Full Judgment Text
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PETITIONER:
AGRA ELECTRIC SUPPLY CO. LTD.
Vs.
RESPONDENT:
SRI ALLADIN & ORS.
DATE OF JUDGMENT:
12/08/1969
BENCH:
BHARGAVA, VISHISHTHA
BENCH:
BHARGAVA, VISHISHTHA
VAIDYIALINGAM, C.A.
CITATION:
1970 AIR 512 1970 SCR (1) 808
1969 SCC (2) 598
CITATOR INFO :
R 1972 SC1201 (8,10,14)
F 1972 SC1626 (8)
F 1972 SC2326 (13,14,15,26)
R 1973 SC2650 (6)
RF 1977 SC2257 (3)
R 1984 SC1064 (12)
ACT:
Industrial Employment (Standing Orders) Act (20 of
1946)-Standing Orders certified under Act--Whether
applicable to workmen employed before such certification.
Termination of service during probation--Real basis
misconduct-Order worded as simple termination--Power of
Labour Court to go behind and ascertain real basis.
HEADNOTE:
Prior to 1951 there were no rules or conditions of service
prescribing the age of superannuation in the appellant-
Company. In 1951, its Standing Orders were certified under
the Industrial Employment (Standing Orders) Act, 1946, and
were brought into force. Standing Order 32 provided 55 years
as the age of superannuation. The first three respondents
were workmen employed in the Company in 1929, 1935 and 1937.
Relying on Standing Order 32 the Company served notices on
these 3 workmen who had attained the ages of 58, 64 and 59
on the dates of the ’respective notices, and retired them.
The Labour Court, to which the dispute arising from such
retirement was referred, held that the Standing Orders
having been certified long after these workmen were employed
and the conditions of their employment not having provided
any age of retirement.the Company could not apply Standing
Order 32 to them, that the orders of retirement on the
ground of superannuation were bad and gave conse quential
directions.
The Company appointed the 4th respondent in December
1965 as a cleaner. The letter of appointment stated that he
was to be a probationer for 6 months with discretion to the
concerned officer to extend the period. The letter also
stated that during the probationary period his service was
liable to. termination without any notice and without
assigning any reasons therefore. His service was terminated
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in February 1966. Before the Labour Court evidence was
led on behalf of the Management that workman’s service was
terminated because his work as probationer was
unsatisfactory. The Labour Court found on the evidence
before it that the real reason for passing the impugned
order of termination was not the alleged unsatisfactory work
but his having unauthorisedly used a motorcycle belonging to
an engineer of the Company and caused damage to it. In that
view, the Labour Court held that the exercise of the power
to terminate was not bona fide and consequently set aside
that order also.
In appeal to this Court,
HELD: (1)(a) The Act provides that every employer of an
indusTrial establishment must have his Standing Orders
certified, that the Standing Orders should be submitted to
the certifying authority along with particulars of all the
workmen then employed as also the name of the union if
any, to which they belong, That the certifying authority
should give notice to the union, and in its absence, to the
workmen to make Their objections and an opportunity to the
employer and the representatives of The workmen for being
heard, that the authority should thereafter adjudicate upon
the fairness and reasonableness of the Standing Orders
submit-
809
ted, that the authority should certify the Standing Orders
with modifications or additions if any, that any person
aggrieved by such certification may appeal to the appellate
authority, that the Standing Orders as finally certified
come into operation on a particular day, that the employer
should publish them on notice boards in such a manner that
they become easily known to the workmen, and that, after the
expiry of 6 months from the date on which the Standing
orders or the last modification came into operation,
either the employer or any of the workmen could apply for a
modification. These provisions show that once the
Standing Orders as certified come into operation, they
’become binding on the employer as well as all the workmen
presently employed and those employed thereafter in the
establishment, as uniform conditions of service. If the
Standing Orders were to bind only those who are subsequently
employed, the result would be that there would be different
conditions of employment for different classes of workmen,
depending on whether the workmen were employed before or
after the certification of the Standing Orders or a
modification of such Standing Orders, and would render the
principle of collective bargaining ineffective. Such a
result would render the conditions of service of workmen as
indefinite and diversified as before the enactment of the
statute though it was to do away with such diversity that
the Act was passed. [812 D-H; 813 A-D; 814 A-E]
Salem Erode Electricity Distribution Co. Ltd. v. Salem
Erode Electricity Distribution Co. Ltd. Employees Union,
[1966] 2 S.C.R. 498, follOwed.
Guest, Keen, Williams Pvt. Ltd. v.P.J. Sterling, [1960]
1 S.C.R. 348, explained.
(b) The decision of the same Labour Court in Ref. No. 91
of 1964 between the appellant-Company and its workmen,
wherein it was held that the very same Standing Orders did
not apply to workmen employed prior to their coming into
force, did not prevent the Company from reagitating the
same question, because: [816 F]
(i) The rule that an award binds all the workmen
employed in an establishment and even future entrants is
not based on the principle of res judicata but. is rounded
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on the condition for raising an industrial disputed. [817 A-
B]
The Newspapers L.td. v. The State Industrial Tribunal,
U.P. [1957] S.C.R. 754, 761, Workmen v. Balmer Lawrie & Co.
[1964] 5 S.C.R. 344 and Shahdara (Delhi) Saharanpur Light
Rly. Co. Ltd. v. Shahdara Saharanpur Railway Workers’ Union
[1969] 1 L.L.J. 734, referred to.
(ii) The award in Ref. 91 of 1964 was based on the
supposition that the Guest, Keen, Williams case, decided
that Standing Orders were not binding on those who were
employed prior to the certification and their coming into
force. But the Salem Erode Electricity Distribution Co.
Ltd. cage has explained that case and shown that such a
supposition was not correct. Since the very basis of the
award in Ref. 91 was wrong the distinction made therein
between those who were previously appointed and those
appointed subsequently is also wrong. [817 E-H]
(iii) Further, the consequence of holding that the Company
was barred by principles analogous to res judicata would be
that there would be two sets of conditions of service, one
for those previously employed and the other for those
employed after the Standing Orders were certified, a
consequence wholly incompatible with the object and policy
of the Act. [817 D-E]
810
(2) It is. a well-settled principle of industrial
adjudication that even if an impugned order is worded in the
language of a simple termination of service, industrial
tribunals can look into the facts and circumstances of the
case to ascertain if it was passed in colourable exercise of
the power of the management to terminate the service of an
employee and find out whether it was in fact passed with a
view to punish him. In the present case, the letter of
appointment states that the workman was appointed as a
probationer for a period of 6. months with power to extend
the period of probation. Standing Order 2(c) also provides
that the normal period of probation shall be 6 months with
discretion to extend the period, the maximum period of
probation being 12 months. That means that at tie end of the
period of probation the Company would have to decide whether
to confirm him or terminate his service and that the
probationer’s service cannot be terminated during the
probation period except for some misconduct. The statement
in the letter that workman’s service was liable to
termination even during the probationary period only meant
that the appointment was subject to the Management’s power
of termination as provided in the Standing Orders. Such a
power is provided in Standing Order 14, but the termination
of the workman was not for any of the grounds set out
therein. Therefore, the termination during probation was
not in conformity with the power to terminate under the
Standing Orders. [819 A-F]
Further, the finding of the Labour Court is one of
fact and meant that it rejected the evidence led by the
Management that the work of the workman was found
unsatisfactory. Since the finding is not perverse and is
based on evidence, it means the termination was punitive in
nature. Such an order could be passed only after a proper
inquiry. Therefore, order of the Labour Court setting aside
the termination was right. [819 G-H]
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2483 of
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1968.
Appeal by special leave from the Award dated July 24,
1968 o,f the Labour Court, Meerut in Case No. 92 of 1966.
S.V. Gupte, D.N. Mukherjee and M.L. Car, for the
appellant.
Mohan Kumaramangalam, M.K. Ramamurthi, Vineet Kumar,
Shyamala Pappu and J. Ramamurthy, for the respondents. The
Judgment of the Court was delivered by
Shelat, J. In this appeal, by special leave, two questions
arise: (1) whether standing orders govern the employees
appointed before they ,are certified under the Industrial
Employment (Standing Orders) Act, 20 of 1946, and (2)
whether the appellant-company was entitled to terminate the
service of a workman appointed as a probationer before the
expiry of the period of probation except on the ground of
misconduct.
The first question relates to 3 workmen, Alladin, Ram
Prasad and Noorul Zaman, who were employed in 1929, 1935 and
1937 respectively, long before the company’s standing orders
were certified and brought into force in 1951 and who were
superannuated
811
under standing order 32 of the said standing orders. Prior
to 1951 there were no rules or conditions of service
prescribing the age of superannuation. Standing order 32
for the first time laid down 55 years as the age of
superannuation. Relying on standing order 32 the company
served on the three workmen notices dated December 19, 1964,
November 20, 1963 and January 27, 1964, who had by then
attained the age of 58, 64 and 59 years, by which the
company retired them with effect from January 1, 1965,
December 29, 1963 and March 1, 1964 respectively. The Labour
Court, to which the dispute arising from the compulsory
retirement was referred, held that the company’s standing
orders having been certified long after these workmen were
employed and the conditions of their employment not having
provided any age of retirement, the company could not apply
standing order 32 to them, and therefore, the orders of
superannuation were bad, and directed their reinstatement
and payment to. them of their wages from the date of
retirement till the date when they would be reinstated.
Thus, the question involved in this appeal is whether
the company could retire ’by applying standing order 32
these three workmen, who admittedly had long passed the age
of superannuation provided thereunder. Counsel for the
company argued that once the standing orders are certified
and come into operation, they would, subject to their
modification as provided under the Act, bind all workmen,
irrespective of whether they were employed before or after
they came into force’, and that therefore, the Labour Court
was in error in holding to the contrary and ordering their
reinstatement. Mr. Kumaramangalam, on the other hand,
argued ( 1 ) that the company’s action amounted to applying
standing order 32 retrospectively, that was not warranted,
for, if the standing orders were intended to be so applied,
they would have so expressly provided, and (2) that in a
previous reference, being Ref. 91 of 1964, between the
appellant-company and its workmen, this very Labour Court
had decided that these standing orders did not apply to
workmen previously employed, that an appeal was sought to be
filed in this Court against that order but no special leave
was granted, and therefore, that order became final.
Consequently, the company was not entitled to reagitate the
same question, as it was precluded from doing so by
principles analogous to the principle of res judicata.
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The question as to whether standing orders were
retrospective in their application can obviously arise only
if they do not in law bind workmen previously employed.
Such a question can hardly arise if the provisions of the
Act show, as contended by counsel for the Company, that once
they are certified and come into force, they bind both the
employer and all the workmen presently employed.
812
As observed in Shahdara (Delhi)-Saharanpur Light
Railway Company Ltd. v. Shahdara-Saharanpur Railway Workers’
Union(1) the Act is a beneficent piece of legislation, its
object being to require, as its preamble and its long title
lay down, employers industrial establishments to define with
sufficient precision the conditions of employment of
workmen employed under them and to make them known to such
workmen. Before the passing of the Act, there was nothing
in law to prevent an employer having different contracts
of employment with workmen employed by him with different
and varying conditions of service. Such a state of affairs
led to confusion and made possible discriminatory
treatment between employees ,and employees though all of
them were appointed in the same premises and for the same
or similar work. Such a position is clearly incompatible
with the principles of collective bargaining and renders
their effectiveness difficult, it not impossible. To do
away with such diversity and bargaining with each individual
workman, the legislature provided by s. 3 of the Act that
every employer of an industrial establishment must, within 6
months from the date of the Act becoming applicable to his
industrial establishment, submit to the certifying authority
under the Act draft standing orders prepared by him for
adoption in his industrial establishment providing therein
for *all matters set out in the Schedule to the Act, and
where model standing orders are prescribed to have such
draft standing orders in conformity with them. The draft
standing orders are to be accompanied by particulars of
workmen employed in the establishment as also the name of
the union, if any, to which they belong. This requirement
clearly means particulars of the workmen in employment at
the date of the submission of the draft standing orders for
certification and not those only who would be employed in
future after certification. Under s. 4, such draft orders
’are certifiable if they provide for all matters set out in
the Schedule, are otherwise in conformity with the Act and
are adjudicated as fair and reasonable by the certifying
officer or the appellate authority. Section 5 requires the
certifying officer to forward a copy of the draft standing
orders to the union or in its absence to workmen in the
prescribed manner with a notice requiring objection, if any,
from the workmen. After giving the employer and the union or
the workmen’s representatives an opportunity of being heard,
the certifying officer has to decide whether or not any
modification or addition to the draft submitted by the
employer is necessary and then certify the draft standing
orders ’and send copies thereof and of his order in that
behalf to the employer, the union or the representatives of
the workmen. Section 6 confers the right of appeal to any
person aggrieved by such order to the appellate authority,
who, by his order, can. either confirm or amend the standing
orders. Under s. 7, such standing
(1) [1969] 1 L.L.j. 734.
813
orders are to come into operation on the expiry of 30 days
from the date on which their authenticated copies are sent
by the certifying officer to the parties where no appeal
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against these orders is filed or where such appeal is filed
on expiry of 7 days from the date on which copies of the
appellate authority’s order are sent as required by s. 6(2).
Section 9 requires the employer to post the standing orders
’as finally certified on boards maintained for that purpose
at or near the entrance through which the majority of
workmen inter the industrial establishment and in’ all
departments thereof. Section 10 confers the right to an
employer or any of the workmen to apply for modification
after expiry of 6 months from the date on which they of the
last modification thereof came into operation. The
Schedule to the Act sets out matters which the standing
orders must provide for. These matters are classification
of workmen, shift working, periods and hours of work,
holidays, pay days, wage rates, conditions and procedure for
applying for grant of leave, closing and reopening of
sections of the industrial establishment, temporary
stoppage: of work, liabilities and rights of the employer
and the workmen arising therefrom, termination of
employment, disciplinary action, penalties etc.
The obligation imposed on the employer to have
standing orders certified, the duty of the certifying
authority to adjudicate upon their fairness and
reasonableness, the notice to be given to the union and in
its absence to the representatives of the workmen, the right
conferred on them to raise objections, the opportunity given
to them of being heard before they are certified, the fight
of appeal and the right to apply for modifications given to
workmen individually, the obligation on the employer to have
them published in such a manner that they become easily
known to the workmen, all these provisions abundantly show
that once the standing orders are certified and come into
operation, they become binding on the employer and all the
workmen presently employed as also those employed thereafter
in the establishment conducted by that employer. It cannot
possibly be that such standing orders would bind only those
who are employed after they come into force and not those
who were employed previously but are still in employment
when they come into force. The right of being heard given
to the union or, where there is no. union, to the
representatives of the workmen, the right of appeal and the
right to apply for modification given to workmen
individually clearly indicate that they were provided for
because the standing orders, as they emerge after
certification, are intended to be binding on all workmen in
the employment of the establishment at the date when they
come into force and those employed thereafter. Surely, the
union or, in its absence, the representatives of workmen,
who are given the right to raise objections either to the
draft standing orders proposed by the employer or to the
fairness and reasonableness of their provi
814
sions, could not have been intended to speak for workmen to
be employed thereafter and not those whom they presently
represent. Besides, if the standing orders were to bind only
those who are subsequently employed, the result would be
that there would be different conditions of employment for
different classes of workmen, one set of conditions for
those who are previously employed and another for those
employed subsequently, and where they are modified, even
several sets of conditions of service depending upon whether
a workman was employed before the standing orders are
certified or after, whether he was employed before or after
a modification is made to any one of them and would bind
only a few who are recruited after and not the bulk of them,
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who though in employment were recruited previously. Such a
result could never have been intended by the legislature,
for, that would render the conditions of service of workmen
as indefinite and diversities, as before the enactment o,f
the Act. Why does s. 3 (3) of the Act require the employer
to give particulars of the workmen employed by him at the
date of his submission of the draft standing orders unless
the object of making him furnish the particulars was to have
uniformity of conditions of service and to make the standing
orders binding on all those presently employed. That is why
the Act also insists among other things that after they are
certified they must be made known to all workmen by posting
them at or near the entrance through which they pass and in
the language known to the majority o,f them.
In Guest, Keen, Williams Pvt. Ltd. v.P.J. Sterling(1) a
view apparent contrary to the one above stated was said to
have been taken since it was held there that it was unfair
in that particular case to fix the age of superannuation of
previous employees by a subsequent standing order, which
should apply in that matter to future entrants. In that
view the Court fixed 60 years as the age of retirement for
such previous employees although the standing order had
provided 55 years as the age of superannuation. Salem Erode
Electricity Distribution Company Ltd. v. Salem Erode
Electricity Distribution Co. Ltd. Employees Union(2) this
Court, however, took the same view which we have stated
above and held that the provisions of the Act clearly
indicated that matters specified in the Schedule to the Act
should be covered by uniform standing orders applicable to
all workmen employed in an industrial establishment and not
merely to entrants employed after their certification. The
question arose out of an application made by the employer
for modification of the existing standing orders by
providing different rules relating to holidays and leave for
employees appointed before a certain date and those
appointed after that date. Negativing such a modification,
the Court, after examining
(1) [1960] 1 S.C.R. 348. (2) [1966] 2 S.C.R. 498.
815
the relevant provisions of the Act, stated at pages 504 and
505 as follows:
"One has’ merely to. examine these
clauses one by one to be satisfied that there
is no scope for having two separate Standing
Orders in respect to any one of them. Take the
case of classification of workmen. It is
inconceivable that there can be two separate
Standing Orders in respect of this matter.
What we have said about classification is
equally true ,about each one of the other said
clauses; and so, the conclusion appears to be
irresistible that the object of the Act is to,
certify Standing Orders in respect of the
matters covered by the Schedule; and having
regard to these matters, Standing Orders so
certified would be uniform and would ,apply to
all workmen alike who are employed in any
industrial establishment.
On principle, it seems expedient and
desirable that matters specified in the
Schedule to the Act should be covered by
uniform Standing Orders applicable to all
workmen employed in an industrial
establishment. It is not difficult to imagine
how the application of two sets of Standing
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Orders in respect of the said matters is bound
to lead to confusion in the working of the
establishment and cause dissatisfaction
amongst the employees. If Mr. Setalvad is
right in contending that the Standing Orders
in relation to these matters can be changed
from time to time, it may lead to the
anomalous result that in course of 10 or 15
years there may come into existence 3 or 4
different sets of Standing Orders applicable
to the employees in the same industrial
establishment, the application of the Standing
Orders depending upon the date of employment
of the respective employees. That, we think,
is not intended by the provisions of the Act."
At page 509 to 510 the Court referred to. the case of Guest,
Keen, Williams Private Ltd. (1), relied on by the employers’
counsel, and explained why the Court had fixed 60 years as
the age of superannuation ,for the employees appointed
before the standing orders were certified although the
standing orders had fixed 55 years as the. age of
superannuation stating that:
"that course was adopted under the special and unusual
circumstances expressly stated in the course of the
judgment."
(1) [1960] 1 S.C.R. 348. LISSupCI/69--8
816
This decision thus confirms the view taken by us that the
object of the Act is to have uniform standing orders
providing for the matters enumerated in the Schedule to. the
Act, that it was not intended that there should be different
conditions of service for those who are employed before and
those employed after the standing orders come into force,
and finally, that once the standing orders come into force,
they bind all those presently in the employment of the
concerned establishment as well those who are appointed
thereafter.
Counsel for the workmen, however, drew our attention to.
the award in Ref. 91 of 1964 under s. 4(k) of the U.P.
Industrial Disputes Act, 1947. That reference, no doubt,
was between the appellant-company and its workmen and the
question decided there was whether the company was right in
compulsorily retiring the six workmen there concerned under
these very standing orders although they were employed.
before they were certified and came into force. The Labour
Court, relying on Workmen of Kettlewell Bullen & Co. Ltd. v.
Kettlewell Bullen & Co. Ltd.(1) which in turn had relied on
Guest, Keen, Williams’ case(2), held that Standing Order 32
of these Standing Orders could not be applied to those
previously appointed and that, therefore, the company’s
action in retiring those workmen was. not justified.
We may mention that the case of Kettlewell Bullen &
Co.(1) -was not one concerned with Standing Orders but with
rules made by the company and this Court, relying on the
decision in Guest, Keen, Williams Private Ltd. (2) held that
where the rules of retirement are framed by the company they
would have no application of its prior employees unless
such employees have accepted the new rules. It is clear that
neither the case of Kettlewell Bullen & Co.(1) nor the case
of Guest, Keen, Williams Private Ltd.(2) in the fight of the
explanation given in the case of Salem Erode Electricity
Distribution Ca. Ltd.(a), was applicable and the Labour
Court was, therefore, clearly in error in basing its award
on the decision in the case of Kettlewell Bullen & Co.
(1).The argument, however, was that even if that award was
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erroneous, the company did not appeal against it,
consequently it became final and the issue there decided
being the same and between the same parties, principles
analogous to the principle of res judicata would apply
and therefore no relief should be granted in the present
case to the company. It is. true, as stated in The
Newspapers Ltd. v. The State Industrial Tribunal, U.P.(4)
that an award bind’s not only the individualS present or
represented but all workmen employed in the establishment
and even future entrants. But that principle is rounded on
the essential condition for the
(1) [1964] 2 L.L.J. 146, (2) [1960] 1 S.C.R. 348.
(3) [1966] 2 S.C.R. 98. (4) [1957] S.C.R. 754, 761.
817
raising of an industrial dispute itself. If an industrial
dispute can be raised only by a group of workmen acting on
their own or through their union, the conclusion must be
that all those who sponsored the dispute ,are concerned in
it and therefore bound by the decision on such dispute.
(see M/s. New India Motors (P) Ltd. v.K.T. Morris)(1). Such
a consideration, however, is not the same as the principle
of res judicata or principles analogous to res judicata. In
Workmen v. Balmer Lawrie & Co.(2) no doubt, a case of
revision of wage scales, this Court cautioned against
applying technical considerations of res judicata thereby
hampering the discretion of industrial adjudication. (see
also Shahdara (Delhi)-Saharanpur Light Railway Co. Ltd. v.
Shahdara Saharanpur Railway Workers’ Union(a). How
inexpedient it is to apply such a principle. is evident from
the fact that the ’award in Ref. 91 of 1964 was based on the
decision in Kettlewell Bullen & Co. Ltd. (4) which in turn
had followed the case of Guest, Keen, Williams Private
Ltd.(5) on the supposition (which, as aforesaid, was no.t
correct) that standing orders are not binding on those who
are employed prior to their certification and their coming
into force. The company, presumably, did not challenge the
correctness of that award because it was perhaps then
thought that was the law laid down in Guest, Keen, Williams
Private Ltd.(5). The consequence of holding that the company
is barred by principles analogous to res judicata would be
that there would be two sets of conditions of service, one
for those previously employed and the other for those
employed after the standing orders were certified, a
consequence wholly incompatible with the object and policy
of the Act. The very basis of the award in Ref. 91 of 1964,
namely, the wrong understanding of the decision in Guest,
Keen, Williams Private Ltd.(5), having gone, it becomes all
the more difficult and undesirable to perpetuate the
distinction made therein between those who were previously
appointed and those appointed subsequently and to refuse on
such an untenable distinction relief to the company. The
award in Ref. 91 of 1964 was made on May 24, 1965 when it
was believed that the decision in Guest, Keen, Williams Co.
Ltd.(5) laid down the principle that standing orders would
not bind workmen previously employed. That was not so was
clarified in the case of Salem Erode Electricity
Distribution Co. Ltd.(6), the decision in which was
pronounced on November 3, 1965 removing thereby any possible
misapprehension. The present reference was made on June
23, 1966, tong after the decision in Salem Erode
Electricity Distribution Co. Ltd.(6) and the Labour Court
gave the award impugned in this appeal on July 24, 1968.
Thus, both the Reference and the award were made in
circumstances different from those which
(1) [1960] S.C.R. 350, 357. (2) [1964] 5 S.C.R. 344.
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(3) [1969] 1 L.L.J. 734. (4) [1964] 2 L.L.J. 146.
(5) [1960] 1 S.C.R. 348. (6) [1966] 2 S.C.R. 498.
818
prevailed when Ref. 91 of 1964 was made and disposed of, a
factor making it doubtful the application of a principle
such as res judicata.
The second question relates to the workman, Shameem
Khan. The company appointed him under a letter of
appointment dated December 2, 1965 to the post of a cleaner
as a probationer for 6 months with discretion to the
resident engineer to extend that period. The letter also
stated that during his probationary period his service would
be liable to termination without any notice and without
assigning any reason therefore and that he would not be
deemed to have been confirmed automatically in the post on
the expiry of the probation period unless so advised in
writing. The workman worked ,as such probationer till
February 28, 1966 when he was served with a memorandum that
his service was terminated as from the close of that day.The
workman’s case was that the company had no right to
terminate his service before the expiry of the 6 months
period of probation which is the period prescribed by
standing order 2(c), that the stipulation in the letter of
appointment that his service was liable to termination
during the probation period was contrary to. that standing
order, and that therefore, that stipulation was not valid,
and lastly, that the said order, though apparently one of
termination simpliciter, was not a bona fide order, was in
truth punitive m nature, and therefore, could not be passed
without an opportunity of being heard having been given to
him in a properly held enquiry. The ,fact is that no such
enquiry was held and no opportunity was given to the workman
to explain any misconduct for which he could be removed or
dismissed.
The evidence before the Labour Court was that the
concerned workman had unauthorisedly used the motor-cycle
belonging to one Sidhana, a shift engineer in the company
and that motorcycle met with an accident while the workman
was using it causing damage to it. Three days after that
accident a report alleging that his work as a probationer
was unsatisfactory was made by his superior officer. On
this evidence the Tribunal came to the conclusion that the
impugned order was not an order of termination simpliciter,
that though couched in that language it was. passed as a
punishment or the workman having used that vehicle without
the consent of its owner and was, therefore, an order of
dismissal. The Tribunal was also of the opinion that the
said report alleging unsatisfactory work by the. workman was
colourable and made at the instance of the shift engineer or
at any rate was inspired by the s.aid incident. In this
view the Labour Court held that the exercise of power to
terminate the service of the workman was not bona fide and
consequent it set aside that order and directed his
reinstatement.
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Now, it is a well settled principle of industrial
adjudication that even if an impugned order is worded in the
language of a simple termination of service, industrial
tribunals can look into the facts and circumstances. of the
case to ascertain if it’ was passed in colourable exercise
of the power of the management to terminate the service of
an employee and find out whether it was in fact passed with
a view to punish him. The letter of appointment clearly
states that the workman, Shameem Khan, was appointed as a
probationer for a period of 6 months with power to the
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 11
resident engineer to extend the period of probation.
Ordinarily, that would mean that at the end of the probation
period the company would have to decide whether to confirm
him to a permanent post or, if that is not possible, to
terminate his service. Standing order 2 (c) provides that a
probationer is ’an employee who is provisionally employed to
fill a permanent vacancy in a post and who has not completed
the period of probation thereunder. It also lays down that
the normal period of probation shall be 6 months but the
resident engineer has the discretion to extend that period,
the maximum period of probation being 12 months in all.
Ordinarily, this would mean that a probationer’s service
cannot be terminated except for some misconduct until the
expiry of the probation period. The letter of
appointment, no. doubt, contained a provision that the
service of the workman was liable to. termination even
during the probationary period. That provision, however,
must be read to mean that the appointment was subject to
the management’s power of termination as provided in the
standing orders. Standing order 14 provides for such a
power ’and lays down that the service of "any employee"
(which expression includes a probationer as is clear from
the classification of employees in standing order 2) can be
terminated on grounds (a) to (f) therein set out. It is
quite clear that the termination of service of the concerned
workman cannot be attributed to any one of these grounds.
Therefore, that order cannot be said to have been
passed conformity with the power to terminate his service
under the standing orders.
But apart from this consideration, the Labour Court came
to a finding on the evidence before it that the real reason
for passing the impugned order was not the alleged
unsatisfactory work on the part of the workman but his
having unauthorisedly used the motorcycle and causing damage
to. it, that the order was punitive and not a Simple
termination of service and was therefore in colourable
exercise of the power of termination. This finding is
clearly one of fact and meant that the Labour Court rejected
the evidence led by the management that the work of the
concerned workman was ,found unsatisfactory. It is
impossible to say from the evidence before the Labour Court
that finding was perverse o.r such as could not be
reasonably arrived at. In that view, it is
820
impossible to interfere with the order of the Labour Court
relating to workman, Shameem Khan.
In the result, the appeal is partly ,allowed. The order
of the Labour Court in connection with the 3 workmen whom
the company retired, is set aside but its order relating
to workman, Shameem Khan, is confirmed. In accordance with
the order, passed by this Court on January 24, 1969, while
granting stay to the appellant-company, the company will
pay to the workman, Shameera Khan, interest at 6% per annum
on the amount of the arrears of wages still due to him under
the order of the Labour Court. As the appeal is partly
allowed and partly dismissed, there will be nO order as to
costs.
V.P.S. Appeal partly allowed.
821