,000/-.' The claim of the worker was that during the year 1959-61, the Management had been paying bonus to its employees at the rate of three months salary. Therefore, notwithstanding that he had been dismissed from service on 21-11-1961, he was entitled to bonus which in his case came to Rs. 135. There was also an amount of Rs. 50, which was in deposit with the Management on his behalf as security and that amount also had to be repaid to him. He also claimed arrears of salary for a certain period and that was disallowed by the Labour Court and there is no challenge now before me about it. But the Labour Court, however, found that the Management was liable to pay bonus to the worker, but the amount was fixed at Rs. 121. and also to return the security deposit of Rs. 50.

2. Learned counsel Sri Chellaswami appearing for the Management in this writ petition argues that in the absence of any award by a competent Tribunal or a settlement between the Management and the workers, the workers cannot enforce the claim for payment of bonus by a claim petition under Section 33-C(2) of the Industrial Disputes Act and that the Labour Court has also no jurisdiction to give a decision about the right to obtain bonus in such a claim petition. This argument, however, appears to me to go against the trend of authority, which is inclined to take a wide view of the scope of the enquiry under Section 33-C(2). Thus in East India Coal Co. v. Rameswar, : (1968)ILLJ6SC , the Supreme Court has laid down that whereas Sub-section (1) of Section 33-C is confined to claims arising under an award or settlement or under Ch. V-A, claims which can be entertained under Section 33-C(2) are not so confined to those under an Award or settlement or Ch. V-A.' No doubt, when there is an award or settlement and the claim under Section 33-C(2) is based upon such an award or settlement, the Court dealing with that claim, as has been laid down in several decisions including the decision above cited, has powers analogous to those of a Court in execution proceedings, and it would be open to the Labour Court to consider the plea of nullity where the award is made without Jurisdiction.

But these last observations do not mean that the jurisdiction of the Labour Court under Section 33-C(2), when a claim for payment of bonus is raised before it, is not confined to its determination only if there is an award or settlement about the bonus, and the Court cannot refuse to give a decision by making a computation, when there are ample materials from which the Court could hold, apart from the existence of an actual award or an actual settlement, that the worker has a right to be paid bonus. From this point of view, I am of the opinion that the absence of an award or settlement will not per se, exclude the jurisdiction of the Labour Court to consider the claim for the computation of bonus by the worker, and I therefore overrule this objection of the petitioner in this case.

3. What the Labour Court has then to consider, when a claim for bonus is made before it under Section 33-C(2) in the absence of an award or settlement, is whether in the light of the particular circumstances in which the claim to bonus is made in the case, the worker's claim could be sustained or not. The general principles in regard to the award of bonus have now come to be fairly settled by reason of the successive decisions in Industrial Disputes arising out of claims for bonus on which awards have been passed by labour tribunals. They relate to the period before the passing of the Payment of Bonus Act. These principles have been summarised in the latest book of V. G. Row, 'Law relating to Industrial Disputes' 3rd Edn. part II page 750. The general principle is that all workmen who have had a hand in earning profits of a particular year would be entitled to bonus, and all apprentices should be entitled to bonus especially when apprentices are also specifically included in the definition of the word 'workmen' in the Industrial Disputes Act, 1947. The bonus should be in terms of the basic wages only and it should not include dcarncss allowance unless there is a custom to so include it or to include any other similar allowance. Then comes the issue which is relevant for the circumstances of this case, the issue of dismissal for misconduct of a worker, and whether it would disentitle him to claim bonus.

This issue has come In for consideration in several awards of Labour tribunals of which the awards in Ganesh Flour Mills Co.v. Their Workmen, 1952 1 Lab LJ 524 , Burmah Shell Oil Co. v. Their Employees, 1954 1 Lab LJ 21 (LATI at Luck) and Mill Owners Association, Bombay v. Rashtriya Mill Mazdoor Sangh Bombay, 1950 2 Lab LJ 1247 (LATI at Bom) may be mentioned. In the first decision, the Labour Appellate Tribunal held that employees dismissed for misconduct would not be entitled to claim bonus for the year. In the second of the above decisions the Labour Appellate Tribunal refused to grant bonus to workers dismissed for misconduct involving financial loss to the company. In the third of the above cited decisions, the Labour Appellate Tribural was of the opinion that for the reasons given by the All India Industrial Tribunal (Bank Disputes) known as the Sen Award, bonus would be payable to employees who had been dismissed for misconduct and a provision to the contrary to it in the award should be deleted. V. G. Row's book above referred to at pages 750-51 gives the relevant findings of the Sen Award in this respect in the following terms-

'As to the second condition, it is pointed out on behalf of the employees that one who is dismissed for misconduct must be regarded as sufficiently punished by the dismissal, and it is contended that he should not again be penalised by forfeiture of the bonus, which may, besides, in respect of a period within which the misconduct did not take place. Such a contention was upheld in an award made by Mr. P. S. Bakhale Industrial Tribunal, Bombay. (The Eastern Chemical Co. (India) Bombay v. Its Workmen). It is also doubtful how far such a provision actually serves as a deterrent against misconduct when the prospect of dismissal does not serve as such. 'There is no doubt, however, that if an employee has defrauded his bank or caused it damage or loss, any claims which the Bank can legitimately have against him should be set off against any claims (including a claim to a bonus) which he may have against the bank.' We think that the conditions as to forfeiture of the bonus on account of dismissal for misconduct is a remnant from the days when a bonus was regarded as a sort of reward or ex gratia payment and, therefore, subject to that we have said above. We are not in favour of its retention.' (Italics there into ' ') mine). What would appear from the foregoing is that while it may not be a safe precedent in Labour Management relations, to hold that the dismissal of a worker for misconduct, per se, would disentitle him to payment of bonus for a year when other employees similarly situated but who continued in service had been paid bonus, it will be proper to recognise an exception to this rule in cases where the dismissal has been for misconduct which involved loss or damage to the Management. In these excepted cases the management would be entitled to withhold bonus to the worker as a set-off against the loss or damage.

4. In the present case the order of dismissal passed by the Management on 21-11-1961, which I have extracted above, states precisely that it was for misconduct which caused loss to the company. The question arises for consideration as to whether the worker not having appealed against that decision or attempted to get the decision reversed in his favour by any of the methods which the statute allows him, could press in proceedings under Section 33-C(2) initiated as in this case, more than three years later, for a fresh consideration by the Labour Court of the circumstances which led to his dismissal. The Labour Court, in the present case, observed that the worker in question gave evidence that he did not meddle with the brake tube and that he did not know what was spent by the company towards its repairs. Thereupon the Labour Court observed that even if he had meddled with the brake tube, the driver could have averted the accident if he was careful enough when he was driving the bus. The Labour Court also referred to the evidence of M. W. 1 that the main duty of the worker in question as a conductor was to issue tickets and collect fare and there was no misconduct in his collections or in his duty as a conductor throughout his service,

It appears to me that it will be entirely out of place for the Labour Court, in proceedings under Section 33-C(2) initiated several years after the original order of dismissal of the worker, to embark on an enquiry about the propriety of the order of dismissal or the terms of the order of dismissal, constituting as it were an appellate authority over the decision of the management. In my opinion that would be totally outside the scope of the powers of the Labour Court in a similar case. So far as the present enquiry about the claim to bonus is concerned, the Labour Court ought to have treated the order of the Management passed in 1961 dismissing the worker for misconduct which caused damage to the Management, as having become final and conclusive as between the Management and the worker.

5. Next, it appears to have been urged before the labour court, that the Management had paid bonus even for workers dismissed for misconduct in prior years. The Labour Court observed that the Management had failed to adduce satisfactory evidence to prove that workers dismissed for misconduct were not paid bonus in any year preceding 1960-61. It appears to me that this way of approach to the matter in dispute involves the placing of the burden of proof on the wrong party. Once it was established that the worker had been dismissed for misconduct, involving loss or aamage to the Management, under the general principles referred to earlier mentioned in the Sen Award, prima facie, the worker would be disentitled to a claim for bonus. It will be for the worker to prove that in the particular management wherein he is employed there was a practice contrary to the general principles laid down. In such circumstances it will be for him to adduce evidence about it. The approach of the Labour Court in this case regarding this aspect of the case involves therefore a wrong approach in regard to the burden of proof. In fact, the worker in the course of his evidence in this case has only alleged that 'it was incorrect to say that only workers who were working satisfactorily were paid bonus'. He has not asserted that the workers dismissed for misconduct, involving loss to the Management, had been paid in earlier years bonus by the Management. It appears, therefore, that the decision of the Labour Court in this case that the first respondent is entitled to bonus notwithstanding that the order of the Management terminating his services for misconduct involved loss to the management and had become final, is not based on correct principles as laid down by the well-known awards in the case of industrial disputes, including the Sen Award dealing with the matter. The order of the Labour Court, therefore, requires to be set aside and writ of certiorari so far questioning the direction regarding payment of bonus has to issue.

6. With regard to the claim for repayment of the security amount, it is urged by the learned counsel for the Management that since the order of dismissal involves a finding that the worker had caused loss to the Management, the Management would be entitled to retain the security amount as a set-off against that loss. Here, however, the position is different from the case of bonus; prima facie, the money belongs to the worker and in the normal course he would be entitled to get a refund of it. It was for the Management to prove satisfactorily when the matter came before the labour court in a claim petition under Section 33-C(2), that the Management had a lien on that money for loss caused to it by the worker's misconduct. Necessary evidence establishing the link between the worker's conduct and the loss to the Management should have been adduced in the context of the return of the security money. For that purpose the observations of the labour court relating to the insufficiency of the evidence adduced by the Management on this aspect of the case become relevant.

The proper analogy for dealing with this aspect of the claim can be deduced from the principles laid down in the Payment of Wages Act, 1936, where the Management seeks to make a deduction against the worker's claim for wages on account of damage or loss caused by the worker to the employer. In such a case, Section 10(1-A) of the said Act states that the management should give an opportunity to the worker to show cause against the deduction and adduce satisfactory evidence to support this claim. In my opinion, that evidence, as found by the labour court, is lacking in this case. Therefore, the claim of the worker for repayment of the security deposit amount must be allowed.

7. There was an argument finally urged by the learned counsel for the worker, first respondent, that the amounts involved are very small and that this court, while exercising its discretionary power under Article 226 of the Constitution, should be slow to interfere with the decision of the Labour Court. But a claim was put forward strenuously on behalf of the petitioner that in dealing with the question of bonus in this case, a principle of considerable importance in the consideration of labour-management relations is involved and a decision is necessary without dismissing the writ petition as dealing with amounts of no great value. I was inclined to agree with this contention and heard arguments for and against. That is the reason why the matter had to be considered at some length and a decision given as above.

8. The writ petition is allowed in part as stated above and dismissed in other respects. No order as to costs.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //