B.N. Banerjee, J.
1. The petitioner firm carry on business as manufacturers of umbrellas, at No. 252-C, Chittaranjan Avenue, in the town of Calcutta. The demand for umbrellas being of seasonal nature the work of umbrella manufacture is carried on in the factory of the petitioner firm for about seven months in the year, namely from the month of January or February to August. It is stated in the petition, that at the beginning of each manufacturing season workmen are engaged in the factory on the basis of estimated seasonal requirement, on piece rate basis. Excepting a skeleton staff, the factory of, the petitioner firm does not, it is stated, employ any workmen during off-season.
2. This version is not, however, admitted in the affidavit-in-opposition affirmed on behalf of respondents Nos. 2, 3 and 6 to 13 (namely, the All India Chhata Karkhana Mazdur Union, workmen of the petitioner said to be represented by All India Chhata Karkhana Mazdur Union and certain dismissed workmen, hereinafter referred to). It is therein stated that the ending of the manufacturing season does not out an end to the contract of service and all workmen, except those temporarily employed in the previous season, retain a lien on the next season's employment and are entitled to be employed when the season starts.
3. It is further stated in the petition, that there are a number of umbrella manufacturing factories In Calcutta and the workmen employed in such factories are members either of 'Calcutta Chhatakarkhana Mazdoor Union' or 'All-India Chhata Karkhana Mazdur Union'. It is also stated in the petition; that tie workmen often change their member-ship in the two trade unions and whenever they change their membership of the trade unions, the petitioner firm have to approach the trade union, which controls the workmen, for the purpose of recruitments of workmen in the factory. In February 1960, it is alleged in the petition, 'Calcutta Chhata Karkhana Mazdur Union' succeeded in capturing the loyalty of workmen in the factory of the petitioner firm, excepting that of respondents Nos. 6 to 13 and two others, who opposed any change over. This resulted in a violent dispute between workmen and workmen, on February 4, 1960. On February 5, 1960, the work-Tien, it is alleged, who had gone over to the 'Calcutta Chhata Karkhana Mazdur Union' prevented respondents Nos. 6 to 13 and two others from working in the petitioner's factory and on the very next day presented to the petitioner firm a demand in writing calling upon the petitioner firm not to employ respondents Nos. 6 to 13 and two others any further. At a later stage, however, they relented in respect of the other two persons and allowed them to rejoin their work but, it is stated, the petitioner firm could not take back respondents Nos. 6 to 13, due to obstruction by the workmen, who were members of 'Calcutta Chhata Karkhana Mazdur Union. The result was that respondents Nos. 6 to 13 stood dismissed.
4. The aforesaid version, however, is not admitted by respondents Nos. 2, 3 and 6 to 13, In their affidavit-in-opposition. They say that the petitioner firm were in active sympathy with the persons, who staged the demonstration on February 4, 1960, and were keen to see that their workmen all belonged to Calcutta Chhata Karkhana Mazdur Union. They deny that the dismissed workmen (respondents 6 to 13) were ever prevented from working in the factory of the petitioner firm. They say that the letter, dated February 6, 1960, was prepared by the leaders of the Calcutta Chhata Karkhana Mazdur Union and the signatories were made to sign the same under threat of violence held out by the said leaders as well as influence exerted on behalf of the petitioner firm. On the aforesaid allegation the blameworthiness for the wrongful dismissal of respondents Nos. 6 to 13 was sought to be attached to the petitioner firm.
5. The dismissal of respondents Nos. 6 to 13 gave rise to an industrial dispute and the said disoute was ultimately referred by the respondent State Government to the Second Labour Court for adjudication.
6. The Second Labour Court came to the following conclusions:
(a) 'The company has raised a preliminary objection that this is not an industrial dispute on the ground that the workmen in the employment of the company are not members of the union which has raised the present dispute ****** it is in evidence that at least upto 4th February, 1960, if not up to a later date, most of the workers in the employment of the company were members of the Union which has raised the present dispute. Later most of the workers became members of a rival union. The question whether a particular union has a locus standi to raise an industrial dispute depends on the fact whether at the time of the raising of the dispute a large number of workmen in the establishment are members of that union, in the present case it is clear from evidence that almost all the workmen in the employment of the company were members of All India Chhata Karkhana Mazdoor Union, the union mentioned in the order of reference. The subsequent conduct of the workmen in joining another union does not affect the question whether this is an industrial dispute. So I hold that this is an industrial dispute.'
(b) '' * * * the contention of the Union that 10 workmen were refused work on 5th February, 1960 on account of their trade union activities falls to the ground. Though the resolution of the other workmen and their letter to the company are dated 6th February, 1960, it is clear from evidence that they communicated their request to the company on 5th February, 1960 not to give work to the 10 workmen. It is also clear from evidence that the company dismissed the eight workmen mentioned in the issue of the order of reference out of a deference to the wish of the other workmen in the factory. The company has tried to justify its action by saying that in the matter of appointment and dismissal of workmen it is hound to carry out the directions of the majority of the workers. The company has not adduced any evidence to show that it did so in any earlier instance. I am not aware of the existence of any employer in this country who arts according to the direction of the majority of his workmen in the matter of appointment and dismissal of workmen. The union has rightly pointed out that the dismissed workman were in the service of the company and of nobody else. So the company has to accept the responsibility of their dismissal; the question at whose instance it did so is immaterial in the present adjudication.'
(c) 'An employer in order to support a dismissal must prove a misconduct leading to the dismissal. In the present case the company has not issued any charge-sheet to any of the dismissed workmen. So there is no allegation of any misconduct against them. Thus the position is this that the company has dismissed the eight workman mentioned in the issue of the order of reference for nothing. Hence I hold that their dismissal is unjustified. Accordingly I order that they should be reinstated and be paid wages for the period of their unemployment. It is in evidence that the factory of the company is more or less a seasonal one and all the eight workmen mentions in the issue of the order of reference did not work throughout the year. It is also on evidence that they were piece-rated workers. So I order that they shall be paid wages from 5th February, 1960 until the date of their reinstatement at the rate of their average earning for one year prior to 5th February, 1960.''
7. Against the award of the said Labour Court, the petitioner moved this Court praying, inter alia, for a Writ of Certiorari for the quashing of the award and for a Writ of Mandamus restraining the Labour Court and the State Government from giving effect thereto and obtained this Rule.
8. Mr. Sankar Ghosh, learned Advocate for the petitioner firm, raised a two-fold contention in support of the Rule. He contended, in the first place, that the procedure adopted by the Labour Court in making the award was faulty; he contended, in the next place, that there was error apparent on the face of the award and the same deserved to be quashed.
9. The first line of the argument of Mr. Ghosh has two branches. He contended firstly that regard being had to the nature of the dispute, the Labour Court properly had exercised its discretion in allowing the petitioner firm being represented by lawyer but was wrong in reversing that discretion at a later stage of the proceeding when it disallowed further appearance of any lawyer on behalf of the petitioner firm. A close scrutiny of the order sheet, however, shows that this argument is not factually correct. It appears from Order No. 2, dated June 25, 1960, that the petitioner firm filed a letter authorising two advocates to represent their case before the Labour Court. The onlyorder that was made on that letter was that the same be kept with the record. It further appears from Order No. 7, dated September 3, 1960, as follows :
''Union files a petition objecting to the appearance of lawyers on behalf of the company. Copy to the company. No lawyer will be allowed to appear in this case.'
10. It then appears from Order No. 11, dated December 13, 1960, as hereinbelow set out:
'Shri Phani Ghosh, Vice-President, appears for the Union, Shri P. K. Sanyal, Advocate with Shri T. P. Chatter-jee, Advocate, appears for the company.
At the outset Shri Phani Ghosh presses the objection of the union to the appearance of any lawyer on behalf of the company. As against this objection, Shri P. K. Sanyal, Advocate contends that the company filed a petition on 24-6-1960 authorising Shri P. K. Sanyal Advocate-and Shri T. P. Chatterjee, Advocate to represent it in this case; Shri P. K. Sanyal, Advocate filed on 26-7-1960 on behalf of the company the petition which was to be heard today, and the union filed a petition in reply to that petition on 10-8-1960; but the union did not raise any objection to the appearance of a lawyer even upto 10-8--1960 the union raised the objection on 3-9-1960. So Shri P. K. Sanyal argues that the objection is delayed and as such should be rejected. Shri Phani Ghosh contends that the Union had no knowledge of the authority filed on 24-6-80. The record shows that the Union had no specific notice of the authority; but the Union received a copy of petition filed by Shri P. K. Sanyal on 26-7-1960. So the union could file the objection on 10-8-1960, the date on which it filed the petition in reply to the petition of the company dated 26-7-1960. In that sense there has been a little delay on the part of the Union in raising the objection. But I do not see why the objection should be rejected for delay. The hearing of the case has not yet been started. It cannot be raised that the Union has given implied consent to the appearance of a lawyer on behalf of the company. The company has not been prejudiced in any way by the delay in raising the objection. So I uphold the objection and under Section 36(a) of the I. D. Act. Ordered that the company will not be allowed to be represented by any lawyer.'
11. Notwithstanding all that, it appears from Order No. 19, dated August 4, 1961, as follows:
'The union withdraws the lawyer's objection. Shri Lenin Roy, Advocate with Shri Ananta Sarkar, Secretary appears for Union Sri P. K. Sanyal, Advocate appears for the company, case opened * * * * *'.
12. Thereafter, the parties were represented before the Labour Court by lawyers throughout. No notice was taken of the last quoted order and only a part of the order sheet, exclusive of the last quoted order, was annexed to the petition. That accounts for the factually mistaken argument. 1, therefore, reject this argument as wholly devoid of substance.
13. The second branch of the first line of argument is that the Labour Court was wrong in rejecting an application by the petitioner firm, dated July, 26, 1960, praying that the dispute being really one between workers and workers, who were members of rival trade Unions, the workers who had objected to the further employment of the dismissed workmen should be summoned to appear as parties to the proceeding. It was also contended, that the Labour Court was wrong in rejecting an application, dated May 11, 1961, by workmen in the petitioner firm, who were members of the 'Calcuta Chhata Karthana MazdurUnion', praying to be impleaded as parties to the proceeding. The first mentioned application was rejected by the Labour Court by an order, dated January 17, 1961, with the following observations :
'The company filed a petition on 26-7-1960 prayingthat certain persons described as workmen and mentioned in the list to the petition should be made parties in this case. The Union objected to that prayer by a petition dated 10-8-1960.
***** The question whether the Company was forced to dismiss the workmen mentioned in the order of reference at the direction of other workmen relates to the decision of the issue mentioned in the order of reference, This question can be no valid reason for summoning the other workmen as parties in the dispute. As has been rightly pointed out by Shri Ghosh, appearing for the union, the company and not the other workers has dismissed the workman in question. Further the order of reference itself makes all workmen in the employment of the company parties to the dispute; all workmen obviously include the workman mentioned in the list attached to the petition of the company.
In view of the above considerations, I hold that there is not substance in the petition of the company filed on 26-7-1360; hence I reject it. So I order that the workmen mentioned in the list attached to the petition will not be summoned as parties in this case.'
14. That last mentioned application was rejected by the Labour Court by an order, dated May 11, 1961 with the following observation :
'Some persons 'describing themselves as workmen of the company have filed a petition praying that the workmen represented by another union may be made a party in this dispute or alternatively that the case may be adjourned for enabling them to obtain Government order tor making the workmen represented by that union a party in this dispute. It appears that the purpose of this petition is that the other union should be made a party in this dispute.
Evidence in support of that purpose has not been adduced before me. If the petitioners wanted to have Government order for making the other union a party In this present dispute, they had sufficient time. So I reject the petition and proceed to hear the merits of the case.'
15. I wonder for what purpose the aforesaid two applications were made before the Labour Court. The only question for consideration by the Labour Court was whether the dismissal of respondents Nos. 6 to 13 was justified. The award to be made by the Labour Court need be binding on the petitioner firm, the dismissed workmen and the trade Union, representing them. There was no necessity for the Labour Court to consider any dispute-between the rival trade union workers and, therefore, it was not also necessary for the Labour Court to exercise its jurisdiction under Section 18 of the Industrial Disputes Act, and to summon the workmen affiliated to Calcutta Chhata Karkhana Mazdur Union as parties to proceedings or otherwise to implead them as parties. The aforesaid two applications were by themselves pieces of overdoing and the Labour Court was Hot wrong in rejecting both of them.
16. I now turn to the main argument of Mr. sankar Ghosh that the award was erroneous on the face of it. He contended that the object of the Industrial Disputes Act was preservation of Industrial peace and termination ofindustrial disputes. Inasmuch as the workers of the petitioner firm, belonging to the Calcutta Chhata Karkhana Mazdur Union, were bent upon adopting a 'closed shop' policy as against respondents Nos. 6 to 13, it would not have been conducive of industrial peace by retaining them in service. By directing re-instatement, the award tended to perpetuate an industrial dispute and to compel the employer to face the hazards thereof and as such was a patently erroneous industrial award which should not be sustained. He further contended that the Labour Court was wrong in holding that an employer must prove misconduct of workmen in order to support dismissal. According to Mr. Ghosh the general proposition that an order of dismissal must be founded on misconduct admitted of exceptions, one exception being that where the retention of some workmen in service would endanger industrial peace their dismissal may be justified even in the absence of misconduct.
17. Compulsory trade unionism in British and American industries has given birth to a form of militant trade unionism in those countries. For such compulsion to be enforced effectively, there must be some element of collaboration from employers. This may be tacit but it is more effective when written into agreement. Such agreements normally take two forms, 'Union Shop' agreements or 'closed shop' agreements, concluded to satisfy different economic conditions where the demand for compulsion exists. A 'Union shop' agreement stipulates that workers in a particular establishment or industry must join either one specific union or one of a number of unions within a given time limit after commencing work at an establishment or industry. A 'closed shop' agreement can take one of three forms:
(i) a worker must be a member of a named trade union before he can be considered for employment -- the membership being the only key to employment;
(ii) the agreement can impose trade-union membershipas a condition of employment; or
(iii) the employer must use a trade union as the sole. agency for placing workers in his employment.
Though the 'closed shop' agreement is the more stringent agreement of the two, both are coercive in nature. Regard being had to the general inequality of bargaining power between the employer and the employees, there seem to be three justifications for a trade union demand for compulsory trade unionism. It may be demanded because (i) the union wishes to improve its finance or (ii) to increase its bargaining strength or (iii) the hold of leaders over the members. A trade union must be financially strong to continue all forms of self-help pressure tactics and must have membership solidarity in order to be able to exert the pressure effectually. V. K. Alien, a lay member of the Amalgamated Union of Building Trade Workers, poses a major criticism against compulsory trade unionism. He says,
'A major criticism of compulsory trade unionism is that makes so many members simply card-holders and nottrade unionists.
* * * More than this, compulsory trade unionism might weaken the union. A trade union is like a fresh stream; when it is demmed up it collects a lot of muddy water and scum rises to the top. Men who are forced into a union are not only passive dead-weights so far as membership participation is concerned; they are also often focal points of disaffection and disruption and form the nucleus to which the dissatisfied voluntary members may cling. Their resentment into being press-ganged into a union infects others.
Some trade union officials, unfortunately, prefer to be misled and treat the 'closed shop', agreement as an 'institution building' device. It streamlines union organisation; the recruitment function is removed from the shoulders of trade union officials, where it should lie, to those of management, and it removes, therefore, the need for union officials to justify the activities of the union to potential members. In all cases the employer becomes an ally in the maintenance of discipline in unions; even the collection of dues is some times transferred to the firms' administration. A trouble-saving device of this nature certainly has its attractions.'
(vide V. K. Alien 'On Power of Trade Unions page 57). There is, in my opinion, a good deal of force in the rather out-spoken criticism. There may also be another justified criticism against 'closed shop' compulsory trade unionism. A compulsory trade union organisation may become a concentration of economic power having the same potential dangers as in business monopolies and may need be opposed to preserve democratic conditions.
18. Norman Citrine in his book entitled 'Trade Union law' observes [at pp. 41-42),
'where the object of an association of plumbers was to obtain a monopoly of the trade by creating difficulties for non-members, it was held that the association was in unreasonable restraint of trade (Johnston v. Aberdeen Master Plumbers' Association -- 1921 SC 62). It would appear that a 'closed shop' rule of trade union, prohibiting its members from working with non-members might, in some circumstances, be held illegal on this ground'.
Although some of the English treatises on Trade Unionism treat compulsory trade Unionist with caution, American authors, like Ludwing Teller, wherever recognising the legality of 'closed shop' agreement notice the right of the dismissed employee to obtain relief in damages under the law of tort. In his book entitled 'Labour Disputes and Collective Bargaining' (Section 90 pages 265-66), Ludwig Tellor observes:
'A strike to procure the discharge of a fellow employee may have its inception in part of a plan to procure a closed shop. In such a case the strike is legal if the strike for a closed shop is legal in the given jurisdiction. 'The privilege to demand a closed shop necessarily includes the demand that employees refusing to be members of the union be not continued in employment.' Discharge of a fellow employee may also be sought by a strike simply because of the obnoxious character of the employee, whose discharge is sought, or because the disliked employee, acting in a supervisory capacity, has been too rigid in the enforcement of rules or in the general management of supervision. In the former case a strike has been held both legal and illegal while as to the latter case, the single case an the subject holds the strike illegal.
(De Minico v. Craig, 207 Mass 593). There is a third conceivable situation, involving a strike to procure the discharge of a supervisory employee on account cf his discrimination against employees engaged in union activity or because of his Interference, restraint or coercion In connection with the organising activities of employees. Cases involving anti-union activities of supervisory employees under the National Labour Relations Act are numerous.
The Restatement of Torts (Section 790) recognises the legality of concerted action by employees for the purpose of procuring the dismissal of fellow employees either because of their obnoxious habits, conduct or character or because of their failure or refusal to become or properlyto remain a member of the union. It is added, however that 'the rule stated in this section applies to the cases of the employer whether or not the dismissed employee has a cause of action'. The addendum is debatable since it would seem that a strike or other labour activity should be held illegal where the employee whose discharge is thereby sought has a valid cause of action for the resulting discharge.'
Section 19 of the Indian Trade Union Act 1926, provides for enforceability of agreements between members of a trade union, in the following language :
'Notwithstanding anything contained in any other law for the time being in force, an agreement between the members of a registered Trade Union shall not be void or voidable merely by reason of the fact that any of the objects of the agreement are in restraint of trade :
Provided that nothing in this section shall enable any Civil Court to entertain any legal proceeding instituted for the express purpose of enforcing or recovering damages for the breach of any agreement concerning the conditions of which any members of a Trade Union shall or shall not sent their goods, transact business, work, employ or be employed.' There is no provision in the Trade Union Act for enforceability of an agreement like a 'closed shop' agreement between the employer and the trade union of employees. In the wisdom of the Parliament, no necessity has as yet been felt for importing English or the American variety of 'closed shop' agreements, of debatable value, in the trade union law of this Country.
19. I have, therefore, to proceed on the basis that there is no legislative provision for compulsory trade unionism in this country. It is also nobody's case that there existed any 'closed shop' type of agreement between the petitioner firm and the Calcutta Chhata Karkhana Mazdur Union. That being so, the dismissal of respondents NOS. 6 to 13 cannot be justified on any theory of 'closed shop' agreement.
20. The petitioner is thus left with summary dismissal of respondents Nos. 6 to 13, not on the ground of misconduct, and without any justification excepting that the dismissal was for the purpose of pleasing the workers, who were members of the Calcutta Chhata Karkhana Mazdur Union. If the Labour Court held such a dismissal to be wrongful, it cannot be said to have been wrong.
21. But the question remains whether the Labour Court was justified in directing re-instatement by way of relief to the wrongfully dismissed workmen.
22. In the case of Western India Automobile Association v. Industrial Tribunal, Bombay Mahajan, J. observed:
'* * * when a dispute arises about the employment of a person at the instance of a trade union or a trade union objects to the employment of a certain person, the definition of industrial dispute would cover both the cases. In each of these cases, although the employer may be unwilling to do so, there will be jurisdiction in the tribunal to direct the employment or non-employment of the person by the employer. * * * The dispute of this character being covered, by the definition of the expression industrial disputes there appears to be no logical ground to exclude an award of re-instatement from the jurisdiction of the industrial tribunal.'
Further explaining the above quoted observations, the Supreme Court observed in the case of Punjab National Bank Ltd. v. All India Punjab National Bank Employees' Federation : (1959)IILLJ666SC :
'In exercising Its jurisdiction to direct reinstatement ofdismissed employees industrial tribunals have indicated certain general considerations for their own guidance. In the case of a wrongful dismissal the normal rule adopted inindustrial adjudication is that reinstatement should beordered.
'But', observed the Full Bench of the Labour Appellate Tribunal in Buckingham and Carnatic Mills Ltd. v. Their Workmen, 1951-2 Lab LJ 314 (LATI at Cal) in so ordering the tribunal is expected to be inspired by a sense of fair-play towards the employee on the one hand and considerations of discipline in the concern on the other. The past record of the employee, the nature of his alleged present lapse and the ground on which the order of the management is set aside are also relevant factors for consideration.' It is obvious that no hard and fast rule can be laid down in dealing with this problem. Each case must be considered on its own merits, and, in reaching the final decision an attempt must be made to reconcile the conflicting claims made by the employee and the employer. The employee is entitled to security of service and should as protected against wrongful dismissal, and so the normal rule would be reinstatement in such cases. Nevertheless in unusual or exceptional cases the tribunal may have toconsider whether, in the interest of the industry itself, it would be desirable or 'expedient not to direct reinstatement. As in many other matters arising before the industrial courts for their decision this question also has to be decided after balancing the relevant factors and without adopting any legalistic or doctrinaire approach.'
The position, therefore, is that on account of the attitude taken up some of the workers in the factory of the petitioner firm, who are members of the Calcutta Chhata Karkhana Mazdur Union, the petitioner had to dismiss respondents No. 6 to 13 and this gave rise to an industrial dispute. The dismissal was rightly held to be wrongful, in the circumstances of the case, but what was the remedy ?The re-instatement of the wrongfully dismissed workmen may be taken by the other workers of the petitioner firm with ill-grace and may start fresh industrial hostilities. This should be avoided. In such exceptional circumstances the Labour Court should have considered the unusual circumstances and instead of directing re-instatement should have compensated the wrongfully dismissed workmen withadequate monetary compensation. In the instant case, the employment of the dismissed workmen was found to be seasonal. The workmen could not prove their story that duringoff-season they retained any Men on employment. They were dismissed almost at the beginning of the season 1960. They are, therefore, entitled to the amount of wages which they expected to earn during 1960 season. This will haw to be calculated on the basis of what other employees of the category of respondents Nos. 6 to 13 earned during the year 1960.
23. In the result this Rule succeeds to the extent indicated above. The finding of the Labour Court that respondents Nos. 6 to 13 stood wrongfully dismissed is sustained but the relief granted stands quashed. The matter shall now go back to the Second Labour Tribunal for calculationof the amount of monetary compensation and for an award accordingly.
24. Let a Writ of Certiorari accordingly issue. Let a Writ of Mandamus also issue on the respondent State Government to take all necessary steps in order to enable the Second Labour Court to make a fresh award in accordance with the directions herein contained.
25. There will be no order as to costs.