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National Rolling and Steel Ropes, Ltd. Vs. Sixth Industrial Tribunal and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtKolkata High Court
Decided On
Judge
Reported in(1962)IILLJ455Cal
AppellantNational Rolling and Steel Ropes, Ltd.
RespondentSixth Industrial Tribunal and ors.
Excerpt:
- .....as between the petitioner company and its workmen, there was an agreement as to the payment of ex gratia gratuity in the event of retirement or death of workmen, while in service, on the following terms:it is recognized by the employees that although no formula is in force for gratuity, the management have given sympathetic consideration bo far in the case of each employee who retired from service or an unfortunate few who died while in service. management will continue to give the sympathetic consideration to an ex gratia payment in their sole discretion. it is agreed between both parties that no formula for gratuity can be laid down or insisted upon. if and when government lays down a statutory provision, the same will of course be adopted.2. in the year 1958, one of the senior clerks.....
Judgment:

S.N. Banerjee, J.

1. As between the petitioner company and its workmen, there was an agreement as to the payment of ex gratia gratuity in the event of retirement or death of workmen, while in service, on the following terms:

It is recognized by the employees that although no formula is in force for gratuity, the management have given sympathetic consideration BO far in the case of each employee who retired from service or an unfortunate few who died while in service. Management will continue to give the sympathetic consideration to an ex gratia payment in their sole discretion. It is agreed between both parties that no formula for gratuity can be laid down or insisted upon. If and when Government lays down a statutory provision, the same will of course be adopted.

2. In the year 1958, one of the senior clerks in the employment of the petitioner company, named Mritunjoy Dutta, attained the age of superannuation and was due to retire on 1 July, 1958. At the request of the said Mritunjoy Dutta, he was given a sympethetic extension of service for another six months and he ultimately retired on 31 December 1058.

3. The respondent 2 trade union, representing the workmen of the petitioner company, made a representation to the petitioner company for payment of a lump sum as gratuity to the said Mritunjoy Dutta. The petitioner company rejected the representation because it considered that no such ex gratia payment of gratuity should be made in favour of that particular employee. This raised an industrial dispute and the following issue was referred to the sixth industrial tribunal for adjudication by the State Government:

Whether Sri Mritunjoy Dutta us entitled to any retirement benefit? If so, what should be the amount of such benefit ?

4. The industrial tribunal came to the following finding:.I am quite alive to the fact that any ex gratia payment was to be in the sole discretion of the management, or, in other words, the management could use a discretion whether an ex gratia payment was to be made to a particular employee and if it was to be made, what would be the amount. Bat a discretion to be used must not be arbitrary. O.P.W. 1 Sri Sitapati admits that two retired workers Sri S.C. Adhikari and Sri P.N. Ghose were given ex gratia payments, the former having rendered very valuable services both in the office and in the factory, and the other having a long period of service with unblemished conduct. Another ex gratia payment was made to one Srimati Maya Roy, whose husband Sukumar Roy had died while in service. The company's attitude was just and fair and one cannot but feel happy about it.... It is the case of the union that ex gratia payments were made to all the employees who retired from service but the company files a list (Ex. J.) to show that no ex gratia payments were made to at least two of the head office employees--S.R. Jajodia and M.R. Jhunjhunwala. The other workers whose names appear in Ex. J are all factory workers.... There is no evidence on the side of the company that Jajodia and Jhunjhunwala rendered long and meritorious service to the company. So, it is taken that an essential qualification to a claim for ex gratia payment--a long period of uninterrupted service--was wanting and there was therefore no prayer for such payment by Jajodia and Jhunjhunwala.... Considering all these facts and circumstances discussed above, I find that Sri M. Dutta having rendered a long and uninterrupted approved service is entitled to a sum of money from the company as retirement benefit beside his provident fund accumulations.... Taking into consideration the fact that Sri Dutta rendered a long and uninterrupted approved service and the fact that be was granted an extension of service for six months, I consider a sum of Rs. 1,080 which is equal to three months' of his salary including the dearness allowance to be a fair amount of an additional retirement benefit which he is entitled to, and an award is made accordingly.

5. The propriety of the award is being disputed in this rule, at the instance of the petitioner company, which has prayed for a writ of certiorari for quashing of the award.

6. In my opinion, the tribunal did not properly interpret the agreement as to gratuity, which I have already set out. The first part of the clause, hereinbefore quoted, records a historical fact that the petitioner company was making payment of gratuity to retiring workmen or to the dependants of workmen; who died in service, on sympathetic consideration. The second part of the agreement left the payment of snob ex gratia gratuity at the sole discretion of the management and to its sympathetic consideration. No rate for payment of gratuity was agreed upon--that matter also being left at the discretion of the management.

7. In the instant case, Mritunjoy Dutta was given an extension of service on sympathetic consideration. Possibly the petitioner company was not prepared to bestow on him the twofold benefit of extension of service and payment of gratuity. In any event, matters which are discretionary and left to the sympathetic consideration of the employer cannot be enforced by the workmen by legal process. The settlement that was arrived at on the point of gratuity proceeded in the workers' faith in the management and in the expectation that the petitioner, company would sympathetically deal with the workmen at the time of their retirement or would make some ex gratia payment to the dependants of workmen, who died in harness. An agreement of this type cannot be specifically enforced and the tribunal was wrong in attempting to substitute its own discretion, in matters which were left in the sole discretion of the petitioner company, The tribunal was further wrong in fixing an amount of gratuity, although no rate for payment of gratuity had been agreed upon in the agreement above recorded. For the reasons aforesaid, I am of opinion that the award of the tribunal cannot be sustained and I quash the same. Although the petitioner company wins in this case, it now makes a generous offer for payment of Rs. 500 only ex gratia to the workman Mritunjoy Dutta, which offer is accepted by respondent 2. I record that offer.

8. This rule is made absolute. Let a writ of certiorari issue quashing the award. I make no order as to costs.


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