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PETITIONER: ATHERTON WEST & CO.  LTD.

       Vs.

RESPONDENT: SUTI MILL MAZDOOR UNION AND OTHERS.

DATE OF JUDGMENT: 16/03/1953

BENCH: BHAGWATI, NATWARLAL H. BENCH: BHAGWATI, NATWARLAL H. MAHAJAN, MEHR CHAND

CITATION:  1953 AIR  241            1953 SCR  789  CITATOR INFO :  R          1955 SC 258  (13)  R          1957 SC   1  (7)  RF         1957 SC  82  (19)  RF         1957 SC 194  (3,5,6)  R          1957 SC 326  (7)  R          1958 SC  79  (22)  R          1958 SC 761  (4)  R          1959 SC 230  (20)  RF         1959 SC 389  (16)  R          1960 SC 160  (26)  RF         1963 SC 677  (17)  RF         1978 SC 995  (6,10)

ACT:     U.P.  Industrial  Disputes Act, 1947 ss.  3,  8--U.  P. Government Notification No. 781 (L)/XVIII of March 10, 1948, cls.  4,  7,  23 Dismissal of  workmen  with  permission  of Regional Conciliation Officer-Jurisdiction of Board to  hear the  dispute   whether dispute ceases to  be  an  industrial dispute-Award of Board-Absence of one member during hearing- Validity of award.

HEADNOTE:    Under   the  provisions  of  clauses  4  and  7  (3)   of Notification   No.  781  (L)/XVIII  issued  by  the   United Provinces  Government on March 10, 1948, the absence of  one of  the  members of the Regional Conciliation Board  on  the last date of hearing and his nonparticipation in the  making and signing of the award would not render the award void  or inoperative.   The  dismissal of workmen and their  non-employment  would not  cease  to be An industrial dispute merely  because  the Regional  Conciliation Officer had given written  permission to the employer to dismiss them under clause 23 of the  U.P. Government Notification of March 10, 1948.  Such  permission does not validate the dismissal but only removes the ban  on the  right of the employer, his agent or manager to  dismiss the  workmen  concerned during the pendency  of  proceedings relating to an industrial dispute.

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JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 8 of 1953. Appeal  by  special  leave from  the  decision  dated  16th August,  1951,  of the Labour Appellate Tribunal  of  India, Calcutta, in Appeal No. 43 of 1951 (Cal.). C.   K.  Daphtaru, Solicitor-General for India, (Sri  Narain Andley, with him) for the appellant. C. P.  Varma  for   the respondent. 1953.   March 16.  The Judgment of the Court was  delivered by  BHAGWATI  J.-This  is an appeal by special  leave  from  a decision  of  the  Labour  Appellate  Tribunal  ’of   India, Calcutta,   confirming  an  award  made  by   the   Regional Conciliation  Board  (Textiles  & Hosiery),  Kanpur,  in  an industrial   dispute   between  the   appellants   and   the respondents. 781 The respondents 2, 3 and 4 were employees of the appellants, respondent  2  was  employed in  the  clerical  cadre  while respondents 3 and 4 were employed as wrapping boy and piecer respectively  and their service conditions were  governed-by the  standing  orders  of  the  Employers’  Association   of Northern India, Kanpur, of which association the’ appellants were members. There  was a theft in the canteen within the mill  premises between  the night of January 6 and 7, 1950, and some  money belonging to the appellants invested in the canteen  account was stolen from the safe.  A report of the theft was made to the police authorities and an investigation was made by  the police,  as  well as the appellants in the  matter  with  no result.   The management of the appellants  thereafter  took action  against one J. P. Gurjar, who was in charge  of  the canteen  in  connection with the losses of  money  from  the account  of  the  canteen and after the  completion  of  the enquiries terminated his services.  An industrial dispute in respect of the non-employment of the said J. P. Gurjar arose between  the parties which dispute was at the material  time taken  in  appeal before the Industrial  Court  (Textiles  & Hosiery), Kanpur.  During the pendency of those proceedings, some  time  in  August,  1950,  the  respondent  4  made   a confession  in  regard  to the said  theft  implicating  the respondents 2 and 3 also therein.  On the 29th August, 1950, the   management   of  the  appellants  presented   to   the respondents  2,3 and 4 charge-sheets in respect of the  said theft  and  suspended them on the 30th  August,  1950,  from their  service.   They also made an application on  the  2nd September,  1950,  to the Additional  Regional  Conciliation Officer,  Kanpur,  asking  for  permission  to  dismiss  the respondents 2, 3 and 4. The Additional Regional Conciliation Officer,   Kanpur,   instituted  an   enquiry,   heard   the respondents 2,3 and 4, considered the evidence which was led before him by the appellants as well as the respondents  2,3 and 4 and made an order on the 12th October, 1950, according to the appellants permission for the dismissal of the 782 respondents  2,  3 and 4. The respondents 2, 3  and  4  were accordingly  dismissed from their employ by  the  appellants with effect from the 13th October, 1950.  An   industrial  dispute  thereupon  arose   between   the appellants  and  respondents 2, 3 and 4 in  respect  of  the -non-employment of respondents 2,3 and 4 and respondent 1, a registered trade union, of Which the respondents 2, 3 and  4 were  members,  ultimately moved the  Regional  Conciliation Board  (Textiles and Hosiery), Kanpur, on the 1st  November, 1950,  challenging  the  propriety and  bona  fides  of  the

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appellants  in terminating the services of respondents 2,  3 and 4.  The  appellants filed their written statement on the  25th November, 1950, contending inter alia that the dismissal was fully  justified, regular and proper, having’ been  made  in accordance  with the permission accorded by  the  Additional Regional  Conciliation  Officer.  The only issue  which  was canvassed before the Regional Conciliation Board was whether any  or  all of the three workmen named in  the  application dated  the  1st  November, 1950,  has/have  been  wrongfully dismissed  and  if so, to what relief is  he/they  entitled. The Board consisted of three members, Shri R. P. Maheshwari, Chairman,  and  Shri  B. B. Singh and  Shri  J.  K.  Bhagat, Members.  Shri J. K. Bhagat was not present on the last date of  the  hearing and the award was therefore signed  on  the 20th  April, 1951, by Shri R. P. Maheshwari and Shri  B.  B. Singh.  Under the terms of the award the Board held that the dismissal  was wrongful and that the respondents 2, 3 and  4 were  entitled to reinstatement as also to the  full  wages, including   dearness  allowance  from  the  date  of   their suspension to the date they were taken back on duty.   The   appellants  preferred  an  appeal  to  the   Labour Appellate Tribunal of India, Calcutta.  The appeal was heard on the 16th August, 1951, and the Labour Appellate  Tribunal dismissed  the  appeal of the  appellants.   The  appellants obtained special leave from this Court and filed the present appeal. 783  Two  contentions  were urged by Shri C.  K.  Daphtary  who appeared for the appellants before us-(1) that the award was void  and inoperative as it was made by only two members  of the Board, the third, member, Shri J. K. Bhagat not  having- been  present at the last hearing and-not having signed  the same  and  (2)  that the  Additional  Regional  Conciliation Officer having given the written permission for dismissal of respondents 2, 3 and 4 no industrial dispute could arise  by reason of the -non-employment of respondents 2, 3 and 4  and the   Regional   Conciliation   Board   had   therefore   no jurisdiction to entertain the application made before it  by respondent 1 on behalf of the respondents 2, 3 and 4 and the award  of  the  Regional  Conciliation  Board  ordering  the reinstatement  of  respondents  2, 3  and  4  was  therefore without  jurisdiction, void and inoperative and  the  Labour Appellate Tribunal was in error in confirming the same.   In  support of his first contention Shri C.  K.  Daphtary relied upon clause 4 and clause 7, sub-clause (3) of the  G. N. No. 781 (L)/XVIII, dated 10th March, 1948, issued by  the United  Provinces Government regarding the  constitution  of Regional  Conciliation Boards and Industrial Courts for  the settlement of industrial disputes within the State.  Clause 4-" No business may be transacted at any meeting of any Board unless all the three members are present  Clause 7 (3)-" Where no amicable settlement can be reached on one or more issues the Board, if all the members  thereof agree  or  if  they do not so  agree,  the  majority  of,the members  -agreeing or if no two members agree, the  Chairman alone, shall record an award and the reasons for such award, on the issues -on which the parties were unable to reach  an amicable settlement."   Shri  C.  K.  Daphtary therefore urged that  Shri  J.  K. Bhagat  not having been present at the last meeting  of  the Board and not having signed the 784 award  the award could not be lawfully made by the  Chairman and  the  other member who were present and who  signed  the

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award  and  the award was therefore  void  and  inoperative. Shri  C. P. Varma who represented the respondent  before  us however  drew  tour attention to the  Government  Order  No. 388(11)/  XVIII/37  (LL)-/50 dated 2nd  March,  1951,  which amended the above clauses 4 and 7(3). Clause 4 as amended provides:- " (1) Notice of every meeting of the Board shall be given to the members by the Chairman in advance.   ( 2)   If apart from the Chairman either or both the other     members fail to attend any meeting of the Board of which  notice  has  been given to  them,  the  Chairman  may transact the business’ of the Board without the presence  of the  absent  member  or members ; and no  such  business  or proceedings,  of the Board shall be held invalid  merely  by reason  of the fact that either one or both of  the  members were not present at the meeting." Clause 7 (3) as amended provides:-   "Where  no amicable settlement can be reached on  one  or more  issues, if all the members present agree the Board  or if they do not so agree the majority of the members agreeing ’or if no two members present agree or if only the  Chairman is present, he alone, shall record an award and the  reasons for  such  award  on the issues on which  the  parties  were unable to reach an amicable settlement."  These amendments in the clauses 4 and 7 (3) are enough  in our  opinion to repel the contention of Shri C. K.  Daphtary that the absence of Shri J. K. Bhagat from the last  meeting and also his non-participation in the making and signing  of the  award  rendered.the award void  and  inoperative.   The Board was empowered under the amended clauses 4 and 7(3)  to act in the absence of Shri J. K. Bhagat and the award as  it was made and signed by the two remaining members, viz., Shri R. P. Maheshwari and Shri B.  B.   Singh,  was  lawful   and binding on the parties. 785 In  support  of his second contention Shri  C.  K.  Daphtary relied upon clauses 23 and 24 of the Government Notification dated the 10th March, 1948, above referred to.   Clause  23  :-" Save with the written Permission  of  the Regional  Conciliation  Officer or  the  Assistant  Regional Conciliation  Officer  concerned irrespective  of  the  fact whether an enquiry is pending before a Regional Conciliation Board-or the Provincial Conciliation Board or an appeal  has been  filed  before the Industrial Court, no  employer,  his agent  or  manager, shall discharge or dismiss  any  workmen during  the continuance of an enquiry or appeal and  pending the  issue  of the orders of the State Government  upon  the findings of the said Court...........  Clause  24:-"(1)  Except as  hereinbefore  provided  every order made or direction issued under the provisions of  this Order  shall  be  final  and conclusive  and  shall  not  be questioned by any party thereto in any proceeding...........  Shri  C. K. Daphtary contended that the order made by  the Additional   Regional  Conciliation  Officer  on  the   12th October’  1950, giving the appellants permission to  dismiss respondents 2, 3 and 4 was final and conclusive in regard to the appellants’ right to dismiss them from their employ  and their  dismissal accordingly by the appellants could not  be the  foundation  of any industrial dispute  which  could  be referred to the Regional Conciliation Board at the  instance of respondent 1. He further contended that if no  industrial dispute  could thus arise the Regional  Conciliation,  Board had no jurisdiction to entertain the same and the award made by  the Board was therefore without jurisdiction, -void  and inoperative  and could not also be confirmed by  the  Labour

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Appellate Tribunal.  We  are unable to accept this contention.  The  Government Notification  dated  10th  March, 1948, was  issued  by  the Governor  of the United Provinces in exercise of the  powers conferred by clauses (b), (c), 786 (d)  and  (g)  of  section 3 and section 8  of  the  ,United Provinces  Industrial Disputes Act, 1947.  It  provided  for the constitution by the Provincial Government of such number of Conciliation Boards as might be deemed necessary for  the settlement  of  industrial  disputes  consisting  of   three members of which one was to be the Conciliation Officer  for the area, one was to be representative of the employers  and one   was   to  be  the  representative  of   workmen,   the Conciliation Officer for the area being the Chairman of  the Board.  The order provided for the mode in which  industrial disputes  may be referred to the Board for enquiry  and  the manner  in which the enquiry was to be conducted.   It  also provided  for the constitution by the Provincial  Government of such number of Industrial Courts as it might be necessary consisting  of a President assisted by such equal number  of assessors  as  the President  might  determine  representing employers and employees.  Provision was made for appeals  to such Industrial Courts from the awards of the Board and also for  the hearing of the said appeals.  After making  further provision for the procedure to be adopted before the  Boards as  well  as the Industrial Courts, the Order by  clause  23 above mentioned imposed a’ ban on the discharge or dismissal of any workman by the employer, his agent or manager  during the pendency of an enquiry before the Regional  Conciliation Board  or the Provincial Conciliation Board or of an  appeal before   the  Industrial  Court  except  with  the   written permission  of  the  Regional Conciliation  Officer  or  the Assistant  Regional  Conciliation Officer concerned  and  by clause  24  made every order or direction issued  under  the provisions of the said Government Order final and conclusive except as thereinbefore provided.   It is clear that clause 23 imposed a ban on the discharge or  dismissal  of  any workman pending  the  enquiry  of  an industrial dispute before the Board or an appeal before  the Industrial  Court  and the employer, his  agent  or  manager could only discharge or dismiss 787 the  workman  with the written permission  of  the  Regional Conciliation Officer or the Assistant Regional  Conciliation Officer  concerned.   Even if such) written  permission  was forthcoming  the employer, his I agent or manager  might  or might  not  discharge or, dismiss the workman and  the  only effect of such written permission would be to remove the ban against the discharge or dismissal of the workman during the pendency  of those proceedings.  The  Regional  Conciliation Officer  or  the  Assistant  Regional  Conciliation  Officer concerned  would  institute  an  enquiry  and  come  to  the conclusion whether there was a prima facie case made out for the discharge or dismissal of the workman and the  employer, his  agent  or  manager was not  actuated  by  any  improper motives  or  did  not  resort  to  any  unfair  practice  or victimisation  in  the matter of the proposed  discharge  or dismissal of the workman.  But he was not entrusted, as  the Board  or  the Industrial Court would be, with the  duty  of coming to the conclusion whether the discharge or  dismissal of  the workman during the pendency of the  proceedings  was within  the  rights of the employer, his agent  or  manager. The  enquiry  to be conducted by the  Regional  Conciliation Officer  or  the  Assistant  Regional  Conciliation  Officer

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concerned  was not an enquiry into an industrial dispute  as to  the non-employment of the workman who was sought  to  be discharged or dismissed, which industrial dispute would only arise after an employer, his agent or manager discharged  or dismissed  the  workman  in  accordance  with  the   written permission  obtained from the officer concerned.   This  was the   only  scope  of  the  enquiry  before   the   Regional Conciliation Officer or the Assistant Regional  Conciliation Officer  concerned and the effect of the written  permission was not to validate the discharge or dismissal but merely to remove the ban on the powers of the ’employer, his agent  or manager  to  discharge  or dismiss the  workman  during  the pendency  of the proceedings.  Once such written  permission was granted by him that 102 788 ,order made or direction issued by him was to be final  land conclusive and was not to be questioned by any party thereto in any proceedings.  The only effect of )clause 24(1) was to prevent   any   party  to  the  pending   proceedings   from challenging  the  written  permission thus  granted  by  the officer concerned Such written permission could not be  made the  subject-matter of any appeal at the instance of  either party and both the parties would be bound by the order  made or  direction issued by the officer concerned so far  as  it gave or refused the permission to the employer, his agent or manager in the matter of the proposed discharge or dismissal of the workman. This was the only scope of the provisions of clauses 23  and 24 (1) above. mentioned.  ’-Once the written permission  was granted  by  the  officer concerned,  the  ban  against  the discharge  or dismissal of the workman would be removed  and the employer, his agent or manager could in the exercise  of his discretion discharge or dismiss the workman but in  that event  an  industrial  dispute within  the  meaning  of  its definition  contained  in  section 2(k)  of  the  Industrial Disputes Act, 1947, would arise and the workmen who had been discharged  or  dismissed  would be entitled  to  have  that industrial  dispute  referred to the  Regional  Conciliation Board for enquiry into the Same.  That right of the  workman to  raise an industrial dispute could not be taken  away  in the manner suggested by Shri C. K. Daphtary by having resort to  the provisions of clauses 23 and 24(1) aforesaid.   That right  was  given  to  the  workman  by  the  terms  of  the Industrial  Disputes  Act,  1947, and  the  U.P.  Industrial Disputes Act, XXVIII of 1947, and would remain unaffected by any of the provisions hereinbefore referred to. We  are  therefore, of the opinion that this  contention  of Shri C. K. Daphtary also fails. We may before concluding advert to one circumstance and that is  that even though the Labour Appellate  Tribunal  rightly confined its jurisdiction to 789 determining  substantial  questions of law involved  in  the appeal, it nevertheless observed that even on the) facts the conclusions of the Board were perfectly justified and  there was  no  substance  in the appeal on merits  as  well.   The appellants  were  not  heard at all on merits;  and  it  was hardly  legitimate  for the Labour, Appellate  Tribunal  suo motu  to consider the merits of the appeal and arrive  at  a finding  in  regard  to  the same.’ If  at  all  the  Labour Appellate  Tribunal  bad any jurisdiction in regard  to  the merits it was incumbent upon it to have heard the appellants in  regard to the merits before arriving at a conclusion  in regard to the same.

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The  result is that this appeal fails and must be  dismissed with costs.                                Appeal dismissed. Agent for the appellant : S. S. Shukla.